Can an employer stand down an employee?

The answer to this question is maybe.

Sec 524 of the Fair Work Act, which covers most but not all of the employers and employees in Australia, effectively provides that subject to any applicable enterprise agreement (which may make express provision for the situation) an employer may stand down an employee during a period in which the employee cannot usefully be employed because of a stoppage of work for any cause for which the employer cannot reasonably be held responsible.

Now, I am unaware of any case law on what this means, but in my opinion it certainly does not mean that an employer can necessarily stand employees down due only to the economic implications and impact of the Coranavirus pandemic.

In my view, which might be controversial, there is a distinction between “a stoppage of work” and the economic implications of the pandemic and profitability.

I image that Qantas has taken excellent legal advice before standing down 20,000 employees. In its case, it appears very clear that the business of flying passengers domestically and internationally has been devastated by the impact of the virus, together with other external influences such as the government banning certain passengers from entering the country and restrictions on passengers flying elsewhere. Thus, I imagine it could argue that there has been a “stoppage” of considerable work thus permitting it to invoke the stand down provisions of the Act.

That, as it seems to me, is a quite different situation from an employer standing down employees because of a downturn of business. It will be interesting to see what develops in this context. I would recommend that an employer contemplating doing so should take first class employment law advice.