Christmas shutdown – can you force your staff to use annual leave?
It’s common for many businesses to shut down over the Christmas/New Year period, but whether you are able to direct your employees to use their leave over this period will depend on their Award. The amount of notice you must give is also Award-dependent, along with whether, and how, you can arrange to provide your employees with annual leave in advance.
If your employees agree to take leave – and their consent is genuine, and not the result of pressure from you – then you can generally come to an agreement between yourselves.
Before you make any decisions, ensure that you are confident that you know the Award that applies to your employees, and check the specific wording. All Awards are slightly different!
Can you force staff to use annual leave?
Whether you can require that your staff use annual leave or take unpaid depends on their Award. Note that the Award must specifically permit employers to direct employees to take leave during a shut down – if nothing is mentioned, you can’t do it.
If the Award doesn’t mention annual shutdowns or expressly permit employers to direct staff to take leave, then you don’t have the right to require this of employees. You can always request that staff use annual leave over a shutdown period – but you cannot force or require it.
If your employees don’t have enough annual leave, you can allow them to take unpaid leave. However, if an employee doesn’t have enough annual leave, and doesn’t consent to taking unpaid lead, you can’t force them to take unpaid leave.
What if staff won’t agree?
If their Award doesn’t enable you to direct them to take leave, and they don’t want to or refuse to do so voluntarily, you cannot force them to. Ultimately, you will need to pay them their ordinary hourly rate over the shutdown.
Annual shut downs, but not at Christmas?
Many Awards permit annual shutdowns for Christmas – but this does not mean you can shut your business at any other time, and assume that the same notice and shut down provisions apply. If you want to close your business temporarily, e.g. to renovate, or because things are quiet, you are unlikely to be able to require that your staff take leave for this.
Some Awards, particularly those in industries that are actually busiest over Christmas, permit temporary shut downs that are not specific to the Christmas period. But the general principle is that annual shut down periods are linked to the Christmas/New Year period only.
The following table has a list of common Awards, and the notice periods that apply.
|Award||Annual shut down – can you force leave?||Notice period?||Leave in advance, by agreement?|
|Clerks – Private Sector Award||yes||4 weeks||yes|
|General Retail Industry Award||yes||4 weeks||yes|
|Building and Construction General and On-Site Award||yes||2 months||yes|
|Professional Employees Award||depends||depends||yes|
|Health Professionals||Dental and medical practices – yes||Must be reasonable||yes|
|Fitness Industry Award||yes||4 weeks||yes|
|Real Estate Industry Awards||yes||unspecified||yes|
|Legal Services Award||yes||4 weeks||yes|
|Restaurant Industry Award||yes||4 weeks||yes|
This information is correct at 1 December 2020 – but is subject to change. Always make sure you check the Award before making any decisions!
For more information, see the Fair Work website’s update about entitlements over the Christmas period.Go back