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Closing loopholes: Casual employment changes

There have been changes to the Fair Work Act as part of the new ‘Closing Loopholes’ laws. The changes take effect at different times between December 2023 and August 2025.

The Fair Work Ombudsman has outlined the key changes introduced by the recent reforms; here’s a breakdown of what they mean for employers and employees.

Casual employment changes

There have been multiple changes to casual employment laws.

These include to:

  • how casual work is defined
  • the pathway to full-time or part-time employment
  • employee and employer responsibilities.

New casual employment definition

A new definition of ‘casual employee’ will be introduced to the Fair Work Act. Under this definition, a person is a casual employee if, when they start employment:

  • the employment relationship has no firm advance commitment to ongoing work, taking into account a number of factors, and
  • they’re entitled to a casual loading or specific casual pay rate under an award, registered agreement, or employment contract.

Employees who start as a casual, will stay casual until their employment status changes either through:

  • a conversion process or Fair Work Commission order, or
  • accepting an alternative employment offer and starting work on that basis.

Firm advance commitment

Whether there is a firm advance commitment needs to be assessed on:

  • the real substance, practical reality and true nature of the employment relationship
  • several other factors.

The other factors that must be considered include whether:

  • the employer can offer or not offer work to the employee (and whether this is happening)
  • the employee can accept or reject work (and whether this is happening)
  • it’s reasonably likely there will be future work available of the kind the employee usually performs in the employer’s business, based on the nature of the business
  • there are full-time or part-time employees performing the same kind of work in the employer’s business as the work the employee usually performs
  • the employee has a regular pattern of work even if it changes over time due to, for example, reasonable absences because of illness, injury or other leave.

The above isn’t a full list and other factors may apply.

For this assessment, not all factors need to be satisfied and a single factor won’t determine whether a person can be considered a casual or not.

For example, a regular pattern of work on its own doesn’t indicate that an employee has a firm advance commitment to ongoing work. An employee who has a regular pattern of work may still be a casual employee if there is no firm advance commitment to ongoing work.

When assessing whether there is a firm advance commitment, you can look at:

  • the contract of employment, or
  • the contract as well as any mutual understanding or expectation between the employer and employee that isn’t part of the contract.

The mutual understanding or expectation can be worked out from how the contract is performed, or what the employer and employee do after entering into the contract.

Fixed term contracts

Casual employees can generally be hired on fixed term contracts.

However, an employee can’t be engaged as a casual on a fixed term contract if all of the following apply to them:

The exception won’t apply to casual employees employed on a fixed term contract before 26 August 2024.

Changing from casual to full-time or part-time employment (casual conversion)

A new pathway will be introduced for eligible employees to change to full-time or part-time (permanent) employment if they want to. This will replace the current rules for changing to permanent employment.

Find out more about these changes at Changing from casual to full-time or part-time employment (casual conversion).


Stay informed about the latest updates—explore the other posts in our Fair Work Act changes series here.


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