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COVID-19 Business Continuity – 6th May

I’m here with the COVID-19 business continuity update for Wednesday 6th May.

In today’s update:
1. JobKeeper enabled directions – a flow chart
2. JobKeeper enabled directions and Long Service Leave

1. JobKeeper enabled directions – a flow chart

Now that many of you are in the JobKeeper scheme, you will be able to confidently use the JobKeeper Enabled Directions allowed under the Fair Work Act.

I’ve spoken about the provisions before so here’s a quick recap:

  • Fair Work Act has implemented temporary changes to provide employers with greater flexibility during COVID-19.
  • The provisions for JobKeeper enabling directions allow employers to:
    • Change employee work hours, days, times, duties and locations
    • Request employees to take annual leave in certain circumstances.
  • There are differences between what changes an employer can direct and what they can only request (i.e. cannot direct).

To help you understand how to use the JobKeeper enabled provisions, there’s a flow chart you can reference:
JobKeeper Fair Work Act flow chart

To read all the rules, visit: https://treasury.gov.au/sites/default/files/2020-04/Fact_sheet-Changes_to_Fair_Work_Act.pdf

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2. JobKeeper enabled directions and Long Service Leave

Those of you hit the hardest by COVID-19 have already had to stand down team members. In many instances you and your individual team members agreed to top up their wages by allowing them to take annual leave. This has the dual benefit of reducing the annual leave entitlements that you’ll have to pay out at some point and also enabling your team members to remain on their full pay. (Remember, under the JobKeeper legislation your employees must retain at least 2 weeks of annual leave).

But what do you do if your team members have exhausted all of their annual leave or didn’t have any available?

Long Service Leave (LSL) is not included in the JobKeeper enabled provisions, however under the existing rules for LSL you can direct an employee to take their LSL but you must give them at least 12 weeks’ written notice.

On the other hand, if the request for LSL is initiated by your employee then they can take the leave as soon as you agree.

So, once their annual leave is exhausted, you and your team member have the option of switching to LSL to top up their wage.

Be aware, you need to carefully document what you and your employee agree to, to avoid issues in the future. Speak to your coach and they’ll be able to direct you to the appropriate assistance.

As LSL is governed by the state governments, be aware of the following laws for Victorian employees:

  • You and your employee can agree that they can take half leave at double pay. While this doesn’t reduce your wage costs now, it does reduce your leave liability in the longer term;
  • LSL can be taken for as little as one day at a time. This could be useful if you have reduced an employee’s work days. In this instance, after they have used up their annual leave (retaining 2 weeks as per the JobKeeper rules) you and your employee could agree that they take one day a week of long service leave. Again, this has longer term benefits rather than an immediate cash flow benefit.

Here are the rules for LSL:

Long service leave overview

See the rules on the Victorian government website here:
https://www.business.vic.gov.au/hiring-and-managing-staff/long-service-leave-victoria/long-service-leave-an-overview

For businesses in the trades with employees who are covered by CoINVEST, these Long Service Leave provisions do not apply. Instead, workers submit a claim for payment for long service leave directly through CoINVEST.

For more information about CoINVEST, visit: https://www.coinvest.com.au/workers/claiming-long-service-leave

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Finally, the government announced today that 4.7 million Australian employees are currently eligible for JobKeeper. This is short of their budgetary estimate of 6 million.

 

Ash

 

Ashley Thomson B.Eng(Hons), Grad. Dip. Mgmt, MEI
Managing Director
Tenfold Business Coaching

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