Australia: Paid pandemic leave - implications for employers and employees in the aged care sector

In brief - a Full Bench of the Fair Work Commission has determined to vary the Aged Care Award to provide for two weeks of paid pandemic leave

In addition to the amendments to the Aged Care Award, the Full Bench also expressed its support for the inclusion of similar paid pandemic leave provisions in the Nurses Award and the Health Professionals and Support Services Award, to the extent employees covered by those Awards are engaged by residential aged care providers, or are required to work in residential aged care facilities.

Having previously resisted calls for the provision of paid pandemic leave under the Aged Care Award, the Full Bench cited the unfolding situation in Victorian aged care facilities and the increased risk of exposure for staff working in residential aged care amongst its reasons for now supporting the Australian Council of Trade Unions, Health Services Union and Australian Nurses' and Midwives' Federations' submissions in favour of paid leave.

Factors supporting the amendment of the Awards

In addition, the Full Bench determined it was necessary to include provisions providing for paid pandemic leave in order to achieve the modern awards objective in the Fair Work Act (FW Act), namely "for the minimum safety net constituted by the Aged Care Award to be fair to employers and employees and to be relevant to the current circumstances of the COVID-19 pandemic", noting the following:

• relative living standards and the needs of the low paid

The Full Bench defined "low paid" employees for the purpose of its consideration of the proposed leave entitlement as those employees earning less than two thirds of median full time earnings, or less than $916.67 per week, and observed that the full time minimum weekly wage for Aged Care Employees Levels 1 to 5 (inclusive) of the Aged Care Award were less than this amount, as are the rates for Assistants in Nursing and some Enrolled Nurses covered by the Nurses Award, before concluding that the aged care sector "employs significant numbers of low-paid employees".

• the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and regulatory burden

Here, the Full Bench referenced the Federal Government's financial assistance measures for residential aged care providers, specifically the availability of funding grants for aged care providers located in "hotspots" or whose staff reside in "hotspots" and relied upon evidence presented by the Government to the effect that the funding was intended to be used by providers for the benefit of employees required to self-isolate, noting that such funding "may" extend to the wage costs of self-isolating casual employees who do not have access to paid leave and to full-time and part-time employees who do not have any leave entitlements. Interestingly however, the Full Bench acknowledged "the information provided to us does not wholly disclose the extent of financial assistance which may be available" before concluding that "the financial assistance measures announced by the Commonwealth Government which we have earlier described will substantially reduce if not wholly remove the cost of any paid pandemic leave entitlement which might be established for the most affected residential aged care employers". The Full Bench also stated it was "confident" the issue of additional costs for labour hire or agency staff required to back-fill staff shortages, and particularly, who would be responsible for meeting those costs, would be the subject of "productive discussion" between the aged care industry and the Government. Obviously, it remains to be seen whether the financial assistance provided by the Government does in fact offset the increased wage costs incurred by providers as a consequence of the inclusion of paid pandemic leave provisions in the relevant Awards.

• the likely impact of any exercise of modern award powers on employment growth, inflation and the sustainability, performance and competitiveness of the national economy

The Full Bench determined that there was "a clear relationship"  between the containment of the COVID-19 pandemic and the restoration of the national economy. In particular, the Full Bench cited the potential for effective infection control measures in residential aged care to benefit employment growth and the sustainability and performance of the national economy. The Full Bench also noted that "the requirement for self-isolation is primarily to prevent the spread of infection which, in the aged care sector is especially critical because of the vulnerability of aged persons to COVID-19 fatalities. Thus, the requirement to self-isolate may be said to be in the public interest".

• the absence of access to paid personal/carer's leave and the increased likelihood of employees presenting for work unwell and/or failing to report symptoms

The relevant point to note in respect of this consideration is that employees required to self-isolate may not have access to paid personal carer's leave, either because they may not be unfit for work (but rather required to self-isolate as a preventative measure), or because the employee may have previously exhausted their entitlement to paid personal/carer's leave and/or may be a casual employee not entitled to paid leave. In these circumstances, the Full Bench considered there was an inherent risk that employees would attend work while unwell or otherwise not report symptoms that would require them to self-isolate for fear of the financial implications, thus posing a significant risk in terms of infection control measures.

Which employees can access paid pandemic leave?

The provision of paid pandemic leave under each of the Aged Care, Nurses and Health Professionals and Support Services Awards will extend to residential aged care providers across the country with employees covered by one or more of these Awards.

To access the entitlement to paid pandemic leave, an employee must be prevented from working (including prevented from working at home) because:

• the employee is required by the Government or medical authorities to self-isolate or quarantine;
• the employee is required by their employer to self-isolate or quarantine;
• the employee is required on the advice of a medical practitioner to self-isolate or quarantine because they are displaying symptoms of COVID-19 or are suspected to have come into contact with a person suspected of having contracted COVID-19;
• the employee is in isolation or quarantine while waiting for the results of a COVID-19 test; or
• of measures taken by the Government or medical authorities in response to the COVID-19 pandemic.

When is an employee not entitled to paid pandemic leave?

Employees will not be entitled to access the new paid pandemic leave entitlements in the following circumstances:

• the employee could otherwise access and take a period of paid personal/carer's leave;
• the employee becomes eligible to receive workers' compensation payments as a result of contracting COVID-19;
• the employee refuses to be tested for COVID-19 "at the earliest opportunity";
• only casual employees engaged on a regular and systematic basis will be eligible to receive paid pandemic leave. A casual employee who does not work regular and systematic hours will not be eligible to receive paid leave; and/or
• the employee requests to take a period of leave commencing after 29 October 2020, although the period of paid pandemic leave may extend beyond this date.

How much will employees taking paid pandemic leave be paid?

• Full time employees will be paid their base rate of pay for the ordinary hours they would have worked had they not been on leave.
• Part time employees will be paid the greater of the agreed ordinary hours and the average of their weekly ordinary hours of work for the previous six weeks.
• Regular and systematic casuals will be paid the average weekly pay received by the employee in the previous six weeks, or where the employee has been employed for less than six weeks, for the duration of their employment.

Implications for employers and employees covered by an enterprise agreement

The proposed changes relate to the Aged Care Award, the Nurses Award and the Health Professionals and Support Services Award and not to an employer's enterprise agreements meaning, once the proposed changes to the Awards are introduced, an employer covered by an enterprise agreement will not  be required to offer paid pandemic leave to its employees. Offering such leave would only become compulsory if changes were made to the leave provisions in the National Employment Standards or another provision of the FW Act.

Obviously however, the question of whether a provider is under a mandatory obligation to offer paid pandemic leave or not, will not prevent employees or their representative unions from making a claim for such leave in the event of an outbreak. In the short term at least, this issue is more likely to be one of choice for providers as opposed to a question of legal obligation.

In the longer term, if the paid pandemic leave provisions are still a feature of the Awards at the time the employer's enterprise agreement is due for renegotiation (at this stage the Fair Work Commission has indicated the paid pandemic leave provisions will continue to operate in respect of employees required to self-isolate on or before 29 October 2020), then the provision of paid leave will become relevant for the purposes of satisfying the better off overall test.

When do the proposed changes take effect?

The draft Determinations amending the Aged Care Award, the Nurses Award and the Health Professionals and Support Services Award are intended to operate from 29 July 2020, with interested parties having until 2 pm today (28 July 2020) to respond to the proposed variation to the Awards.

Megan Bowe
Aged Care
Colin Biggers & Paisley

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.