With Christmas and the New Year fast approaching, employers should be considering how they can best manage their work arrangements over the festive season. Among these management decisions are questions of whether the workplace should be closed over the holiday period and, should the workplace remain open, ensuring that employees are paid correctly for the upcoming public holidays.
Employers are able to close their workplace over the festive season (known as a ‘shut down’ or ‘close down’), but if they do so there are rules and requirements regarding the management of employees that must be followed.
We discuss the important employment law considerations employers should be aware of during the festive season below.
Can employers require an employee to use their leave entitlements over the shut down?
An employer is only able to direct its award/enterprise agreement-covered employees to use their annual leave over a shut down period if the employees’ modern award or enterprise agreement allows it.
Although modern awards and enterprise agreements typically allow employers to direct their employees to use their annual leave over shut down periods, they should be reviewed carefully to ensure that their rules are followed. For example, some modern awards require employers to provide employees with a minimum period of notice prior to a shut down, or stipulate that a workplace can only shut down during certain periods of time.
If the modern award or enterprise agreement does not contain any rules about shut downs, employers cannot direct their employees to use their annual leave during the shut down period unless the employee agrees to do so.
Alternatively, if an employee is not covered by a modern award or enterprise agreement, employers are only allowed to direct the employee to use their leave entitlements over the shut down period if the direction is reasonable under the National Employment Standards (NES).
What if an employee doesn’t have enough leave to cover the shut down period?
If an employee does not have enough leave to cover the shut down period, the employee’s modern award or enterprise agreement must be considered to see what is permissible. However, employers are generally able to allow an employee to either:
- Use annual leave before they have accrued it; or
- Take unpaid leave.
In the event that an employee is not covered by a modern award or enterprise agreement, an agreement can still be made to take unpaid leave or annual leave in advance; but the employee cannot be directed to do so. We suggest employment contracts or workplace policies for such staff specifically address taking of unpaid leave or annual leave in advance, in the event an employee has insufficient leave accrued.
Can I require my employees work on a public holiday?
The NES confirms that:
- an employee is entitled to be absent from work on a public holiday, unless their employer has made a reasonable request for the employee to work on the public holiday; and
- an employee is entitled to be paid their base rate of pay if they are absent from ordinary hours of work on a public holiday (see more detail below).
Employers are entitled to reasonably request employees to work on a public holiday. Employees, however, can refuse to work on a public holiday if the refusal is reasonable.
To help decide if a request to work on a public holiday is reasonable, there are a number of factors to consider, including, but not limited to:
- the nature of the workplace and the work completed;
- whether employees will receive additional pay (e.g. penalty rates);
- personal circumstances, such as family/caring responsibilities of the employee; and
- the amount of notice provided by the employer when making the request.
What payments need to be made on a public holiday?
If a workplace remains open throughout the festive season, employees who work on public holidays may be entitled to public holiday penalty rates pursuant to their applicable modern award or enterprise agreement.
Alternatively, if the workplace is closed on the public holiday but would otherwise usually trade or operate on that day, full-time and part-time employees are entitled to be paid their base rate of pay for the ordinary hours they would have worked on that day had it not been a public holiday.
