Coronavirus and Employment Law
Well, we have all been flat out trying to deal with the operational issues of the coronavirus pandemic. How many of us have given consideration to the employment issues that will arise in short order? The state of the legislation indicates that scant attention has been given to this circumstance; but the good news is that Rob Rankin of Rankin Business Lawyers in Melbourne has delivered some great insight.
Rob’s Top 10 Practical Tips:
- Speak to staff about potential business disruption and the effect this might have on redundancies or, preferably, job sharing.
- Shareholders and directors should consider reducing salaries/dividend payments.
- An approach to your landlord regarding short term rent reduction or payment terms might assist to share the load.
- Forecasting with significantly reduced cashflow will help identify potential issues.
- Speak with the bank and ATO about payment plans and potential payment holidays.
- Cease all non-critical face to face meetings and travel.
- Plan with staff about working from home and reducing hours.
- Review supply terms and engage with suppliers.
- Look at where short term cash savings might be made in your business.
- Review current insurances and advise stakeholders of potential ramifications.
Understand your insurance policies and communicate these to relevant stakeholders.
Coronavirus and Employment Laws – what you need to know
With coronavirus (COVID-19) now a global pandemic, there is understandably a lot of information for businesses and individuals to get their heads around. Already, there is an influx of information available to people concerning how to best prevent the spread of COVID-19, especially in the workplace. The Department of Health, Worksafe Victoria and Safe Work Australia are continuously updating their information concerning COVID-19, with helpful tips on how best to control the risk to workers’ health. We encourage you all to visit these websites (listed below) to ensure you are up to date and doing everything in your capacity to comply with workplace health & safety (WH&S) laws, policies and procedures.
However, the information that has not been so readily available is how this will all play out from an employment law perspective. For example, can you stand your employees down to limit risk? If so, do you have to pay them? What if your business hits a financial hurdle due to the pandemic? Can you lay off your workers? These are only a few of the many question’s organisations will be facing over the coming weeks and months.
There are so many ‘what-ifs’ surrounding the practicalities concerning the impact of COVID-19 on employers, but not too many answers. This is because there is not always a ‘one size fits all’ answer to the problem pursuant to our current national employment laws (governed primarily by the Fair Work Act 2009 (FWA) and National Employment Standards). For this reason, we strongly encourage you to contact us if you are an employer and not sure about what steps you can (or should) take regarding your WH&S obligations and how to ensure you are also properly complying with relevant employment legislation (as well as any enterprise agreements, awards, employment contracts and policies that might be in play).
As a general overview, we have provided the information below to alert you to some important issues and considerations to be aware of when navigating your business along this difficult and worrying time for us all.
Workplace Health & Safety
Employers have a duty to provide and maintain a safe workplace. More information can be found by following the links provided below, however in short, employers must, so far as is reasonably practicable, provide and maintain a working environment that is safe and without risks to the health of employees and independent contractors. Employers must also provide information, training or supervision to employees and contractors where necessary, and continuously monitor the health of employees and the conditions of the workplace on an ongoing basis.
Interactions with the Fair Work Act – Standing employees down
A question that will arise for many employers (if it has not already), is whether their exercise of reasonable measures pursuant to their obligations under WH&S laws might include standing workers down. The appropriate action in this regard will depend on the nature of the request. Is the worker unwell? Have they just returned from a high-risk country and need to be quarantined or self-isolate? Are they perfectly well and able to work, but they wish to remain isolated (or the employer decides that it is too risky for any employee to attend work)?
For employees that are directed not to attend work but are not actually unwell, unless an organisation has specific arrangements in employment contracts (or other workplace instruments), it is likely at this stage that employers will need to pay the employee.
On the flipside, employees who cannot work as they are sick with COVID-19 can take paid sick leave (or carer’s leave if looking after an ill household member). Employers cannot require an employee to take sick or carer’s leave, however the employee will not be entitled to be paid unless they use their paid leave entitlements. Casual employees are entitled to 2 days of unpaid carer’s leave per occasion.
Where such employees do not have enough leave available, they can access unpaid sick leave up to a period of 3 months before losing protection under unfair dismissal laws. Employees who take a period of sick leave that is paid the whole time are protected from dismissal regardless of how long they’re on leave.
As it currently stands under the FWA, an employee can only be stood down without pay if they cannot be usefully employed because of an equipment breakdown, industrial action or a stoppage of work for which the employer cannot be held responsible. Most commonly, this includes situations such as severe and inclement weather, or natural disasters. At this stage, it is unlikely to encompass the COVID-19 pandemic, but this of course could change in the future if more severe lock-down directives are issued by the government.
Notwithstanding the above, it is important to review any obligations the employer may also have pursuant to any applicable enterprise agreement, award, employment contract or policy.
It may be practical for an employer to direct their employees to work from home (as a reasonable attempt to maintain health and safety). However, it is important to review any obligations the employer might have under any applicable workplace instrument. Employers should consider the nature of the work involved and the suitability of the employee’s home. WH&S laws will still apply when an employee is working from home, so it is vital that employers ensure they are not fixing one WH&S issue and creating another.
Termination of employment and redundancy
It is imperative for employers to observe the current laws under the FWA regarding termination of employment. Specifically, employees are protected from being dismissed because of a temporary absence due to illness or injury. Furthermore, the FWA includes protections against being dismissed because of discrimination, a reason that is harsh, unjust or unreasonable, or another protected right. These protections will continue to operate in relation to employees impacted by COVID-19.
Some employers may need to make employees’ positions redundant in response to a business downturn. If this is the case, employers may have to pay redundancy pay. There are several requirements that must be met for redundancies and we urge you to contact us if you are in this position.
This is only the tip of the iceberg and there will be many legal implications facing employers and employees due to the COVID-19 pandemic. As noted above, there may not be a ‘one size fits all’ approach to the specific issue you are dealing with, so please get in touch with us to discuss your individual requirements so that we can assist you in successfully navigating this difficult time.
Coronavirus (COVID-19) health alert
Exposure to coronavirus in workplaces
Coronavirus (COVID-19): Advice for Employers
We understand that there are more questions than answers. The simple truth is that there are a multiplicity of circumstances that face employers and consequently little in the way of simple solutions. Many thanks to Rob and his team.
1300 529 249
13 March 2020