Significant Changes to the Fair Work Act

Significant amendments to the Fair Work Act (Cth) 2009 (Fair Work Act) are set to take place over the coming months, including the commencement of the Closing Loopholes No. 2 Act (Cth) 2024 (Closing Loopholes Act).

Key takeaways of the new Act

New Definition of ‘Casual Employee’

The Closing Loopholes Act introduces a new definition of ‘casual employment’, which is determined based on the ‘practical reality’, ‘the real substance’ and ‘true nature of the employment relationship’.

Employees engaged on or after the commencement of the Closing Loopholes Act can notify their employer that they no longer meet the requirements of ‘casual employment’ under the new definition and can advise their employer that they wish to become a permanent employee, providing them with additional rights under the Fair Work Act.

Employers can reject a request, as long as they have reasons based on ‘fair and reasonable operational grounds’. Employers will also have a further obligation to provide casual employees with a ‘Casual Employment Information Statement’. 

‘Employee’ or ‘Independent Contractor’?

The new Act will also turn to the relationship between an individual and an employer, the terms of the employment contract and how the contract is performed in practice to determine whether an individual is an employee for the purpose of the Fair Work Act.

This may mean that an individual hired as an independent contractor may be later found to classify as an ‘employee’ granting them further rights under the Fair Work Act.

What should you do to prepare for the changes?

For Employers

With these changes set come into effect on 26 August 2024, it is important for Employers to promptly undertake reviews on their current casual employees, in order to identify their status under the new definitions.

Additionally, employers will need to initiate reviews and potential amendments to their current casual employment contracts, in order to ensure that they reflect the impending legislative changes.

Employers should consider whether their pre-existing procedures for casual conversion adheres to the new laws. It is important to note that the employee must now request to change their employment status, and that the onus is no longer on the employer.

For Employees

It is important for employees to consider their status as casual employee pursuant to the upcoming changes. Employees should seek to identify if they satisfy the criteria to initiate casual conversion under the new act, and if so, begin preparing their written notification requesting conversion of their employment.

Understanding and initiating these substantive changes may be difficult, however, the skilled Employment Law team at Marsdens Law Group is available to assist.

For advice on how the Closing Loopholes Act affects you, your business, or your current employment contracts and procedures, please do not hesitate to contact us. 

The contents of this publication are for reference purposes only. This publication does not constitute legal advice and should not be relied upon as legal advice. Specific legal advice should always be sought separately before taking any action based on this publication.