This article was co-authored by Beth Kitchener, Michael Nightingale and Ying Yi Lim.

With the Christmas and New Year period soon upon us, it is timely to revisit the changes to the shutdown rules of 78 Modern Awards (Awards) (listed below) which came into operation earlier this year.

These changes impact the ability of employers to implement temporary shutdown periods (including end of year holiday shutdown or office closure periods) and require employees covered by one of the Awards to take leave (and in particular unpaid leave) during the shutdown period.

Summary of Award Shutdown provisions

Under the Award shutdown provisions:

  • Notice of shutdown – Employers who wish to shut down all or part of their operation for a particular period, and require Award-covered employees to take annual leave during that period, must give the Award-covered employees 28 days’ written notice of the temporary shutdown period.

    The required notice period may be reduced if agreed between the employer and a majority of the relevant employees.

    If an employee is engaged after the notice has been given, the employee must be given written notice of the shutdown period as soon as reasonably practicable after they are engaged.
  • Direction to take paid leave during the temporary shutdown period must be written and reasonable – Employers can only direct employees to take a period of paid annual leave to which the employee has accrued an entitlement.

    The direction must be in writing (and would usually be provided with the Notice of shutdown), and must also be reasonable.

    Reasonableness will be assessed in all of the circumstances, including the needs of both the employee and the employer’s business; the custom and practice within the business; and the timing of the direction to take leave.
  • Employees cannot be directed to take unpaid leave or leave in advance –Employers can no longer direct an Award-covered employee to take unpaid leave during any part of a shutdown period which the employee does not have sufficient annual leave accrued to cover.

    An employer and an employee with insufficient paid leave accrued can agree in writing that the employee will take paid annual leave in advance of it being accrued, or take unpaid leave, to cover that part of the shutdown period.

    An employee cannot be required to enter into an agreement to take paid leave in advance or unpaid leave to cover all or part of a shutdown period. If such an employee does not agree to leave in advance or unpaid leave, the employer will need to consider alternative arrangements.

What does this mean for employers?

If you are an employer with employees to whom any of the 78 Awards below apply, consider taking the following steps:

  1. Identify employees affected by these changes
  2. Update internal communications or policies regarding temporary shutdown periods or office closures in line with the new Award requirements
  3. Ensure at least 28 days’ notice is provided to your employees as to an intended temporary shutdown and any direction to take annual leave
  4. Update HR managers, business partners and team leaders on how to provide a valid direction to take paid annual leave to employees with sufficient leave to do so
  5. Identify employees who will not have sufficient annual leave accrued to cover all or part of the shutdown period, and seek to implement appropriate arrangements with them

    Such employees can generally be directed to take the annual leave that they do have accrued, but cannot be directed to take annual leave in advance or unpaid leave to cover the balance of the shutdown period

    The employer can seek the employee’s agreement to take annual leave in advance or unpaid leave to cover the balance of the shutdown period

    If the employee does not agree to take annual leave in advance or unpaid leave, then the employer may wish to require the employee to work as part of a skeleton staff during the part of the shutdown period they are not on annual leave, in preference to paying the employee for not working during that period.

Our Employment & Labour Team can work with you to develop solutions best-suited for your specific workforce, industry and business needs. 

Please contact us if we can be of assistance.  

