Question :
Can employers rotate staff on to their Annual Leave, then leave without pay and then move to standing down staff while also not applying for the government subsidy?

Question submitted 30/03/20 @ 04:54pm
Industry: Digital and Technology
  • On this one I think it would be best to consult offical channels. This is not a bad place to start



    In most cases you cannot require an employee to take annual leave. The Holidays Act requires you and your employee(s) to come to an agreement on when annual leave should be taken – but if agreement can’t be reached, then you can give your employee no less than 14 days’ notice before you require them to take annual leave. Annual leave must be paid at the employee’s contracted rate of pay.

    Leave without pay can only be done by agreement with your employee.

    Even in this difficult time, f you need to remove roles from your business, you need to undertake a restructuring process and consult in good faith with your affected employees on that proposal. https://www.employment.govt.nz/workplace-policies/workplace-change/overview-of-workplace-change/

    The government subsidy is being offered on the basis that you meet a range of criteria, including that you must retain the employees named in your application for the period of the subsidy.

    I’d be interested to know why you wouldn’t be applying for the wage subsidy – it’s sort of there to help both employer and employees out.

    It’s right that you can only apply leave entitlements with employee consent and no doubt they would be asking as to why the subsidy hasn’t been applied for.

    Maybe you are lucky in that your revenue hasn’t reduced below 30% as yet… but likely to do so I would suggest in coming month(S).

    I imagine you will have a standard clause for Force Majeure in your employment contract that enables you to do a lot of things, but that should be wisely applied after taking legal advice – but not only that maintaining good relations and acting reasonably and in good faith will also be key to avoid ET claims at a later date and keep the employees you will need coming out of this

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