Important changes to workplace laws commencing on 1 January 2018 for casual and part-time employees

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As part of the four-yearly modern award review process, the Fair Work Commission (‘FWC’) has been reviewing a range of matters related to casual and part-time employees. 
The areas under review have included:
  • Overtime for casual employees previously not entitled to overtime ;
  • Part-time rostering arrangements and record keeping;
  • Minimum engagement for casuals; and
  • Casual conversion to permanent employment
***  Please note that these changes only apply to employers covered by Modern Awards. They do not apply to employees covered under State of federal enterprise bargaining agreements or employers in Western Australia only operating through a sole trader or partnership structure, or a trust with a corporate trustee, and who as such are covered under Western Australian State industrial relations laws.

On 12 December 2017, the Fair Work Commission (‘FWC’) published the final decision for the changes to the first three areas.  A summary of the affected Awards is provided below.

Name of Award

Overtime for Casuals

Part Time Rostering

Minimum Engagement ***

Fast Food Industry Award 2010

Yes

No

No

General Retail Award 2010

Yes

No

No

Hair and Beauty Industry Award 2010

Yes

No

No

Hospitality Industry (General) Award 2010

Yes

Yes

No

Passenger Vehicle Transportation Award 2010

No

No

Yes

Pastoral Award 2010

No

No

Yes

Rail Industry Award 2010

Yes

No

No

Registered and Licensed Clubs Award 2010

Yes

Yes

No

Restaurant Industry Award 2010

Yes

Yes

No

Social, Community, Home Care and Disability Services Industry Award 2010

No

Yes

No

Wine Industry Award 2010

No

No

Yes

 

*** There are some additional Awards which are subject to a final decision in this area.

All other Modern Awards continue to operate as previously was the case, however, further changes to Modern Awards are expected in the near future as the FWC winds up its 4 Yearly Review of Modern Awards.

These changes come into operation from 1 January 2018 but do not take effect until the start of the first full pay period commencing on or after 1 January 2018.

The information provided below is general information in relation to the changes. Some Awards that have been varied in different ways to the general position or that have not had all the variations outlined below included in them.  Businesses need to check the Awards that cover their operations to ensure they understand how the changes will impact them.  If you need assistance in determining how the changes will impact your operations, ESSA is available to assist you in that process.  Usual consulting fees will apply.

                                                                            

Casual Employees

Casual employees covered by some Awards (refer to the above table) that work in excess of 38 hours will be entitled to overtime rates. In some cases, casual employees that work more than a prescribed number of hours per day or outside the span of ordinary hours prescribed by the relevant Award may also be entitled to overtime payments.

The overtime rates payable are prescribed within the awards.

Part-time Employees

Currently, a number of Modern Awards, mainly in the hospitality industry have very restrictive provision in relation to the employment of part-time staff.  These restrictions have made it difficult to employ staff on a part-time basis and have effectively forced employers to engage most staff in this industry as casuals.  This issue is present in a number of other industries, however, at this time the Decision only effects the Awards indicated in the above table.

The clauses vary slightly from Award to Award, however the following is typical of the changed provision.

At the time of engagement, part-time employees and their employer will have the following agreed in writing.
  • the number of hours of work which is guaranteed to be provided and paid to the employee each week or, where the employer operates a roster, the number of hours of work which is guaranteed to be provided and paid to the employee over the roster cycle (the guaranteed hours); and
  • the days of the week, and the periods in each of those days, when the employee will available to work the guaranteed hours (the employee’s availability).
Where an employee has regularly worked in excess of their agreed hours over a period of 12 months, the employee may request to have their guaranteed hours increased. This change must be recorded in writing.

An employer has the right to refused on reasonable business grounds and this refusal must be made in writing.

The changes to the rostering arrangements for part-time staff, whilst not perfect, are a positive for employers.  It does however, as a requirement of the Modern Award, mean that employers will have to go through a process with part-time staff to determine their guaranteed hours and availability.  This will avoid the current problem of having to pay permanent staff overtime even if they haven’t worked their 38 hours in a week.
 
Future Changes

In the near future we expect additional Awards to be impacted by the minimum engagement provisions.

In addition to this, all Modern Awards will have what is known as a casual conversion clause inserted into them.  Currently 85 of the current 125 or so Modern Awards do not have this provision.  The change will allow casuals employed for more than 12 months to apply to become a permanent staff member.  How this will play out will be interesting.

Finally, the FWC will finalise its current 4 yearly review, with amended Modern Awards being issued at that time. This could happen sometime this year.  What the outcome will be is unknown, but it is likely that there will be change in most Awards to some degree.
We will keep clients apprised of the changes as we become aware of them.

If you require specific advice on any issue, please contact our office to discuss your issues.