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Casual workers could soon have the right to become permanent employees, but business groups warn the changes may create economic uncertainty.

Employment Minister Tony Burke has unveiled reforms to force bosses to offer casual staff who work regular hours a permanent job.

Workers would not have to take up the offer and could remain a casual employee to continue receiving loadings on their hourly rates.

More than 850,000 people will be covered by the changes, but Mr Burke expects most casuals won't take them up.

He said the proposal would neither deter employers from taking on casual workers nor impact the bottom line of businesses.

"I don't see in a million years how this can add costs to business, because instead of paying the loading you pay leave, you never pay both ... and they're calculated to offset each other," he said in Canberra.

"By giving people secure jobs you get a more loyal workforce and you get a workforce that appreciates the security that's been given to them."

Mr Burke said the changes would improve workers' rights and close a loophole used by employers to avoid paying permanent entitlements to an ongoing workforce.

Businesses will not have to back-pay employees for any entitlements gained by moving to permanent employment.

"At the moment you can be working a full-time roster for a year and you still get classed as a casual," Mr Burke said.

"There'll be some people with those sorts of hours who want to stay where they are and nothing will change for them, but for people who want security this gives them a way to be able to do it."

Australian Council of Commerce and Industry chief executive Andrew McKellar warned the changes could create uncertainty for employers and impact small businesses in particular.

"Many small business owners are saying they are concerned that if they lose that flexibility, the ability to roster people according to demand and according to the requirements of the business, that's a fundamental change," he said.

"Our concern is that what the government is proposing would take us backwards, it would unpick that existing level of certainty.

"That can't be a good thing for employment and it can't be a good thing for small business."

Australian Council of Trade Unions secretary Sally McManus said the government's proposal was modest.

"People who are working regular jobs with regular hours deserve regular rights," she said.

"The government is leaving it in the hands of the worker to decide, if they're working regular hours, they want to be a permanent employee, get sick leave and annual leave or whether they want to keep their loading and remain as a casual.

"I don't think that it could be fairer than that."

Yet Mr McKellar questioned why there was a need for change when the employment minister expected most casuals not to take it up.

He accused the government of reacting to a "false narrative" from the unions that casual jobs were inherently insecure.

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More households are in severe housing stress than at any other time in the nation's history while the shortfall in social housing has peaked at record highs.

A report has laid bare the brutal reality of Australia's housing crisis, revealing two in three Australians are experiencing housing stress.

Defined as spending more than 30 per cent of income on housing, the sharp rise in housing stress is pushing ordinary Australians to the brink as more are forced to abandon their dreams of housing security.

Renters appear hardest hit, with more than four in five experiencing rental stress, according to a report released on Monday by the national housing campaign Everybody's Home.

The campaign, launched by a coalition of housing, homelessness and welfare organisations, found the overwhelming majority of those surveyed worried about their financial security, mental health and well-being.

Spokeswoman Maiy Azize said the human cost of the housing crisis and government inaction was grim.

"People are forced to abandon their dreams of providing security and stability for themselves and their loved ones, to rent and even share house well into their retirement years, and to live with a constant fear of price hikes or eviction," she said.

"Renters now face a housing market that has never been less affordable or more volatile as they are forced to spend record amounts to keep a roof over their heads."

Ms Azize said the 750 people surveyed included women with children considering sleeping in their cars or on the streets, unable to find an affordable home.

"Even those who are the system's winners are filled with worry about what the future holds for the next generation," she said.

"More and more are missing out on the dream of a home."

The housing campaign said the government would need to create 25,000 homes a year to meet the social housing shortfall.

"Social housing is the best way to free up cheaper rentals and boost the supply of affordable homes," Ms Azize said.

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Casual workers will be able to transition into a permanent role if they want to under a shake up of industrial relations laws.

The government is moving ahead with further employment reform that will force employers to offer casual workers who work regular hours a permanent job.

Workers do not have to take up the offer and can remain a casual employee to continue receiving loadings on their hourly rates.

Workplace Relations Minister Tony Burke said he expects most of the 850,000 people the legislation will cover will remain casual.

"Many casuals won't want a permanent job ... but there are casual workers who are trying to support households," he will say in a speech to the Sydney Institute on Monday.

"They're being used as though they're permanent workers and the employer is double dipping, taking all the advantages of a reliable workforce and not providing any of the job security in return."

Businesses will not have to back-pay employees for any entitlements gained by moving to permanent employment.

Mr Burke said that means there will be no additional economic costs with workers swapping extra loading for holidays.

"There's actually zero cost to the economy but a huge change in job security for people who need it," he said.

The laws will form part of a broader set of industrial relations reforms that the government will introduce to parliament later in the year.

The government is also moving to enact same job, same pay laws to stop employers paying labour hire cheaper rates than the awards they have negotiated with their workers.

Mr Burke rejected suggestions it would lead to employers having to pay people with decades of experience the same rate as the new kid on the block.

"I can categorically rule that out," he told Sky News on Sunday.

"What I'm wanting to close is a loophole where an employer has already agreed that for a particular worker with a particular level of experience there should be a minimum rate of pay and then labour hire is used to undercut the rate of pay they just agreed to."

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Giving casual workers the right to become permanent employees will not affect business profits, the employment minister says, as the federal government seeks to shake up industrial relations laws.

Employment Minister Tony Burke will introduce reforms to force employers to offer casual workers who work regular hours a permanent job.

Workers do not have to take up the offer and can remain a casual employee to continue receiving loadings on their hourly rates.

More than 850,000 people will be covered by the reforms, but Mr Burke expects most to remain casual.

He also said the changes would not deter employers from taking on casual workers.

"If an employer has hours that are in fact permanent hours, then there is no loss to the employer in the actual total dollar figure (because) they don't pay the (casual) loading, they pay leave instead," he told ABC Radio National on Monday.

"There's no actual cost to the economy here and, for example, there is a job that isn't ongoing or it's a job where the hours are not guaranteed, then in those circumstances it would never have satisfied the test anyway."

The changes will attempt to close loopholes for employers seeking to avoid paying permanent entitlements to an ongoing workforce.

"Many casuals won't want a permanent job ... but there are casual workers who are trying to support households," Mr Burke said.

"They're being used as though they're permanent workers and the employer is double dipping, taking all the advantages of a reliable workforce and not providing any of the job security in return."

Businesses will not have to back-pay employees for any entitlements gained by moving to permanent employment.

Independent senator Jacqui Lambie said she supported the proposal as Australia was not attracting the same number of workers it did before the COVID-19 pandemic.

"Businesses are doing it tough trying to find employees still so we need to fix that issue," she told Sky News.

The government is also moving to enact same job, same pay laws to stop employers paying labour hire cheaper rates than the awards they have negotiated with their workers.

Mr Burke rejected suggestions it would lead to employers having to pay people with decades of experience the same rate as the new kid on the block.

"I can categorically rule that out," he told Sky News on Sunday.

"What I'm wanting to close is a loophole where an employer has already agreed that for a particular worker with a particular level of experience there should be a minimum rate of pay and then labour hire is used to undercut the rate of pay they just agreed to."

© AAP 2023