The workforce implications of Thursday's snap public holiday

The snap public holiday announced for this Thursday has created discontentment and frustration in some sectors. Many employees, particularly in the healthcare sector, will be asked to treat Thursday as a normal work day but they will be entitled to certain additional employment entitlements. These extra costs will largely be worn by employers, but in other sectors it is likely that public holiday surcharges will seek to recoup some of the costs of penalty wage rates.

Certainly a number of business and industry groups have expressed frustration with the costs involved in a non-planned public holiday. Many retail and hospitality businesses hardest hit by COVID-19 lockdowns will be faced with the difficult decision to either shut down (and, for some, lose significant custom) or absorb the additional costs involved in opening.

Here are some of the employment legal considerations to keep in mind.

Do I have to give my employees the day off on Thursday?

Permanent full- and part-time employees are entitled to the day off on gazetted public holidays according to the National Employment Standards in the Fair Work Act.

But employers can request that a permanent employee works on this day if that request is reasonable. For example, if there is a genuine business need and operations must be kept running on Thursday, employers can ask employees to work.

Equally, an employee is entitled to refuse a reasonable request to work on Thursday if they have reasonable grounds for doing so. Employees with caring responsibilities will have reasonable grounds to refuse a request to work given the closure of most child care and school holiday care facilities.

Genuinely casual employees are always entitled to refuse a shift and so may decide not to work on Thursday, with the appropriate notice.

Do I have to pay penalty rates to employees who work on Thursday?

It depends.

There is no general right to penalty rates. Public holiday penalty rates arise under industrial instruments such as modern awards or enterprise agreements. If an award or enterprise agreement applies to your employees they will be entitled to a public holiday wage rate (usually at least double time, sometimes up to double time and a half).

But there are also other options available under some industrial instruments. For example, some modern awards provide that an employee working a public holiday can be provided with time off in lieu or additional annual leave instead of being paid penalty rates. Some awards also provide that another day can be substituted for the public holiday, which might be useful if there is a real business need for the employee to continue to work on Thursday.

If you are paying your employees an annualised salary in satisfaction of any penalty rates they might otherwise be entitled to, you will need to factor in any work on Thursday in assessing whether the annualised salary is enough. This should be a consideration if you are requiring an annualised salary employee to work on Thursday, because you will not have factored this additional public holiday into any pre-determined annualised salary.

We don't agree with the reason for the public holiday. Do we have to honour it?

Without a change in monarch for over 70 years, there is no real precedent for a public holiday with such little notice. That said, the Australian Federal and State Governments have determined that the National Day of Mourning is an appropriate response and in line with established protocols.

Regardless of your political views on the reason for the public holiday, the public holiday must be observed. Employers would be well advised to ensure that any commentary about the rationale for the holiday is appropriate and professional.

Employee engagement should be top of mind in most sectors at the moment. Labour shortages and unique hybrid work challenges in the post-COVID-19-lockdowns workplace mean that all employers should be focused on measures they can take to maximise staff retention. The response to and management of arrangements for this short-notice public holiday will be highly visible to employees and all employers must keep this in mind.

Kellie-Ann McDade is an employment partner at Baker & McKenzie

Note from the editor: Please note that this article has been prepared for informational purposes only, and is not to be construed as advice.