On this page

Want to learn more?

Fill in the form below and we'll get in touch

JobKeeper Explained: Stand Downs

Published August 13, 2020 (last updated September 23, 2020) Author: Employsure
business owner who has used jobkeeper stand downs

JobKeeper has been of immense help during the unprecedented impact of the COVID-19 pandemic. The subsidised wages of JobKeeper, a centrepiece of the program, have kept employers and their staff employed, and given businesses all around the country the best opportunity to return to business-as-usual when lockdowns and restrictions lift.

It goes without saying, but many businesses have struggled since COVID-19 came to the fore. Downturns naturally mean that thoughts went to redundancies, stand downs and other cost saving measures for employers.

The JobKeeper legislation provided a much-needed wage subsidy. But it also brought more than that.

Employers under the scheme have been given a set of rights to help them keep their business afloat during these trying times.

One of these provisions assist employers is that they give some leeway to manage their staff and roster in a way that best suits during the COVID-19 pandemic and associated lockdowns and restrictions.

For those Qualifying and Legacy Employers JobKeeper 2.0 continues to afford employers extra rights to reduce their employees working hours. This is different to the standard unpaid Stand Down provisions with the Fair Work Act, and due to the subsidized wages, JobKeeper Enabling Stand Down Directions are a very feasible option for employers.

What is a JobKeeper Enabling Stand Down Direction?

If you are eligible, you can use JobKeeper Enabling Stand Down Directions to reduce an employees’ hours. For Qualifying Employers who meet the relative turn over test, this means reducing hours to zero. Utilizing this provision may allow them to keep the employee in employment in the short term, before making a final decision in the future on whether a redundancy is required once business conditions are more stable.

For legacy employers under JobKeeper 2.0, you can still use the stand down direction to reduce the amount of hours your employee works to no less than 60% of their ordinary hours at the 1 March 2020.

Business owners should note that any ‘time on’ for a JobKeeper enabled  stand down is taken into account when determining how much service, notice and redundancy pay is required. Therefore, delaying a redundancy through a stand down may result in higher costs if you do decide to proceed with a redundancy in the future.

Employsure recommends employers to get in touch with a workplace relations expert if they are considering enacting stand downs. Any type of stand downs are one of the most complex aspects of the Australian workplace relations system.

JobKeeper 2.0 | The Ultimate eGuide

Find out more about JobKeeper 2.0 and JobKeeper Enabling Directions with this free guide for employers.

How Are These Different from Normal Stand Downs?

Under the Fair Work Act, stand downs are a very different beast. Stand downs without pay in particular have very strict criteria.

These JobKeeper Enabling Stand Down Directions are provided by the JobKeeper amendments to the Fair Work Act. This article discusses the provisions for JobKeeper Enabling Stand Down Directions and not stand downs (with or without pay) as provided otherwise in the Fair Work Act. For more information about stand downs, please read this page.

Criteria for Enacting a Stand Down Direction

For Qualifying Employers, to use and make a Direction in this way, the rules are:

  1. Your business must qualify for the JobKeeper scheme at the time the Direction is given
  2. It must be the case that the employee cannot be usefully employed for their normal days or hours because of changes to the business attributable to the COVID-19 pandemic or government initiatives to slow the transmission of COVID-19 (e.g. government shutdowns of businesses)
  3. The implementation of the Direction must be safe
  4. The Direction must be reasonable in all the circumstances
  5. Your business must be entitled to receive the JobKeeper payment for the employee in the period to which the Direction applies
  6. The employee’s hourly rate of pay cannot be reduced
  7. Before giving the Direction, your business must consult the employee (or their representative) about the Direction
  8. The employee must be given 3 days’ written notice of your business’ intention to give the Direction (or earlier, if genuinely agreed with the employee)
  9. The Direction must be in writing

For Legacy Employers, to use and make a Direction, there are a few differences:

