JobKeeper enabling directions and the Fair Work Commission

Here is a summary of another JobKeeper case in the Fair Work Commission, from a summary of it issued by the Commission today, which deals with the principles which apply to the Commission’s determination of the reasonableness of a Jobkeeper enabling direction.

“On 2 June 2020, the Applicant lodged an application pursuant to section 789GV of the Fair Work Act 2009 concerning whether a JobKeeper direction given to him by his employer was reasonable.

The employer operates a recruitment business for accounting and finance roles in Australia and New Zealand. The business has been significantly impacted by the COVID-19 pandemic. The employer qualified for the JobKeeper scheme and is receiving JobKeeper payments for the Applicant.

On 1 April 2020, the employer issued JobKeeper directions to its employees. The employer directed the Applicant to reduce his hours to 65% of the pre-pandemic arrangements. The Applicant’s dispute with his employer was not about this direction.

The employer gave the Applicant another direction on 3 June to reduce his hours of work to 12 per week, or a 71.5% reduction to his pre COVID-19 arrangements. The Applicant disputes this direction because he is the sole income earner for his household and does not believe that he can meet the requirements of his job if he is only working 12 hours per week.

Commissioner Platt accepted that the COVID-19 pandemic has significantly impacted and continues to impact the employer’s income stream and cashflow.  It appears likely that the employer will have a negative cashflow in June 2020. The Commissioner also accepted that the financial impact of the second direction on the Applicant is significant.

The Commissioner decided that the direction was reasonable within the meaning of section 789GK of the Fair Work Act 2009, and that the employer was entitled to make the JobKeeper enabling direction. The employer must review the situation each month.”

Application by W.C. [2020] FWC 2928 delivered 4 June 2020 per Platt C