The Federal Court of Australia has ordered logistics business Toll Transport to pay a worker more than $42,000 after finding the company was wrong to refuse his request for full-time employment.
The 26-year-old worker had been employed by Toll for close to 10 years before he requested his casual position, in which he worked an eight-hour shift from 4:00am Monday to Friday, be converted to a permanent full-time position.
He was working a regular routine of 38 hours a week.
The Federal Court heard the request was knocked back by the company, and that the worker was instead offered a permanent part-time position of 30 hours a week.
The worker’s legal team argued the offer failed to uphold the company’s obligations to not reasonably refuse a conversion to permanent work on a “like for like” basis.
Federal Court Justice Geoffrey Flick ultimately decided that the worker was entitled to be converted to a full-time position, and Toll was incorrect in refusing this as it breached its obligations under the company’s 2013 enterprise agreement, as well as the Road Transport and Distribution Award, of which elements had been incorporated into Toll’s agreement.
The provisions in these documents meant a worker who had completed 12 months of casual employment did have the right to request their employment be converted to permanent status.
It was found that the counter-offer of a 30 hour role that was put to the worker did not fit with the agreement’s obligation to offer “like-for-like” permanent positions to eligible employees.
“The simple fact is that had clause 21(e) of the Enterprise Agreement been properly implemented, [the applicant] from about 27 May 2016, would have been employed as a full-time permanent employee. He was not,” Justice Flick said.
Because of this, the court determined Toll must be penalised for the failure to convert the worker to a permanent full-time position, as well as failure to provide employee records that the worker had requested in the course of discussing his role.
The court ruled Toll must pay $42,500 in penalties for contraventions of workplace law, and that these penalties be paid to the worker.
Both parties have also been invited to make submissions about how much further compensation the worker should be paid due to losses incurred in the period where he did not have full-time employment with Toll, but should have been converted as per the workplace agreement.
In a statement provided to SmartCompany, a Toll Group spokesperson said the company will improve its systems around the conversion of eligible casual workers to full-time status as a result of the court’s decision.
“Since 2011, our national enterprise agreements have provided greater opportunities for casuals to convert to full time than the award. The enterprise agreement subject to this court decision outlines a commitment from Toll to convert 300 casual employees to permanency in the first year of its term,” the spokesperson said.
“Toll will carefully review the court ruling and use this as an opportunity to improve our systems and processes to better support our people to have a long and rewarding career at Toll.”
SmartCompany was unable to contact the worker prior to publication.
Workplace lawyers tell SmartCompany that an employee’s right to ask to be converted from a casual position to permanent full- or part-time is outlined in each individual industry award or enterprise agreement.
This makes it incredibly important for employers to check what their obligations are to staff based on which agreements cover their workers, says managing director of Workplace Law, Athena Koelmeyer.
“One of the main things is if you have an enterprise agreement that has been negotiated, make sure you comply with those terms and conditions,” she says.
Clauses relating to how an employee can ask to be converted from casual to permanent work previously only applied to some awards, but in July the full bench of the Fair Work Commission decided to extend these rights to workers in an additional 85 awards.
This means employers should review the most up-to-date version of awards to make sure they know which terms apply to their workers, Koelmeyer says.
Chris Molnar, an employment, industrial relations and workplace safety partner at TressCox Lawyers, tells SmartCompany that businesses should keep a detailed record of how long casual employees have been working for them, and when they may be eligible to convert their roles.
While the terms vary from award to award, in general a worker who has been employed as a casual for a continuous 12 months has the right to request a change. Many clauses outline that the employer should ask the worker one month out from the one-year deadline whether they would like to change, Molnar says.
However, if a company does not raise the issue with a worker, the employee remains entitled to the transfer and can request it further down the line, Molnar says.
“If that notice is not given that they can convert, then the employee still has an ongoing right to [that option to become permanent],” he says.
“It’s important employers focus on what basket of employees have the right to convert.”
There are some cases in which employers can reasonably refuse this right, but Molnar suggests businesses think carefully about why they are refusing to make a worker permanent and whether this reason is genuine.
“You need to look at what’s happening in the particular circumstances. A situation where it is quite reasonable for me to refuse is when the position is actually going to conclude in a number of weeks,” he says.
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