The hospitality industry has been significantly impacted by the COVID-19 pandemic, with many businesses facing a stoppage of work as a result of government-mandated lockdowns, and having a subsequent shortage of available hours for employees.

A recent decision by the Fair Work Commission (the “FWC”) demonstrates that while employers must ensure that they have a legitimate reason to stand down employees, in some circumstances employees will have a part to play in sharing the burden of dealing with COVID-19.

Background

The Applicant worked for the Respondent’s hotel on the Gold Coast. Following the Queensland government mandated shut down from 1 August 2021 and 8 August 2021, the Respondent operated with a “skeleton staff”, including the Applicant. In a series of communications sent by the Respondent from 3 August 2021, the Applicant was stood without pay until 13 August 2021.

Following the government mandated shut down, the Respondent offered reduced hours to staff by way of temporary contract variations in order to retain its work force. Out of the 268 other staff, the Applicant was one of only two to refuse. Following her refusal, she was stood down for periods between 13 and 16 August 2021 and from 26 August to 19 September 2021 (the “Subsequent Stand Downs”). The Applicant made an application to the FWC claiming that the Subsequent Stand Downs were in breach of section 524 of the Fair Work Act 2009 (Cth), and that monetary orders should be made in her favour. The Applicant contended that there was no genuine stoppage of work and that she could have been usefully employed during the Subsequent Stand Downs by attending to bookings and the backlog of work.

Outcome

The FWC held that there was not a genuine stoppage of work, as the mere reduction of work did not constitute a stoppage of work. The FWC therefore found that the Subsequent Stand Downs were not in accordance with section 524 of the Fair Work Act 2009 (Cth) (the “FW Act”). The FWC considered that because there was no genuine stoppage, the hotel was ‘still in operation’, albeit in a severely reduced capacity.

However, the FWC did not consider that there were any grounds to support a monetary order being made in favour of the Applicant, despite there being a breach of the FW Act. The FWC noted that the Respondent had taken steps to ensure some form of work for the majority of its staff in the midst of the COVID-19 lockdowns, and considered that the Applicant also had to ‘share the burden’ arising from COVID-19.

Key takeaways

• One of the grounds for a stand down under section 524 of the FW Act is a genuine stoppage of work for any cause for which the employer cannot reasonably be held responsible.
• A mere reduction in available work cannot constitute a stoppage, even if the business is running a substantially reduced capacity.
• An invalid stand down will not automatically give rise to monetary orders, and the FWC will consider the circumstances surrounding the decision to stand down employees.

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