I need to put an employee who works in Australia on furlough due to down turn of the business. but we do not have local

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Customer: i need to put an employee who works in Australia on furlough due to down turn of the business
JA: Was this discussed with a manager or HR? Or with a lawyer?
Customer: I am HR but we do not have local HR in Australia and no understanding of the law
JA: Is the workplace "at will" or union? Is the job hourly or salaried?
Customer: salaried permanent contract no union
JA: Anything else you want the Lawyer to know before I connect you?
Customer: no
Answered by John Melis in 19 mins 2 years ago
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John Melis
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John Melis, Expert

Hi, I’m John, solicitor, and reviewing your post, and may need to ask a few questions a long the way to assist you.

With regard to the information you have provided, is there any specific aspect that you consider is the most important part that you require addressed.

Customer
Hi
The employee is on an employment contract and has been employed since 13 June 2016
Due to the crisis our business has a huge loss of revenue and we are putting people on furlough and taking up government grants were we can
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John Melis, Expert

In relation to your important matter, under the law of frustration you will be able to ask your employees to stand down without pay the law of frustration happens when circumstances change after a contract has been formed which is out of control of the actual contract and arrangements between the parties and is not a foreseeable event.

Such as the pandemic that is now in place as a result of the coronavirus. Which is changing rapidly, requiring businesses to adapt, reduce staff, in order to keep the business afloat.

The coronavirus creates a situation where frustration of contract has occurred and neither party can perform the contract.

This enables you as the employer to either terminate the contract of employment or standdown the employees without pay until further notice where the business can start up again.

Where an employment contract is frustrated, it comes to an end by operation of law rather than at the initiative of the employer. Frustration of employment may occur, for example, as a result of the death or imprisonment of an employee. However, employers should be aware that the courts and tribunals are generally reluctant to find that a contract has been frustrated.

Nevertheless, it is possible to identify a number of situations where the question of frustration is likely to be a live issue. They include: death , imprisonment, change in economic circumstances, long-term illness or injury, loss of security clearance.

If an employer considers that a contract has been frustrated it should communicate this to the employee as soon as possible. Courts and tribunals may interpret an employer’s inaction in the face of a frustrating event as an acknowledgment that the contract is still on foot.

​Thank you for reaching out today.

You have a legal right to protect your interests in this important situation.

I am a user like you in this chat forum to assist in your important question today.

Thank you kindly for rating me with 5 stars, which helps me support the community.

You can come back to this post any time to ask questions without additional charge.

I hope I have assisted with answering your important question today, and thank you for supporting the community.

Customer
We want to put this employee on furlough so we dont have to pay him for a while. Can we do this in Australia and if so can you help me with the process. I am HR based in UK as we do not have local support in Australia
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John Melis, Expert

Which respect to my comments just above, and if you are unable to see them please let me know and I'll repost it for you, you can stand down your employee accordingly Based on the noted position

Customer
OK that makes sense, so I can speak to the employee and tell them I want to stand them down for a month without pay and he cannot refuse?
Customer
What is the risk to the company?
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John Melis, Expert

Yes you can do exactly what you have said and if they refuse then you'll need to frustrate the contract, and terminated on the basis of the pandemic a virus that sweeping across Australia

Customer
Is there special documentation that I need to provide to the employee and can you assist me with a template?
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John Melis, Expert

In this particular instance there are various templates that can be utilised, which you will be able to obtain from the companies local lawyer, or you can search those online. Generally this type of document is professionally drafted specific for its purpose.

Customer
How long am I able to stand down this employee without pay?
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John Melis, Expert

This is at the discretion of the company

Customer
OK thank you, ***** ***** company able to provide me with a template letter for standdown we do not have a local lawyer in Australia as we use UK Based global lawyers
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John Melis, Expert

Thank you for your follow-up, unfortunately I'm not able to provide a temp late for you but as you have U.K.'s bass lawyers, they will be able to prepare a temp late based on legal precedence they will be working on at the present time. UK law and Australian law work on the same premises.

Customer
OK thank you for the advice
Have a good day.
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John Melis, Expert

Thank you for reaching out today and I wish you safety during this coronavirus time

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