For businesses planning to shut down over the Christmas period, Senior Employment Relations Advisor from Employsure, Ashlea Maley, says businesses need to double-check their rights and conditions. “Employers can only have one closedown per year, any more and they need their employee’s consent. During a closedown an employer can require employees to take annual leave, even where this requires employees to take time off for which they are not fully reimbursed,” explained Maley. “The employer is required to provide employees with at least 14 days advance notice of the closedown.”
Employees that have been under contract for less than 12 months are not entitled to annual holiday pay after closedown. “In this situation, the employer must pay the employee eight percent of their gross earnings since their start of employment less any payment for annual holidays taken in advance.” In addition to the eight percent payment, there may be an agreement between the employer and employee regarding paid annual holidays. If the employer consents to the employee taking paid annual leave in advance of their entitlement, the employer should protect themselves from the cost of the employee leaving.
Out of convenience businesses should nominate a date for the closedown, so employees become entitled to annual holidays. “It is important that employers comply with the notice period, we advise this is in writing either via email or hard copy to be able to prove that notice was provided in time,” said Maley.
Businesses that are planning to stay open for the holidays should be aware of the additional requirements that employees are obligated to, such as extra pay, an extra day off or extra alternative leave. Those in the hospitality, restaurant and retail industry will most likely remain open as they will need employees to meet consumer demand and fill specific jobs. “Casuals can be used however employers should be aware of the risks of engaging casual employees.”
It is important for businesses to check the conditions relating to their rights to inform their employees on the process of the annual closedown.