Managing the workforce impacts of COVID-19

23 March 2020

With the increasing effect on businesses as a result of COVID-19, what can employers do to best manage workforce issues?

Working from home arrangements

Where this is practical having regard to the nature of the work the employee performs and the availability of technology/resources, employers can require employees to work from home.

If employees are going to be working from home, employers need to comply with their work health and safety duties by taking reasonable precautions to verify that an employee’s home work environment is safe.  If they have not done so already, all applicable employees should be required to undertake a safety assessment process in respect of their home work environment.

Employers should also review existing policies with respect to flexible working arrangements and consider whether they are adequate.

Utilisation of leave – by agreement or direction

Both annual leave and long service leave may be taken by agreement between an employer and employee.

Employers can direct staff to take annual leave if permitted under the terms of applicable modern awards/enterprise agreements.  Under most awards this is limited to employees who have an excessive leave accrual (usually more than 8 weeks’ in which case a direction can be given to take leave to bring it down to 6 weeks) or possibly where there is a business close down. 

In the case of employees not covered by an award or agreement, an employer may require an employee to take annual leave if the requirement would be reasonable.  Arguably, depending on the circumstances facing the employer, such a direction may be reasonable where the employee has an excessive leave accrual, where the business shuts down, or where the Government mandates that someone isolate themselves.

It is possible that employees may by agreement take annual leave in advance of being accrued, subject to the terms of applicable awards/agreements.

Under State legislation employees may be directed to take long service leave in certain circumstances.

Employers should review the terms of employment contracts, awards and enterprise agreements and also consider staff leave accruals, so they know the circumstances in which employees can be required to take leave if necessary. 

Varying hours or rosters

Many businesses may consider the need to vary, or scale down, their operations.  Hours of work can generally be reduced by agreement with individual employees.  Otherwise an employer’s ability to reduce employees’ hours of work will depend on the terms of employee contracts of employment and awards/agreements.  Employers should seek advice before implementing any changes of this nature.

Standing down employees without pay

If a business (or part of a business) closes down (including by direction of the Government) and employees cannot be usefully employed, employees may be stood down without pay.  There is no right to stand down employees if there is useful work available for employees to do which is within the terms of their contract of employment.

Managing redundancies and complying with redundancy obligations

It may be necessary for employers to make staff redundant.  The amount of redundancy pay employees are entitled to receive will depend on their period of service and any terms in their employment contract or award/agreement.

It is possible for employers to request from the Fair Work Commission a reduction in the amount of redundancy pay required to be paid if they cannot afford to pay the full amount.

Businesses with less than 15 employees are not required to pay redundancy pay under the Fair Work Act (but may be required to do so under the terms of contracts of employment or awards/ agreements).

In the event that it may become necessary to terminate the employment of employees due to a reduction in work requirements, businesses should ensure that they:

  • consider whether there are any options for redeployment within the business or associated entities;
  • undertake a proper consultation process with any employees covered by an award/agreement about the current circumstances, its potential effect on the business, the potential for redundancies and interim options available to limit or delay redundancies; and
  • comply with the notice of termination of employment and redundancy pay requirements under the Fair Work Act and any more generous contractual provisions.

Taking these steps will ensure the terminations are genuine redundancies and the employees are not eligible to bring unfair dismissal claims.

Businesses should also be mindful of not dismissing employees or taking any other adverse action against them on unlawful grounds, such as age, illness or disability (i.e. because they have or had COVID-19).

Work health and safety obligations in the current climate

All employers owe a work health and safety duty to ensure, so far as is reasonably practicable, the health and safety of employees and other people affected by work undertaken at the workplace.  This includes providing a workplace that is without risks to health and safety.

In the current environment, this duty requires businesses to (at least):

  • stay up-to-date with current advice from State and Federal health departments and share information with employees; and
  • undertake a risk assessment and consider whether work activities will or may put staff or other people in the workplace at risk, and what controls are reasonably practical to implement to manage those risks.

Appropriate controls should be in line with Government directions and emerging public health advice.

Businesses should take extra precautions in allowing visitors to enter the workplace, including independent contractors, such as asking visitors to provide information in advance about whether they have flu-like symptoms, have been in contact with anyone infected with COVID-19, or have travelled to a high-risk area.  If a visitor answers ‘yes’ to any of these questions, businesses should consider requesting that the person not come to the workplace until they can provide a medical clearance.

Managing employee absences

When are employees entitled to sick leave?

Permanent employees will be entitled to access paid sick leave (subject to the usual requirements to submit substantiating evidence, such as a medical certificate) if they contract COVID-19, or are unable to attend work because they need to care for an immediate family member or household member who has contracted COVID-19.  There is no limit on the number of days of accrued sick leave that can be taken in these circumstances.

A casual employee who contracts COVID-19 will not be able to access any paid sick leave.  A casual worker may take up to two days of unpaid carer’s leave if they need to care for an immediate family member or household member who has contracted COVID-19.

What happens if an employee needs to stay at home because their child’s school is closed?

Permanent employees will qualify for paid carer’s leave if they need to look after a child whose school has unexpectedly closed.  Casual employees may take up to two days’ unpaid carer’s leave in this situation.

Where a school’s closure is forewarned or ongoing, employees are unlikely to qualify for carer’s leave.  In that event employees may take annual leave by agreement (if permanent) or otherwise may be granted unpaid leave.

Can employees refuse to come to work?

Employees cannot refuse to work unless doing so would unreasonably expose them to a risk to their health and safety, for example, if a co-worker is known to be infected, or to have travelled to an at-risk destination without self-isolating. 

If an employee wishes to stay at home as a non-mandated precaution they will not be entitled to access paid sick leave entitlements.  The options in this circumstance are for the employee to request to work from home (assuming it is practical to do so) or take a period of leave.  Otherwise the employee may be granted unpaid leave.

What do I do if an employee is required by law to self-isolate?

Employees required to self-isolate will not qualify for paid sick leave unless they are medically unfit for work.  Employers can consider whether it is practical for the employee to work from home.  Alternatively, leave may be taken by mutual agreement.  If the employee does not have sufficient leave accrued then the employee may be granted unpaid leave.

If you would like to discuss how the unfolding situation may affect your employment arrangements, please contact Paul Dugan or Kylie Dunn.


This article provides general comments only.  It does not purport to be legal advice.  Before acting on the basis of any material contained in this article, we recommend that you seek professional advice.




Paul Dugan, Principal in our Disputes Team

Direct Telephone:  +61 8 8210 2266


Kylie Dunn, Senior Associate in our Disputes Team

Direct Telephone:  +61 8 8210 2286