Managing Through COVID-19 Crisis: JobKeeper 2.0 and VIC Lockdown

Published August 30, 2020 Views: 9


On today’s live stream Ed provided updates on the Victorian lockdown, discussed insights into JobKeeper 2.0, and covered the shock overnight change to Level 3 in parts of New Zealand this week.


  • Managing Through COVID-19 Crisis: JobKeeper 2.0 and VIC Lockdown

    Ed: Hi, everyone. It’s Ed here on Friday for our fourth week of doing these weekly sessions. It’s amazing when you look back at those last four weeks and think of everything that’s happened, just a brief summary from a workplace relations perspective at least. First of all, we started to see the signs of the Victorian wave, which we’re obviously deep into now, and the shutdown that followed from that. Questions of permitted work sites, permitted workers and so forth. And those in Victoria might be getting more used to those issues now, but we’ll talk about them a bit later on to try and give some clarification.


    Second of all, what we saw was the emergence of JobKeeper 2.0, which soon became JobKeeper 2.5, and I think is gonna become JobKeeper 2 point something else fairly imminently, and I’ll talk about that today as well, as there’s an increasing sort of level of murmuring from the opposition about some objections they have to the proposed 2.0 scheme, and I’ll give you a bit of insight into what I’m seeing about that.


    And then for any of you doing business in New Zealand, we had this shock acceleration to what they call alert level three in New Zealand overnight on Tuesday. So we as a business spent…I was actually sitting on my sofa on Tuesday night watching telly, and I got one of those pings on my phone which gives you a news headline update, and it says, “New Zealand moves to lockdown.” And New Zealand, bear in mind, that for the last 100 days hadn’t had a case and everyone was attending things like sporting events. We didn’t have social distancing in offices and so forth. And then suddenly they rushed to that and they didn’t give us much time. We had to do it within…by midday the following day. So we as a business had to get about 150 people out of our office in that time, which was a big challenge. I’ll talk about how we worked through that in a moment as well.


    And then beyond the New Zealand challenge, we also get the curveball thrown in yesterday of a decision relating to personal carers leave for permanent employees, full-time and part-time employees, which is known in workplace relations circles as the Mondelez decision. I’m probably not giving the right level accent to that, but I say Mondelez. I’m sure there’s a more fancy way of saying it. But I’ll talk about that decision because it’s important to anyone in Australia who employs permanent staff and relates to their entitlement and their accruals of personal and carers leave.


    So just a quick reminder, I suppose, of the mindset of management. I, like a lot of you, have been wavering in and out of…I say a lot of you. I’m bringing you down with me. I assume that you’ve been wavering in and out of a stage zero, the denial stage, as I have. And, certainly, I felt that on Wednesday when I was critiquing, I suppose, what happened in New Zealand where they saw a handful of cases. Admittedly, they haven’t had some for some time. But, in essence, what happened was that I suppose in less than 24 hours, much of their economy was shut down. And that can be infuriating. It’s infuriating to be running a business in that. It’s infuriating to be trying to leap through that. And it did take me some time, but I think I’m just about there, to rise above that, not to be stuck in stage zero and to remind myself that my job is not to second-guess the politics, not to involve or broil myself in the politics and the whys and wherefores of what’s going on behind that decision. The reality is there has been a decision, and I need to manage the business through that, and I need to make sure that my staff both understand what’s going on but feel appropriately looked after in the circumstances, trying to distill, if you like, the chaos of what’s going on in the public domain, on the political domain, and distilling that into clear, concise and consistent messaging for my staff.


    So, yeah, for any of you that are wavering in and out of that, and, you know…I talked when we previously did the daily sessions. I sort of have a litmus test for me as to when I’m wavering in and out of that. It normally means that for about an hour before I fall asleep at night, I end up reading just about every newspaper I can find online about every sort of fairly one-eyed viewed on lockdown and how it’s an overact and ridiculous thing, and I get myself very frustrated and then don’t sleep very well as a result. I suspect a few of you do something similar to that. So just remember and try and remind yourself just to get back into form, which is we do not control questions of lockdown. That’s just so far beyond our control. There’s not much point in wasting any emotional energy on it. What we do control are the actions that flow from that. And our job is to manage that risk in our business and to properly appraise those actions, distill and implement in your business in such a way as to minimize the impact on your business and hopefully achieve success through the COVID crisis and beyond.


    So a little bit about how I’m managing, I suppose, over the last week or so, before moving on to JobKeeper. So JobKeeper, as predicted here a couple of weeks ago, it’s starting to get a couple of cracks in it as to what JobKeeper 2.0 will look like. You’ll remember we said here a couple of weeks ago that this is not legislation yet. It’s very confusing the way it gets announced by the government. They make out that this is all said and done and at the end of September, JobKeeper 2.0 is gonna flow into the system.


