The recent decision of the Fair Work Commission to grant casual staff, who have been employed under Awards for more than 12 months and who work regular hours, the right to request to become permanent staff will prove to be “further costly red tape that small business could do without,” according to Jim Wilson, Principal of Wilson Haynes – solicitors, conveyancers and business advisors.

“Most of the people who will be covered by these casual awards are lower level staff, who are employed based on an employer’s estimation of affordability versus the projected health of the business.

“As such, in the past, casuals with their lower level of performance management and ease of termination, have given small business employers critical flexibility in an ever-changing and increasingly difficult economy.”

Under the new proposal, an employer can decline a casual’s request, but only after consultation with the casual. Any negative decision must be based on facts known or reasonably foreseeable to the employer at the time. Where the employer’s reasons are not accepted by the employee, the causal can call on the Award’s dispute resolution procedure.

Jim Wilson added: “How can an employer ‘reasonably foresee’ the projected health of the business in these uncertain times, in the context of continuing affordability of casual staff?

“What this decision means is that the cost of casuals to employers will now effectively increase, because they will have to ‘performance manage’ them as if the casuals were permanent staff. They will require to exit the staff member before 12 months, if they do not meet the standards expected of a permanent employee at the 12-month mark (assuming they are called to keep them on).

“This will make casuals considerably less attractive and will undoubtedly see a reduction in the term of employment of them, in favour of other options including involving family members in the business, the use of external contractors such as bookkeepers and increased use of labour hire companies to employ casuals, despite it being more expense to do so.”

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