Employee choice pathway: new laws for casual conversion

On 26 August 2025, eligible casual workers employed by a small business can access the employee choice pathway to request conversion to permanent employment.

What is casual conversion?

While there’s always been the opportunity for a casual employee to change to permanent employment status (full-time or part-time) at any time if the employer and employee agree, casual conversion refers to the formal process where a casual employee transitions to a permanent full-time or part-time employment position under a lawful entitlement.

What is the employee choice pathway?

As per of the Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024, a number of reforms to casual employment came into effect from 26 February 2025.

Under the “employee choice pathway” in the National Employment Standards (NES), eligible casuals can notify their employer in writing of their intention to change to permanent employment. An employer can only refuse the notice for certain reasons.

Prior to 26 February 2025, employers had the obligation to offer conversion from casual to permanent employment after 12 months of service where certain criteria had been met. As a result of Closing Loopholes No. 2, the responsibility to for making application for casual conversion will shift from employers to employees.

How the employee requests conversion

A casual can provide written notice to their employer to change to permanent (full-time or part-time) employment under the employee choice pathway if they:

• have been employed for at least 6 months (12 months if employed by a small business)
• believe they no longer meet the requirements of the casual employee definition.

For small businesses, the new formal pathway comes into effect 26 August 2025, and the employee must have been employed for 12 months prior, rather than 6 months.

A casual can’t provide notice if they:

• are currently engaged in an ongoing dispute with their employer about changing to permanent employment under the employee choice pathway, or
• in the last 6 months, their employer refused a previous notice or they’ve resolved a dispute with their employer about employee choice under a relevant dispute resolution process.

Responding to a written notice

Before responding, the employer must consult with the employee. This includes discussing certain details of what will change if the employer accepts the notice and the employee is no longer a casual employee. This includes whether the employee would be full-time or part-time, what their hours of work would be and when the change would take effect.

The employer must respond in writing to the employee within 21 days of the employee giving the notice, either:

• accepting the change, or
• not accepting the change.

There’s a number of conditions around an employer’s obligations in either accepting an employee’s application or not accepting. There’s no shortage of information online or, if you’d prefer someone in your corner that can help you navigate the often murky waters of HR, why not contact us? Bare Bones Consulting specialises in making HR simple for employers.