    There seems to be…and whether it’s posturing or not…I’ve read something in the media today of labor starting to look…they’re trying to horse trade our relevance of JobKeeper. For example, they’re saying that they may well support the idea of extending the changes to the Fair Work Act, which give employers various different powers like JobKeeper stand-downs, extending those to people…to employers, sorry, that haven’t qualified for JobKeeper 2.0 but still would benefit from those extra powers. There’s a bit of resistance to that, but, basically, labor seem to be saying that they will support that reluctantly but only if the actual amounts paid to people in under JobKeeper 2.0 are increased from the proposed $1,200 initial fee and, I think, $750 for those on lower hours.


    So look, there’s still a lot to come in JobKeeper. Parliament’s not sitting for another couple of weeks, and over the next couple of weeks, we’ll start to see more and more posturing in the press as to what that debate is gonna look like. I don’t have much doubt that there will be a JobKeeper 2.0 of some sort, but the details of which just aren’t there at the moment. So there’s not much point in expending time and energy in trying to work them out and so forth and then to really kind of work to a baseline, prepare for the worst strategy, have a look at what you’re gonna do if JobKeeper isn’t given to you beyond the end of September, if you’re getting it already. How’s that gonna impact you? What decisions are you gonna make? Because if there are, therefore, some big changes to JobKeeper 2.0 and you don’t get it, you’re at least in the mindset of knowing what you’re gonna do from there.


    So that would be my suggestion is to watch this space but prepare for the worst. Do your planning as though you’re not gonna get JobKeeper beyond September and essentially have a series of tactical plays that flow from that planning to say, “If I don’t, then I will do these things.” Which might include, for example, redundancies. Just on that word, actually, I read an article in the UK when I was in stage zero one night reading lots of online newspapers in the UK saying that redundancy in the UK now, as they start to come towards the end of their furlough scheme, is reaching record search levels. So people have not searched on Google for redundancy at quite the same level as they are now ever before.


    And I think that it doesn’t tell us a lot, that, other than that that search, I think, will increase for us here, the need for people to consider redundancy. I’m urging people to consider it now on the prepare-for-the-worst basis that you’re not gonna get JobKeeper 2.0. So don’t presume that you are gonna get it. Start to think about what you’re gonna do if you’re not. And then, of course, it’s good news if you do get it and the rules end up being such that you qualify.


    That’s latest on JobKeeper. If you’ve got any questions on JobKeeper, fire them out when we get to that section at the end of the session. Very brief one from me. I was just having a chat with a friend who is a client as well, actually. He’s got a business with about 20 people, mainly office based, or were, who have all been working from home in Sydney for the last few months. And he’s really personally quite taken to working from home. He loves it. And he doesn’t want to go back to the office, and he wants to move everyone to working from home. And I was trying to dissuade him, I suppose, of that the other day. I just…I feel like it’s an unnecessary additional risk for businesses to make such big, bold decisions as, you know, we’re all gonna work from home. We’re gonna get rid of our office and so forth.


    I think there’s so much unknown at the moment about the consequences of working from home. We don’t know what the cultural impact is gonna be. You don’t know what the impact on people learning and developing when they’re stuck at home is going to be. So there’s all sorts of those…let’s call them soft reasons, that we find very hard to predict. But if you want some harder reasons, if you’re the kind of business that’s thinking about going towards a really big, solid move towards work at home, bear these two things in mind. Remember we talked last week about the fact that you still have health and safety responsibilities at people’s homes. Very few businesses are well set up as organizations to really appreciate and evaluate their health and safety risks over disaggregated workforce when they’re working at, in my friend’s case, 20 different work sites he suddenly gets rather than the one that he had before.


    So that’s a risk but there’s also a cost. And one of the things that he will have to consider and we’re considering here and everyone else that has people that are going to work from home going forward will need to consider is what will their setup be. And it’s not just the technology setup, but you need to consider things like chairs, the way people are set up with their desks and the ergonomics within their workplaces. And you may well end up having to buy them things like that that you’ve already got some of it in the office. Maybe you’re having to duplicate that cost. So there may be a bit of a false economy in thinking that it’s gonna be cheaper to have people working from home. So make sure you’re looking at these things critically.


    We here are going towards a more flexible environment where certain teams are gonna have more option to work from home, and there will be a cost to that for us. There’s a double cost in having to rearrange our offices to suit that change and also to make sure that people are properly set up at home. We’re willing to accept that cost. We’ve balanced it against the cost of having to get extra future space and so forth, and it works out for us. But what we’re definitely not doing is just allowing total carte blanche of people to work from home. We’re really thinking in a lot of detail about what working from home means, how often you’re gonna be required in the office, when are you gonna have meetings, what about training. Everything from subject matter training to leadership training and so forth. And, you know, what I’m articulating there are the sort of things that are a bit easier to do, to be honest, when you’ve got quite a high volume of employees. But if you’re a smaller business with less employees, it can be very risky, I think, just to rush to an eternal work from home policy. So make sure you’re thinking about those things before you do.


    On to Victoria, briefly. I suspect you’re all getting more used to the idea of interpreting the rules. They’re lengthy, there’s been a lot of criticism in the last couple of weeks about how confusing they are, how many gaps there are. Yet, remember we’ve seen all this before, that, you know, the rules are there. They’re there to stay, to be honest, so there’s not much point in going back to stage zero and saying, “How bloody unfair that my neighbor can open up but I can’t,” and so forth. You have to deal with the fact that the rules are there and operate within that environment. Get out of stage zero. Get into stage one in crisis management.


