COVID-19: Stand Down, Terminated or Redundancy? – Australian Workplace Laws

Stood Down but Still Employed

There seems to be confusion when it comes to whether an employee still has a job after they’ve been Stood Down.

Watching and reading the news, we’ve been informed that many thousands of jobs have been “stood down”, and most people take that as people have lost their jobs.

With the panic, confusion and heightened emotions that both Employers and Employees are experiencing, what needs to be clear is…

Legally, employees who are stood down without pay remain employed for the period of the stand down.

The fact that these employees have been Stood Down without pay, doesn’t help the notion that they have lost their jobs.

They have lost their income.

They may still be technically employed, but that is of no comfort when they are lining up at Centrelink or spending hours on the phone trying to get registered for “Newstart Allowance”.

In my last article, “COVID-19: Reduce Hours, Annual Close Down, Stand Down or Redundancy? - Australian Workplace Laws”, I stated,

“Being Stood Down is not the same as being fired. It more of a “holding pattern”… Once the Enforceable Government Directions are lifted, and if the business can begin trading again, the Employer has the responsibility to resume the contract of employment.”

According to the Fair Work Ombudsman’s “Coronavirus and Australian workplace laws” STAND DOWN page (https://coronavirus.fairwork.gov.au/#stand-down),

• If an employee is stood down, they may be able to take up other employment for the duration of the stand down.

• Employees usually need their employer's agreement first.
  

• Employees should also consider if they have other limits on the work they can do for another employer (for example, their employment contract or a workplace policy may prevent them working for a competitor).

The reality of this current situation, where the Australian Government has implemented “Enforceable Government Directions”, for what is an undetermined period of time, many of the affected businesses will not survive and may find themselves with no choice but to terminate an employee’s employment, such as providing notice of termination.

• The Fair Work Act includes requirements that employers have to meet before they can terminate an employee’s employment, such as providing notice of termination.

• An employee is also protected from being dismissed because of discrimination, a reason that is harsh, unjust or unreasonable or another protected right.
  

• Employers are prohibited from exerting undue influence or undue pressure on employees in relation to making certain agreements or arrangements.

If the Employer makes the decision to not just Stand Down employees, but to close their business, they are legally obligated to pay Redundancy Pay, if they are not classed as Small Business.

You would, however, have to give the appropriate Notice Period.

If the employee is being made Redundant and the employer is not classed as Small Business, then the following applies.

As per the Fair Work Act Volume 1, “Subdivision B – Redundancy Pay - 119 Redundancy Pay”, and if the Employer is not excluded under “Subdivision B – Redundancy Pay - 121 Exclusions from obligation to pay redundancy pay”, all statutory entitlements must be paid.

Amount of redundancy pay

(2) The amount of the redundancy pay equals the total amount payable to the employee for the redundancy pay period worked out using the following table at the employee’s base rate of pay for his or her ordinary hours of work:

This article is general advice only.

The appropriate Australian Workplace Laws must be reviewed independently.