Christmas Shut Down – Your Obligations Explained

As the festive season approaches, many Australian businesses plan a period of closure during the Christmas and New Year holidays. This tradition, often seen as a time for rest and rejuvenation, impacts both employers and employees. How employees are treated during this Christmas shut down depends largely on the award or agreement that governs their employment. In this blog, we will delve into the various scenarios employers might encounter and the legal guidelines surrounding their rights and obligations during this period.

If the award or agreement in place permits employers to instruct employees to take leave at specific times, they can do so. The timing and notice requirements may vary depending on the specific award or agreement. For example, the Clerks Private Sector Award allows employers to direct employees to take leave during an annual shut down, with a minimum notice requirement of 4 weeks in writing. This ensures a fair and structured approach to the holiday period.

In cases where employees do not have sufficient annual leave to cover the entire Christmas shut down, employers have several options. They can agree to advance annual leave payments or allow the employee to take unpaid leave. Importantly, employees cannot be forced to take unpaid leave if they do not agree to it. Instead, the employer is obligated to pay them at their ordinary pay rate for the shut down period, ensuring fair treatment for all employees.

When an award or agreement does not address the issue of leave during a scheduled shut down, employers may not compel employees to use their leave. Instead, they should engage in negotiations with their employees regarding paid or unpaid leave. If the award or agreement permits, employers may even explore the option of granting half-pay leave, providing flexibility for both parties involved.

Although rare, some employees may not be governed by any award or agreement. In such cases, employers can direct employees to take leave, but this direction must be ‘reasonable.’ This reasonableness is subject to various factors, including the nature of the business, the employee’s work responsibilities, personal circumstances, and the amount of notice given. Both employers and employees have the right to refuse requests if they believe them to be unreasonable.

Public holidays falling within a period of paid leave are always paid as normal workdays. However, public holidays do not count as annual leave days. Employees should be paid their usual rates for public holidays during their leave. On the other hand, if an employee is required to work on a public holiday, standard public holiday rates apply, generally entailing double time and a half. A substitute working day must also be paid at the public holiday rate.

Determining what is ‘reasonable’ in the context of directing employees to take leave is not an exact science. Several factors come into play, including the nature of the business, the employee’s role, and their personal circumstances. Employers can refuse an employee’s request if they consider it unreasonable, and conversely, employees can also refuse an employer’s request if they believe it to be unreasonable. The impact on the workplace, business costs, efficiency, and the practicality of accommodating requests are some key considerations.

The approach to managing Christmas shut downs for Australian employees depends on various factors, including their specific award or agreement, the availability of leave, and the reasonableness of requests. By understanding these guidelines and factors, both employers and employees can navigate the holiday season smoothly, ensuring a fair and balanced approach to the Christmas shut down. If you find yourself unsure or in need of guidance regarding your specific situation, don’t hesitate to reach out to us here at Gecko Bookkeeping. Our team of experts is here to assist you and provide the support you need to make this period as stress-free as possible.

All information has been sourced from Fair Work Australia website, find all the information you need for your specific industry here!