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COVID-19 Blog

Modern Award Variations in Response to COVID-19

Posted by Shanni Zoeller on 6 Apr 2020

Assisted by Kristina Tato

The COVID-19 pandemic has had, and will continue to have, a significant adverse impact on businesses, large and small. Such impacts are equally felt by employees, with many of them having to take pay cuts, work reduced hours or even worse, be made redundant.  Over the last week or so, employers and employees alike have had to adapt to a new world almost overnight, and try to navigate through uncertainty that is changing by the minute. 

The Fair Work Commission (FWC) has been extremely responsive in its approach to dealing with COVID-19, by varying some Modern Awards. Last Saturday, the FWC varied the Clerks – Private Sector Award 2010 (Clerks Award) which introduced greater flexibility for both employers and employees to work from home, reduce hours of work on a temporary basis and lessen restrictions around directions to take annual leave.

The FWC has now formed a provisional view that 103 Modern Awards will be varied to include an entitlement to unpaid ‘pandemic leave’ and the flexibility to take annual leave at half pay. However, the Hospitality Industry (General) Award 2010, the Clerks Award and the Restaurant Industry Award 2010 take priority.


What will the variations look like?

A.    Unpaid Pandemic Leave 

Employees can take up to two weeks of unpaid leave if he/she is required, by the government or medical authorities, to self-isolate or is prevented from working by measures taken by the government or medical authority in response to COVID-19. 

Notice and evidence requirements will still apply.

Any pandemic leave taken counts towards continuous service.

It is clear from the above that such leave is intended on closing the gap that currently exists.

Many employees who have had to self-isolate in response to government mandates have had to forgo pay because:

•    of their employment status (for example, casual employees); 
•    they have had to use their paid annual leave entitlement (as they don’t strictly fall within the definition of personal illness or injury which gives rise to personal leave); 
•    the employee may have exhausted their personal leave entitlements; or,
•    they do not have any paid leave entitlements and have had to take leave without pay. 

It is proposed that the pandemic leave will be available to employees upfront regardless of their employment status, and will be available up until 30 June 2020, unless otherwise extended. Employees will not be required to use up other paid leave entitlement before accessing unpaid pandemic leave.

B.    Annual Leave at half pay

The FWC, in its provisional view, has attempted to afford employers and employees more flexibility around taking annual leave. What the variations will mean is that employees will be able to take twice as much annual leave on half pay. In a practical sense, the employee can take two weeks of annual leave, but only be paid one weeks’ worth of annual leave. This would include annual leave loading (if applicable under the Award). One week of annual leave will be deducted from the employees’ accrual.

An agreement to take annual leave at half pay must be captured in writing and be kept as an employee record.

It is important to note that unpaid pandemic leave and annual leave at half pay constitute a workplace right under s 341(1)(a) of the Fair Work Act 2009 (Cth).

Long Service Leave in NSW

The NSW State Government has recently amended the Long Service Leave Act 1955 (LSL Act) which aims to give employers and employees more flexibility to access the leave during the COVID-19 pandemic.

These changes now allow employees to take LSL in shorter block periods, such as one day per week and without the employer being required to give them one month’s notice to take the leave; it is now by mutual agreement in writing.

Please note that this will only apply for a six month period from 25 March 2020, after which, it will cease to operate unless is it extended.

What can be seen is that everyone is doing their part to afford employers and employees as much flexibility as possible to ride out this challenging, difficult and unpredictable time. Fingers cross that the COVID-19 pandemic is well and truly under control before the expiry of the six-month sunset clause.

If you have any questions, please do not hesitate to contact Coleman Greig’s Employment Law Team.