Reducing staffing levels during coronavirus

Published 16 February 2021 | Updated 8 April 2021

Find out about reducing staffing levels because of an enforceable government direction and complying with awards, agreements or the JobKeeper scheme.

Awards and agreements

Awards and enterprise agreements include terms about paying full-time and part-time employees for fixed or agreed hours of work and have requirements to consult employees about major workplace change and changes to rosters or hours.

When an employer is required by an enforceable government direction to temporarily reduce staffing levels, they should consider their obligations under an award or enterprise agreement and consider the available options, including:

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JobKeeper employers

Icon of a book with \The JobKeeper scheme finished from 29 March 2021. The information in this section stopped applying from this date. Find out more at Temporary JobKeeper provisions finishing.

The JobKeeper scheme has been extended until 28 March 2021, with some changes. The JobKeeper changes to the Fair Work Act have also been extended, with some changes.

There are two kinds of employers who can use the JobKepeer provisions in the Fair Work Act: qualifying employers and legacy employers.

Qualifying employers

Qualifying employers are employers who qualify for the JobKeeper scheme and are receiving JobKeeper payments for their employees.

A qualifying employer who needs to reduce staffing levels in order to comply with an enforceable government direction can:

Legacy employers

Legacy employers are employers who previously participated in the JobKeeper scheme but no longer participate from 28 September 2020 and can demonstrate at least a 10% decline in turnover for a relevant quarter.

A legacy employer can also:

  • give their employees JobKeeper enabling stand down directions (with some changes)
  • give their employees JobKeeper enabling directions to change their usual duties and location of work
  • make agreements with their employees to work on different days or at different times (with some changes).

For more information, see JobKeeper enabling directions and agreements for legacy employers.

JobKeeper enabling directions and agreements made under the Fair Work Act JobKeeper provisions apply even if they're inconsistent with terms of an award, enterprise agreement or employment contract.

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Employers who can’t use the JobKeeper provisions

Employers who can’t use the JobKeeper provisions may also need to reduce staffing levels in order to comply with an enforceable government direction.

The Fair Work Act provides that awards and enterprise agreements are subject to enforceable government directions under state and territory laws that restrict the performance of work in emergency situations. This means that an enforceable government direction requiring a reduction in staffing levels may override some of an employer's obligations under an award or enterprise agreement. Where this occurs, an employer may be able to reduce employees' hours below those set under an award or enterprise agreement, and not pay employees for the hours they don't work. Other relevant terms of an award or enterprise agreement, such as terms requiring consultation with employees, may also in some circumstances be overridden by the enforceable government direction.

The availability of this option for employers affected by an enforceable government direction has not been tested in the courts and may be subject to competing views. It is only likely to be available to the extent that an enforceable government direction requiring reduced staffing levels makes it reasonably necessary to reduce employees’ hours below those ordinarily set under an award or enterprise agreement. This will depend on the circumstances and how the particular award or enterprise agreement interacts with the enforceable government direction. You should consider seeking independent legal advice if you’re considering this option.

Employers can’t use this option if they are only indirectly affected by an enforceable government direction. For example, if an employer experiences a disruption to its supply from another business that has been required by an enforceable government direction to close, the employer can’t rely on this option to reduce their employees’ hours of work.

Employers have some discretion about how they choose to implement reductions in staffing across their workforce. However, under the general protections in the Fair Work Act, employers cannot take adverse action against employees for a prohibited reason, such as the person’s race, sex, marital status, pregnancy or union or non-union membership. See Protections at work.

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