    They are lengthy, though, and you do need to really invest some time in getting your head around them, which I suspect, by now, those of you that are affected will have done. The concept of permitted work premises remains a bit confusing at times, and my advice on here has been, and remains, to ask yourself whether you’re operating within the spirit of the rules. Now I’ll give you a couple of examples of that and also as to how it’s confusing. The rules expressly say this about construction, the ancillary services to construction. And it’s true of any ancillary services to permitted work premises are entitled to carry on working. So it said, for example, in the rules, that if you are a brick maker, you are an ancillary service to the construction industry that can carry on working and supporting that industry, but it says also that if you are a carpet marker that you are not allowed to do that.


    Now I don’t know where in the bowels of the government someone sat there and decided that in construction projects, you know, everyone can wait for a carpet but they can’t for their bricks, or something like that. I’m sure they’ve done no proper evaluation of, you know, what brick stocks are versus carpet stocks and so on and so forth. And if you’re a carpet maker, I’m sure you’re absolutely furious about it.


    But, you know, what I can say is this. Don’t get stuck in stage zero. That’s a reality of the rules as they stand. We’ve got another three or four weeks of the shutdown in Victoria or Melbourne, if it only goes for the six weeks it was said. And you need to deal with that, and you need to deal within the context of the rules to manage your business through it. Being really annoyed about it doesn’t serve any purpose. And in terms of acting in the context and spirit of the rules, I noticed in looking at them, for example, that one of the things it’s expressly allowed in the rules is employment services, if they can’t be done online.


    Now, I think, to be honest, given what Employsure does, we could just about muster up some argument to say that we are in the world of employment services and we don’t do it online, typically. We do some online work with our clients, but it’s mainly through speaking to and emailing and seeing our staff. And we could, I think, probably muster up an argument to say that we’re therefore a permitted work premise and we can all be in our office and maybe even go out and see people. I don’t think that’s in the spirit, though, of the rules. I don’t think they mean Employsure when they say that, and I’m not gonna try and test the boundaries of it. Conversely, I am gonna test the boundaries a bit where it says that we are permitted to go and help permitted work sites with health and safety. Or it says that…sorry, employer associations are allowed to do that. We also help people with health and safety, and I think that’s a crucial thing at this time, and we interpret the rules to allow us to go and do that.


    So I think what I’m doing there is acting in the spirit of them, and you’ll have equivalents in yourself. In your own businesses, don’t get trapped in the detail and either become victim to the detail, unnecessarily stopping your business on a technical reading of the rules in some way, if the spirit of the rules likely means that you could and should be operating.


    So that’s my suggestion. I’m intrigued to hear on here if anyone’s got any question. Sorry, if anyone’s able to shout out as to whether they’ve had any issues about being a permitted work premise, whether they’ve been challenged by the authorities on it and also about worker permits. Have you or any of your workers had any challenges around worker permits? I’d be fascinated to see how it’s actually occurring in practice in Victoria. I haven’t heard personally of any of our clients calling through with those issues, but if anyone’s had them on here, shout out. I know that there has been…you’ve probably seen the same things I have online about perhaps some overzealous policing in Victoria of a…I saw a pretty shocking incident, actually, of a police person strangling someone who wasn’t wearing a face mask. So I dearly hope that’s an isolated incident. But if that’s the level of zealousness, if that’s a word, that’s being applied, maybe you’re seeing it with regard to the workplace rules as well. I’d be interested to hear.


    So that’s a bit of Victoria. The last thing I just wanna go onto then before we go on to questions is this Mondelez decision. So what happened almost a year ago to the day in August 2019 was that the federal court handed down a decision relating to how you calculate sick leave, personal and carers leave, for permanent staff members, full-time and part-time staff members. And the way the decision came out was a bit of a shock to employers in that it was not favorable to employers. It meant that they suddenly had increased sick leave liabilities to their staff, particularly part-time staff. And the reason for that was this, is that you’ll be familiar with the concept that you get 10 days of sick leave a year, and that that rolls on year to year, subject to anything in your reward or industrial instrument, but as a general principle, that’s what happens. And what they basically said is that you get 10 days, come what may. So if you’re a part-timer that only works 1 day a week, you are still entitled to 10 days of sick leave over the course of the year. So you could take 10 of your 1 days off, which would essentially amount to 10 weeks, not 10 days of work, and you’re entitled to be paid for all of that.


    So you’ve got this incredibly high entitlement to sick leave for part-time workers. And I mean, the real oddity of it was that not only was there the day issue, but on top of that, your sick leave was based upon the number of hours that you were due to work. So you were getting 10 times…let’s say you had a 12-hour shift on 1 day a week. You were getting 10 times that, which is 120 hours, 10 days of sick leave over the course of a year. It was actually more than an equivalent full-time employee doing, say, 38 hours, 9 to 5, Monday to Friday was getting.


