The Australian Government has announced that businesses who have long-term casual staff might soon be hit with fines exceeding $66,000, if they don’t offer them permanent positions.
Since Monday 27th September, employers across the country must begin contacting casual staff who have been employed for at least 12 months, with a written offer to convert them to permanent employment.
The new rules coincide with the changes made to the Fair Work Act which passed through parliament in March 2021. These reforms gave casual employees the right to convert to permanent employment after 12 months of employment, if they have had a regular pattern of hours on an ongoing basis over the past six months.
The definition of small-business employers is businesses who have less than 15 employees at any given time. Under the new rules, small businesses are not required to offer their casual employees an opportunity to convert to permanent employment.
Employers will also not be required to make an offer if there are “reasonable grounds” not to do so. According to the Fair Work Ombudsman, reasonable grounds include when the position of employment is being made redundant, or when the employer would have to make a significant change to the employee’s work hours to make it possible for them to be employed full-time or part-time.
The newly introduced laws mean that businesses are required to write to an employee within 21 days after the employee’s 12-month anniversary to inform them of the casual conversion offer, or reasons why they are not making the offer.
For an employee to accept the offer, the employee is required to respond in writing within 21 days after they receive the offer. If the employee doesn’t respond within the 21-day timeframe, employers can assume that they’ve declined the offer.
Casual employees are also able to request to be converted to permanent employment as long as they have been employed for at least 12 months, have worked a regular pattern of hours over the last six months, and can continue to work these hours in a full-time or part-time capacity.
The Fair Work Ombudsman has outlined that employers cannot reduce or change an employee’s hours of work, or terminate their employment, to avoid having to offer or accept a request for casual conversion.
The new casual conversion entitlement is also now part of the National Employment Standards, meaning companies that fail to make an offer could face penalties in excess of $66,000, while individuals could face $13,000 in penalties.
Casual employees who are unfairly denied an opportunity to convert to permanent employment will also be able to refer their dispute to the Fair Work Commission or seek help from the Federal Circuit Court.
Australian Businesses Admit To Struggling To Retain and Attract Quality Staff
Ongoing border closures and a ban on international travel means that Australian businesses have lost access to technical and skilled workers from overseas coming into the country. As a result of this businesses are now having to fight for available resources and things could potential become more challenging for small businesses across the country.
The challenges are being especially felt by businesses in the hospitality and tourism industries. Many of the businesses in these industries such as restaurants and wineries are struggling to find new staff members to fill work shifts.
One of the reasons why it is especially tough for small businesses is because the skilled workers who are available in the country are able to name their price as the employment market becomes more competitive. As a result of this small business, who have been impacted significantly by lockdown restrictions are finding it extremely difficult to compete against larger businesses who are equipped with a much larger budget.
Local employees across Australia are also becoming more accustomed to and viewing working from home arrangements as more favourable. As a result of this many employees have become resistant to returning to pre-covid work arrangements.
Although there are many advantages of working in an office, many Australian employees find that by working from home has plenty of benefits as you no longer have to spend long periods of time commuting to and from your job and no longer having to pay sustainably high parking fees.
With all this in mind, there are a few things businesses can do to create a team culture that encourages staff retention, in the current environment where budget is a problem for a large number of small businesses across the country. Small businesses will need to take a closer look at other strategies and tactics to retain and attract quality staff without getting caught up in a salary-bidding war.
Currently, the average wage increases an employee accepts when taking another job is at 15 percent. Although salary does play a huge role in employee retention, it’s important to understand that it is not the only factor. Work and lifestyle balance, flexible working arrangements and creating an inclusive work environment for people of different backgrounds are some of factors many employees will take into consideration when deciding on whether or not they choose to accept a new job.
The team at C&D Restructure and Taxation Advisory are here to help. As part of the Vault Group we can offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 07 36086800.
The team at C&D Restructure and Taxation Advisory are here to help. As part of the Vault Group we can offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 1300 1 VAULT (1300 182 858)
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