Christmas is coming and businesses need to start planning their end-of-year holiday season, and how they will operate through this period – it’s a delicate balance between operational needs and employee welfare in agribusiness.
Does your business get busier and need employees to work more hours or through Public Holidays? Or, does your business shut down or work with a ‘skeleton staff’ over Christmas/New Years?
Our extensive experience in HR allows us to guide you through the complexities of modern award provisions with the confidence of Santa, 4 milks into Christmas Eve!
Required Annual Leave During a Shutdown
If your business is shutting down for the holiday season, you may be able to direct your employees to take annual leave. This depends on the award or any relevant registered agreement.
In May 2023, a game-changing Model Clause was introduced to most awards, giving employers more flexibility in managing annual leave during temporary shutdowns. Here’s what you need to know about the conditions placed on this change:
- Provide your hardworking team with at least 28 days’ written notice of the shutdown period. Remember, in the fast-paced world of agriculture and production, time flies – so plan ahead!
- Ensure your employees have enough annual leave to cover the shutdown. This is crucial for maintaining a smooth operation and keeping your valuable workforce happy.
- Your direction to take annual leave must be fair and considerate. We’ll help you strike the right balance.
It’s important to remember though that every award and agreement is different, so you should check to make sure before you give employees any directions to use annual leave. You can check which award may apply to your staff here.
If your staff are employed award-free, you can only direct them to take annual leave if the direction is reasonable.
What Makes a Shutdown “Reasonable”?
In our years of supporting Australia’s vital agriculture and production sectors, we’ve learned that reasonableness isn’t one-size-fits-all. The National Employment Standards (NES) require all directives to take annual leave to be reasonable, regardless of award coverage.
When determining if a shutdown is reasonable, consider these factors from the Fair Work Bill 2008:
- Balance business needs with employee interests
- Honour existing agreements between you and your team
- Align with your industry’s standard practices
- Consider the timing’s impact on your employees’ commitments
- Provide adequate notice
Employees Without Enough Annual Leave to Cover a Shutdown
In an ideal world, every staff member would have ample leave for Christmas shutdowns. However, we know that’s not always the case in the bustling world of agriculture. New hires or unexpected leave calculations can leave you in a bind.
When your staff are faced with insufficient annual leave, don’t let it derail your operations. Here are some strategies we’ve seen work well for our clients:
- Negotiate unpaid leave agreements
- Maintain pay during shutdowns (even without work)
- Keep essential staff on-site during closures
But here’s where our expertise really comes into play. If an employee’s leave bank is running low, we’ve helped many clients find creative solutions using:
- Overtime compensation as time off
- Accrued rostered days off (always in line with industry awards)
- Advanced annual leave options
Remember, though, that employee consent is key. Many awards and agreements require it, and we’ve found that open communication leads to the best outcomes.
Awards and Agreements Without Shutdown Rules
If your staff are employed under an award that doesn’t have rules allowing shut down directions then you can’t direct them to take annual leave.
However, you can come to an independent agreement with your staff to take annual leave, or unpaid leave, over the holiday season.
Working Through a Shut Down or Public Holiday
If one of your employees continues working when your business is shut down, they should receive their normal pay. If there is a public holiday during the shutdown, employees should still be given the day off without loss of pay, or they should be paid the public holiday rates under their award or agreement if they work.
You can ask your employees to work overtime or on a public holiday if it’s reasonable. However, they can decline the request if they have a valid reason.
If you are requesting that an employee work on a public holiday, you need to consider all relevant circumstances. Whether a request is reasonable depends on several things, including:
- the needs of the business
- the role and responsibility of the employee
- the employee’s personal commitments, like family or caring arrangements
- how much notice the employee gets about the extra hours
- what the employee’s contract says.
If an employee works overtime or on a public holiday, their award or registered agreement may give them additional entitlements such as:
- penalty rates
- a different day off
- extra annual leave.
Looking to communicate formally with your staff about your festive shutdown? Download our Letter to Employee Advising Shut Down template.