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@Work: Sham Contracting, Casual Employees and Award Update
Recent changes to casual employee rights, modern awards and proposed changes to contractor arrangements will impact all employers. In this update we take a look at the changes that came into effect from 1 December 2018 and what you need to be aware of if you are undertaking a review of your current policies and contracts to ensure you are compliant with the new provisions.
Award update: Flexible working arrangements
Key changes include:
- employers are required to confer with and take genuine steps to reasonably accommodate an employee’s request for flexible work arrangements;
- if an employer refuses a request it must set out comprehensively the reasons for the refusal and set out other flexible work arrangements it can offer the employee; and
- the Fair Work Commission will now have jurisdiction to determine flexible working arrangements disputes concerning the:
- employer’s response to the employee’s request; and/or
- extent to which the employer conferred with the employee.
Casual employees: Commonwealth plans to control double dipping casual workers
The Government has announced its intention to introduce a regulation to prevent casual workers double dipping on loadings and annual leave entitlements in the aftermath of the Workpac v Skene decision.
Where an employer is found to have wrongly categorised an employee as a casual worker, the proposed regulation will allow employers to request orders from the court to offset any liability against casual loadings already paid to employees.
Casual Employees: Option to convert to permanent employment
A new casual conversion clause has been inserted into these modern awards allowing “regular casual employees” to elect to convert their employment to a permanent status. See the Commission decision here with an example of the clause at .
A request to convert must be provided in writing, and may only be refused by the employer on reasonable business grounds. If you have casual employees covered by these awards you must notify them of their conversion rights by 1 January 2019. These rights are likely to extend to all casual workers in the future with the Government announcing that it will introduce casual conversion legislation in 2019.
Sham Contracting: Consultation on penalties and changing threshold
If you engage independent contractors in your business, it is recommended that you keep a close eye on the sham contracting provisions of the Fair Work Act 2009 (Cth) with the Commonwealth recently signalling its intent to tighten its laws in this space.
A consultation paper has been recently released regarding the practice which occurs when an employer attempts to characterise an employment relationship as an independent contractor relationship. Submissions are invited before 21 December 2018 regarding whether the:
- existing ‘reckless’ threshold for prosecuting employers should be lowered to a ‘reasonableness’ test; and
- fines under the Fair Work Act 2009 (Cth) should be increased where a contract is found to be a sham.