It is a very distressing time in many parts of Australia right now as severe fires continue to blaze.
While there are immediate concerns and actions required to ensure everyone’s safety and protect buildings and assets, as an employer, you are likely to also be thinking about your obligations to your employees at this time. Some employees may be required to support the disaster relief efforts, and as a result you may have employees needing to take emergency services leave, or volunteer leave.
If you have to close your business, do you have to pay your employees?
In circumstances where a natural disaster or emergency, such as a bushfire impacts your business and you are required to close temporarily, in some circumstances, you may stand down your employees without pay.
If you have no useful work for your employees to do during this time, and are considering a stand down, here are some important steps to take:
1. Check the award and agreements
It’s important to look at the modern award or industrial instrument that applies to your business and employees to determine if it provides for a period of stand down, the criteria for this action, and any provisions for employees. It’s also a good idea to check the employment contract to see if there are any clauses related to employee stand downs, and what your legal obligations are.
2. Decide if you will offer paid leave
Under some awards you may be required to pay employees or offer employees the choice of taking accrued paid leave. Even if this is not a requirement, it is still worth considering whether you will pay employees for all or part of the time, if you are able to, or to offer employees the option to take accrued annual leave. It’s a way to show that you are doing your best to support employees during this time.
3. Advise employees
If you do need to stand down employees, it’s best to advise those employees affected in writing (where possible), and cover key information including:
- the date the stand down will commence;
- whether the employees will or will not be paid;
- if there is an option to take accrued paid leave
- how this may affect other employment entitlements; and
- when you anticipate the stand down period will end.
4. Communicate updates
Ensure you have appropriate contact details and keep your employees informed of any updates to the situation and the return to work date.
What if only some positions are affected?
Under the Fair Work Act employers are permitted to stand down employees when there is no useful work for them do. In some cases, certain departments, or certain roles, such as administration or sales, may still have work to do to maintain business operations during this time. Other roles, for example warehouse, manufacturing or logistics may not be required if there are no parts, or orders to deliver.
In this case you may decide to consult with employees, and for different roles consider continuing normal hours, reduced hours, or standing down during this period if there is no work for them to do.
Again, you’ll need to check the award that applies to ensure you meet the requirements that may apply to your specific business or the roles affected.
Alternatives to standing down employees
You may have no option but to stand down employees during floods, bushfires or other natural disasters and emergencies, however there may be some other options to consider:
- Offer employees flexible working arrangements such as working from home, for the period where attending the workplace is not possible.
- If you have multiple workplaces, consider whether it is viable for some or all of your employees affected could relocate their work temporarily to another site.
- Rather than issue a formal stand down notice, in the first instance ask employees to take a period of annual leave.
In summary
An employer can only stand down employees if the reason for the stand down is outside the employer’s control, such as a natural disaster or emergency.
A stand down can be unpaid, but an employer may choose to pay their employees instead, or offer employees the option to use accrued annual leave.
Confirm your obligations according to the award, agreements or contracts that apply to the employees potentially affected before communicating the stand down to your team.
If you are uncertain about your obligations as an employer, or need assistance in managing the process of standing down employees, get in touch with our specialist HR advisors.