The Employment Law Implications of COVID-19

Mar 2020 | Workplace Advisory

Originally published 18 March 2020. Article updated 25 March 2020. 

Material added on 25 March 2020 is in blue for ease of reference.

On 11 March 2020, the World Health Organisation declared COVID-19, also referred to as Novel Coronavirus, a pandemic (an infectious disease outbreak that spreads on a global scale). On 15 March 2020, a mandatory self-isolation period of 14 days was imposed on all people entering Australia from overseas. As the virus continues to spread, and governments continue to impose restrictions, it is important that employers and employees understand their rights and responsibilities.

At the outset, please note the following in respect of the information in this alert:

  • It is current at the time of publishing and will be updated regularly. Due to the rapidly evolving nature of the guidance surrounding self-isolation, it is prudent to regularly check the information available on the Fair Work Ombudsman website and the Department of Health website;
  • It is general in nature. Additional rights or obligations may arise under an award, enterprise agreement, employment contract or workplace policy applying to a particular employment relationship. It also remains possible that Parliament may enact legislation to address the impact of COVID-19 in respect of employment matters;
  • It does not apply to contractors. Where a business has engaged contractors, the terms of the contract should be considered on a case by case basis in determining whether the contractor’s services can be varied, suspended or terminated.

  Can I reduce employees’ work hours?

Many businesses are currently facing the reality of government closure, restrictions on trading, or significant downturn in business.

While redundancies and stand downs remain an option (discussed in further detail below), some employers may also consider reducing employees’ work hours with a view to retaining and supporting as many staff as possible.

Employers cannot unilaterally alter an employee’s work hours (except in the case of casual employees who do not perform work on a regular and systematic basis). If an employer wishes to reduce the hours being worked by employees, a transparent consultation process is critical, noting:

  1. Awards and enterprise agreements require that employees be consulted in relation to major workplace changes, including variations to hours of work;
  2. A unilateral reduction in work hours will likely be a breach of the employment contract and may amount to a constructive dismissal or redundancy; and
  3. Employees are less likely to agree to a reduction in work hours unless they understand the alternatives (which may include involuntary redundancies or staff being involuntarily stood down without pay).

Assuming an employer can reach agreement with employees about a reduction in work hours, the agreement should be recorded in writing, signed by both parties, and a date agreed for review of the agreement with a view to the employee resuming their ordinary hours once the current crisis passes.

What should I consider when conducting a COVID-19 risk assessment in the workplace?

An employer has a duty to ensure the health and safety of workers by taking reasonably practicable steps to eliminate or minimize hazards in the working environment.

In order to comply with their health and safety duty, an employer should conduct a risk assessment in relation to the hazards arising from COVID-19.

Any risk assessment should be completed in consultation with workers and should involve the identification of all hazards arising from COVID-19. The hazards may vary between worksites, but will generally include:

  • The risk of infection in the workplace;
  • The risk of infection while commuting (particularly on public transport);
  • The risk of infection during work breaks (including lunch breaks); and
  • The risk of psychological injury.

Depending on the level of risk revealed by the risk assessment, an employer may need to implement reasonably practicable controls in order to eliminate or minimize the hazards.

What risk assessments should be conducted in relation to home workspaces?

In addition, if an employer will permit or require employees to work from home, a risk assessment of the home workspace should also be completed.

Noting the requirement of reasonably practicable steps, an employer may not be in a position to carry out a risk assessment in every home workspace prior to employees commencing to work from home. At minimum, it would be prudent to ask employees working from home to complete and return a self-assessment checklist designed to flag any serious and imminent risks to health and safety, such as frayed electrical wires, tripping hazards, etc.

What happens if an employee refuses to leave the workplace despite showing signs of illness?

Despite all the warnings to stay home when unwell, there may be employees who will insist on attending work while unwell. If an employee is demonstrating obvious signs of illness (such as a runny nose and coughing), an employer should exclude the employee from the workplace and direct the employee to seek medical clearance before returning to work.

While an employer cannot force an employee to take personal leave in these circumstances, the employee is not entitled to payment if they have not requested leave and they are not ready, willing and able to work. In the current climate, there is a reasonable argument that any obvious signs of illness will render an employee unable to perform work safely in light of the increased risk presented to other workers.

