Are you ready for it? JobKeeper 2.0 and the changes to flexibility under the Fair Work Act

The Coronavirus Economic Response Package (JobKeeper Payments) Amendment Act 2020 (Act) received royal assent on 3 September 2020.

We have set out the key changes to the Fair Work Act 2009 (Cth) (FW Act) for employers below.

Legacy employers

  1. The changes allow “legacy employers” to issue JobKeeper enabling directions to eligible employees.
  2. Legacy employers are employers who received one or more JobKeeper payments prior to 28 September 2020, but do not qualify for JobKeeper payments after 28 September 2020.
  3. Legacy employers will need a certificate stating they have experienced a 10% decline in turnover in relevant quarters in 2020 (June 2020, September 2020 and December 2020) to have access to modified flexibility measures under the FW Act.
  4. The certificate must be issued by an eligible financial service provider, or if the employer is a small business employer, an individual who is authorised and has knowledge of the financial affairs of the employer.

Qualifying employers

  1. Employers who are eligible for JobKeeper payments after 28 September 2020 will continue to have access to the full scope of flexibilities for eligible employees under the FW Act. The flexibility is extended to 29 March 2021.
  2. We note that if employers are proposing to extend any JobKeeper-enabling directions they should be mindful of the notice (consultation) requirements.

JobKeeper enabling stand down directions

  1. Qualifying employers can give these directions to eligible employees.
  2. Legacy employers cannot issue JobKeeper enabling stand down directions to:
    1. reduce an employee’s hours of work below 60% of the employee’s ordinary hours of work as at 1 March 2020; or
    2. require an employee to work less than two consecutive hours in a day.

Unreasonable directions

  1. In considering whether a direction is unreasonable, the amendments have expanded this consideration to include if the directions have an unfair effect on some employees in a particular category when compared with other employees in that category who are also subject to those directions.

Duties and location of work

  1. Qualifying employers and legacy employers can give these directions to eligible employees.

Days of work

  1. Qualifying employers and legacy employers can give these directions to eligible employees.
  2. For Legacy employers, the agreement must not have the effect of requiring the employee to work less than two hours in a day.

Consultation

  1. For legacy employers, a jobkeeper enabling direction given by an employer to an employee in relation to stand down, duties or location of work does not apply to the employee unless:
    • the employer gave the employee written notice of the employer’s intention to give the direction; and
    • the employer did so:
      • at least 7 days before the direction was given; or
      • if the employee genuinely agreed to a lesser notice period—during that lesser notice period.
  1. For legacy employers, an employee may appoint a representative for the purposes of consultation.
  2. For the purposes of the consultation, legacy employers must:
    • provide to the employee or the employee’s representative (if any) information about the proposed direction, which may, for example, include any of the following:
      • information about the nature of the direction;
      • information about when the direction is to take effect;
      • information about the expected effects of the direction on the employee; and
    • invite the employee or the employee’s representative (if any) to give their views about the impact of the proposed direction on the employee (for example, any impact in relation to the employee’s family or caring responsibilities).
  1. The legacy employer is not required to disclose confidential or commercially sensitive information to the employee.
  2. The employer must give prompt and genuine consideration to any views given by the employee or the employee’s representative (if any) and do so within the 7‑day period ending when the direction is given.
  3. The legacy employer must keep a written record of the consultation.

Taking paid annual leave

  1. The flexibility to make an agreement in relation to the employee taking annual leave, including at half pay ceases on 28 September 2020.

Penalties

  1. If an employer knows or was reckless as to whether, it does not satisfy the 10% decline in turnover test and issues a JobKeeper-enabling direction, penalties of up to $13,200 for individuals and $66,600 for body corporates may be imposed.
  2. Penalties can also apply if employees are not notified that a JobKeeper-enabling direction or agreement is continuing or will terminate during a quarter.

If you would like to discuss this further and the implications for your business please contact our Employment + Workplace Relations Partner, Erin Lynch.

Erin Lynch, Partner
M +61 477 330 202
E erin.lynch@vincentyoung.com.au

The contents of this publication do not constitute legal advice and are for general information purposes only.  You should seek legal advice regarding your particular circumstances.