A recent court case indicates there might be some confusion as to when you can stand-down an employee.
An employee can be sent home without pay if there is no useful work for them to do because of:
- equipment break down
- natural disaster (including floods, bushfires, tropical cyclones)
- industrial action.
This is known as a stand down and can only happen if the reason for the stand down was out of your control as an employer.
Employees can’t be stood down without pay just because there is not enough work. They can be directed to take annual leave during a stand-down and are paid their respective annual leave entitlements.
If there is not enough work and you need to reduce your workforce, you need to comply with redundancy requirements including redundancy payments, accrued leave entitlements and payment in lieu of notice.
If business activities are ‘shut down’ during periods such as Christmas and New Year (and the relevant modern award or registered agreement allows it), employees can be directed to take annual leave during this period… if the employee does not have enough annual accrued you may choose to either direct the employee to take leave without pay or pay annual leave in advance.
Inclement or severe weather is when it is unsafe or unreasonable for employees to work because of severe weather conditions. The relevant modern award or registered agreement will set out what inclement weather includes and what you and employees have to do when there is inclement weather.
If you don’t comply with those obligations in relation to stand-down, you could face a maximum penalty of $10,200 per breach, while the company faces maximum penalties of up to $51,000 per breach.
It is crucial for you to know and comply with your obligations when it comes to termination entitlements… you cannot avoid termination pay-outs to employees.
NEED MORE INFORMATION?
If your business is interested in beginning the journey into supporting the financial wellbeing of your workforce, or would like some further information on the topic, please contact Akyra on 07 3204 8830 or book a free 30-minute consultation, for an obligation-free conversation.
Disclaimer – Reliance on Content
The material distributed is general information only. The information supplied is not intended to be legal or other professional advice, nor should it be relied upon as such. You should seek legal or professional advice in relation to your specific situation.