One of the harsh realities of the COVID-19 pandemic is that many employees are finding themselves in a position where they have been stood down from employment. We understand that this is a daunting time for many and this article aims to provide answers to questions you may have if you find yourself in this situation.
What does it mean to be “stood down” from employment?
If you have been stood down by your employer, you have been directed by your employer to stop performing work for a specified period of time. You are still an employee during the stand down period, however your employer is not required to pay you for the period that you are stood down.
Is my employer entitled to stand me down from employment without pay as a result of COVID-19?
This depends on a number of factors, such as the reason for standing you down and whether it has complied with the Fair Work Act 2009 (“the FWA”), or the terms of any applicable employment contract or enterprise agreement.
If your employment is subject to an employment contract or enterprise agreement which contains stand down provisions, your employer is required to comply with those provisions. Otherwise, the stand down provisions in FWA will apply.
According to section 524(1)(c) of the FWA, an employer is entitled to stand down employees during a period in which the employee cannot usefully be employed because of a stoppage of work for any cause for which the employer cannot reasonably be held responsible.
Section 524(1)(c) of the FWA requires that there has actually been a stoppage of work – meaning your employer is not entitled to stand you down from employment simply due to a downturn in business.
The FWA requires that all prospects of useful employment in the business are exhausted before an employer is able to stand down an employee – meaning your employer needs to exhaust all option, such as working from home and redeployment opportunities, before standing you down.
In the context of the COVID-19 pandemic, employers may be able to stand down employees if their business has closed because of an enforceable government direction relating to non-essential services; where there is no work at all for employees to do, even from another location; or if a large proportion of the employer’s workforce is in self-quarantine meaning the remaining employees can’t be usefully employed.
What about my employment entitlements?
If you have been stood down from employment, the stand down period is recognised under the FWA as service with your employer. You will still accrue leave and other entitlements in accordance with the FWA during the stand down period. During a stand down period, public holidays qualify as authorised absence from employment and are deemed not to be unpaid stand down, meaning you are entitled to be paid for public holidays that fall within the stand down period.
What is the difference between being stood down and made redundant?
The main difference between being stood down and made redundant is that when you are stood down, you remain an employee. If your employment is made redundant, your employment is effectively terminated. If your employment is made redundant then, depending on the size of your employer’s business, you may be entitled to a redundancy payment in accordance with the FWA.
What can I do if I don’t think my employer has stood me down lawfully?
Depending on the circumstances, you may be able to make an application under section 526 of the FWA challenging your employer’s decision to stand down your employment. If the Fair Work Commission is satisfied that the stand down was unlawful, you may be able to recover unpaid wages.
As you are still an employee even after you have been stood down from employment you should tread carefully. It is prudent to seek legal assistance before making any allegations against your employer that it has stood you down unlawfully, to ensure that you do not jeopardise your relationship with your employer.
If you have any questions in relation to any of the above, please contact us.