April 30, 2020
Do normal HR laws apply during COVID-19?
Australia’s workplace laws are usually set in stone. However, as the coronavirus crisis cuts through Australia’s economy, the government has had to reconsider what workplace laws look like. Are they even relevant now when so many businesses have been affected by COVID-19? The Government has propped the economy up by implementing the JobKeeper wage subsidy, which you might be taking advantage of. As always when there are workplace changes like JobKeeper payments, it’s worth considering the impacts, particularly from an HR perspective. In our latest article, we explore what you can or can’t do as a business owner during the current crisis.
How has HR laws changed exactly?
As a result of COVID-19 and in response to the JobKeeper stimulus package the government has temporarily provided a whole new section to the Fair Work Act 2009. These rules have expanded an employer’s rights to alter an employee’s conditions in some circumstances.
Under the ‘JobKeeper Enabling Directions’, you may be able to:
– change your employees’ duties
– change their work location
– stand them down or reduce their hours or days of work.
These new rules apply if your business receives JobKeeker payments on behalf of the employee.
How to reduce an employee’s hours due to COVID-19
If you’re receiving JobKeeper payments for an employee and you choose to reduce their hours, here’s what to do. You must provide them with their wages or the equivalent of the JobKeeper payment, whichever is more. For instance, say you have a full-time employee on $60,000 a year, you reduce their hours to four days a week and their pay to 80% or $48,000 ($1,846 a fortnight). You’ll need to pay them the $1,500 a fortnight from the JobKeeper subsidy plus $346 a fortnight from your funds. If, however, your business suffers another downturn and you cut your employee’s hours to 2.5 days a week and their pay to $30,000, this would equate to only $1,154 a fortnight. In that case, you’d have to provide them with the full $1,500 a fortnight JobSeeker payment.
Directing an employee to take leave
Under the changes to the law, you can direct an employee receiving JobKeeper payments to take their annual leave entitlements. Providing they are left with a balance of at least two weeks’ leave. When this happens, you must pay them either their leave entitlements or the JobKeeper payment, whichever is highest. This means if their normal rate is below the JobKeeper threshold, their leave payment needs increasing to $1,500 a fortnight. They’ll keep accruing new leave entitlements at their normal rate during this time. You can also ask an employee to take their leave for twice as long at half the rate of pay.
Minimum conditions still apply
The minimum conditions in the National Employment Standards and awards and agreements still apply, even when you’re changing an employee’s conditions of employment. That means you can’t reduce someone’s pay below the base rate to which they’re entitled. It also means if you change their duties so they’re performing a new role, you must pay them the higher of the salary for their current or previous role.
Changing working hours
On the flip side, you can ask someone to work longer hours, so long as it’s reasonable to do so and you pay them at the correct rate, including any overtime allowance. Whether or not is a request is reasonable depends on a number of factors, including there being no threat to workplace health and safety and no clash with the employee’s personal situation.
You can read more about what constitutes reasonable overtime on the FairWork website.
What if you don’t qualify for JobKeeper payments?
For employees who aren’t part of the JobKeeper scheme, the usual human resources rules and employment laws apply. This means you’re still bound by the provisions of the Fair Work Act 2009, as well as other employment laws, so there’s less flexibility. For instance, sections 524 of the Fair Work Act needs to be used carefully as it ostensibly only lets you stand down an employee in some limited circumstances, such as:
– disrupting of a workplace through industrial action,
– machinery breaks down, or
– there’s some other form of stop-work that isn’t your fault.
We will get through these uncertain times
While Australia’s human resources and employment laws are usually set in stone, the coronavirus is allowing the government to introduce some flexibility. Especially for businesses receiving the JobKeeper wage subsidy. If you’d like to know more about how HR and employment laws have changed as a result of COVID-19 or have any questions regarding the JobKeeper payments, get in touch with the Catalina Consultants team today.