The NSW Premier's announcement of additional COVID restrictions this weekend (17th July) has resulted in further challenges for employers and employees alike. If you own or are managing a business impacted by the tighter restrictions (including but not limited to those in the retail, construction and cleaning industries), you may need to consider your options for managing your workforce at this time.
The Fair Work Ombudsman website (www.fairwork.gov.au) has plenty of useful information (including a template letter directing an employee to stand down), but it can be a bit tricky to navigate, so here are the "must know" highlights:
- > Most of the JobKeeper flexibility provisions that were introduced last year (including a clearer and simpler path to standing down employees and directing a reduction in hours of work) no longer apply, so employers need to rely upon general provisions in the Fair Work Act relating to stand downs, or other provisions within an applicable Award, enterprise agreement or employment contract.
- Under the Fair Work Act, an employer can stand down their employees without pay if they cannot be usefully employed because of a stoppage of work for which the employer cannot be reasonably held responsible.
- If the business has been forced to cease operating as a result of an enforceable government direction and employees cannot otherwise be usefully engaged (for example, in other activities, in other locations, including work from home), it will generally be possible to stand down employees.
- It's important to note that employers cannot rely on the Fair Work Act provisions to stand down employees where the sole reason for doing so is a decline in business conditions/revenue.
- Employers looking to stand down employees should communicate effectively with affected employees and also check applicable Awards for any additional consultation requirements.
- Employees directed to stand down can request that they be paid available leave (other than personal/carer's and compassionate leave), during the period of stand down.
- The circumstances under which an employer can direct an employee to take accrued annual or Long Service Leave are generally quite limited and would not likely be able to be applied in this context.
- Leave entitlements continue to accrue during a stand down and service is deemed to be continuous, even though affected employees are unpaid. Employees are generally also entitled to payment for any public holidays which may fall during the stand down period (where they fall on a day the employee would have ordinarily worked but for the public holiday and stand down).
- Stand downs should be considered a last resort option. Potential alternative actions include:
- Negotiating alternate work arrangements with employees where possible (eg. work from home)
- Negotiating changes to duties, work hours or rosters (be sure to check applicable Awards, contracts and agreements. Employers will generally not be able to direct a reduction in hours for example)
- Negotiating with an employee to take a period of annual or long service leave (by way of example one of our clients has negotiated with their staff to take 2 days annual leave per week for a period of time to ensure the employees continue to receive their full pay, and annual leave accruals reduce, while the business is in a downturn). For a temporary period, employees under many Awards are able to take annual leave at half pay (check relevant Awards for details).
Financial and Other Support
Financial support is available to qualifying workers and businesses impacted by COVID.
- Workers should enquire with Services Australia.
- Businesses should enquire with Service NSW, or chat with your accountant.
There are also several options available for those needing to access Mental Health Support.
It's also suggested that you seek guidance from your financial advisor in relation to accessing and optimising government financial support.
This is general information only and should not be considered legal or specialist advice. It is current as at the date of writing. For further information check the Fair Work Ombudsman website or reach out to us for specific guidance.