    So it was a really odd decision, but it was a real pain for employers, it was a pain for payroll technology providers and payroll professionals to try and work out exactly what it was that part-time employees were meant to receive by way of sick leave. Now what happened yesterday was that the High Court turned around and said, “No. That’s wrong. That’s not the way it should be calculated.” The concept of 10 days of sick leave, you should look at for a part-time employee. You should look at what are their ordinary hours over a 2-week period, or you look at what one twenty-sixth of their annual hours are. So in essence, it’s saying, “Look. Over the course of a two-week period or in general terms, how much is this person working?” And they get 10 days based on a prorated hourly amount rather than on a full daily 10-day amount.


    So someone that works the full 38 hours a week full time gets a full 10 days of full-time sick leave. Someone that works half that amount will, in essence, end up with 5 days, or 5 times 19 hours a week. So that’s the way it roughly works out. Now what do you practically need to do about it? You need to, first of all, speak to your payroll provider, if it’s not internally done, who will in turn need to be looking at your payroll system and checking, number one, did you even know this Mondelez decision existed this time last year? Because maybe you didn’t, and you didn’t change your system and you’ve been paying it the old way, which is all the…the decision’s done by the way. It’s just said that decision last year, it was wrong. The thing we were all doing before that is the way we should go back to. So you maybe never changed your system, so it doesn’t affect you and it doesn’t matter. Maybe you did change your system and you now need to revert back to the old way of doing it going forward, and your payroll provider should be able to do that in line with whichever system it is that you’re using.


    You’ll then need to understand going forward what the inputs are to calculate the appropriate amount of personal carers leave. And then, finally, you’ll need to do essentially an audit going backwards to see if you’ve been overpaying anyone over the course of the last year. So let’s say you did apply the decision of the federal court last August and you had a part-timer who’s had a lot of sick leave over the course of the last year. You might well have paid them for that sick leave over and above what actually they should’ve been entitled to. Now what you’re gonna do if you find that that is the case is very tricky. And, really, you need professional advice from someone like us on that to work out what the process is gonna be to go back to any employees that have been overpaid over the course of the last year.


    But just a final thought on it is that this is a good decision for employers. It’s a pleasing decision in the context of the crisis. And probably to give a…with the decision on, you know, the concept of permanent casuals was one of the biggest thorns in employers’ sides that they needed to deal with. So let’s hope that the High Court looks at that permanent casual decision in the same way when that comes up and reverses the position on that so that employers aren’t stuffed with having to pay a whole day of entitlements to permanent casuals.


    So that’s the stuff on the Mondelez decision and we’re gonna go over to Stu and ask some questions, I hope.


    Stu: Sure, Ed. I’ll kick off with just a couple of comments, if I may. Mary Louise says, “Hi, I’m joining for the first time.” Debbie says, “Hi, Ed and team. I’m new to the group.” And Graham says, apropos of your opening introduction, “Great reminder of priorities, Ed.”


    Ed: Good. Thank you for the comments. That’s good. It wasn’t scrolling. I thought I only saw three things. I thought maybe it’s just my mom watching today and no one else. But no. There’s a lot of people with a lot of questions. Yeah.


    Stu: There’s many, many, many hundreds. And this one from Maria is being watched with some anticipations. And you’ve introduced it earlier on, but let’s go back on it. “Do we pay this quarter for those new eligible employees now, or wait for legislation?”


    Ed: Sorry, for the JobKeeper 2.0, I’m guessing this is…


    Stu: Yes.


    Ed: You need to wait for the legislation and understand whether you’re going to receive JobKeeper 2.0 and whether the employees are eligible. So it’s been suggested that the eligibility date is gonna move for employees, but we don’t know that to be the case until it’s actually legislated.


    Stu: This is from Nathan. “If we have a staff member who takes annual leave for three weeks and asks to be paid at the start of the three week period, which we have to do, do we then pay them on top of the $1,500 in the middle, as otherwise we will not have paid them $1,500 for a fortnight?”


    Ed: So it’s a really tricky one, Nathan. So there was a decision relating to Qantas, who seemed to be getting a kicking from all directions at the moment, but they…this concept of whether you have to top up based on an averaging or based upon the receipt of what people specifically got over the course of a week or a fortnight. From recollection…I’d need to go and check this, and maybe the advisor that’s replying to these questions…do we know who that is today? Whoever it is that’s replying, if you guys could just check this. I mean, my recollection was that the Qantas decision went against Qantas, and that, in essence, you can’t average it out, what someone’s…and do it the employers-friendly way. You need to do it the employee-friendly way. But we’ll double-check that for you and reply.


    Stu: And also with regards to JobKeeper from Sara, “Should we be paying the $1,500 to newly eligible staff in our next pay run or wait just a little bit longer?”


    Ed: Definitely wait longer, Sara. Yeah, there’s no such thing as a newly eligible member of staff yet, because it’s not been legislated.


    Stu: From Jenny, a JobSeeker question. Let’s see if you can help. “Hi, Ed. What is the current position on people who quit their job for JobSeeker? Is it paid straight away, still?”


    Ed: I don’t know, Jenny. Sorry. Yeah. I love your optimism, thinking I would be able to help with that, but I don’t know what the position is…what JobSeeker is to what the turnaround time and the application process is for that.