 What happens if an employee wants to return to work early or wants to cancel an approved leave request due to the government’s travel restrictions?

If an employee was forced to return to Australia early due to the recently introduced international travel restrictions (and has either completed or was not captured by the 14 day self-isolation requirement), the employee may seek to return to work prior to their approved period of annual leave ending.

Similarly, employees who had approved annual leave for planned travel in the future may seek to cancel those future leave requests.

Noting the Fair Work Act allows for a period of annual leave ‘to be taken for a period agreed between an employee and his or her employer’, an employee is arguably entitled to withdraw from any such agreement and to have their annual leave request cancelled. Employers should therefore act with extreme caution in any scenario where an employee might be forced to take annual leave against their will. 

What if a union official seeks to exercise a right of entry in the current climate?

If a union official has validly exercised their right of entry, it is unlikely an employer will be able to deny access based on the risk of COVID-19. This situation may change as travel restrictions and self-isolation requirements are tightened.

Union officials are however obliged to comply with all onsite health and safety requirements. Accordingly, any measures which have been put in place to protect workers (such as maximum number of attendees at meetings, requirements for hand washing, etc.)  will likewise apply to union officials. If union officials refuse to comply with onsite health and safety requirements, they can be denied entry.

What entitlements do employees have if schools or child care centres are closed?

Ideally, employees should be permitted to work from home or to work flexible hours in order to accommodate the need to supervise children. If this is not possible (either because the employment is not suited to flexible or work from home arrangements, or because the employee is unable to balance working from home or flexible working arrangements with their parental obligations), employees will need to access paid or unpaid leave entitlements for the duration of their absence from work.

The Fair Work Ombudsman has issued guidance confirming that a school closing on short notice and for a short period will be considered an unexpected emergency in relation to which an employee may be entitled to access paid carers leave. While no guidance has been issued by the Fair Work Ombudsman regarding long-term closures, it seems implicit that the Ombudsman expects employees to take other forms of paid or unpaid leave during any such long-term closure.

If an employee has exhausted their personal leave entitlements, the employee would be entitled to any accrued annual leave or long service leave. In the absence of that, the employee would be required to take unpaid leave.

What happens if an employee tests positive for coronavirus?

It is important that employers seek immediate advice from health authorities if there is a confirmed case of COVID-19 in the workplace. Employees who have contracted the virus cannot attend the workplace, and the employer can direct the employee to stay away from work and to obtain medical clearance before returning to the workplace. In making such directions, employers should ensure their actions are reasonable in the circumstances and are supported by medical evidence or advice.

As the number of COVID-19 infections increase, health authorities may be overwhelmed and may not be in a position to provide an immediate response to an employer seeking advice regarding a confirmed case of COVID-19 in the workplace. The current guidance from Workplace Health and Safety Queensland is to inform co-workers about possible exposure to COVID-19 but to maintain confidentiality (i.e. do not disclose the name of the worker who tested positive). Employers should also advise workers to seek immediate medical advice if they develop symptoms or are concerned about their health.

Full time and part time employees who have contracted COVID-19 are entitled to paid sick leave for the duration of their incapacity for work (assuming the employee has sufficient accrued personal leave).

An employer is entitled to request a medical certificate or other evidence of the employee’s incapacity for work.

Further, an employer is entitled to request that an employee provide medical clearance before returning to work if they have tested positive and subsequently recovered from COVID-19.

What happens if an employee’s family member tests positive for coronavirus?

If a member of an employee’s household or immediate family has contracted the virus and requires care, the employee is entitled to paid personal (i.e. carer’s) leave (assuming the employee has sufficient accrued personal leave).

The Fair Work Act further contemplates that paid personal leave is available when a member of an employee’s household or immediate family requires care or support because of an unexpected emergency affecting the member. In circumstances where an emergency has been declared in several Australian states and territories, it is arguable that employees are entitled to paid personal leave in order to support any members of their household or immediate family affected by COVID-19 (regardless of whether the member of their household or immediate family is ill).

An employee in these circumstances will be required to self-isolate in any event (discussed in further detail below) and should be permitted to work from home or use their accrued leave entitlements for the duration of the self-isolation period.

