What Businesses Need to Know
As we quickly approach the end of year, it is important that Employers begin preparing for their end of year shutdown period.
Over recent years there have been a number of changes to employment legislation that apply during this period, and it is important that Employers are aware of these changes.
1. Managing Employee Leave
If Employers are planning to shut down over the December/January period, managing Employee leave balances should be considered. As of 1 May 1 2023 both Award-covered and award-free Employees can be directed to take accrued annual leave during a ‘shut down’ period, such as between Christmas and New Year.
However, for any Employee who does not have accrued annual leave to cover the shut-down period, they cannot be directed to take unpaid leave.
An employer and employee can:
- agree in writing for an employee to take a period of unpaid leave; or
- come to an arrangement, agreed in writing, for an employee to take annual leave in advance, resulting in a negative annual leave balance.
If an employee does not agree to either of the above, they should either be paid their salary/wages based on their employment contract during the shut-down period, or alternatively, you could allow them to work during the shut-down period.
What can Employer’s do to avoid this? Employers should be conscious of whether or not to approve annual leave requests prior to the shutdown period, to ensure that there is a sufficient balance to cover the shutdown period. If required and agreed to, employees could take a period of unpaid leave throughout the year at their request.
2. Notice of Shut Down
In addition to the changes above, there are also updated rules in many Awards regarding the notice to Employees of an upcoming shut down. Employers must provide at least 28 days’ written notice of the temporary shutdown period to all impacted employees.
Employers should check the relevant Award and communicate the planned shut down in line with the Award guidelines.
3. Working on Public Holidays
For Employers that continue to operate over the festive season, the Fair Work Act stipulates that Employers are obligated to ‘request’ Employees to work on a public holiday before requiring them to do so. Failure to adhere to this requirement could lead to unlawful work assignments and violation of the Fair Work Act.
For an Employee to work on a public holiday, one of these conditions must be met:
- an Employer has requested the Employee to work the public holiday, and the Employee has agreed to work; or
- the Employee’s refusal to work a public holiday is deemed unreasonable.
Employers shouldn’t rely solely on standard rostering practices for public holidays and the following actions are recommended:
- Issue a ‘draft roster’ for periods including public holidays, or issue specific requests to team members to work on upcoming public holidays
- Provide an explanation as to why you believe the need for the team member to work on the public holiday is reasonable
- Provide Employees with the opportunity to agree to work or state their reasons for refusal
- Finalise the roster based on Employee responses and consider reasons for refusals
- Communicate with Employees if their reasons for refusal are considered unreasonable.
4. Penalty Rates
If Employees agree to working on public holidays, it is important for Employers to be aware of the penalty rates and entitlements that apply to them under the relevant Award. This may include:
- Additional pay (different to their standard hourly rate)
- An additional day off or additional annual leave
- Minimum shift lengths on public holidays
- Options for Employees to request to substitute a public holiday for another day.
Employers should review the relevant Award and ensure all entitlements and correct rates are paid to Employees. We also have included below the 2024 public holiday dates that apply in all states and territories:
- Christmas Day – Wednesday 25th December
- Boxing Day – Thursday 26th December
- New Year’s Day – Wednesday 1st January
Need assistance
At Allan Hall HR, we have a team of experienced HR consultants. Please call us on 1300 916 764 or contact us here. to discuss any questions you may have regarding the shutdown period and managing your business during this period.