With the Closing Loopholes Part 2 workplace reforms now in effect, the updates surrounding the nature of the casual employment relationship is of particular interest to many businesses, with casual employees making up a significant proportion of the Australian workforce, especially in industries such as hospitality and retail.
The changes to the nature of casual employment, what they mean for employers and effectively implementing them within the business, is key to ensuring compliance.
Implementing the new changes around casual employment
Casual loading – Ensure to include the entitlement for casual loading in the casual employment contract, and specify the loading amount. The default minimum loading is currently 25% for national system employers, and 20% for state system employers. However, it is important to comply with any higher loadings contained in any other relevant instrument such as modern awards, registered agreements, or employment contracts.
No ongoing commitment – Avoid any firm advance commitment to ongoing and continued employment within the business, and do not engage in long, ongoing employment relationships with casual employees. After all, the nature of casual work is that it is not permanent, and there is no entitlement to ongoing employment, or certainty in days, hours, or shifts.
Termination period – Remove any reference to a formal notice of termination, or if there is one, ensure it is a short notice period and not comparable to that of a permanent employee. Other processes must still be followed in regards to having a lawful and valid reason for termination.
Employee choice – Casual employees have the right to accept or reject shifts, so employers must provide them with the ability to refuse shifts without facing negative consequences. Casual employees are not obligated to accept work when it is offered.
Rosters – Ensure to remove casual employees from the roster for periods, and avoid providing employees with rosters too far in advance where possible. Additionally, it is important to clearly state on rosters that the business is under no obligation to offer shifts, and communicate this to all casual employees.
Changes to working hours – Clarify that daily working hours and the length of the assignment are for guidance only and can be changed at short notice, in line with the relevant Award. Essentially, a casual employee can have their shift cancelled or be sent home early if they are not needed.
Employee and employer agreement – Clearly communicate the terms around the casual employment engagement and ensure the employee agrees to these conditions. Having a formal agreement in place will help to prevent any lines being blurred.
With significant changes to the nature of the casual employment relationship, businesses with casual employees will need to update relevant documentation and processes in line with the Closing Loopholes workplace reforms. Meeting the new standards set by Fair Work can be challenging. If you require assistance navigating these changes, get in touch with our team today.
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