Planned Shutdowns and Directions to Take Leave
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The Fair Work Commission has changed the way employers can direct employees to take leave during planned annual shutdowns, including over the Christmas and New Year period.
I’m Hamish Procter from Aitken Legal and in this video I’m going to discuss the impact of these changes for employers dealing with planned shutdowns.
Following a review of modern awards by the Fair Work Commission, a new model clause has been inserted into 78 modern awards. The new model clause deals with the circumstances in which an employer can direct employees to take annual leave during a temporary shutdown.
These changes will directly impact employers across Australia in various industries, including in the clerical, hospitality, construction and retail sectors.
So what are the changes that the Commission made?
Firstly, employees can now only be directed to take annual leave during a planned shutdown if they have a sufficient balance of annual leave accrued.
Secondly, if an employee does not have a sufficient balance of annual leave accrued to cover the planned shutdown, the employer cannot direct the employee to take unpaid leave.
Finally, an employer can reach agreement with an employee to take unpaid leave during the planned shutdown, or “purchase” annual leave in advance.
Aitken Legal considers that these changes will have an impact on the way employers assess annual leave requests throughout the year, and in advance of their planned annual shutdowns. For example, an employer may consider refusing an employee’s request to take 3 weeks of annual leave in September if it would leave the employee without a sufficient balance of annual leave for the employer’s planned two-week shutdown at Christmas.
Aitken Legal considers that, through a properly drafted contract, it may be possible to secure a standing and ongoing agreement that an employee will take unpaid leave for any planned shutdown for which they do not have a sufficient balance of annual leave.
Aitken Legal recommends that employers who are impacted by the changes review their employment contracts and leave request forms and processes, and seek advice from an experienced employment lawyer as necessary.
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