On 9 April 2020, the Fair Work Act was amended to support the introduction of the JobKeeper Wage Subsidy.
Once an employer qualifies for the JobKeeper Scheme, new provisions enable employers to:
- make temporary and partial stand-downs in certain circumstances
- temporarily alter employees’ usual duties and locations of work in certain circumstances
- make agreements with employees to alter their days and times of work and use annual leave in certain circumstances
Temporary and Partial Shutdowns
Eligible employers can direct an employee to work fewer hours or days (including no hours). These directions are called ‘JobKeeper enabling stand-down directions’.
Employers can only give employees JobKeeper enabling stand-down directions if the employee can’t be usefully employed for their normal days or hours because of changes to business that are attributable to the COVID-19 pandemic or enforced government direction.
If you introduce these directives, they must be in writing. You also need to:
- make sure the direction is reasonable in the circumstances, including (but not limited to) considering the employees caring responsibilities
- notify and consult with your employees (or their representatives) at least 3 days before issuing the directive (unless your employee agrees to a shorter time frame)
- keep a written record of the consultation
The directive doesn’t apply if an employee is taking paid or unpaid leave or is otherwise absent from work (eg Public holidays). If an eligible employee is on leave that totals less than the JobKeeper payment, the employee is still entitled to be paid an amount equal to the JobKeeper payment.
Employees who are on a JobKeeper enabling stand-down can request to take on secondary employment, training or professional development for the duration of the stand down. Employers must consider these requests and cannot unreasonably refuse them.
Direction to change usual duties or work location
The new provisions enable a qualifying employer to direct an employee to change their duties and work location. This includes working from home or from a different location. These directions are also referred to as 'JobKeeper enabling directions'.
Employers need to ensure:
- the direction is reasonable, including considering the employee’s caring responsibilities
- the modified duties are within the employee’s skill and competency, and the employee has the required licences or qualifications
- the duties are safe considering the nature and spread of coronavirus
- the duties are reasonably within scope of the business’s operations
- any new location is within a reasonable travelling distance.
The direction must be in writing. Employers must notify their employees and consult with them (or their representatives) at least 3 days before issuing the direction (unless the employee agrees to a shorter time frame). They also need to keep a written record of the consultation.
An employee's hourly base pay rate cannot be reduced as a result of a JobKeeper enabling direction.
If an employer changes an employee’s duties, the employer must pay the employee the higher of:
- the base pay rate that applies to their previous duties, or
- the base pay rate that applies to the new duties the employee is performing.
Agreement to work different days and times
Employers and employees can agree for the employee to perform their usual duties on different days or times than usual.
Employers need to ensure that:
- performance of the duties on different days or at different times is safe considering the nature and spread of coronavirus, and is reasonably within scope of employer's business operations
- the employee’s usual work hours aren't reduced (reducing work hours would require a JobKeeper enabling stand down direction).
If an employer asks their employee to make changes, the employee has to reasonably consider the request, and can’t refuse it unreasonably.
Agreement to take annual leave
A qualifying employer can request that an employee take paid annual leave (if they keep a balance of at least 2 weeks).
The employer and employee can agree to the employee taking annual leave at half their usual pay rate.
Employees on annual leave continue to accrue leave and their service continues for the purposes of redundancy and pay in lieu of notice.
An employee can’t unreasonably refuse a request from their employer to take leave.
Temporary Award Changes
On 8 April 2020, Fair Work made temporary changes to 99 awards. These changes apply from an employee’s first full pay period on or after 8 April 2020 until 30 June 2020.
The changes provide employees with:
- 2 weeks of unpaid pandemic leave (not pro-rated for PT or Casuals)
- Annual Leave at half pay
Up to 2 weeks Unpaid Pandemic Leave (or more by agreement with employer) is available immediately to all full time, part time, and casual employees.
Unpaid Pandemic Leave can be taken if the employee is required to self-isolate by government or medical authorities, or if acting on advice of a medical practitioner. It can also be taken in response to government or medical authorities response to the pandemic (e.g enforced restriction of non-essential business).
Employees don’t have to use their paid leave before they access unpaid pandemic leave.
Unpaid Pandemic Leave needs to begin before June 30 but can finish after that date.
Any Unpaid Pandemic Leave counts as service for entitlements under awards or National Employment Standards
An employee must let their employer know that they’re going to take unpaid pandemic leave and the reason for taking the leave. This has to be done as soon as possible and can be after the leave has started. They should also say how long they'll be off or expect to be off work.
An employer can ask an employee to provide evidence to show why they took the leave
An employer must not dismiss the employee or take any other adverse action against an employee because the employee is entitled to unpaid pandemic leave.
Annual Leave Changes
Under the temporary changes to Annual Leave, employees can take their annual leave at half pay and double the time off work, if agreed with their employer.
This means an employee gets 1 weeks' annual leave payment (including annual leave loading if applicable) for every 2 weeks of annual leave they take.
The agreement must be in writing and the employer needs to keep it as a record.
The leave needs to start before 30 June 2020, but can finish after that date.
Fair Work may still vary additional awards, so it’s a good idea to sign up for email updates.
As this legislation is changing by the day, it’s a good idea to sign up for updates and/or keep an eye on the ATO, Fair Work and Treasury websites to ensure you have the most up to date information.
If you need more information on how these measures can apply to your situation, contact your usual Employment or Financial Advisor, or visit the below websites: