Planning for the 2023 Christmas Close Down - What Employers Need to Know

Planning for the 2023 Christmas Close Down: What Employers Need to Know

Unveiling the Changes to Christmas Close Downs: Prepare Your Business Now

You might think it’s a bit early to be talking about Christmas close-downs – but you’d be surprised how planning ahead will save you that feeling of dashing to the finish line.

If you're a business owner or leader who typically closes your business over the festive season, this blog post will cover the essentials you need to know.

As expert HR consultants for small to medium businesses across Australia, we’re identifying the changes that have been made and what you need to do differently this year.

What We Already Know about Christmas Close Downs

Christmas close downs have become increasingly common over the years and, in Australia, are now considered the norm across many industries and awards.

The Christmas close-down period is also the time that many business owners will do all their planning. In fact, at People Powered Business we’re known to be particularly busy over the Christmas New Year period because we will often get calls with owners who now have the time to catch up on all their HR policies, or that piece of HR admin that’s been kept on the backburner during the year. Depending on trends, we might even see spikes in hiring and recruitment just before and after.

There will, of course, be some exceptions to this. Tourism, hospitality, and retail are industries that find this period their busiest time of year with so many on holiday and able to enjoy more travel, shopping and leisure activities.

It’s crucial to note, especially for small to medium businesses that don’t have internal or external HR support, that there are key rules surrounding Christmas close downs. These rules will vary depending on the modern award each business operates under and it’s important to be across them, so you remain compliant and avoid any issues with the Fair Work Commission.

Changes to the Christmas Close-Down Rules in 2023

Recently, some significant changes came into effect regarding directing employees to take annual leave during a Christmas shutdown period. Over 70 modern awards have been updated with new rules.

The Fair Work Commission, based on the changes in these Awards, now requires most employers to give employees at least 28 days of notice before the Christmas shutdown period and to give any employees hired within this 28-day window written notice as soon as possible. Depending on your award, you might have an even longer notice period.

The other significant change is that employers can now only direct employees to take annual leave during the shutdown period if it’s been accrued. This must also be placed into writing and be reasonable.

If any employees don’t have enough annual leave accrued, you'll need to reach a mutual agreement with them. This means discussing options such as accruing time in lieu, taking annual leave in advance, or agreeing to unpaid leave.

These changes came into effect on 1 May 2023 and will impact this year’s end-of-year closure period, so ensure you’re up to speed and compliant with your responsibilities as an employer.

What Employers Need to Do Differently to Prepare for the 2023 Christmas closure period

With these new changes across the majority of Modern Awards around the direction to take leave when there isn’t enough annual leave accrued, plus the 28-day minimum notice period (which can be longer in some awards), employers must start planning for this year's Christmas break as early as possible. You want to be providing notice and communicating about the end-of-year closure no later than October.

Waiting until later in the year could lead to complications and potential non-compliance issues, which is something best avoided.

As an employer, you’ll want to get up to speed in the following key areas:

Understand Your Award: Carefully read your modern award or seek professional help to interpret it. Understand the notice period you need to provide and other rules specific to your award.

Plan the Shutdown Period: Decide on the length of your shutdown period and ensure that your employees have enough time to plan and make any necessary arrangements.

Consider Reasonability: The direction to take annual leave during the shutdown must be reasonable. Factors such as the length of the shutdown, industry norms, and the percentage of leave directed to be taken can be considered in determining reasonability.

Communicate with Employees: Engage in open and transparent communication with your employees. Discuss the shutdown plans, seek feedback, and try to reach a mutual agreement on the leave arrangements.

Don’t forget to map out clearly what, how and when your shutdown period will happen, and make provisions for managing the workload and any resource shortfalls over this time to avoid stress and burnout.

Remember, the Fair Work Commission has extended powers to deal with non-compliance, so it's always better to be informed and prepared.

Be prepared for Christmas closure in 2023

While Christmas might seem far away, the time to plan for the Christmas closedown is now.

By planning and preparing for these changes, you’ll have a smooth and compliant Christmas close down period, allowing both you and your team to enjoy a well-deserved break.

This type of advanced planning can also allow you to be more strategic in your business and identify opportunities that you might not otherwise have seen.

If you need support with your Christmas closure planning, policy or processes, connect with our team at People Powered Business. We help small to medium businesses hire, train and keep the right people for their team and we can help you, too.

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