The “Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024” introduces significant changes to the Fair Work Act, particularly in how casual employees are defined and treated within Australian employment law. Key updates include:

1. A New Definition of Casual Employment: The Act defines a casual employee as one where there is an “absence of a firm advance commitment to continuing and indefinite work”. This definition considers the real substance, practical reality, and true nature of the employment relationship, beyond just the terms of the contract. It focuses on whether the employer can elect to offer work and the employee can elect to accept or reject work, among other considerations. This approach moves away from the previous method of determining casual employment based solely on the terms of the offer of employment, allowing for a more comprehensive assessment of the employment relationship.
2. Employee Choice Pathway for Conversion: The Act introduces a new “employee choice” pathway, enabling casual employees to request conversion to part-time or full-time employment after meeting specific service requirements (6 months for regular employees and 12 months for small business employees). This pathway is designed to offer casual employees greater job security and access to benefits associated with permanent employment. Employers are required to respond to these requests within 21 days, and they can only refuse on reasonable operational grounds.
3. Interaction with Fair Work Instruments: The Fair Work Commission (FWC) has the authority to resolve uncertainties or difficulties arising from the interaction between fair work instruments (such as modern awards or enterprise agreements) and the new statutory definition of casual employment. This provision ensures that the new casual employment definition can be integrated smoothly into existing workplace arrangements.
4. Protections Against Anti-Avoidance and Sham Arrangements: The Act includes provisions to prevent employers from engaging in anti-avoidance practices concerning the new employee choice notifications and sham arrangements that disguise part-time or full-time employment as casual employment. These measures aim to protect employees from being unfairly treated as casuals and ensure they have access to the benefits of permanent employment when applicable.

The legislation reflects a comprehensive approach to addressing the complexities of casual employment, offering clearer definitions, enhanced protections for casual workers, and mechanisms for employees to transition to permanent roles where appropriate. These changes aim to balance the flexibility that casual employment offers to both employers and employees with the need for job security and fair treatment in the workplace.