    Stu: From another Jenny, Jenny S. “I have a casual employee who signed a contract with me that says four weeks notification’s required for termination of employment, but she has just resigned with three days’ notice saying that four weeks is not fair. That is not valid because she’s a casual. Can I enforce the four weeks notification because it’s agreed in the contract, and if she doesn’t comply, can I press charges for any loss of revenue, that is if I can’t replace her in time?”


    Ed: Hi, Jenny. I’m smiling a bit. I’ve been through this before, myself, this sort of… Just as a starting point, there’s an incredible frustration for employers, whether the person’s casual or permanent, as to the period of notice that you may have agreed with the employee. And then that employee doesn’t serve it out and you’re left saying, “Well, what can I do? Can I…” as you’re suggesting, “…sue for damages, essentially, for anything that it’s cost me? Can I withhold any wages that are due?” And the truth is that your starting point on all of those questions is that the employer’s got very little recourse, frankly. Very little forms of the recourse are practical.


    You know, if you lost money because the due notice wasn’t given, actually recovering those damages would be next to impossible to actually go through that process. So you’re already on a bit of a hiding to nothing on it. I think yours is made worse by the person being a casual. So a true casual wouldn’t typically have that four-week notice period that you’re describing. What you’d normally have is just a level of reasonable notice, which someone that hasn’t worked for you for very long is unlikely to be required to give you four weeks’ notice even if you’ve got it in the contract on a casual basis, because in reality, what that sort of shows is that they probably weren’t a casual. And depending on how long that person worked for you, I’d probably not be pushing the point that that four weeks’ notice is due in case they bite back and say, “Well, maybe I wasn’t a casual. Maybe you owe me some crude holiday pay,” or whatever else it might be.


    So, frustrating. I hear you. I’ve been there but, unfortunately, I think probably something you’re gonna have to let go.


    Stu: And Ed, we’ve touched on this before but worth circling back on. From Simon, “Hi. With some employees now starting JobKeeper from August the third, we have not seen any updated employee nomination form for this group. So should we be paying the JobKeeper top-up to them?”


    Ed: So if the eligibility is an employee eligibility question, we don’t know yet as to any changed eligibility rules or criteria for employees. Wait for the legislation. If it’s an employer eligibility thing and maybe you’ve become eligible for August in ways that you weren’t before, then you would need to go through the JobKeeper application process and no doubt then speak to your accountant about that eligibility as well.


    Stu: This from Kristine. “If someone goes on maternity leave, can we still claim JobKeeper for her?”


    Ed: There are specific rules relating to that were all replied to on here as well, but there are eligibility rules that you should probably talk to your accountant about as well. They’re a bit tricky, the maternity leave ones.


    Stu: From Naomi, “Does the pro-rata style of personal leave also apply to businesses with an enterprise agreement?”


    Ed: Pro-rata style and personal? It depends on the terms of the enterprise agreement. Assuming the enterprise agreement reflects what’s in the Fair Work Act, the Mondelez decision will likely impact that. So if there was the level of vagueness and space for interpretation…and actually the Mondelez decision itself is about an enterprise agreement. It’s not purely about the Fair Work Act. But if your enterprise agreement more specifically defines how personal carers leave is calculated, then know the decision is unlikely to affect it. So you need to get some advice on that.


    Stu: And this question from…


    Ed: From us, preferably.


    Stu: Yes, of course. This question from [inaudible 00:32:55] apropos of what you had mentioned before about personal carers leave. She says, “So if all staff are full time, then no change to personal carers leave?”


    Ed: Exactly. Yeah, I mean, assuming you’ve been calculating it in the right way, it’s probably worth just double-checking. But, yeah, in essence, if you’re a business that doesn’t have odd-shaped shifts and hours and people are working 38 hours a week on a full-time basis, then you’ll no doubt have been accruing based on 2 weeks of 38 hours. The only difference is that it was the way in which you accrue has changed. So it was previously you were accruing days based on a calculation of, you know, one day for every X number of days that you worked. It’s now being done on an hour’s basis. So you calculate based on a multiple of hours worked multiplied by 1 over 26.


    So yeah. So there is still a difference in practice made. It’s not as significant for full-time employees, but the way in which you calculate it. Also the way in which you take personal leave and it gets subtracted from your balance has been clarified and is a bit more nuanced than was suggested under the Mondelez decision. So under the Mondelez decision, it was said that you should get paid sick leave based on the hours that you would’ve worked on that day. So let’s say you would’ve worked 12 hours on a day, even though your ordinary hours were only 8 hours on that day, if you would’ve worked the 12 hours on that day, Mondelez said that you should be paid 12 hours of sick leave.


    What the clarification now from the High Court says is no, you only get paid sick leave on your ordinary hours rostered for that day. So it’s the…that you would only get paid on the eight hours and the balance subtracted…sorry, the amount subtracting from your balance would be eight hours.


    Stu: This is from Amanda. “If our business was not calculating 10 days leave for part-time employees, do we need to go back and recalculate leave? And if so, for what period of time?”


