Home JobKeeper-enabling stand down directions can’t be used to underpay employees for hours worked

UpdatesJuly 09, 2020

JobKeeper-enabling stand down directions can’t be used to underpay employees for hours worked

Under the new JobKeeper amendments to the Fair Work Act, employers are able to issue JobKeeper-enabling stand down directions to JobKeeper-eligible employees to work a reduced number of hours, including a reduction to zero.

3 mins read

Under the new JobKeeper amendments to the Fair Work Act, employers are able to issue JobKeeper-enabling stand down directions to JobKeeper-eligible employees to work a reduced number of hours, including a reduction to zero.

Where there is a dispute between an employer and an employee about such a direction, the Fair Work Commission (FWC) can exercise its powers to settle the dispute by conciliation or changing the direction to make it more reasonable.

In Allan Jones v Live Events Australia (2020), an employee asked the FWC to exercise its powers in relation to a JobKeeper-enabling stand down issued by his employer to reduce his paid working hours by 40%, i.e. from 80 to 48 per fortnight. The employer originally asked all employees to agree to the 40% reduction. When the applicant employee refused, because he was still being required to work about 80 hours per fortnight, the employer issued the direction. He was the only employee who received the direction.

The employee argued the direction was unauthorised – as he could usefully be employed for his normal days and hours of work – and was unreasonable – as there was no material disruption to his role, or to racing events in Western Australia.

The employer argued the direction was necessary should sporting events be canceled at short notice, and observed that the employee’s role had in fact been disrupted, as regular overtime was scaled back. Additionally, the direction was fair to employees collectively – reductions to working hours avoided the need for redundancies.

The employer contracts with Australian and New Zealand networks to broadcast live events, including sports and horse racing. The applicant was made a full-time broadcast engineer whose role involved travelling to events with broadcast crew and technicians to secure feed of an event, which is then sold to contracted networks. Predominantly, the employee worked at horse racing events in Western Australia.

The FWC recognised the adverse impact of the pandemic on the employer’s business and accepted it was reasonable for the employer to make a direction reducing working hours. The employer had complied with the requisite notice and consultation requirements.

However, the FWC observed the employer had “overplayed its hand” because the reduction in hours was disproportionate to either the employee’s actual or prospective rostered hours of work. Employees like him were being expected to continue working 80 hours per fortnight to perform productive work. It wasn’t reasonable for the employer issue the direction simply to retain the flexibility to reduce hours of work should it become necessary.

When the employer issued the direction to the applicant employee, it had in fact increased the working hours of other staff. These factors supported a finding that the direction was unreasonable.

The FWC substituted the employer’s direction so the employee’s minimum hours of work not be less than 64 per fortnight. At the same time it warned the employer that, given there appeared to be enough productive work for the employee to work 80 hours per fortnight, the new minimum wasn’t a license to reduce his paid working hours to that level unless there was an objective or fair basis for doing so. The FWC stated the employer should consider other options before reducing hours and pay, such as redeployment, training or development options, or taking annual leave.

Copied