When JobKeeper stand down directions should be used with caution

When JobKeeper stand down directions should be used with caution

A West Australian employee has recently challenged his employer’s ability to issue a temporary JobKeeper stand down direction as a contingency measure should the employer experience a downturn in business during the course of the COVID-19 pandemic.

This issue has recently come to light in relation to a West Australian broadcast media business which issued a stand-down direction to an employee, reducing his guaranteed hours by 40 per cent.  The direction was given on the basis of the risk of cancellations of broadcast events due to the pandemic.  However, despite the direction, the employee continued to be rostered on for his usual 80-hour fortnight. 

The employee challenged the employer’s ability to give such direction in the Fair Work Commission, arguing that the employer was not able to do so as a mere contingency in case normal hours could not be worked at some future time.  The employer argued that the direction was necessary as the COVID-19 situation was fluid and so there was an ongoing potential for work cancellations on short notice in the employer’s industry.

Although the FWC agreed that such cancellations were not beyond possibility, even with the best of intent and risk minimisation, it ultimately determined that the direction given in this case was overly precautionary and that a direction allowing for a cut in hours of 20% was more reasonable.  This it said, did not give the employer a green light to automatically cut the employee’s hours by 20% but, where that was thought necessary, the employer must still consider reasonable alternatives such as redeployment, training or annual leave before resorting to cutting hours.

With the increasing threat to businesses from the recent upspike in COVID-19 cases in Victoria and the associated anxiety this causes businesses and employees, this issue is likely to become more contentious in the weeks and months to come.  Employers should seek advice before issuing JobKeeper stand down directions, particularly when doing so “just in case”.

Melissa Fitzpatrick
08/07/2020

This article has been prepared by marketing at WR Law. The information provided should not be relied upon as legal advice. You should speak with Rosa Raco directly about your specific circumstances via email rraco@wrlaw.com.au or phone 03 54996131.