    Ed: So I take that, Amanda, that you’re basically saying if we didn’t change with the decision last year, presumably only because you’re a legal wiz and you knew that the High Court was gonna overturn it a year later. But the answer to that is go and check. Just check to see what…if you’ve got someone that does your payroll for you, you go and have a chat to them about that. Get the comfort of checking that you’ve done the right thing and that you don’t need to recalibrate in any way.


    Stu: From Beverly. “Can I clarify whether sick leave rolls over each year if untaken?”


    Ed: It does, yes. So it rolls over. It doesn’t typically get paid out when someone leaves. You need to just be sure of what your enterprise agreement or industrial instrument says [inaudible 00:36:08] and so forth. But yes, it rolls over year to year, so if you don’t use it, you don’t lose it, typically.


    Stu: From Marie Claude, “If we had changed our way of calculating the leave for the year, do we need to go back and readjust everything from the beginning to the way it was, or just change everything from this point going forward?


    Ed: Technically speaking, it means that you need to go back and recalculate because a couple of things. You’re not just scrubbing the slate clean and starting to add to whatever the balance is. You’ve gotta get the underlying balance right for the employees so they know how much leave they’ve actually got accrued. And second of all, because you might end up in situations where you have employees that have been overpaid more likely than underpaid. But you need to just go and check to see that you haven’t done the wrong thing either way on that in the intervening period.


    Stu: From Kim, “Can you please elaborate on permanent casual leave? What are permanent casuals entitled to at the moment?”


    Ed: A good question, Kim. So you might remember there’s this decision called Rossato and WorkPac that came out that sort of everyone was up in arms with in the midst of COVID and…well, I think probably still in the midst of that. But in the midst of COVID and JobKeeper, this decision came out that basically said, “If someone that you might call a casual worker but there are certain characteristics around their work…” Which is broadly speaking that they look a bit more like they’re permanent workforce, then in which case they…notwithstanding the fact that their pay is being enhanced to compensate for the absence of things like personal leave or annual leave, that they in fact accrue that and, therefore, they have that entitlement. So it may be that they have taken time off because they’re sick and you haven’t otherwise paid them or that they may now be saying that they’re entitled to paid holidays and so forth.


    The difficulty is with that decision is that it’s very much like the Mondelez one. It’s being appealed, so we’re basically sitting somewhat in limbo at the moment waiting to see if the High Court’s gonna agree with what is now being said and that you do have to pay permanent casuals this extra money.


    And for employers, the trouble is that someone that comes to you today and says, “You owe me this money” is technically correct if they can be satisfied or show that they are in the category of casuals that gets these entitlements. What we’re advising people to do is to try and manage that situation by saying, “I understand that decision is being appealed. At this stage, I’m not proposing to start paying out entitlements like that to any casuals and will adhere to whatever the decision is when it comes out through the High Court in due course.” But there’s a risk that you get some pushback from employees on that, and you might end up seeing people starting to go to the Fair Work Ombudsman and the Fair Work Ombudsman then challenging employers who are not paying their permanent casual staff properly.


    Stu: And just an acknowledgement from our tech guys. “Apparently, there is a transmission issue for some people. The majority are getting a good stream, but there is some interruption to some people. We’re looking into it.”


    Ed: It might just be this stuff’s bloody confusing and it’s not a transition. It’s really…you know, I’m finding I’m sort of confusing myself today. They’re two very, very tricky issues that it’s quite hard to advise in the abstract on. You know, the truth is, with the sick leave decision, for good measure, you should be going back and checking what you did and how you’ve done it over the last year, but you definitely need to go and look at the sick leave balances of all of your permanent staff and then the casuals decision is a slightly different one, but there will be lots of tricky situations coming out for people asking for entitlements that are currently entitled to them on the basis of the Rossato decision, but that may change.


    Stu: Okay. This question from Klara. “Do I pay a casual JobKeeper…she has been on it until now…for the six weeks leave she is about to take?”


    Ed: So you will receive JobKeeper, on my understanding, for…if it’s a person who has otherwise been getting it. So even though they go away on leave and they’re not working that they’re…because they’re considered to be this regular and systematic style of casual. But I think that you’ll carry on getting the JobKeeper.


    Stu: Interesting one from Jenny.


    Ed: Sorry, or I should say as well that if you…obviously, JobKeeper, you pass it on. You don’t keep it. But have a chat to your accountant, though, if you’d see whether you’ve got any obligations about notifying the ATO if someone is not working with you during that period. But, you know, my understanding is that you’d receive it and pass it on.


    Stu: And this is a follow-up question from Jenny from a little earlier. “If the employee leaves without handover and without uploading her work documents to Google Drive as required for the handover, can I withhold her pay? We pay in arrears until she completes her handover fully.”


    Ed: So who asked the question?


    Stu: This is Jenny.


    Ed: Jenny. I was wondering if it was the same person who’d asked about the employee leaving without giving due notice.


    Stu: I think it might be.


