In this challenging COVID-19 environment, it becomes important for GP clinics to understand their legal obligations under employment law
With many industries shutting down because of the COVID-19 crisis, Australia is seeing more pay cuts, reduced hours, forced leave, companies standing people down, and redundancies.
In this environment, it becomes quite important for GP clinics to understand their legal obligations under employment law. So, what can, and can’t GP clinics do to reduce costs during this time?
We asked My-Linh Dang, the managing director at Metis Law, the questions that are on GPs’ minds.
Q: What’s the difference between standing down employees and making employees redundant?
A: Standing down
Standing down is a right afforded to an employer to suspend an employee’s work and pay for a defined period where the employee cannot be usefully employed (including to do work that falls outside the employee’s usual duties) because of, relevantly, in the case of the COVID-19 pandemic, stoppage of work where the cause of the stoppage cannot reasonably be held to be the responsibility of the employer.
Employers can stand down employees under the Fair Work Act (“FWA”), an enterprise agreement or a modern award.
Employers are not required to pay employees during the period of the stand-down. Employees may request to access their paid leave entitlements during this period (e.g. annual leave, long service leave or carer’s leave). The period of stand-down is recognised by the FWA as ‘service.’ This means that employees will continue to accrue entitlements such as annual leave.
The conditions for triggering a stand-down are not simple to meet. A downturn in revenue or activity of the business is not, of itself, enough to meet the requirements for a valid standing down. Stand-downs can sometimes be unlawful, so care needs to be taken and advice sought before standing down employees.
Redundancy
Redundancy, on the other hand, is where an employer terminates an employee’s employment contract either because the employer no longer needs the role to be done by anyone, or because the employer has become insolvent or bankrupt. Redundancy, in the current environment, can be lawful when the business downscales due to lower revenue. Employees who are made redundant no longer accrue entitlements. However, the employer may be liable to make a redundancy payment to the employee.
Q: What do employees have to say ‘yes’ to and what can they push back on?
A: At heart, the decision to stand down or make employees redundant is a commercial one that is made by the employer. However, such decision-making is nonetheless subject to rules that ensure fairness and equity to all parties. The FWA is the statutory rulebook that defines the rights and obligations for both employees and employers.
Standing down
Employees can expect to only be stood down for lawful circumstances. A reduction in business or financial distress as a result of the pandemic will not likely be adequate reasons to validly stand-down employees.
In the current pandemic response, it is those businesses that have been required to close until further notice (e.g. pubs and businesses providing non-essential services) that would likely be permitted to stand down employees.
- Employees can expect to be consulted before being stood down. Employers must consult with their employees and consider any concerns expressed regarding the impact of this change on their wellbeing.
Redundancy
- Employees can expect redundancy dismissals to be genuine. Where it is not, the dismissal will be considered unfair and would attract penalties. A dismissal will be a genuine case of redundancy where the employer no longer requires the job to be performed anymore due to changes in operational requirements and the employer has consulted with employees about the redundancy.
A dismissal will not be a case of genuine redundancy where the employer still needs someone else to do the job; or has not consulted or could have reasonably in the circumstances given the employee another job within the employer’s business.
- Employees can expect to receive adequate notice of the termination. The length of notice will depend on the length of continuous service by the employee and varies from 1 week to 4 weeks in the medical industry.
- Employees can expect an adequate redundancy payout. The value of the payout is determined on a scale and the longer an employee has been with the company, the higher the value of the package. Employees who have been employed for less than 12 months, or where the business employs less than 15 employees are not entitled to redundancy pay.
Q: Do employers have to negotiate with their staff on alternative measures?
A:
- For the purposes of stand down and redundancy, the FWA requires that employers consult their employees on changes to rosters or hours of work. Employers must provide information about the change; invite the employee to give their views regarding the impact of the change (including on family); and consider any views from employees about the impact of the change.
- Of course, employers are not obliged to make a specific decision, as these decisions are commercial. The law only requires employers to provide this platform for employees to voice their concerns. As for employees, this could be a good opportunity to negotiate reduced hours, pay reductions or leave.
Q: Are there discrimination issues involved in standing down some staff and not others?
A:
- Issues of discrimination arises when an employer treats an employee less favourably than another employee in the same circumstances on the basis of sex, race, gender, sexual orientation, age, disability, marital status or parental status. In the case of a redundancy dismissal or a standing down, what is relevant is not so much the outcome of the decision, but the manner in which that decision was made.
- For employers, being transparent and having good communication platforms are key to reducing any potential misunderstandings that arise from these decisions.
Q: How does the JobKeeper policy work and how might it affect a GP clinic’s strategies around redundancy and stand downs?
A:
- The JobKeeper Payment is proposed payment made to eligible businesses affected by the Coronavirus to support them in retaining employees. While the government has announced the policy, it is still subject to legislation being passed.
