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New shutdown leave rules

02 March 2023

From 1 May 2023, updated rules on taking annual leave during a shutdown apply for 78 Modern Awards.

The new rules mean employers may require employees to take paid annual leave during a temporary shutdown.

A shutdown is when a business temporarily closes, such as during Christmas and New Year. A shutdown isn’t the same as a stand down, which is when an employer tells employees not to work because they can’t be usefully employed for reasons outside the employer’s control.

Under the rules, employers must provide at least 28 days’ written notice of the temporary shutdown period to all impacted employees. The requirement to take annual leave must be reasonable.

The notice period can be reduced through an agreement between the employer and the majority of impacted employees.

An employee who doesn’t have enough paid annual leave to cover the whole period can form an agreement with their employer for other options for the days not covered, such as:

    • using accrued time off

    • annual leave in advance

    • leave without pay.

The employee will be paid for any public holidays during the shutdown period that fall on days they would normally work.

This article was originally published by The Victorian Chamber of Commerce

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