    Ed: So yeah. Jenny, you are in a tricky situation. I don’t wanna just keep saying that today. I wanna try and help you out if I can. So if an employee has left and they may have some contractual obligation to return certain information to you and likewise, you’re not technically permitted to deduct from their pay. Withholding pay is a very tricky situation as well. You’re not lawfully meant to do that. But you could pick up the phone to this person, and I think this is a starting point for this is it just sounds like everyone’s gonna fall out pretty quickly unless you do this and have a chat to them and say, “Look, I’m not willing to do your final pay until you’ve been through these stages.” See what their reaction is and see if you can encourage them just to play sensibly. But it sounds like if you’re not careful, you guys are gonna go from naught to 60 a bit too quickly and end up in a dispute.


    Stu: This one from Janet. “I have a question about accruing annual leave. At the moment, all my staff are working part-time receiving JobKeeper. Should their leave now be calculated based on hours worked?”


    Ed: Quite testing me out today, guys. These are questions I haven’t thought of for a while. So if they have been…essentially, there’s been a JobKeeper-enabled work direction that has reduced their hours, my understanding is…and whoever it is. I don’t know if it’s Sam advising on here today. Shoutout if I get this wrong, but my belief is that they accrue based on the hours that they are doing, not on what their prior arrangement was.


    Stu: From John. “Hi, Ed. If someone is a casual and gets a casual loading, my understanding is the loading should cover for leave entitlements.” Question.


    Ed: If they’re a true casual, as it’s sort of sometimes being called at the moment, the problem with this Rossato decision is this concept of permanent casuals that are getting casual loading, but you still get leave entitlement as well. But if someone’s a true casual and doesn’t follow in the definition of a more permanent casual under this confusing Rossato decision, then they…yes, you’re right, that their equivalent of leave is covered for in that loading.


    Stu: From Deb. “If someone is a casual and works different hours most weeks, are they classed as a permanent casual?”


    Ed: It’s a bit more complex than that, to be honest. You need to look at the picture as a whole. Doesn’t matter whether they just work different hours each week. It depends on how long they’ve worked for you. The best litmus test I could give you to sort of scratch the itch, so to speak, and work out whether you need to get more involved in the analysis of this and whether you’ve got a risk is try and think of it like this. So if you just suddenly took away the hours from a casual or vice versa, they just said, “I’m not doing those hours this week, this day, this month.” Whatever it is. And the response by either of you was, “What the hell?” And you thought to pick up the phone and ask the person and say, “What’s happened there? I’m relying on you,” or vice versa, then you’ve probably got a bit of a tricky situation that you need to explore. And there are, obviously, plenty of casual situations like that which are not true casual, and we’ve heard one of them on here today where a casual being asked to provide four weeks’ notice doesn’t sound like a true casual relationship.


    You know, true casual relationships are often seen in things like hospitality where people will give a level of reasonable notice to say that they can or can’t attend the shift, but there’s no recourse or concern if they can’t. That’s their entitlement. And vice versa that you may or may not give them shifts and there’s no expectation of the work from the worker.


    Stu: And Ed, just an update from our tech guys. “If your stream is freezing, press the 10-second back button. It seems to be working for a lot of people.”


    Ed: Great. Did you hear that, everyone? If your screen is freezing, press the 10-second back button. I love how we say tech guys. That sounds like we’ve got sort of a whole team dead…it’s not really just us fumbling around pretending to be the tech guys.


    Stu: Correct.


    Ed: Yeah, okay. Good, good.


    Stu: Sounded good at the time.


    Ed: Yeah. Definitely. We haven’t got like a hotline to Mark Zuckerberg saying, “Come on, Mark. [crosstalk 00:46:30].”


    Stu: No, we’ve got Stu and [inaudible 00:46:32].


    Ed: Yeah. Yeah.


    Stu: From Sara. “Does the permanent casual decision apply only to full-time casual staff, or part-time as well?”


    Ed: Sorry, the permanent casual decision? So part-timers already get paid entitlements or accrue entitlements to annual leave and sick leave as well. So it’s not relevant to them. Basically, what it does is it says that there’s this class of casual workers that start to get treated like they’re actually part-time workers notwithstanding the fact that actually they probably get paid a better hourly rate than their colleagues that are in permanent part-time roles.


    Stu: From Tony. “Our current leave policy says staff are to provide evidence of sick leave from one day off. Can this also apply to casual staff?”


    Ed: Hi, Tony. Risky one, applying that to casual staff, because unless they’re falling within this Rossato-type decision, they don’t get sick leave. So there’s no obligation for them. They can say to you, “I just don’t wanna turn up,” not that “I can’t turn up because I’m not well.” The true casual doesn’t have to turn up in that way as long as they give you a reasonable notice of it. And so if you turn around and say to someone, “Well, you’ve gotta justify why you didn’t turn up.” That starts to sound to me like you might be having a permanent casual situation that you need to get examined to make sure you don’t have risks and liabilities associated to that.


    Stu: From Debbie. “I’m in Victoria and an employee wants to take time off. They are full time. What are their entitlements regarding leave?”


    Ed: Hi, Debbie. So assuming you’re operating in some level or way or…and that employee is working. So they’re entitled to their normal leave process to say they…giving you notice and you agreeing to that leave and them using leave that’s accrued and they’re entitled to under the Fair Work Act or otherwise.


