Important ‘stand down’ information for Victorian employers

Legal Practice Director

From midnight on Wednesday, 5 August 2020, Victoria will enter Stage 4 restrictions and all non-essential retailers located in the Melbourne metropolitan area will be restricted to contactless ‘click and collect’ and delivery services. The restrictions will last for at least the next 6 weeks, and as such it is important for retailers to understand the options available to manage their staff over this period.

In preparation for midnight on Wednesday, 5 August 2020, you may need to consider standing down your workers. During this time, it is important to continue to manage your legal and compliance obligations. There are rules that govern when an employee can legally be stood down without pay, which will depend on whether a business is eligible to participate in the JobKeeper Payment Scheme.

 

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SCENARIO 1: JOBKEEPER ELIGIBLE – EMPLOYER AND EMPLOYEES

If both the business and the employee are eligible to participate in the JobKeeper Payment Scheme, you may be able to issue a JobKeeper enabling stand down direction to the employee. For the period that they are stood down, the employee must continue to be paid JobKeeper, even if this would be more or less than their ordinary rate of pay.

To be able to issue this direction the employee must not be able to be “usefully employed” elsewhere (including from home) because of the impact of the COVID-19 pandemic or government initiatives to slow the transmission of COVID-19.An employee must be given at least three days’ notice of a JobKeeper enabling stand down direction. However, if an employee ‘genuinely agrees’ a lesser notice period may be provided.

Until a JobKeeper enabling stand down direction takes effect, employees must continue to be paid for at least their ordinary hours of work, even if they do not perform any work.

NRA Legal has created a FREE template letter to assist members with issuing a JobKeeper enabling stand down direction.

 

SCENARIO 2: JOBKEEPER INELIGIBLE – EMPLOYER AND/OR EMPLOYEES

If either the business or the employee is not eligible to participate in JobKeeper, the employee is only able to be stood down without pay in circumstances where the employee cannot be “usefully employed” because of (among other things) a stoppage of work for any cause for which the employer cannot reasonably be held responsible.

Where a business is impacted by the latest restrictions in Victoria and has been directed by the government to close or to limit its on-site operations, the law may permit the employer to stand down its employees without pay in accordance with s.524 of the Fair Work Act 2009 (Cth). If you are a JobKeeper ineligible employer or have JobKeeper ineligible workers, we recommend you obtain urgent advice in relation to your specific circumstances.

Importantly, an enterprise agreement or contract of employment may provide additional requirements relating to standing down employees.

Remember that while employees are not required to be paid during a period of a stand down, leave will continue to accrue as though the stand down did not occur.

Finally, an employee who is not eligible to receive JobKeeper may be eligible to claim JobSeeker (or other types of income support from the Federal Government) if they have been stood down. These employees should be encouraged to contact Services Australia as soon as possible to determine whether or not they are eligible.