With the Christmas and New Years holiday period approaching, you need to be aware your business needs to provide employees with notice of a shut down over this period.
Following changes to 78 Modern Awards, you are required to give affected employees a minimum of 28 days’ written notice of a shut down. This means that for businesses intending to close on 22 December 2023, employees must be given written notice no later than 24 November 2023.
The updated regulations allows businesses to mandate an employee’s use of paid annual leave during a temporary shutdown, as long as it is reasonable.
The key change is that you must not direct employees to take unpaid leave during a shut down; however, you can offer this as an option to employees.
It is important that businesses consider this when approving annual leave requests ahead of a regular shutdown, particularly if this will leave the employee with insufficient annual leave to cover the shutdown.
Employees with insufficient accrued annual leave may discuss alternative arrangements with their manager – e.g. utilising accrued time off in lieu, long service leave or taking paid annual leave in advance. These arrangements should be confirmed in writing and records of what has been agreed must be kept in the employee’s personnel file.
Can you direct your employees to take annual leave for the Christmas/New Year shut down?
You have the right to direct employees to take annual leave during a Christmas/New Year shut down. However, as of 1 May 2023, if you employ a person covered by a modern award, you will need to check whether you need to meet the new notice requirements to exercise that right.
New changes in 78 modern awards require you to give affected employees 28 days’ written notice of the shutdown. A shorter notice period may be agreed between the employer and the majority of relevant employees.
The written notice must be given to new starters joining after the notice as soon as reasonably practicable after being engaged.
If applicable, you will need to comply with these requirements to be able to direct employees to take paid annual leave during the shutdown. Again, this direction must be in writing and must be reasonable. There is no guidance as to when such a notice is unreasonable. It will be rare that such a requirement would be unreasonable if the proper notice of the shutdown is given.
The modern award provisions do not allow you to direct employees to take unpaid leave during a shutdown. So, you will need make it clear to employees that annual leave requests will be refused if it results in insufficient leave being available during the regular shutdown.
Employees could also use rostered days off or time off in lieu of overtime to ensure they are paid during the shutdown. Other options include granting paid leave in advance to employees who have insufficient leave accruals to cover all of the shutdown. These arrangements will need to be in writing and comply with relevant award provisions.
You could also give employees the option to take unpaid leave during the shutdown. Any agreement to do so must be recorded in writing, e.g. by exchange of emails or text message. A copy of any such agreement should be retained in the employee’s personnel file.
If you want to create a right to direct employees to take unpaid leave during a shutdown, you might want to negotiate appropriate provisions in employment contracts or enterprise agreements.
If your workforce is covered by any of the 78 modern awards impacted by the 1 May 2023 overhaul of business shutdown provisions by the Fair Work Commission, you should review your business arrangements to ensure compliance FWC Decision – Shutdown Provisions.
It is important to note that not all Awards have the same wording in relation to the new shutdown provisions – e.g. Building and Construction General On-Site Award 2020 requires two months of written notice to the employee and only applies to a shutdown period over Christmas and the New Year holidays. Various other awards allow for industry-specific temporary shutdown periods – e.g. the Poultry Processing Award 2020 and Hydrocarbons Industry (Upstream) Award 2020 which include temporary shutdowns for mechanical maintenance.
Christmas Day, Boxing Day and New Year’s Day will be public holidays will be holidays in all states. Some states have opted to have part-day public holidays on Christmas Eve and New Year’s Eve. See the table below to see which dates are public holidays for your state.
Full-time and part-time employees generally have the right to be absent from work on a public holiday and are entitled to receive payment for their usual hours of work on that day or part-day.
While the general rule is that employees can take a day off on public holidays, you can make reasonable requests for employees to work on these days. An employee can refuse such a request if it is deemed unreasonable or if the refusal is reasonable.
It’s important to note that modern awards and enterprise agreements may also include provisions that deal with public holiday entitlements (which may require penalty rates to be paid or have a procedure of allowing substitute days).
Public holiday entitlements are an integral part of the NES, providing employees with the right to take time off and refuse work on these days.
Akyra’s Key Takeaways for Employers
Akyra recommends that all business / organisation owners and operators should:
- Employers who are planning on a shutdown across the Christmas period must ensure they provide written 28 days’ notice – if planning to shutdown on 22 December 2023, then employees must be given written notice no later than 24 November 2023.
- It is important to have discussions with your employees about the leave and what type of leave they wish to take so, plan for discussions with employees asap in relation to taking unpaid leave or annual leave in advance.
- Review and update any internal procedures relating to temporary shutdown periods, particularly related to award covered employees, including the required notice periods and give consideration as to what a ‘reasonable request’ looks like
- Update internal systems to allow for leave in advance or unpaid leave to be accessed by employees.
In relation to public holidays:
- plan rostering arrangements well in advance,
- give employees plenty of notice if genuinely requesting them to work on a public holiday;
- communicate effectively to ensure compliance with the Fair Work Act as it relates to public holiday work arrangements.
The Christmas / New Year period can be stressful for any employer as there is the usual ‘business’ of the lead up to this period, and now there are new changes to shutdowns that need to be considered where a shutdown applies to your business. Akyra are experts in assisting employers in managing their responsibilities. If you require help with the new shutdown provisions, contact us today – email@example.com or 07 3204 8830.
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.