On 24 and 28 March 2020, the Fair Work Commission (FWC) made its first determinations to vary two modern awards (Hospitality Industry (General) Award 2010 (Hospitality Award)and Clerks – Private Sector 2010 (Clerks Award)) in response to the coronavirus (COVID-19) pandemic and the challenges employers are currently facing.  It is likely that similar flexibility changes will follow for a range of awards given the extensive reach of the pandemic across industries.

Hospitality Award changes in response to COVID-19

On 24 March 2020, the Fair Work Commission (FWC) granted an application by the Australian Hotels Association, and supported by the United Workers Union, to vary the Hospitality Industry (General) Award 2010 (Hospitality Award).  The application sought to insert a new schedule to provide for award flexibility on a temporary basis.

The FWC acknowledged that the recent Government announcements in response to COVID-19 would likely have a substantial impact on employers and employees in the hospitality sector.  The FWC determined that the variation was necessary to achieve the modern award objective and to ensure the retention of as many employees as practicable in the current crisis. 

The determination varies the Hospitality Award to insert ‘Schedule L – Award flexibility during the COVID-19 Pandemic.’  The award variation commenced on 24 March 2020 and will operate until 30 June 2020.  The Schedule allows employers to make the following directions:

  • For employees to perform duties outside the scope of their
    classification subject to the duties being within their skill and competency,
    being safe and the employee being licensed and qualified to perform them, and
    the Higher Duties provision in the Hospitality Award;
  • For full-time employees to work fewer hours (an average of between 22.8
    and 38 ordinary hours per week) and the employer will pay the employee on a pro
    rata basis;
  • For part-time employees to work fewer hours (an average of between 60%
    and 100% of their guaranteed hours per week or the
    guaranteed hours per week over the roster cycle);
  • For employees
    to take annual leave with 24 hours’ notice, subject to the employer considering
    the employee’s personal circumstances.

Employees that are directed to work fewer hours will continue to accrue annual and personal leave based on the employee’s ordinary hours of work prior to the commencement of the Schedule.  Employees that take annual or personal leave will also be paid leave based on their ordinary hours of work prior to the commencement of the Schedule. 

While employers can direct employees to take annual leave, this does not prevent an employer and employee agreeing to the employee taking annual leave.  By agreement between the employer and employee, during the operation of the Schedule, an employee may take twice as much leave at half the rate of pay for the period of annual leave.

Access the FWC’s determination and Schedule L here. 

Access the reasons for the FWC’s decision here.

Clerks Award changes in response to COVID-19

On 28 March 2020, the Fair Work Commission granted an application by the Australian Chamber of Commerce and Industry (ACCI) and the Australian Industry Group (AI Group), with support of the Australian Council of Trade Unions and the Australian Services Union, to vary the Clerks Award.  These changes provide greater flexibility for employment arrangments for clerical and administrative workers in response to COVID-19.

The determination varies the Clerks Award by inserting ‘Schedule I – Award flexibility during the COVID-19 Pandemic.’  The Schedule includes the following flexibility changes:

  • For employees to perform duties within their skill and competency regardless of their classification, provided the duties are safe and the employee is licensed and qualified to perform them; 
  • For employers to roster part-time employees working from home by agreement for a minimum of two consecutive hours on any shift, and for casual employees working from home by agreement to be entitled to a minimum payment of two hours’ work at the appropriate rate;
  • For the spread of ordinary hours for day workers to be between 6.00am and 11.00pm, Monday to Friday, and between 7.00am and 12.30pm on Saturday, for employees working from home by agreement with the employer;
  • For employers and full-time and part-time employees to agree to reduced ordinary hours (where approved by a percentage of employees and in accordance with a prescribed voting process as set out under Schedule I)  ;
  • For employers and employees to agree to the taking of up to twice as much annual leave at a proportionately reduced rate;
  • For employers to direct an employee to take accrued annual leave with at least one week’s notice or on shorter notice if agreed;
  • For employers to require employees to take annual leave as part of a close down, or for employees who have not accrued sufficient leave to take paid annual leave for the part of the close down for which they have accrued leave and unpaid leave for the remainder of the close down.

Schedule I operates from 28 March 2020 until 30 June 2020 unless extended beyond this date.

Access the FWC’s determination and Schedule I here.

Access the reasons for the FWC’s decision here.

What next

These award changes are aimed at providing employers and employees with the various flexibilities in working arrangements that are now seen as necessary options to preserve, as best as can be, on-going employment of employees, and businesses as a whole.

Given the widespread impact of COVID-19 on employers and employees, we anticipate that other unions and employer associations will make applications to vary other modern awards.  Employers should stay informed of any award changes to assist with the management of their employees during this time. 

We will publish further information about variations to other modern awards.

For further information on any of the issues raised in this alert, please contact: