Christmas Shutdown
It is hard to believe that Christmas is just around the corner, bringing to mind Christmas shutdowns. After the COVID lockdowns, the freedom to be able to get out can only be likened to a positive experience.
For many businesses, there is the expectation that they will experience their busiest period of the year in the lead up to the festive season. On the other hand, some businesses will take the opportunity to close down for a few days either prior to or after Christmas. Either way, you need to think about how this will affect your employees.
So, if you’d like to close down your business over the break, here are some of the most important considerations you need to take into account.
Review the Provisions in the Applicable Modern Award
If your workplace is considering a Christmas shutdown, you are in effect instructing your employees to take annual leave during the closure. This is more commonly referred to as compulsory closure.
The most important step is to check the conditions relating to your right to send employees on an annual closure. This will depend on the Modern Awards or Enterprise Bargain Agreements that apply for your business. These will outline the minimum required notice period to notify your employees.
Most Awards will contain terms which allow employers to send employees on an annual closure. This is usually subject to an employer giving affected employees at least four weeks’ notice. In saying that some Awards or Enterprise Bargain Agreements may require a greater period of notice.
For example, the Building and Construction General On-site Award requires an employer to give at least two month’s notice of a closure.
In another example, under the Security Services Industry Award, an employer must provide at least one months’ notice in writing before the leave needs to be taken.
This is why it is really important that you check the applicable Award to you.
Not all industries allow you to direct employees to take Annual Leave
If the Award or Enterprise Bargain Agreement remains silent on closures or does not give directions to take leave, you can’t force employees to use their leave. Instead, you can negotiate with them to take paid or unpaid leave but if they don’t agree, you can’t force them, but you will have to pay them their ordinary hourly rate for the time they would have worked while the business is closed.
This leads to a bigger issue….
Christmas shutdown: Understanding Annual Leave
What if your employees have no annual leave left, their balance is zero? Or what if they have some annual leave left, but not enough to cover the entire closure? What if they’re not entitled to paid annual leave?
The answers to these questions usually lies in the Award or the Enterprise Bargain Agreement. This is something that you should be across before you communicate the closure to your employees. Not only will your employees probably ask you some of these questions, but if your employees are entitled to paid annual leave, it would be wise to know exactly how much you need to pay! This also involves factoring in leave loading if applicable.
As a general rule (depending on the Award or Enterprise Bargain Agreement) are:
- You may still be able to direct them to take unpaid annual leave
- You may still be able to direct them to take the time off, and pay them for the entitlements that they have. You may direct them to take unpaid time off for the remainder.
- You may still be able to direct them to take paid annual leave. If they are casuals, give them notice that they will not receive any shifts for the length of your closure.
- You may also allow your employees to go into paid negative leave which they can then accrue when they get back to work. However, this is up to you as an employer. It is recommended that this only be exercised in extreme circumstances.
Do you need employees during the Christmas shutdown period?
You may need some employees during the closure to continue to work in the background in a smaller capacity. Emails to answer, phone queries and to troubleshoot or provide aftercare service. However, this might be at a reduced capacity from both a headcount perspective and a hours of operation perspective.
For example, at Now Actually, we always ensure that there are always Advisors on call during the Christmas and New Year period. This ensures that our clients are supported during this time. After all, HR never sleeps, and we know the importance of timely communication!
If you need skeleton employees to still attend work, you can request that they do so. Again, this comes with a warning. You may have extra obligations towards employees working over this period as they may be entitled to extra pay or an extra day off, particularly if they work on public holidays.
Communicate, communicate, communicate!
Even if the applicable Award or Enterprise Bargaining Agreement obliges you to give your employees notice of a Christmas closure, we recommend that you still notify your employees well in advance.
Let employees know when you’re closing the workplace and when you’re reopening. This also involves:
- letting employees know which roles you require to work during the closure period
- letting employees know for what period of time these roles will work for
For the employees who you require to continue working, Now Actually recommends that you clearly communicate to the affected employees or their managers what your intentions are and how it will work logistically. Communication is key to success. The earlier the better.
Christmas shutdown for Non Award Employees
Is your business not governed by an Award or Enterprise Bargain agreement? It is still recommended that you follow the steps above when it comes to Christmas shutdowns.
Still unsure about what direction to take during Christmas shutdown period?
If you’d like some assistance in how you communicate to your Employees or need to formulate a strategy? Now Actually can help!
Drop us an email at contact@nowactually.com.au or
