13 Jul UPDATE – FOUR YEARLY REVIEW OF MODERN AWARDS

The Fair Work Commission is in the process of conducting its legislated four yearly review of Modern Awards and has handed down a decision (4 yearly review of modern awards – Casual employment and Part-time employment [2017] FWCFB 3541 (5 July 2017)) which may, pending further determination, have significant implications for employers engaging casual employees.

The key points to take from the decision are:

1.  Casual Conversion

The Full Bench has decided it is necessary to implement a casual conversion clause in approximately 80 Awards not currently containing such a clause. This means casuals covered by such Awards may elect to convert to permanent employment subject to specified criteria.

The model term provides:

–  a qualifying period of 12 months;

–  a qualifying criteria that the employee worked a pattern of hours on an ongoing basis which could continue to be performed; and

–  that employers must provide all casuals with a copy of the clause within 12 months of their initial engagement.

However, it is important to note that an employer will still be able to refuse such a request on certain grounds.  For example, a conversion may be refused on the grounds that it would require a significant adjustment to the casual employee’s hours of work to accommodate them in full-time or part-time employment in accordance with the terms of the applicable Modern Award, or it is known or reasonably foreseeable that the casual employee’s position will cease to exist or their hours of work will significantly change or be reduced within the next 12 months.

2.  Casual Overtime Rates

The Full Bench has also held that a number of Modern Awards should be varied to provide for overtime payments to apply to casual employees who work a certain number of hours per day or hours in addition to 38 hours per week.  The Full Bench stated that this is necessary to meet Modern Award objectives and ensure a fair and relevant safety net for causal employees.

The Awards likely to be affected by the change include the Hospitality Industry (General) Award 2010, Registered and Licensed Clubs Award 2010, Restaurant Industry Award 2010, General Retail Industry Award 2010, Fast Food Industry Award 2010 and Hair and Beauty Industry Award 2010.

3.  Minimum Engagement Period

Additionally, the Full Bench reached the provisional view that 34 Modern Awards which currently contain no minimum engagement period should be varied to include a two hour minimum engagement period for casuals.

The Full Bench also considered it necessary to achieve Modern Award objectives to introduce a three hour “minimum floor” engagement into the Manufacturing and Associated Industries and Occupations Award 2010, the Vehicle Manufacturing, Repair, Services and Retail Award 2010, Graphic Arts, Printing and Publishing Award 2010 and the Food, Beverage, and Tobacco Manufacturing Award 2010.

What happens now?

The Fair Work Commission is giving interested parties until 2 August 2017 to make further submissions about the above variations.

Any variations will occur following the Full Bench making its final determination.

We will keep you up to date on how this progresses.

If you are unsure about whether any of the variations will affect your business, contact the team at HR Law for advice.