Leave entitlements are changing for 99 awards in response to the COVID-19 crisis. Whether you’re an employer or a payroll professional, it’s important you understand these changes and operate within the new rules over the coming months.
Why the Fair Work Act was amended
The Fair Work Act was amended to ensure workers who contract COVID-19, or have been exposed to a confirmed case, are provided with enough leave to self-isolate. Amendments allow the introduction of unpaid pandemic leave and annual leave at half pay. These provisions give all workers — whether full-time, part-time or casuals — the right to take time off as directed by government guidelines while keeping their employment.
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Unpaid pandemic leave
Employees of an affected award can take up to two weeks’ unpaid pandemic leave if they’re required to self-isolate by authorities or on medical advice, or if government measures prevent them from working. The latter could apply, for instance, to employees whose work involves activities or venues that are currently prohibited due to social distancing measures.
You can refer the Fair Work Ombudsman website for a full list of affected awards.
Unlike paid personal leave and annual leave, unpaid pandemic leave is available immediately. This means employees won’t have to accrue leave over time, nor would they need to utilise other leave entitlements first.
What’s more, the full two weeks is provided to all employees irrespective of whether they work part-time, full-time on a casual basis. Unpaid pandemic leave won’t affect other leave entitlements and counts as service under the Modern Awards and the National Employment Standards.
Unpaid pandemic leave must start before 30 June 2020, but can end after this date.
Employer and employee responsibilities
It’s worth noting that employees are responsible for letting their employer know, as soon as possible, that they’re taking unpaid pandemic leave and explain their reason for doing so. They should be clear about how long they expect to be away from their duties.
An employer cannot respond by taking an adverse action or by dismissing an employee. However, the employer has the right to ask the employee for evidence to substantiate their need to take time off.
When unpaid pandemic leave won’t be available
As unpaid pandemic leave is designed to assist in situations where a worker has to perform his or her duties on the employer’s premises, if the work can be performed elsewhere — like at home — then the worker cannot receive this type of leave.
Additionally, unpaid pandemic leave is a one-off entitlement. This means an employee is only eligible for this leave once even if they’re required to self-isolate multiple times.
Annual leave at half pay
Another measure that came into effect allows employees to take annual leave at half pay, which enables them to double their time off work.
For example, if an employee takes four weeks’ of annual leave over eight weeks, then their pay over the eight-week period would be the same as their pay over a four-week period. However, only four weeks would be deducted from their annual leave balance.
You can find another example of how this might work in practice on the Fair Work website.
But bear in mind the employer must agree with the arrangement. On top of this, the agreement must be recorded in writing and be kept by the employer.
Like unpaid pandemic leave, annual leave at half pay must commence before 30 June 2020 but can finish after that date.
Finally, workplace regulations are changing to provide employers and employees more flexibility during the COVID-19 crisis. It’s crucial to check for updates regularly so you can stay compliant.
Watch our virtual event: ‘Leading through the COVID-19 crisis’
On 26 May, we held our first Sage Advice Live virtual event. Watch our video to hear from our panel on how their businesses have navigated the challenges of COVID-19, what the future business landscape will look like, and tips on how you can survive and thrive.
You'll hear from:
- Cindy Nicholson, CEO, Braintree
- Mark Chapman, Tax Communications Director, H&R Block
- Danielle Wood, Program Director, Grattan Institute
- Kerry Agiasotis, MD & EVP APAC, Sage
- Mark Jones, Chief Storyteller & CEO, Filtered Media (Host)