Casual to Permanent in 2026: New Conversion Rights & How to Request It
Understand the new casual-to-permanent conversion rights in Australia for 2026. Learn about employee-initiated conversion, eligibility requirements, how to make a written request, employer grounds for refusal, and the financial implications of converting including losing casual loading but gaining leave entitlements.
The new employee-initiated casual conversion right
The Closing Loopholes legislation that took effect in 2024-25 fundamentally changed how casual conversion works in Australia. Previously, employers of 15 or more employees were required to offer conversion after 12 months of regular, systematic employment. The new framework shifts power to employees — casual workers now have the right to initiate conversion themselves by providing written notification to their employer. This is a significant change because the old system relied on employers proactively making offers, which many simply did not do, either through ignorance or deliberate avoidance. Under the new rules, the process is employee-driven: you assess whether you meet the eligibility criteria, you provide written notification to your employer, and the employer must then respond within 21 days. The employer can only refuse on specific grounds set out in the legislation. If you are not satisfied with the employer's response, you can take the matter to the Fair Work Commission for resolution. This new framework applies from the date the amendments commenced and covers all national system employers, including small businesses (with modified timeframes).
Eligibility: When can you request conversion?
To request conversion under the new employee choice framework, you must meet certain eligibility criteria. For employees of non-small business employers (15 or more employees), you must have been employed for at least 6 months and no longer meet the definition of a casual employee — meaning you no longer work on a basis that is irregular, uncertain, or without a firm advance commitment to continuing and indefinite work. In practice, this means if you have been working regular, predictable shifts over 6 months (such as the same days each week or a recurring roster pattern), you likely qualify. For employees of small business employers (fewer than 15 employees), the eligibility period is 12 months instead of 6 months, and the same requirement of no longer meeting the casual definition applies. The new definition of 'casual employee' introduced by the Closing Loopholes amendments focuses on the real substance and practical reality of the employment relationship, not just what the contract says. This means even if your contract says 'casual,' if you have been working like a permanent employee in practice, you may be eligible for conversion.
How to make the request in writing
Your request to convert from casual to permanent employment must be in writing. A well-drafted request should include: a clear statement that you are providing notification of your choice to convert under section 66AAA of the Fair Work Act, the date you commenced employment, a description of your regular working pattern over the past 6 (or 12) months including days, hours, and any consistent roster pattern, a statement that you believe you no longer meet the definition of a casual employee, and whether you are seeking conversion to full-time or part-time employment (based on your regular hours). For example: 'Dear [Manager], I am writing to notify you of my decision to convert from casual to permanent [full-time/part-time] employment under section 66AAA of the Fair Work Act 2009. I commenced employment on [date] and have been working a regular pattern of [describe pattern, e.g., Monday to Friday, 9am to 5pm] for the past [X] months. I believe I no longer meet the definition of a casual employee as my employment involves a firm advance commitment to continuing work on a regular basis. I would like this conversion to take effect from [date]. I look forward to your response within the required 21-day period.'
Grounds on which your employer can refuse
Your employer can only refuse your conversion request on specific grounds set out in the Fair Work Act. These include: that you still meet the definition of a casual employee (your work pattern is genuinely irregular or intermittent), that there are fair and reasonable operational grounds for not accepting the notification (such as the position being genuinely temporary, funding-dependent, or subject to seasonal fluctuations that would not support ongoing employment), or that accepting the conversion would require a significant adjustment to your hours to accommodate you as a permanent employee that is not feasible. The refusal must be in writing and must clearly state the grounds relied upon. A blanket refusal without specific justification, or a refusal based on reasons not permitted by the legislation (such as wanting to avoid paying leave entitlements), is not lawful. If your employer refuses and you disagree with the grounds, you have the right to apply to the Fair Work Commission for dispute resolution. The FWC can review the employer's decision, attempt conciliation, and if necessary, make binding orders including ordering the conversion to take effect.
Appeal to Fair Work Commission if refused
If your employer refuses your casual conversion notification or fails to respond within 21 days, you can apply to the Fair Work Commission to resolve the dispute. The process begins with filing a Form F10 — Application to deal with a dispute. The FWC will first attempt to resolve the matter through conciliation, where a Commission member facilitates a discussion between you and your employer to reach an agreed outcome. If conciliation is unsuccessful, the FWC can conduct a more formal conference or hearing and make binding determinations, including ordering the employer to accept the conversion. When assessing the dispute, the FWC considers whether the employee genuinely no longer meets the casual definition based on the practical reality of the employment relationship, whether the employer's stated grounds for refusal are fair and reasonable, and the overall circumstances including the employee's working pattern and the employer's operational needs. You do not need a lawyer to make an FWC application — the process is designed to be accessible. However, union members can have their union represent them, and community legal centres can provide free advice on workplace rights disputes.
Benefits of converting: Leave, job security, and mortgage applications
Converting from casual to permanent employment unlocks a range of entitlements that can significantly improve your financial security. As a permanent employee, you gain: paid annual leave (4 weeks per year for full-time, pro rata for part-time), paid personal/carer's leave (10 days per year), paid compassionate leave (2 days per occasion), unpaid parental leave (12 months plus an additional 12 months if requested), redundancy pay if your position is later made redundant, and notice of termination (or payment in lieu). You also gain greater job security — casual employees can have their shifts cut or their employment ended at short notice, while permanent employees have unfair dismissal protections after the minimum employment period. Beyond workplace entitlements, permanent employment status makes a material difference when applying for home loans, car loans, and credit cards. Lenders strongly prefer permanent employment and often require casual employees to have been in the same role for 12 months or more, with proof of regular income. Converting to permanent status can improve your borrowing capacity and access to competitive interest rates, which is particularly valuable during a cost-of-living crisis when housing affordability is already stretched.
Casual loading vs permanent entitlements: What you keep and what you lose
The most common concern about converting from casual to permanent is losing the 25% casual loading. This loading is paid to casual employees in lieu of paid leave entitlements and other benefits of permanent employment. When you convert, you lose the casual loading but gain paid leave and other entitlements — so the question is whether you come out ahead or behind financially. For most workers, the value of permanent entitlements exceeds the casual loading over time. Consider: 4 weeks of paid annual leave at your base rate is worth approximately 7.7% of your annual pay, 10 days of paid personal leave is worth approximately 3.8%, and redundancy pay entitlements accumulate with each year of service. Combined, these are worth roughly 11-12% before counting job security, notice of termination, and the practical benefits of permanent status. The casual loading of 25% exceeds this on pure dollar terms, but the loading only compensates you when you actually work — if you get sick or want a holiday as a casual, you earn nothing during that time. Permanent employees continue to receive income during leave. The financial impact varies by individual circumstances, so model both scenarios using your actual hours and rate before deciding.
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General information and estimates only — not legal, financial, or tax advice. Always verify with the Fair Work Ombudsman (13 13 94) or a qualified professional.
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