Casual employees and the employee choice pathway
Since 26 August 2024, whether someone is a casual employee depends on the real substance of the relationship, not just the contract. The employee choice pathway, fully live since August 2025, lets eligible casuals ask to convert to permanent employment, and employers must respond within 21 days.
A new statutory definition of casual employee took effect on 26 August 2024: someone is a casual only if there is no firm advance commitment to continuing and indefinite work, assessed on the real substance, practical reality and true nature of the relationship rather than the contract alone. This replaced the old approach, which looked only at the written contract at the start of employment. Alongside it came the employee choice pathway, which replaced the previous casual conversion right. Eligible casuals, those with at least 6 months' service (12 months at a small business employer, fewer than 15 employees) who believe they no longer meet the casual definition, can give written notice they want to become permanent. The employer must respond in writing within 21 days, and can only refuse on specific grounds. The pathway opened for existing casuals on 26 February 2025 for most employers and 26 August 2025 for small businesses, and the Fair Work Commission can now arbitrate any dispute.
How is a casual employee defined now?
An employee is a casual only if there is no firm advance commitment to continuing and indefinite work, judged on the real substance and practical reality of the relationship, not just the contract's wording, since 26 August 2024.
How does the employee choice pathway work?
A casual with at least 6 months' service (12 months at a small business) who believes they no longer meet the casual definition can give written notice requesting permanent employment. The employer must respond within 21 days and may only refuse on specific grounds: the employee still meets the casual definition, fair and reasonable operational grounds, or it would breach a required recruitment process.
What if there is a dispute?
The Fair Work Commission can now arbitrate any employee choice pathway dispute that isn't resolved at the workplace level, a broader power than the old casual conversion regime, where FWC arbitration required both parties to consent.
Who handles this if you hire through Teamed?
Casual employment status, the employee choice pathway and the 21-day response clock are all handled inside Teamed's Australian employment framework: your casual workers are classified correctly from the start, and any conversion request is managed compliantly and on time.
Key figures
| Detail | Value |
|---|---|
| New statutory definition of casual employee | Fair Work Act 2009 (Cth) s15A: an employee is a casual only if there is no firm advance commitment to continuing and indefinite work, and they are entitled to a casual loading or a specific casual pay rate under a Fair Work instrument or their contract. Effective from 26 August 2024. (source) |
| How casual status is now assessed | Whether a firm advance commitment exists is assessed on the real substance, practical reality and true nature of the employment relationship (contract terms plus conduct and mutual understanding), with no single factor determinative. This replaced the pre-26 August 2024 approach (following WorkPac v Rossato) that looked only at the written contract at the start of employment. (source) |
| Employee choice pathway commencement | Started 26 February 2025 for employers other than small business employers, and 26 August 2025 for small business employers. From those dates the Employee Choice pathway is the only route from casual to permanent employment; the old Casual Conversion process ceased to apply to new notifications. (source) |
| Eligibility to notify | A casual employee can give written notice of their choice to become permanent if they have worked for the employer at least 6 months (12 months for a small business employer) and believe they no longer meet the statutory definition of casual employee. A casual who wants to stay casual can simply not use the process. (source) |
| Employer response obligation and timeframe | The employer must respond in writing within 21 days of the notification. If accepted, the employee becomes permanent. The employer may refuse only on 3 grounds: the employee still meets the casual definition, there are fair and reasonable operational grounds, or accepting would breach a recruitment or selection process required by law. (source) |
| Dispute resolution powers | The Fair Work Commission can now arbitrate all Employee Choice pathway disputes if workplace-level resolution fails. Under the old Casual Conversion regime, the FWC could only arbitrate a dispute if both parties consented. (source) |
Frequently asked questions
Can a casual employee force a conversion to permanent?
They can request it under the employee choice pathway if eligible, and the employer must respond within 21 days, but the employer can refuse on specific grounds such as genuine operational reasons.
Does a casual have to use the employee choice pathway?
No. A casual who wants to stay casual can simply not use the process.
When did the employee choice pathway start?
26 February 2025 for most employers, and 26 August 2025 for small business employers (fewer than 15 employees), for casuals already employed before 26 August 2024.
The Closing Loopholes reforms are Australia's biggest overhaul of the Fair Work Act in years. When Teamed is your legal employer, we track every change and update your contracts, policies and payroll as the law lands, so you never have to read a statute to stay compliant.
