The Fair Work Commission (FWC) has kicked off the new financial year by announcing two proposed changes to modern awards as a result of the four yearly modern award review. The changes are that:

• a casual conversion clause is to be incorporated into 85 modern awards

• in its preliminary view, workers covered by modern awards should have access to unpaid family and domestic violence leave.

Casual conversion is coming

In a Full Bench decision handed down on 5 July 2017, the FWC found that due to the increased casualisation of the contemporary workforce, there is a need for modern awards to contain a clause enabling ‘regular casual employees’ to request to convert to full or part-time employment.

The Full Bench reached this conclusion on the basis of evidence from employee unions and individuals that an increasing proportion of the workforce are ‘long-term casual employees’ (many of whom work regular shifts) who do not get the benefit of entitlements such as sick and annual leave. The Full Bench found that this creates, in those long-term casuals, an ‘incapacity to properly balance work and... personal and caring responsibilities’, and the ‘potential for the sudden loss of what had been regular work without any proper notice or adjustment payment’.

What can casual employees request?

Under the proposed new clause, a ‘regular casual employee’ (who has been employed for 12 months, and who has worked ‘a pattern of hours on an ongoing basis which, without significant adjustment, could continue to be worked in accordance with the full-time or part-time provisions of the relevant award’) can request to convert to:

• full-time employment, if they have worked an average of 38 hours or more in the preceding 12 months
• part-time employment (as per their usual pattern of work), if they have worked less than an average of 38 hours per week, in the 12 months before the request is made.

The draft clause requires employers to provide all casual employees with a copy of the casual conversion clause within the first 12 months of their employment, so that they are aware of their ‘right to request’.

Can employers refuse a request?

Under the draft clause, employers can refuse an employee’s request for casual conversion on reasonable grounds ‘after consultation with the employee’. The clause specifically provides that ‘reasonable grounds for refusal’ will include that:

• the employee is not really a ‘regular casual employee’ (in that there would need to be a significant adjustment to their hours to enable them to be engaged as a full-time or part-time employee under the relevant award)
• it is known or reasonably foreseeable that within the next 12 months:
  • the casual employee's position will cease to exist
  • the casual employee's hours of work will be significantly reduced
  • there will be a significant change in the days or hours of work required to be performed by the employee, which cannot be accommodated within the days or hours the employee is available.

If the request is refused, the employer must provide the employee with the reasons for its refusal in writing within 21 days of the request being made. If the employee does not accept the reasons for the refusal, the draft clause provides that the employee can raise a dispute about the refusal under the award’s dispute resolution procedure.

Next steps

The FWC has invited interested parties to make submissions regarding its draft conversion clause by 2 August 2017. It has also invited submissions regarding the proposal to make other changes to modern awards, including the proposal to incorporate a two hour daily minimum engagement period for casual employees (in those modern awards that do not already specify a minimum engagement period).

If you would like to make a submission to the FWC regarding the draft clause, please let us know. The FWC will take any submissions into consideration before finalising the draft conversion clause.

In the meantime, modern award covered employers should follow the progress of the draft clause carefully, and should consider:

• updating its ‘onboarding’ processes to ensure new casual employees are provided a copy of the casual conversion clause within the first 12 months of their employment (once the clause is operative)
• training its HR managers to respond to requests for casual conversion, in accordance with the new clause.

Unpaid domestic violence leave – on the horizon

While at this stage it is a preliminary view only, a Full Bench of the FWC has also indicated its support for a new clause in all modern awards that would enable employees to take a period of unpaid family or domestic violence leave.

No paid leave yet – but watch this space

In a decision handed down on 3 July 2017, the Full Bench rejected an application by the Australian Council of Trade Unions (ACTU) for a clause allowing 10 days of paid family or domestic violence leave to be included in all modern awards.

The Full Bench found that, while it considers family violence to be a ‘significant community issue’ that requires a ‘workplace response’, it was not satisfied that 10 days’ paid leave was required for all employees covered by modern awards due to a lack of data available regarding the impact of providing paid leave. It did, however, state that it had ‘no difficulty in concluding that the provision of paid leave would be a desirable outcome’ given the financial impact of domestic and family violence on employees – therefore leaving it open for a further application to be made in the future.

Unpaid leave required to respond to unique challenges

Notwithstanding that it rejected the application for paid leave, the FWC has indicated its support for a term to be incorporated into modern awards that would allow employees to:

• take a period of unpaid family and domestic violence leave
• access their personal/carer’s leave for family and domestic violence reasons.

The FWC stated that an entitlement to unpaid domestic or family violence leave ‘serves to confirm the significance of family and domestic violence leave as a workplace right and provides an employment protection in circumstances where there is a need to access such leave’.

In reaching this conclusion, the FWC noted that the employee entitlements currently available in modern awards, such as the right to request flexible work arrangements, and entitlements to personal leave and annual leave, were insufficient given the unique challenges facing employees that experience domestic or family violence. In particular, the FWC found that:

• ‘an employee needing to attend court for the purpose of… [obtaining] an interim apprehended violence order… or who needs to find alternative accommodation, cannot afford to wait 21 days to see if her or his request for flexible working arrangements has been approved’
• employees can currently use personal leave to recover from illness or injury (including psychological injury), but cannot currently use personal leave for other domestic violence related reasons (such as attending court)
• an employer must agree to an employee taking annual leave, which makes it insufficiently flexible for those employees ‘facing the need for urgent leave’ for a domestic or family violence reason.

Next steps

The FWC has invited any interested parties to make submissions regarding its preliminary view on unpaid family and domestic violence leave. It will convene a mention to hear from interested parties in due course.