“Second Vacancy” not needed to offer casual conversion in the APS

In one of the first decisions on the new casual conversion provisions inserted into the Fair Work Act 2009 (Cth) in early 2021, the Fair Work Commission has made it clear that conversion in the Australian Public Service does not offend the principles of merit-based recruitment and that agency heads must make offers to their casual workforce where the criteria are met.

The case of CPSU v Commonwealth of Australia (Services Australia) [2022] FWC 1246 considered the interaction between the provisions and the principles of merit-based recruitment embedded in the Public Service Act 1999 (Cth) and the Australian Public Service Commissioner’s Directions.

The matter concerned a cohort of casual employees engaged by Services Australia who satisfied the requirement to be made an offer for conversion under the provisions set out in section 66B of the Fair Work Act (that is, they had been employed for 12 months, and during the last 6 months worked a regular pattern of hours on an ongoing basis).

Upon the enactment of the provisions, only some of the Cohort had been offered conversion. In relation to those who were not offered conversion, Services Australia relied on the “reasonable grounds carve-out in section 66C of the Fair Work Act, specifically, section 66C(2)(d):

"(d) making an offer would not comply with a recruitment or selection process by or under a law of the Commonwealth or a State or Territory."

Services Australia's argument had three steps.

1. It had to comply with the principles of merit-based recruitment. for casual employees to be eligible for conversion:
• prior to their consideration for conversion, they must be deemed suitable for an ongoing position and then placed in a merit pool; and
• at the time of consideration for conversion, there must be an ongoing position vacant for which they have been deemed suitable previously.
2. At the time the Cohort’s eligibility for conversion under the provisions was assessed, conversion was not offered if there was no available vacancy.
3. Accordingly, there existed a reasonable ground not to offer conversion on the basis that doing so would not comply with the principles of merit-based recruitment set out in the Public Service Act and the Directions.

In disputing this interpretation, the CPSU argued that:

• the cohort, having already been placed in a merit pool (usually for 12 months) has already complied with the principles of merit-based recruitment set out in the Public Service Act and the Directions, and thus is eligible to receive offers of ongoing employment;
• accordingly, section 66C(2)(d) does not operate as a barrier preventing an offer of conversion, as doing so does not offend the principles of merit-based recruitment;
• the provisions do not contemplate the requirement for there to be a vacant ongoing position for which a casual employee would be suitable at the time of consideration for conversion; and
• unless any other exceptions set out in section 66C were present, Services Australia was required to offer the cohort ongoing employment in the positions its members were currently performing.

How causal conversion works in the APS: the Fair Work Commission's view

Commissioner Johns disagreed with Services Australia’s “available vacancy argument:

"Services Australia and the APSC do not appear to accept that the Casual Conversion Term operates to create the vacancy, or to put it another way, that the Fair Work Act deems that an ongoing role exists which must be offered to the eligible casual employee." [emphasis added]

In other words, the nature of the casual position in question is such that it is capable of being an ongoing position in and of itself, and there is therefore no need to consider whether a vacant “ongoing position is available for conversion to occur.

Further, Commissioner Johns noted that by virtue of section 8 the Public Service Act operates subject to the Fair Work Act; to accept Services Australia’s argument would “allow it to veto casual conversion. Such a contention is contrary to the legislative intent.

Finally, Commissioner Johns made clear that any conversion under the provisions must be “like for like… That is to say if the eligible casual:

1. has been working 3 days per week, the ongoing offer is to a part-time position;
2. has been working 150 hours in a settlement period, the ongoing offer is a full-time position."