Unpaid Trust Distributions: ATO's Rulings vs. Recent AAT Decision and What It Means for 2023
It has long been the ATO’s practice to treat a trust’s unpaid present entitlements (“UPE”) to a company as a loan for th...
The Federal Government has already directed restaurants, cafes and pubs to shut down some of their services to slow the spread of the Coronavirus.
Employees have lost their jobs. Some employees are on stand down.
The government is providing income support payments (Jobseeker and the Coronavirus supplement) for people who have lost their jobs and who are on stand down from their employment during these tough times.
The focus of this Coronavirus update is to answer some of your questions about directing your staff to stand down ‘without pay’. It will also provide ways you can support your staff through these tough times.
Under the Fair Work Act (section 524), an employer can direct employees to stand down ‘without pay’ if the employee(s) cannot be ‘usefully employed’.
The Coronavirus Pandemic is the example. The Government has directed:
The shut down of businesses is not your decision. It’s an enforceable government order that has been issued. This is why you may stand down your employee(s), if they cannot be ‘usefully employed’.
Employees on stand down without pay remain employed by you. As such, your employees while on stand down, will continue to accrue leave entitlements (personal/carer’s, annual and long service leave).
So long as the Coronavirus pandemic continues, there is no time limit. When the Coronavirus is behind us, it is the government’s expectation that your employees will return to their job in your workplace.
Check your relevant awards or enterprise agreement for any provisions about directing employees to stand down. For example, is there a requirement to consult with and notify your employees before directing them to stand down?
Although employers are not required to pay their employees during a period of stand down, you may consider other options before standing your employees down without pay.
Meet with each employee to consider all options before directing the employee to stand down. You may agree to alternative arrangements with the employee before they are on stand down without pay. For example:
Talk with your employees and provide them with the information they need about the government’s Jobseeker and Coronavirus supplement. The Australian Government’s Fact Sheets on income support for individuals and early access to superannuation are good guidelines. They are easy to read and to understand. You can access these documents and other information from the links below.
Australia Government – Economic Response to the Coronavirus - Income support for individuals and households and early access to superannuation https://treasury.gov.au/coronavirus/households
Ulton - Stimulus relief package and what this could mean for you https://www.ulton.net/blog/stimulus-relief-package-and-what-this-could-mean-for-you
Fair Work Ombudsman website – Coronavirus and Australia workplace laws https://www.fairwork.gov.au/about-us/news-and-media-releases/website-news/coronavirus-and-australian-workplace-laws
Batch Mewing Lawyers - Employer’s Quick Guide to Coronavirus in the Workplace https://batchmewing.com.au/employers-quick-guide-to-coronavirus-in-the-workplace/
Employers may terminate an employee during a period of stand down if the employee’s position is redundant. You must follow the redundancy process. Consult with the employee, provide a valid reason as to why the position is no longer required, give the employee notice and pay the employee a redundancy payment (if applicable).
Employers may terminate an employee during probation (qualifying period - 6 months or 12 months for small business equal to or less than 15 employees). Technically, the position is redundant due to decrease in demand for services/sales/products due to the Coronavirus. No redundancy payment is required.
An employer must give the employee 1 (one) week’s notice or pay the employee
1 (one) week’s pay in lieu of notice and pay the employee their accrued annual leave entitlements as a minimum.
If you require assistance with standing down your employee(s), contact our HR Consultant, Christine Guy direct on (07) 4154 0413 or mobile 0407 588 194 or email cguy@ulton.net
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