JOBKEEPER 2.0: Questions remain

| July 23, 2020

JOBKEEPER 2.0: What hasn’t been addressed is what will happen with all of the directions to reduce hours that employers have made under the Jobkeeper legislation. Employment law expert Sean Melbourne explains.

JobKeeper-eligible employers are able to direct employees to reduce their hours for the purpose of enabling them to remain employed. Many businesses did this after JobKeeper came in.

Under the legislation all of these directions have a fixed expiry date of 28 September 2020. When they expire each employee will automatically revert to their pre-JobKeeper hours. This will be unsustainable for many businesses and they will have little choice but to make employees redundant.

It will certainly not help keep people employed if this happens. It will also be a significant cost to businesses because they will be required to make redundancy payments and pay out leave entitlements, which have continued to accrue as normal while employees have been working reduced hours.

It makes sense to allow employers who remain eligible for JobKeeper after 28 September to also retain the ability to direct employees to reduce hours. Let’s hope the government addresses this soon so employers and employees have certainty about what will happen come 28 September.