What is “Permaflexi”?

Posted by Luke Mitchell on 20 March 2019
What is “Permaflexi”?

1 January 2019 marked the commencement of the ”casual conversion” clauses inserted into those Modern Awards which did not already provide casual employees the right to request a conversion of their employment from casual employment to full time or part-time employment. 

With the implementation  of the new notification requirements still in its infancy and in light of the potential consequence of the Full Federal Court’s decision in WorkPac Pty Ltd v Skene [2018] FCAFC 131, the NSW Business Chamber has applied to the Fair Work Commission to have a new “Permaflexi” category of employee recognised in Modern Awards.  That application envisages a category of employees who would maintain flexibility in ongoing employment in return for receiving   a 10 per cent loading on their hourly rate, while also accruing annual and personal/carer’s leave entitlements on a pro rata basis (in the same way that permanent part-time employees accrue those entitlements).

Stephen Cartwright, NSW Business Chamber CEO, explained the rationale behind the proposal of the “Permaflexi” category:
“For the past 120 years, business has employed casual employees and paid them a higher hourly rate in lieu of annual leave and sick leave. The Federal Court’s recent decision in the Workpac
case indicated that some casuals can now claim both the casual loading and annual leave and sick leave on top of this.

“Australian businesses are stunned and understandably frustrated by this decision. It seems that under the current Fair Work laws, many casual employees have become something else.
The current system of modern awards has been upended and we must get this fixed as soon as possible.”

“Our modern awards must ensure a fair and relevant minimum safety net for both employers and employees. Given the Workpac decision we are moving to make sure that we re-establish this certainty as quickly as possible.”

Unions have spoken out in opposition to the Permaflexi category claiming the proposal is “a ruse aimed at further eroding job and wage security”. ( A ruse to reduce pay – Unions to battle permaflexi proposal. )

After several years of relative stability with industrial relations laws, the recent developments around long term casuals are likely to cause confusion for employers and employees alike.  

For employers, avoiding costly court battles over underpayment of wages is paramount - knowing that you are categorising and paying your employees correctly offers peace of mind.

We are experienced employment lawyers who can assist you with the review and negotiation of employment agreements and contracts. We specialise in providing clarity and confidence as to your legal rights and obligations.