A recent decision by the Fair Work Commission (FWC) has clarified the circumstances where employers on JobKeeper can reduce their employees’ hours of work.
An employer that is receiving the JobKeeper wage subsidy cannot use this as an excuse on its own to dramatically reduce an employee’s hours of work. Any reduction of hours must be in proportion with the reduction in work available. That is, there needs to have been a reasonable change in the availability of work for that employee to perform before the employer can use the enabling directions under the JobKeeper Legislation to reduce the employee’s hours.
In the recent matter of Allan Jones v Live Events Australia Pty Ltd , an employee working 80 hours per fortnight had their hours reduced to 40 hours per fortnight. This employee’s main duties were directly related to the broadcasting of horse racing events. The FWC decided that a direction to reduce the employee’s hours was reasonable, but not to the extent enforced by the employer.
FWC found that there was more work available for the employee to perform beyond the 40 hours per fortnight made available by the employer. This finding was based on the fact that the horse racing industry did not stop during the covid pandemic. The FWC considered that given a substantial part of the employee’s role was related to the broadcasting of horse racing events, there was actually very little reduction in the employee’s available work. While the employer had been impacted by covid as a whole, this particular employee’s work had not been impacted by 50 percent. Therefore, the 50 percent reduction in the employee’s hours was unreasonable.
The FWC decided to increase the employee’s hours to 64 hours per fortnight resulting in the employee returning to 80% capacity.
The findings of the FWC highlight the fact that there needs to be a correlation between the work available and the reduction of hours before an employer gives a direction under the JobKeeper legislation to reduce the employee’s hours of work. Make sure you keep this in mind when considering a reduction in employees’ hours of work, even if that employee is receiving JobKeeper.
For more information on this and other employment law topics, please contact our Employment Law team on (02) 4927 2900.