COVID-19 changes to 103 modern awards and potential further changes ahead

Image > COVID-19 changes to 103 modern awards and potential further changes ahead

A Full Bench of the Fair Work Commission yesterday varied 103 modern awards to include a new "Schedule X - Additional measures during the COVID-19 pandemic", introducing an entitlement for employees to take unpaid pandemic leave and the ability to take twice as much annual leave at half pay.1

The amendments were made at the Commission's own initiative to address the unique circumstances pertaining to the COVID-19 pandemic, and follow consent applications to vary the Hospitality Industry (General) Award 2010, the Clerks – Private Sector Award 2010 and the Restaurant Industry Award 2010 late last month to include, among other things, the ability to take twice as much annual leave at half pay. See our previous article regarding the amendments to the Clerks - Private Sector Award 2010.

The 103 awards were selected for amendment on the basis of the industries (and associated awards) that are likely to be impacted by the COVID-19 pandemic in the short and medium term; the awards which have a significant proportion of award-reliant employees; and awards with a high proportion of small businesses. Having regard to these considerations, awards for the construction, maritime and mining and resource sectors are excluded, but may have a "Schedule X" introduced in the course of a second phase of amendments.

With limited exceptions, the submissions received by the Full Bench regarding the proposed Schedule X amendments were supportive, or did not oppose, the proposed variations. The Australian Chamber of Commerce and Industry, the Australian Council of Trade Unions and the Ai Group all supported the proposed variations, with the Commonwealth Minister for Industrial Relations providing submissions expressing his strong support.

Note 1 to Schedule X makes clear that an employee covered by the award who is entitled to the benefit of either new provision has a workplace right for the purpose of section 341(1)(a) of the Fair Work Act 2009 (Cth), with Notes 2 and 3 providing a reminder of the prohibitions against an employer taking adverse action against an employee because of their workplace rights (section 340) and of persons organising or taking action with the intent to coerce another person in relation to the exercise of workplace rights (section 343).

Unpaid pandemic leave

All employees subject to the amended awards, whether full-time, part-time or casual, will have an entitlement of up to two weeks' unpaid pandemic leave if they are required by government, medical authorities or acting on the advice of a medical practitioner to self-isolate and are consequently prevented from working, or are otherwise prevented from working by measures taken by government or medical authorities in response to the pandemic.

The unpaid pandemic leave:

  • is available in full immediately (as opposed to accruing progressively based on continuous service);
  • must commence before 30 June 2020, but may end after that day;
  • may be for a period of more than two weeks by agreement; and
  • counts as service for the purposes of other entitlements.

This amendment seeks to address a "regulatory gap" in leave entitlements and protections against dismissal for employees who are required to self-isolate for 14 days as part of efforts to "flatten the curve", but who might not have an entitlement to personal leave (e.g. if they have not tested positive for COVID-19, are not displaying symptoms and are not unfit for work because of personal illness). The amendments mean that such an employee would be protected from dismissal because of their temporary absence under section 352 of the Fair Work Act 2009 (Cth).

Unpaid pandemic leave was not included in the consent variations to the Hospitality Industry (General) Award 2010, the Clerks – Private Sector Award 2010 and the Restaurant Industry Award 2010, but these awards will be updated to include these as a result of yesterday's decision.

Double annual leave at half pay

The amended awards will provide additional flexibility regarding annual leave, by allowing an employer and employee to agree to take up to twice as much annual leave at half the rate of pay. That is, an employer and employee will be able to agree to the employee, instead of taking one week's annual leave on full pay, taking two weeks' annual leave and receiving the same as the pay they would have been entitled to receive for one week's leave on full pay (including leave loading) and having one week of leave deducted from their leave accrual.

A period of such leave must start before 30 June 2020, but may end after that date.

Potential further changes

Many submissions received by the Full Bench highlighted the need for flexibility beyond the amendments proposed, for example, to remove or reduce restrictions on an employer's right to direct employees to take annual leave or to reduce their working hours. Despite this, the Full Bench decided to proceed with the limited Schedule X amendments in order to provide "a quick response to the current crises". However, in reaching its decision the Full Bench emphasised that they will continue to monitor developments and encouraged industrial parties to have discussions regarding consent variation applications, noting that the determination of such applications will continue to be expedited.

In its submissions, the ACTU sought that the Commission, as a matter of urgency after making the Schedule X determinations, consider what additional measures might be fair, relevant and necessary to meet the modern awards objective in awards covering employees who, as part of their employment:

  • are required to personally attend to the needs of persons who have COVID-19;
  • are at a recognised high risk of suffering from the COVID-19 virus; or
  • work in health and community sector-related environments where the risk of exposure to COVID-19 is clearly elevated (such as in disability services and aged care).

The ACTU, Australian Nursing and Midwifery Foundation, the Health Services Union and the Association of Professional Engineers, Scientists and Managers Australia expressed the strong view that such workers should be entitled to paid pandemic leave on multiple occasions, given the likelihood they may be required to self-isolate on more than one occasion to minimise the spread of infection.

The Full Bench has advised that it will shortly convene a conference of interested parties with a view to establishing a separate process to address this issue.

Any such amendments may impact awards including the Aboriginal Community Controlled Health Services Award 2010, the Aged Care Award 2010, the Ambulance and Patient Transport Industry Award 2010, the Health Professionals and Support Services Award 2010, the Medical Practitioners Award 2010, the Nurses Award 2010, the Pharmacy Industry Award 2010, and the Social, Community, Home care and Disability Services Industry Award 2010.

Our team is actively monitoring and considering the implications of legal and regulatory developments in response to the COVID-19 pandemic. You can find our COVID-19 collection here.

All information on this site is of a general nature only and is not intended to be relied upon as, nor to be a substitute for, specific legal professional advice. No responsibility for the loss occasioned to any person acting on or refraining from action as a result of any material published can be accepted.

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Angela Xu

Angela Xu