Posted by Maeve Doyle | 24 March 2020 | COVID-19
The economy is being impacting by the coronavirus (COVID-19) pandemic and the government measures to contain the spread. Businesses are all considering ways to cut costs.
The greatest expense for many businesses is salaries and wages and, therefore, reducing employee hours has become a focus. Remember that you have invested time and money in finding and training good people and that you must retain the ability to re-start once this difficult time has passed.
This brief article outlines your options to reduce employee costs.
Option 1: TEMPORARY FLEXIBLE WORKING ARRANGEMENTS
Consider all flexible working arrangement options, such as working from home or flexible work hours. If you are changing working conditions remember:
OPTION 2: PAID OR UNPAID LEAVE
Sometimes it is not practical for employees to work from home.
You may be able to direct employees to take annual leave. However, the limitations of enterprise agreements and awards still apply in relation to how much leave you can direct employees to take and the amount of notice that you must give them.
Maintain open communication with your employees about the impact of coronavirus on the business and their employment options. They may well agree to take accrued leave to help safeguard the business and their job.
OPTION 3: STAND DOWN
You can stand down employees in accordance with the Fair Work Act, an enterprise agreement or a modern award. Generally, you can stand down employees without pay if:
However, meeting the above conditions is not simple, so think carefully about using a stand down. Also, some employees can be stood down while others – who can still be usefully employed – are not.
As part of the consultation with employees about stand down, some employees may request paid leave (such as annual leave or long service leave) during the stand down
Employees who have been stood down may be able to access Centrelink benefits.
OPTION 4: REDUNDANCY
If your employees’ roles are no longer required due to the loss of work, you can commence the redundancy process. To avoid unfair dismissal claims, make sure you strictly comply with your consultation obligations under any applicable modern award or enterprise agreement. As part of the redundancy process you should also explore other options such as
Seek legal advice before starting any redundancy process.
Maeve Doyle is a senior employment lawyer with Nexus. If you need further advice or support, she can be contacted on email@example.com or by telephone 0417 451 638 or +612 9016 0141.
This publication is © Nexus Law Group and is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.
In our COVID-19 NEXUS Alerts #2 and #3, we looked at the Commonwealth and NSW legislative measures which had been introduced to mitigate the impact of COVID-19 pandemic on certain commercial and retail leases – with detail being proposed to follow via specific state and territory regulations being adopted. NSW has now enacted its regulations.