Christmas Closedown Q&A

With the Christmas holidays fast approaching, we thought it would be helpful to answer some key questions that are often asked by employers at this festive (and somewhat hectic) time of year.
Q.  Can an employer enforce a closedown over the Christmas break?   
A.  Yes, an employer can closedown operations and require an employee to take their annual leave at a particular time each year.  For most employers this occurs over the Christmas and New Year period, generally running for two – three weeks.  An employer must give employees at least 14 days’ notice in writing that a closedown period will be enforced.  Ideally, this would be referred to in employment agreements as well. 
Q.  Can an employer operate more than one closedown period in a year?
A.  An employer can only enforce a closedown once within a 12-month period (although an employer can have different closedown periods across different parts of their business).  However, this does not stop an employer from asking their employees to take leave (by agreement) over the Christmas break.  Most employees will want to take some sort of a holiday, albeit perhaps not a full two – three weeks. 
Q.  Can an employee be forced to take unpaid annual leave during a closedown?
A.  Yes, employees can be required to ‘discontinue their work’ (i.e. to take unpaid leave) provided they are given at least 14 days’ written notice of the requirement.  An employer may also agree to let employees take annual leave in advance to cover the closedown period.
Q.  Can an employer force an employee to take annual leave outside of a closedown period?
A.  In the first instance, employers and employees must attempt to reach an agreement on when annual leave will be taken.  Good faith obligations are very important here!  Where an agreement cannot be reached, an employer can require an employee to take annual leave at a particular time by giving the employee 14 days’ written notice. 
Q.  What are the public holiday nuances to be aware of this summer?  
A.  Because Christmas Day falls on a Sunday this year, the holiday will be observed on Tuesday 27 December 2022.  New Year’s Day also falls on a Sunday so the holiday will be observed on Tuesday 3 January 2023.  This means that: 

  • where an employee usually works Monday to Friday, they will get the observed holidays as paid public holidays
  • where an employee usually works weekends, they will get the real Christmas and New Year’s Day as paid public holidays. 

Our December 2020 article provides an in-depth guide on how to pay employees for working on a public holiday:
Q.  What happens where a public holiday falls during a closedown? 
A.  Where a public holiday falls on a day when an employee is already on annual leave due to a closedown period, that day doesn’t count as an annual leave day (aka, it should not be deducted from an employee’s annual leave balance), provided that it would have been an otherwise working day for the employee if there was no closedown.
Q.  With COVID numbers expected to peak over Christmas, what happens if an employee gets sick during the Christmas holidays? 
A.  During a closedown, if the day on which an employee is sick is an otherwise working day for the employee (but for the closedown), they are entitled to paid sick leave rather than drawing on their annual leave balance.  However, where an employee is on annual leave outside of a closedown period and they become sick, there is no mandatory obligation on the employer to allow the employee to take sick leave.  That said, a fair and reasonable employer might still allow sick leave to be taken, if the employee supplies a medical certificate or proof of a positive COVID test etc. 
If you have any questions about your upcoming holiday/closedown obligations, please do not hesitate to contact us.

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