Whilst an employer cannot force an employee to take paid personal leave, the employee is not entitled to be paid unless they use their paid leave entitlements.

Casual employees are entitled to two days of unpaid personal (i.e. carer’s) leave per occasion when a member of their household or immediate family requires care and should be permitted to decline shifts for the duration of any self-isolation period.

An employer is entitled to request a medical certificate or other evidence to support an employee’s request for personal leave.

What happens if an employee is stuck overseas or is unable to return to work due to quarantine or self-isolation?

Where an employee was sent overseas for work, and is prevented from returning to Australia, the affected employee will be entitled to full pay.

Where an employee is stuck overseas following personal travel, they are not entitled to be paid unless they rely on paid leave entitlements. At an employer’s discretion, the employer may permit the employee to work remotely from overseas or may negotiate paid or unpaid leave arrangements.

All people entering Australia from midnight on 15 March 2020 are required to self-isolate for 14 days. The Fair Work Act does not specifically cover these circumstances, so it is advised that an arrangement be negotiated between the employer and the employee. Such arrangements may include:

  • Permitting an employee to work from home or another location;
  • Permitting an employee to access any accrued leave entitlements; and
  • Any other paid or unpaid leave arrangement (including, for example, allowing employees to take annual leave in advance of accrual).

Any person who has been in close contact1 with someone who has a confirmed case of COVID-19 must self-isolate at home and cannot return to work until receiving medical clearance. As explained above, such an employee may be entitled to access paid personal (i.e. carer’s) leave. If paid personal leave is not available or not appropriate (for example, because the employee lives alone and had close contact with a friend who tested positive for COVID-19), work from home or leave arrangements should be negotiated between the employer and the employee.

What happens if an employee chooses to stay home as a precautionary measure?

Any person who has been in casual contact2 with someone who has a confirmed case of COVID-19 may continue to attend work while they remain well. Any such person will be required to self-isolate if they begin to experience symptoms.

Employees who choose to stay home following a casual contact or for other precautionary reasons may seek to negotiate an arrangement with their employer taking into account what is reasonably practicable in the circumstances (such as working from home). Alternatively, the employee may choose to take some form of unpaid or paid leave. In this case, normal leave application processes will apply. If the employee is not relying on paid leave entitlements, the employee is not entitled to be paid.

An employee does not have an entitlement to stay home or refuse to perform work unless the employee has a reasonable concern about a serious risk to their health or safety from immediate or imminent exposure to a hazard. Employers should take a common-sense approach to any such scenario, including consideration as to whether:

  • The employee is in a high risk category; or
  • The employee is in regular contact with a person in a high risk category.

It will almost always be unreasonable for an employer to refuse an employee’s request to stay home on a precautionary basis if the employee is willing to take unpaid leave for the duration of their absence.

Can an employer direct an employee to stay away from work as a precautionary measure?

The model Work Health and Safety (WHS) laws do not expressly permit an employer to direct a worker to stay away from work as a precautionary measure. The WHS laws do, however, require employers to take reasonably practicable steps to ensure the health and safety of their workers and others at the workplace. This duty requires identifying risks at the workplace and doing what is reasonably practicable to eliminate or minimise those risks. In other words, employers are required to undertake a risk assessment taking into account all of the relevant information from the health authorities and the prevailing circumstances at the workplace.

Depending on the circumstances, directing workers and other people to stay away from the workplace as a precautionary measure may be considered a reasonably practicable step in eliminating or minimising the risk of the virus spreading, as well as minimising other risks that may be created by the virus (including physical, psychological or other harm). Particularly where employees have the ability to work from home, a risk assessment conducted by the employer may point towards a requirement that all such employees work remotely.

In other circumstances, directing employees to stay away from work may not be reasonably practicable, particularly where employees do not have the ability to work from home. In these circumstances, there may be other controls an employer may implement in order to minimise the risk of the virus spreading (including increased cleaning arrangements, and supply of hand sanitizer, gloves, etc.) and minimising other risks created by the virus (including more regular paid breaks, provision of counselling to employees, etc.).

In deciding what steps are reasonably practicable in a particular workplace, it is essential that the employer:

  • considers the specific context of the workplace; and
  • consults with employees about the most suitable approach to be taken to minimise the risk presented by COVID-19.

