When can an employer stand down employees?

Under the Act, you can only stand down employees without pay if they cannot be usefully employed due to:

• Industrial action (not organised by the employer)

• Breakdown of machinery or equipment

• A stoppage of work for which the employer cannot reasonably be held responsible

This last category is the most commonly relied on and includes supply chain disruptions preventing operations.

However, it isn’t as simple as saying there is a supply chain problem, a stand down is only lawful if:

• The employee cannot be usefully employed (even in alternative duties)

• The cause is beyond the employer’s control

• The stand down is genuinely necessary and temporary

If useful work is available, even at a lower level or different duties, a stand down may not be valid.

If employees are lawfully stood down from work they are not paid. However, they still continue to accrue leave entitlements, and if they choose, the employee can elect to be paid their annual leave or other entitlements, for example, take their paid rostered days off, RDOs, or time off in lieu, TOIL.

If a public holiday occurs during stand down they must still be paid for the public holiday if the public holiday falls on a day the employee would normally work.

Risks for employers

Common mistakes that employers make include:

• Standing down employees due to lack of work or downturn alone (this is not sufficient)

• Failing to consider alternative duties

• Using stand down to reduce costs.

Seasonal downturns or market conditions alone will not justify stand down—this is a common compliance trap in agriculture.

So what to do in the current circumstances.

If you are considering a stand down of an employee:

1. Identify the trigger event (supply chain event – e.g. can’t operate machinery or carry out plantings)

2. Assess whether employees can be usefully employed elsewhere

3. Check your award,

4. Communicate clearly with the employee, verbally and confirm in writing:

o Reason for stand down

o Expected duration

o Employee options (leave, etc.)

5. Keep the situation under regular review and keep your employees informed.

Contact Primary Employers Tasmania to discuss your particular circumstances and whether a stand down is valid