As we saw in the global COVID-19 pandemic, unforeseen circumstances may put business owners in the bleak situation of having to shut down their workplace (or part of their workplace) for a period of time.
Section 524 of the Fair Work Act 2009 (Cth) provides circumstances in which an employer can stand down their employees. The effect of an employer standing down an employee is that the employer is not required to pay ordinary hours of work to the employee for the stand-down period.
During this period of forced closure when the employee is not able to perform their work, you can rely on section 524 to stand down your employees, with or without pay. In these circumstances, it is your choice whether you pay some or all of the employee’s pay.
As the employer, you can also request, if you wish, for the employee to take their accrued annual leave or long service leave. But if you agree to this, then you need to pay the employee during this leave period.
If you are intending to stand down your employees, you must notify the affected employees in writing of any stand-down period and the arrangements that will apply during that period, e.g. pay, party pay, leave, etc. Please contact us for appropriate documentation to put this in place. Our documentation gives you two alternatives:
- To stand down without pay and no right to take annual leave or long service leave; or
- To stand down with pay and the option to take annual leave or long service leave.
If you need any help implementing an effective stand down, or to get assurance that section 524 applies to give you the right to stand down employees, then call us on (02) 9199 8597 or email us.
The information contained in this post is current at the date of editing – 14 August 2024.