Live Events Australia Pty Ltd (Live Events) suffered adverse revenue impacts due to disruptions to its business caused by the current pandemic. To mitigate these impacts, Live Events scaled back its operations and re-assessed its budget.
In March 2020, Live Events requested its workforce accept a 40% reduction in salary and hours. A broadcasting engineer, Mr Jones, was the only employee to refuse this request. The reduction accepted by the rest of the workforce was since varied to 20%.
In June 2020, Live Events issued a JobKeeper direction to Mr Jones, reducing his hours by 50%. The direction was purely precautionary and Live Events had no objective evidence of an operational need for the reduction. Since being issued with the direction, Mr Jones has continued to be rostered on and work his full-time hours. The only reduction in practice was to the hours of overtime he would work.
The Fair Work Commission found the JobKeeper direction was disproportionate to Mr Jones’ rostered time and prospective hours, and arrangements Live Events had in place with other employees who accepted a 20% reduction in salary and hours. The Commission amended the direction to reduce Mr Jones’ hours by 20%.
- Before issuing any JobKeeper direction, employers must: have objective evidence of its operational requirements, considered against the operational requirements across the relevant industry; and consider reasonable alternatives to reducing hours or income (such as redeployment to alternate roles or an agreed draw-down of annual leave accruals). In this case, Live Events had evidence to the contrary – racing operations continued without unscheduled interruptions.
- JobKeeper directions must be regularly reviewed against current objective evidence of operational requirements. Given the unpredictable nature of the current pandemic, operational requirements may have elevated variance month-to-month. What may be considered a reasonable reduction in hours or income one month may not be the next.
- JobKeeper directions must be issued fairly amongst employees. In this case, Live Events only issued a JobKeeper direction reducing Mr Jones hours, despite the workload of others also being impacted by the unscheduled interruptions. Given Mr Jones was the only employee who refused Live Events’ request for a reduction in salary and hours, he may have had an arguable adverse action claim.