What should an employer consider when directing employees to work from home?

In addition to conducting a risk assessment (as outlined above), employers should review their obligations under any applicable enterprise agreements, awards, employment contracts or workplace policies. Employers should consider the nature of the work, and whether it is suitable for the employee to do at home. Employers should be aware that WHS laws still apply when an employee is working from home, and employers must therefore take reasonably practicable steps to ensure home workspaces are without risks to health and safety.

What if I need to make employees redundant or reduce working hours?

All awards and enterprise agreements impose obligations on employers to consult with employees prior to any major changes, such as redundancies or reduced hours. These consultation processes require the employer to provide written notice to any award or agreement-covered employees who are likely to be affected by the changes, and to have open discussion about steps that could be taken to avoid or minimise the impact of the changes on employees.

Avenues which should be explored in order to avoid or minimise the impact of redundancies or reduced hours may include:

  • Inviting employees to volunteer for redundancies or reduced hours; and
  • Inviting employees to voluntarily take paid or unpaid leave.

Can an employer enforce a shut down period or stand down employees without pay?

A shut down is when a business temporarily closes during slow periods of the year, such as Christmas and New Year. Some awards or enterprise agreements allow for more than one shut down period per year. Employers should consult the applicable award or enterprise agreement governing their business to check whether an additional shut down period is allowed. During a shut down period, employers can direct their employees to take annual leave (or unpaid leave if an employee has exhausted their annual leave entitlements).

An employer may stand down an employee during a period in which the employee cannot usefully be employed due to circumstances outside of the employer’s control. In these circumstances, section 524 of the Fair Work Act allows an employer to stand down an employee without pay. It is likely that any unpaid stand down due to COVID-19 will be closely scrutinised, so employers should exercise caution and seek advice before doing so.

Can an employer direct employees not to travel?

Employers can direct employees not to engage in work-related travel. In normal circumstances, however, it is unlikely that employers will be able to direct an employee not to engage in personal travel. In the context of COVID-19, it is reasonable for an employer to require an employee to abide by any limitations on travel imposed by the Australian Government.

Can an employer refuse an annual leave request if an employee is planning to travel overseas?

Pursuant to section 88 of the Fair Work Act, an employer can refuse an employee’s annual leave request if the refusal is reasonable. If an employee is planning to travel overseas during a period of annual leave, there is a strong argument that an employer could reasonably:

  • refuse the annual leave request on the basis of operational requirements, noting the employee will need to comply with the mandated 14 day self-isolation period imposed by the Australian Government for people entering Australia; or
  • make approval of the leave request conditional on the employee’s agreement to take either annual leave or unpaid leave for the duration of the mandated 14 day self-isolation period (if work from home arrangements cannot be facilitated).

Can an employee make a workers’ compensation claim if they contract coronavirus in the workplace?

The workers’ compensation schemes differ across states and territories. There are, however, some common elements that would apply to COVID-19. These include the following prerequisites for a valid claim:

  • The worker is covered by the scheme;
  • The worker has an injury or illness covered by the scheme; and
  • The worker’s injury or illness arose out of, or in the course of, their employment.

Whether a claim for contracting COVID-19 will be covered by workers’ compensation will depend on the individual circumstances of the case and the applicable state or territory law. In many circumstances, it will be difficult for an employee to prove that the virus was contracted in the course of employment. This difficulty will be amplified as confirmed cases grow and the spread of the virus through social contact continues.

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1 There is a broad definition of close contact, which includes having more than 15 minutes face-to-face contact with a confirmed case, spending more than two hours in an enclosed space with a confirmed case, living in the same household as a confirmed case, and having direct contact with the body fluids of a confirmed case. Ordinarily, health authorities will contact all identified close contacts of persons who test positive to COVID-19 to enforce self-isolation measures.
2 A casual contact occurs where a person has had less than 15 minutes face-to-face contact with a confirmed case in the 24 hours prior to the onset of their symptoms, or who has shared a close space with a confirmed case for less than two hours in the 24 hours prior to the onset of their symptoms.

Disclaimer: Please note this information is current at the time of publishing.

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