Christmas Shutdowns

It’s November and Christmas is nipping at our toes so it’s time to start planning for the office Christmas shutdown.

Christmas is the part of the year when staff go on holiday and spend time with their family and friends. It’s also the time of the year when managers get asked a lot of questions by their staff about the Christmas period. Most of these questions relate to leave and holiday entitlements.

It can be a minefield for small businesses; to help you out we’ve answered some of the most common questions so that you’re prepared and ready to tackle the Christmas and New Year Period confidently.

What is a shutdown?

A shutdown is when a business temporarily closes during slow periods of the year, such as Christmas and New Year.

When is the Christmas shutdown?

Typically, businesses that shut down for the Christmas-New Year period do so from Christmas Eve or the Friday before if Christmas Eve falls on a weekend and re-open around the first working day after the New Year Day Public Holiday. Some businesses do opt to close for a longer period. This is an operational decision best made by each business.

Whilst most businesses can choose whether or not they remain open during the Christmas-New Year period they must close on Christmas Day because it is a restricted trading period.

In Queensland, according to The Holidays Act 1983, an extra public holiday will be added when Christmas Day falls on a weekend. The same applies to Boxing Day or New Year’s Day. Boxing Day this year falls on a Monday so the extra public holiday for Christmas Day will be on Tuesday the 27th of December. New Year’s Day also falls on a Sunday so Monday the 2nd of January becomes a public holiday.

New South Wales, Victoria, and the Northern Territory observe the same public holidays as Queensland over the Christmas shutdown period.

What are my obligations?

If your business has a registered enterprise agreement in place, you need to check the agreement to determine if there are any obligations contained within concerning the Christmas shutdown and whether you can direct your employees to take paid annual leave over the shutdown or whether you have different obligations concerning payment of wages over this period.

Likewise, if your employees are employed under the conditions of a modern Award, you need to check the Award to determine if you can direct your employees to take paid annual leave during the Christmas shutdown.

Where a direction to take annual leave is permitted, you are required to provide sufficient notice of this requirement. A good rule of thumb is to send out communications to your staff by no later than September to advise them of the proposed shutdown dates and their options for taking leave over this period.

What if my employees are not covered by an Award or a registered agreement?

If your employees are not covered by an Award or registered agreement, then the Fair Work Act allows employers to require employees to take annual leave during the Christmas shutdown period as long as the request is reasonable. Whether or not a request is reasonable will be assessed on the needs of the business, any previously agreed arrangements, the timing of the request, whether the notice period is reasonable and the nature of the business, i.e., is it reasonable that the business shuts down over the Christmas period?

Note that you are still required to provide reasonable and sufficient notice of the requirement to take leave over the shutdown.

Can I ask my employees to work on a public holiday?

You are permitted to ask your employees to work on a public holiday if the request is reasonable. Some things which may make a request unreasonable include whether or not the employee is entitled to overtime and penalties, whether the employee has family/caring responsibilities, whether the work would present a risk to the employee’s health and safety, whether the business’ usual operations would make it unlikely that an employee needs to work on a public holiday.

What do I have to pay my employees for working on a public holiday?

Many Awards provide employees with penalty rates for working on a public holiday and in some instances, employees may request to substitute an alternative day off for working on a public holiday provided this has been agreed in writing between the employer and the employee.

However, this does not remove the obligation to pay the employee the public holiday penalty rates that they are entitled to.

Can my employee refuse to work on a public holiday?

Yes. An employee has a right to refuse work on a public holiday. Like employers, employees must not unreasonably refuse a request to work on a public holiday. Some things which make a refusal reasonable include the nature of the work, the employee’s personal circumstances, and how much notice they were given.

Can I terminate an employee’s employment if they refuse to work a public holiday?

Employees cannot summarily dismiss an employee for refusing a request to work on a public holiday.  The reasons for the refusal need to be taken into consideration and as with any termination process unless serious misconduct was involved, then the employee is entitled to procedural fairness before their employment is terminated.

If your employee refuses to work on a public holiday you should refer to the Fair Work Act 2009 or an HR Specialist before you take any further action.

Key takeaways

  • In most cases, employers are permitted to direct employees to take leave over a Christmas shutdown period.
  • Employers must always exercise reasonableness when implementing a Christmas shutdown and requiring employees to take leave
  • Sufficient notice is required to be given to employees if you require them to take leave
  • Employers may ask employees to work on a public holiday however the employee may refuse the request

If you have any questions about your rights and obligations during the Christmas shutdown period get in touch at megan@meganmacallister.com.au or via the Contact Form.

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