Do I need to pay people during the COVID resurgence ?

by | Aug 13, 2020 | Covid-19, Employment Agreements, News & Events

Obviously, Auckland is back up to Level 3, and the rest of the country is at Level 2 as of midday today (12th August 2020).  So the question being asked is do I have to pay people for the next 3 days?

To help you work this out you need to check a few things:

  1. Does your employment agreement contain a Force Majeure clause?  And if so, does it specifically reference Pandemics?  If the answer to both questions is yes then you need to observe the requirements of that clause.  For example, it may allow for unpaid leave or for employees to be required to take annual leave
  2. Do you have a lower guaranteed hours clause in your employment agreements?  If so then you need to observe the requirements of that clause.  Take note of minimum payment requirements e.g.  minimum 3 hours pay if a shift is cancelled later than 12 noon the previous day
  3. Have you received the second subsidy, and are you still within that 8 week period?  If so you will be governed by the minimum requirements of the subsidy declaration i.e. a minimum of 80% pay.  NB that subsidy was for an 8 week period and applications opened on the 10th June, so many will be just in the last few weeks of that subsidy period
  4. What have you consulted with your staff about and what was the timeframe covered by that consultation period?  If you consulted with your staff about changes to their terms of employment during lockdown then you may have a situation that you are still covered by the terms of that consultation.  However, I would be careful of this approach as many of us thought lockdown was behind us.

If none of the above applies then what?

Simply put, the terms of your employment agreements apply, so if you contract states that (e.g.) you are paid 40 hours a week, or a salary of $XX,XXX in 52 equal instalments, then you need to honour those clauses.

There is nothing to prohibit you from asking your employees if they want to take leave, but unfortunately, you don’t have any rights to require them to take leave at short notice unless you have a contractual right as identified above.

Can I consult to change things?

At this stage the Level 3 restrictions are only in place for 3 days.  I sincerely hope that they will not be extended, however, we are all in the wait and see phase at the moment.  I will obviously be monitoring the situation and will provide more guidance if things extend. 

However, if you are in the position that you do need to immediately consult with your staff then the Isolation Payments template letter published in April will help get you started on what you need to consult with your team.   

Stay safe everyone, and shout out if you have any questions


Lisa Mackay

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