For many businesses, it may not be necessary nor viable to remain fully operational during the Christmas and New Year holiday period. Thankfully, many modern awards and agreements allow employers to direct their staff to take annual leave – or unpaid leave when annual leave has been exhausted – during a business close down period.

Employers planning to either completely close their business or shut down a part of the business during this period need to be aware of the requirements to give notice and communicate shut down plans to their impacted employees. Under some awards, employees must be given 3 months’ notice of a planned shut down, and with only 4 months until Christmas, now is the time to consider doing this!

What are employer obligations when planning a shut down?

Due to the variations between different awards, it’s important to review the specific requirements around shut downs and comply with the correct notice periods set out in the award or agreement that applies to your business.

The awards do have varying requirements around the allowable reasons for shut down, how much notice is to be given to employees, and how the notice must be given, i.e. whether notice can be provided verbally or whether it must be done formally in writing.

Whether an employee is employed on a casual or permanent basis will determine if they are eligible for leave entitlements. Where a permanent employee does not have sufficient leave accrued, the employer may direct them to take unpaid leave, or in some instances, the employer may provide paid leave in advance.

How much notice should an employer give if the award doesn’t specify a notice period?

If a business consistently has an annual closure closing over the Christmas and New Year period then it is beneficial to reference annual business shut down periods in your policies and employment contracts. It’s also a good idea to discuss this with employees during the recruitment and onboarding process, so there are no surprises.

Where a Christmas closure is new to the business, and, even if there is no strict requirement under the award to give a specific notice period, employees will appreciate being aware of the closure well in advance. Two to three months’ notice would be considered reasonable and allow employees to plan for the time off work.

Casual workers and new employees who may not have accrued sufficient annual leave will be most impacted by the business closing over the Christmas and New Year period and it is worth considering how some employees may respond and ensure that your communications around the shut down are messaged well.

What is the best way to inform employees about the business closing over Christmas?

The business closure can be communicated in various ways, again depending on the award. If advising employees verbally, we also recommend providing employees with written notice and in this communication:

  • confirm the dates of the closure;
  • specify who will be required, or not required to work during the period;
  • advise any expectations leading up to the closure, e.g. completing projects, or cleaning out shared fridge; and
  • clarify any leave entitlements or requirements to take unpaid leave if employees have insufficient leave accrued.

It is also a good idea to send a reminder to the team closer to the closure. Some accounting packages allow for a message to be added onto payslips and this can be another effective way to communicate reminders around shut down periods with your employees.

Need help managing employee communications?

We can assist in interpreting award requirements so you know your obligations as an employer and we can then draft appropriate communications for you to send to your team advising of any shut down periods. If you need HR help, don’t hesitate to get in touch with our team, via the chat box here or calling us on 08 6150 0043.

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