- Under the proposed JobKeeper policy a business is eligible if the business has a turnover of less than $1 billion and the business estimates that their turnover has fallen or will likely fall by 30% or more. Or, if turnover is more than $1 billion the business must estimate their turnover has fallen or will likely fall by 50% or more
- Eligible businesses that elect to participate will receive a payment of $1,500 per fortnight per eligible employee. An eligible employee is an employee who:
- is currently employed by the business (this including those stood down or employees a business re-hires who were employees at 1 March 2020);
- is a full-time or part-time employee, or a casual employed on a regular and systematic basis for longer than 12 months as at 1 March 2020;
- As at 1 March 2020, was aged 16 years or older, was an Australian citizen, the holder of a permanent visa, or a Special Category (Subclass 444) Visa Holder, was a resident for Australian tax purposes; and is not in receipt of a JobKeeper payment from another employer.
- For businesses who are considering standing down employees or have already stood down employees if the business elects to pay an entitled employee at least $1,500 per fortnight (before tax) they are entitled to receive the JobKeeper payment of $1,500 per fortnight. So, where an employee’s total remuneration is less than $1,500 per fortnight (before tax), or has been stood down, the employer must provide the employee at least $1,500 per fortnight (before tax). Where an employee earns more than $1,500 per fortnight, employers can use the payment to subsidise the employee’s wages.
- If an employee has been made redundant or a business is considering redundancies the business must note that once a redundancy is made the person is no longer an employee and therefore, the business is not entitled to any JobKeeper payment for that person.
Q: To what extend are GP clinics liable if staff get sick because they came into contact with a COVID-19 case in the workplace?
A:
- GP clinics have an obligation, so far as reasonably practicable, to ensure, the health and safety of their staff. This extends to employees and contractors. That is,
- not to put them at risk from work carried our as part of their business;
- provide a work environment without risks to health and safety; and
- provide information, training instructions or supervisions that is necessary to protect all persons from risks to their health and safety arising from work.
- This duty imposed on GP clinics, with respect to health and safety, requires the clinics, so far as reasonably practicable, to eliminate risks to health and safety and if it is not reasonably practicable to eliminate risks, to minimise those risks so far as reasonably practicable. This means clinics should ensure they are providing the appropriate personal protective equipment and ensuring proper use and ensuring adequate decontamination and cleaning of the clinics.
- In assessing what is reasonable GP Clinics must consider ways of eliminating or minimising the risk of infection and the availability and suitability of ways to eliminate or minimise the risk. This means following relevant industry and government guidelines on best practice for minimising risk of infection.
Q: Can employees insist on a change in employment terms because they are concerned about COVID-19 exposure to themselves or a family member they live with?
A:
- Work Health and Safety legislation requires GP Clinics to consult with staff who are directly affected by a matter relating to work health or safety. Staff must be given a reasonable opportunity to express their views and raise a work health and safety issues and contribute to the decision making process.
- The FWA also provides certain staff the right to request flexible working arrangements with respect to hours, patterns and locations of work. GP Clinics can only refuse flexible working conditions on reasonable business grounds which include:
- the requested arrangements are too costly;
- it is impractical to change other employees’ working arrangements or to hire new employees to accommodate the request; or
- the request would result in a significant loss of productivity or have a significant negative impact on the business.
- Full-time and part-time employees are entitled to carer’s leave, sick leave and annual leave. GP clinics are not entitled to unreasonably refuse an employee’s request for annual leave.
- Employees are however generally required to follow all reasonable directions of their employers. So, if the employee is unable to work remotely and does not have any available leave entitlements, they may be required to take unpaid leave during this time if they are unable to attend work. Administrative staff may be able to work remotely with little disruption to the business, while it may be difficult for all nurses and doctors to work remotely.
Q: What other issues might be affecting GP clinics right now in relation to employment law?
A:
Work health and safety obligations apply to the workplace even where that workplace is the staff member’s home. That is businesses are liable for staff who are injured at home the same way they are liable if the staff member is injured at the clinic. For example, injuries can be caused by incorrect set up of the work station, so employers should ensure staff who are using laptops are provided with an external monitor, keyboard and mouse. The staff member must have a location where they can set up a work station that has sufficient lighting and there is no glare on their screen.
Also, staff must have an exit path that is clear from trip hazards and smoke detectors must be installed in case of a fire. It is useful to create a work from home checklist so employees can self-assess their home office and employers can assist with providing any additional items required to ensure that the risk of injury is minimised.
The emotional wellbeing of employee who are working from home is also important so it is important that staff are connecting via telephone and videoconferencing regularly. Employers should also encourage staff to get up and move around so they are not sitting stationary all day.
Privacy and confidentiality are also required to be maintained remotely. It is important that GP clinics have developed appropriate policies and procedures with respect to these obligations. For example, where a telephone health consult is being provided, what staff need to do to ensure the privacy and confidentiality of the consult, how patient records can be accessed and maintained remotely.
Q: What kinds of questions are you getting from clients about employment law right now?
A:
Very similar questions to what you have canvassed above: what options are available and the risks to employers in terms of terminating or maintaining staff; how these options impact the ability of employers to access the proposed government assistance packages; the impact of the COVID-19 situation on various employee entitlements, including maternity leave; employers’ obligations with respect to health and safety and working from home / self-isolation.
The situation with COVID-19 is an unprecedented and evolving one. The government is making a lot of the policy on very short timeframes, so the details are still to be fleshed out and understood.
It is important that GP clinics continue to keep their staff up to date with the latest on best practice, any expected changes to the workplace to their employment and to be as accommodating as possible during these difficult times.