List of 78 Modern Awards affected

  1. Aboriginal and Torres Strait Islander Health Workers and Practitioners and Aboriginal Community Controlled Health Services Award 2020 (clause 22.3)
  2. Aircraft Cabin Crew Award 2020 (clause 19.4)
  3. Airline Operations – Ground Staff Award 2020 (clause 22.6)
  4. Alpine Resorts Award 2020 (clause 25.3)
  5. Aluminium Industry Award 2020 (clause 22.4)
  6. Ambulance and Patient Transport Industry Award 2020 (clause 22.7)
  7. Animal Care and Veterinary Services Award 2020 (clause 22.5)
  8. Aquaculture Industry Award 2020 (clause 22.9)
  9. Asphalt Industry Award 2020 (clause 21.8)
  10. Banking, Finance and Insurance Award 2020 (clause 22.5)
  11. Black Coal Mining Industry Award 2020 (clause 24.9)
  12. Broadcasting and Recorded Entertainment Award 2020 (clause 18.6)
  13. Building and Construction General On-site Award 2020 (clause 31.3)
  14. Business Equipment Award 2020 (clause 23.5)
  15. Car Parking Award 2020 (clause 24.6)
  16. Cemetery Industry Award 2020 (clause 19.3)
  17. Cement, Lime and Quarrying Award 2020 (clause 22.8)
  18. Cleaning Services Award 2020 (clause 21.4)
  19. Clerks—Private Sector Award 2020 (clause 32.5)
  20. Coal Export Terminals Award 2020 (clause 20.7)
  21. Commercial Sales Award 2020 (clause 20.6)
  22. Concrete Products Award 2020 (clause 22.6)
  23. Contract Call Centres Award 2020 (clause 22.10)
  24. Educational Services (Post-Secondary Education) Award 2020 (clause 22.5)
  25. Electrical Power Industry Award 2020 (clause 21.8)
  26. Electrical, Electronic and Communications Contracting Award 2020 (clause 21.5)
  27. Fitness Industry Award 2020 (clause 21.3)
  28. Food, Beverage and Tobacco Manufacturing Award 2020 (clause 25.11)
  29. Gardening and Landscaping Services Award 2020 (clause 20.9)
  30. Gas Industry Award 2020 (clause 20.7)
  31. General Retail Industry Award 2020 (clause 28.4)
  32. Graphic Arts, Printing and Publishing Award 2020 (clause 31.12)
  33. Hair and Beauty Industry Award 2020 (clause 24.3)
  34. Health Professionals and Support Services Award 2020 (clause 26.5)
  35. Higher Education Industry—General Staff—Award 2020 (clause 24.4)
  36. Horse and Greyhound Training Award 2020 (clause 18.6)
  37. Hospitality Industry (General) Award 2020 (clause 30.4)
  38. Hydrocarbons Industry (Upstream) Award 2020 (clause 25.7)
  39. Joinery and Building Trades Award 2020 (clause 27.9)
  40. Journalists Published Media Award 2020 (clause 20.8)
  41. Legal Services Award 2020 (clause 22.7)
  42. Local Government Industry Award 2020 (clause 23.5)
  43. Manufacturing and Associated Industries and Occupations Award 2020 (clause 34.7)
  44. Meat Industry Award 2020 (clause 25.8)
  45. Mining Industry Award 2020 (clause 22.7)
  46. Mobile Crane Hiring Award 2020 (clause 24.6)
  47. Miscellaneous Award 2020 (clause 21.4)
  48. Nursery Award 2020 (clause 22.12)
  49. Nurses Award 2020 (clause 22.7)
  50. Oil Refining and Manufacturing Award 2020 (clause 24.6)
  51. Pest Control Industry Award 2020 (clause 23.9)
  52. Pharmaceutical Industry Award 2020 (clause 21.5)
  53. Plumbing and Fire Sprinklers Award 2020 (clause 24.4)
  54. Poultry Processing Award 2020 (clause 21.5)
  55. Premixed Concrete Award 2020 (clause 22.8)
  56. Professional Employees Award 2020 (clause 18.4)
  57. Racing Clubs Events Award 2020 (clause 23.5)
  58. Racing Industry Ground Maintenance Award 2020 (clause 21.5)
  59. Real Estate Industry Award 2020 (clause 20.5(a))
  60. Registered and Licensed Clubs Award 2020 (clause 25.4)
  61. Restaurant Industry Award 2020 (clause 25.4)
  62. Road Transport (Long Distance Operations) Award 2020 (clause 20.4)
  63. Road Transport and Distribution Award 2020 (clause 24.9)
  64. Salt Industry Award 2020 (clause 23.10)
  65. Seafood Processing Award 2020 (clause 21.11)
  66. Security Services Industry Award 2020 (clause 21.4)
  67. Silviculture Award 2020 (clause 22.5)
  68. Storage Services and Wholesale Award 2020 (clause 24.5)
  69. Sugar Industry Award 2020 (clause 31.5)
  70. Supported Employment Services Award 2020 (clause 32.3)
  71. Surveying Award 2020 (clause 22.7)
  72. Telecommunications Services Award 2020 (clause 22.9)
  73. Textile, Clothing, Footwear and Associated Industries Award 2020 (clause 32.6)
  74. Timber Industry Award 2020 (clause 28.10)
  75. Vehicle Repair, Services and Retail Award 2020 (clause 29.6)
  76. Water Industry Award 2020 (clause 22.4)
  77. Wine Industry Award 2020 (clause 24.9)
  78. Wool Storage, Sampling and Testing Award 2020 (clause 23.5)

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