  1. Employers may continue to access the JobKeeper enabling directions provisions in the Fair Work Act after 28 September 2020, but they must satisfy a 10% decline in turnover test and have a certificate confirming this
  2. It must be the case that the employee cannot be usefully employed for their normal days or hours because of changes to the business attributable to the COVID-19 pandemic or government initiatives to slow the transmission of COVID-19 (e.g. government shutdowns of businesses)
  3. The employees hours cannot be reduced to less than 60% of the ordinary hours as at 1 March 2020
  4. If reducing an employee’s hours of work or changing their days or times of work, Legacy Employers must ensure that an employee works at least two hours on a given day
  5. The implementation of the Direction must be safe
  6. The Direction must be reasonable in all the circumstances
  7. Before giving the Direction, your business must consult the employee (or their representative) about the Direction
  8. The Direction must be in writing
  9. The employee must be given 7 days’ written notice of your business’ intention to give the Direction (or earlier, if genuinely agreed with the employee)
  10. The employee’s hourly rate of pay cannot be reduced

If the above rules are complied with, the employee must comply with the Direction. If the employee does not comply, you can make an application to the Fair Work Commission to deal with the dispute.

What Are The Different Types Of JobKeeper Enabling Directions?

Under JobKeeper, eligible Qualifying Employers may be able to also take the following actions:

  • direct an employee to perform different duties or work at different work locations.

Under the extended JobKeeper provisions, Legacy Employers can:

  • issue JobKeeper enabling stand down directions (with some changes)
  • issue JobKeeper enabling directions in relation to employees’ duties and locations of work
  • make agreements with employees to work on different days or at different times (with some changes).

Frequently Asked Questions

  • What is a JobKeeper Enabling Direction?

    Broadly speaking, employers receiving JobKeeper payments can give eligible employees JobKeeper Enabling Directions to vary certain terms of the employee’s employment, without the employee’s consent.

    Under JobKeeper, an employer can do any or a combination of the following:

    • Vary an employee’s duties
    • Increase or decrease an employee’s hours of work
    • Change an employee’s location of work

    JobKeeper also has new provisions for stand downs for employers and employees under the scheme.

  • What Does It Mean to Be Stood Down?

    If an employee is stood down, it means they remain employed by their employer, but they are not required to work because of a stoppage of work that the employer can’t reasonably be held responsible for. An employee can be stood down with or without pay.

  • How Long Can You Stand Down An Employee?

    Under the Fair Work Act, an employer must give employees notice of when their stand down is set to end.

  • How Many Hours or Days of Work Can Be Reduced?

    Under the JobKeeper Enabling Directions, provided by the JobKeeper amendments to the Fair Work Act, an employer can reduce and employee’s hours of work from anywhere to zero, if they so wish. However, there are many criteria that has to be met for this to be a feasible option – chief of which is that the employer and eligible employee are under the JobKeeper scheme.

  • Can an Employee Refuse a JobKeeper Enabling Stand Down Direction Request by the Employer?

    An eligible employee who is given a JobKeeper enabling direction in accordance with the Fair Work Act must comply with the direction, unless the direction is not reasonable in the circumstances.

    If the employee fails to comply, you have the ability to make an application to the Fair Work Commission to deal with the dispute. The Fair Work Commission has the power to approve the direction, set it aside or provide an alternative JobKeeper enabling direction. Failure to comply gives rise to a breach of the Fair Work Act.

About Employsure.

With over 27,000 clients, Employsure is one of Australia’s largest workplace relations specialists.

We help small business owners better understand workplace relations and WHS legislation, giving them peace-of-mind that their business is getting backed by expert advice.

Want to know more about JobKeeper Enabling Directions?

Call Employsure right now to get free, initial advice about JobKeeper Enabling Directions.

Have a question?

Have a question that hasn’t been answered? Fill in the form below and one of our experts will contact you back.

  • This field is for validation purposes and should be left unchanged.

Call Now

1300 207 182

Live Chat

Click here