Australian employers often ask whether there is a specific number of hours a casual employee can work before they must be converted to permanent employment. The short answer from the Fair Work Act 2009: there is no hour threshold. Casual conversion depends on whether the employee has worked a regular pattern of hours over a 12-month period — not on how many hours they have worked in total.

Under the National Employment Standards (NES) section 66, casual employees have a legal right to convert to permanent employment after 12 months if certain conditions are met. Employers with 15 or more employees must proactively offer conversion. Small business employers must consider requests. These rules apply to every casual employee covered by the Fair Work Act 2009, regardless of industry or Modern Award.

How Casual Conversion Works Under the NES

Casual conversion is a National Employment Standard — every casual employee in Australia is entitled to it. It cannot be contracted out of, regardless of what an employment contract says. The provision sits in section 66 of the Fair Work Act 2009, introduced in March 2021.

The right to convert applies after two conditions are met:

• The casual employee has been employed for 12 months
• During the last 6 months of that period, the employee has worked a regular pattern of hours

If both conditions are satisfied, the employer’s obligations depend on the size of the business. The Fair Work Ombudsman provides detailed guidance on casual and fixed-term conversions, including templates for making and responding to offers.

The 12-Month Qualifying Period and Regular Hours Pattern

The 12-month period is the qualifying threshold. A casual employee who has been with your business for less than 12 months is not eligible for conversion, regardless of how many hours they work.

During the last 6 months of the 12-month period, the employee must have been working hours that could reasonably continue as a full-time or part-time employee. This is what the legislation calls a “regular pattern of hours.” It does not mean identical hours every week — a roster with consistent shifts can qualify.

What does not qualify as a regular pattern:

• Purely on-call work with no predictable schedule
• Sporadic or intermittent engagement with no discernible pattern
• Hours that are about to significantly change in the next 12 months

Employer Obligations: Offer vs Request Model

Employers With 15 or More Employees

You must proactively offer casual conversion — you cannot wait for the employee to ask. After the 12-month qualifying period, if the employee has a regular pattern of hours and there are no reasonable grounds to believe that pattern will change significantly, you must offer either full-time or part-time employment in writing within 21 days. The offer should specify the proposed hours, the type of conversion, and give the employee a reasonable period to accept or refuse.

Small Business Employers (Under 15 Employees)

Small business employers operate under an employee-request model. There is no obligation to proactively offer conversion. The obligation arises only when the casual employee makes a written request after 12 months. You then have 21 days to respond — either agreeing, offering alternative arrangements, or refusing on reasonable grounds.

Reasonable Grounds for Refusing Conversion

Whether you are offering or the employee is requesting, you may decline conversion if reasonable grounds exist:

• The employee’s position will not exist in the next 12 months
• The hours of work will significantly reduce or change in the next 12 months
• It is not reasonable at that time to convert the employee, considering the nature of the work

Each ground must be assessed objectively and documented in writing. A Fair Work Commission dispute will require evidence that your decision was based on genuine operational factors, not convenience.

Modern Award Casual Conversion Clauses

Many Modern Awards include their own casual conversion terms. These operate alongside the NES provisions, and the NES sets the minimum standard. Employers covered by a Modern Award cannot use an award clause to avoid their NES obligation to offer or consider conversion. Check the applicable award on the Fair Work Ombudsman website for any additional procedures. For broader guidance on managing casual and permanent employment, see our HR best practice resources for Australian employers.

Employee Choice Pathway (Closing Loopholes Changes)

From 26 August 2024, the Fair Work Legislation Amendment (Closing Loopholes) Act introduced an additional conversion pathway. If a casual employee believes they no longer meet the definition of a casual employee — because their work has become regular with a firm advance commitment to continuing work — they can give written notice requesting to change to permanent employment.

The employer has 21 days to respond and can refuse only on reasonable grounds or if the employee still genuinely meets the casual definition. This pathway runs alongside the NES section 66 provisions, giving eligible employees a second route to conversion.

Consequences of Non-Compliance

Failing to offer conversion when required — or failing to respond to a request within 21 days — exposes your business to a Fair Work Commission dispute. The Commission can order conversion and, in some circumstances, compensation.

For employers managing multiple casuals, maintaining accurate records of hours worked, patterns of engagement, and the 12-month anniversary date for each casual is essential. Poor record-keeping is the most common reason employers lose these disputes. If you need structured documents to manage this process, explore our range of free employment documents designed for Australian employers.