This year, there is a lot of change happening in workplace relations obligations for employers as a result of the Secure Jobs Better Pay reforms being legislated by the Albanese Government.
However, there are other things that are happening in this space as a result of decisions made respectively by the Fair Work Commission and the Federal Court.
Changes to rules on annual closedowns
The Fair Work Commission has recently handed down a decision to vary 78 modern awards in relation to annual closedown arrangements.
Historically, annual closedowns have generally required a period of notice from a few weeks to a couple of months and employees then have to take annual leave during the closedown.
Employees who don’t have adequate annual leave balances go on leave without pay for that part of the closedown period not covered by annual leave.
The major change that this decision makes is to remove the employer’s right to put an employee on leave without pay if the employee does not have adequate annual leave to cover the closedown period.
Instead, the employer will need to formally obtain the employee’s written agreement to go on leave without pay. If the employee does not agree, the employer must provide the employee with work or, if that isn’t possible, pay the employee normal wages for that part of the closedown period not covered by annual leave.
The employer and the employee may also agree to the employee having annual leave in advance.
What this means for employers?
Essentially, full-time and part-time employees who do not have adequate annual leave to cover an annual closedown period can withhold agreement to take leave without pay or annual leave in advance and still be entitled to payment by the employer for the part of the closedown not covered by annual leave without having to work and without having any deduction from paid leave entitlements.
This is clearly a disincentive to employing people as full-time or part-time and arguably runs counter to the new Object of “Job security” in the Fair Work Act. Employers can avoid the issue by employing people as casual employees.
In circumstances where an employer might need to recruit someone in the months leading up to their annual closedown, they might want to make employment conditional on a prospective employee agreeing to take leave without pay when the forthcoming annual closedown occurs as part of the job offer/contracting process.
Employers also need to revisit their annual leave policies and procedures and how they manage employees’ leave applications and accruals to ensure that employees have adequate annual leave to cover the closedown period. If an employee requests a period of leave which would result in the employee not having enough annual leave left at closedown time to cover the full period of the closedown, you might want to make approval conditional on the employee agreeing in writing to take leave without pay at closedown time.
Assuring that employees receive the required notice in writing of closedowns also needs to be provided for (different Awards have different requirements in this regard).
There is probably also a need to consider the question of closedowns of themselves – what the need for them is and how long they need to go for.
These changes to modern awards are due to take effect from 5 May 2023.
Changes to rules on working on public holidays
The Federal Court has recently made a decision that an employer cannot “require” an employee to work on a public holiday. An employer can only “request” an employee to work on a public holiday and the employee is able to refuse that request on reasonable grounds.
The case in question was one where the operations ran every day of the year including public holidays and employees were rostered on that basis. Employment contracts and work rosters reflected that and that has been fairly standard and accepted practice across industry generally.
One factor in this case was that employees who were rostered to work on the two public holidays in question – Christmas Day and Boxing Day – did not receive any additional (penalty) payments for working on those days.
Another was the fact that the Fair Work Act does confer a right for an employer to request an employee to work on a public holiday but not to require them to do so.
What this means for employers?
If there is a term in your employment contracts that requires an employee to work on a public holiday, that will not be enforceable and could be held to be in breach of the Fair Work Act.
It may be appropriate to consider the question of whether it is essential that operations continue on public holidays.
You should also have a look at your wage structures for public holidays – what people are paid for working these unsociable hours.
This article has been prepared to provide as accurate a picture as possible based on information that is currently available pending finalisation of the legislation. It does not constitute legal or professional advice and should not be relied upon in that regard.
About the author
Peter Maguire is the owner and practice leader of Ridgeline HR, an award winning HRM consulting practice which has been operating since 2000. Peter is an acknowledged expert in workplace relations and also a high performance leadership coach with over 40 years of experience in HRM. Ridgeline HR’s byline is “Helping PEOPLE in BUSINESS with PEOPLE BUSINESS”.