    Stu: Time for one more?


    Ed: Yes, please.


    Stu: Okay. From Loraine. “Hi, Ed. I saw you on Sunrise this week talking about redundancies. It’s something we sadly may have to consider moving forward. You mentioned the importance of the conversations between employees and employers in these situations. Do you have any advice about how to broach that? We’ve never done it before, and it’s a tough conversation to have.”


    Ed: Yeah, it really is. There are two versions of this advice, I’d say. Try and think always of the law relating to anything in the employment redundancy in this particular case. It’s like the safety net, really, that you should really be trying to operate to a better standard. And what the law says is a safety net is that you need to warn employees, and you need to consult with them. And what that means is giving them due warning that there is a risk of a redundancy, not that you have decided that there is a redundancy, that you must not go into this with a closed mind. You must go in with an open mind. The law requires you to do that. And that you will meet with them or receive from them any feedback or proposals as to how redundancy could be avoided or the situation could be handled in a different way. So that’s the basic starting point. I suppose how do you do that in terms of tips with that…transparency underpins all of this. It’s the same as any form of communications we talk about on here. Just make sure you’re clear, concise and consistent. So don’t, you know, tell employee A in the corridor but forget to mention it to employee B and C, because they’ll start to feel like they’re getting picked on and maybe that they’re being preselected.


    Be as open and honest as you can. Make sure you back up whatever you say in writing. So, for example, if you wanted to explain that the business was suffering from the crisis and there was [inaudible 00:50:35] make impact to the crisis on your business, you might not go into full…you know, you’re not required to give full financial details of that, but you might give a sense of the circumstance to the employees when you are warning them and therefore then when you consult with them, just so they’ve got enough information to engage in a healthy conversation with you about it.


    I’ll give you an example about what I mean with that. So as a business during the crisis, we have defined what we call our paying client number. So we have about 27,000 clients. A number of those, we have said to them that they can have a payment holiday based upon their financial pressures. And we measure that number by saying how many of our clients are actually paying us. And that’s a critical measure that I’ve told the entire business that we monitor week to week. And I explain that to them each week.


    So if we ended up going to a situation where…touch wood, and, fortunately, we’re not at this stage yet, but we needed to make redundancies, I would be explaining it to them through the paying client number and saying, “Guys, as I’ve explained each week, we’ve been monitoring this number. As you’ve seen for a number of weeks it’s been going in the wrong direction. Let’s say if we were ending up in a redundancy process, we’ve consequently had to look at making cost reductions in order to achieve the necessary business goals.” And I’d put that in writing. I’d then invite them to a meeting to discuss it with me, probably individually. I might warn them as a group, but I’d individually give them the opportunity to speak to me. So it’s not an easy process. It’s a very emotional one as well. So do take care in doing it.


    Stu: And Ed, just a couple of comments to wrap up.


    Ed: I’ve got something to wrap up on as well after that, but I’ll take a comment as usual. Only if they’re nice ones.


    Stu: Two nice ones. A compliment for both you and Ed from Marie Claude. “Thank you so much. You’re the first people in Australia that have said my French name perfectly.”


    Ed: Oh, yeah.


    Stu: And from Karen. “Hi, Ed and team. Thank you again. Just finished my Blip training and so excited to get all the info in and start using it. Woo-hoo. Thanks for your words and wisdom each Friday.”


    Ed: Great news, Karen, and now I feel under pressure, Marie Claude. Thank you. Please don’t mention Stu when handing out compliments. Just keep them directed to me. Thank you. No, the thing I wanted to talk about is that I went to see a…they’re not actually a client of ours, but they are someone that works on…works on here…watches this, and has previously been a client in prior roles. Mel’s now at a charitable organization called Fighting Chance. I went to see them yesterday. I’d say it was just one of the [inaudible 00:53:31] is the best meeting I’ve had in ages. No offence to anyone else who’s watching that I had a meeting with recently, but yeah.


    It’s an organization that just does the most amazing thing. In various ways, it’s helping disabled people to get into the workplace. And I saw one branch of this yesterday, for example, which was an office of about 150 people all working on…doing data input and digitalizing big paper storage, document storages for a lot of big companies like banks. And there are people there with various forms of disability who are inputting the data from those hard copy documents into digital systems, and it’s providing the opportunity to understand how to work in an office-based environment. A lot of the subtleties involved in that, from the socializing through to the how to work with managers and so forth.


    It was just a fascinating thing to see this organization and how it’s grown, and it really opened my mind. It’s gone from a handful of employees to now about 400 employees. I think it’s a remarkable story. I thought I’d just shout out on it that I just really enjoyed my trip there yesterday. It was very eye-opening for me and inspired me through the crisis and seeing how they’re dealing with the crisis with particular challenges that they are having. And it was fascinating to see from both a personal and workplace relations perspective.


    So that’s it from me. Nice to see everyone, even if I’ve been a bit [inaudible 00:55:18] today. Blame Zuckerberg, not us. [inaudible 00:55:23] whoever else [inaudible 00:55:27] internet. So thank you very much. We’ll speak to you next week.

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