Posted November 29, 2021
The year is flying by and very soon Christmas will be here. Have you thought about closing your salon over the Christmas/New Year period?
Many business owners choose to close for a number of reasons; it’s usually less busy as a lot of customers may be on holidays themselves, it reduces leave balances, there are a few public holidays in the period so employees get a decent break without needing to use too many days of annual leave, and everyone can spend quality time with family and friends.
However, if you want to close over this period, there are requirements that must be followed, and it is very important to plan ahead.
It is also recommended that you communicate with your employees that the business has an annual close down, and during this time they are required to take annual leave or potentially unpaid leave if they don’t have enough in their leave accruals. This could be outlined in a contract or a policy.
What are the public holidays during Christmas-New Year 2021-2022?
# This is a substitute day, not an additional day.
What do I need to do if I want to close my salon during Christmas/New Year?
The rules which set out close downs come from:
- the National Employment Standards (NES) and the Hair and Beauty Industry Award 2010, or
- Hairdressers Award 1989 if you are in Western Australia and your business is not a Pty Ltd company.
The National Employment Standards (NES)
The NES allow employers to direct employees to take annual leave in reasonable circumstances.
A direction to take annual leave may be reasonable if it’s part of a close down.
Hair and Beauty Industry Award 2010 – the modern award (all salons other than businesses in Western Australia which are not Pty Ltd companies)
Under the modern award, an employee can be required to take annual leave as part of a close down if you give them at least four weeks’ notice.
Hairdressers Award 1989 (WA) – the state award (businesses in Western Australia which are not Pty Ltd companies)
The state award only applies to businesses that are not Pty Ltd companies. This award does not contain a clear term that allows employers to direct employees to take annual leave during a Christmas close down.
If your salon has always closed during the Christmas/New Year break, you can inform your employees of this custom and practice that happens every year. A good way to do this is to notify new employees when they start work that some of their annual leave will have to be taken at Christmas time, and remind all employees throughout the year.
Can I direct an employee to take unpaid leave if they do not have enough annual leave to cover the period?
An employee may not have enough annual leave to cover the whole close down period, such as a new starter who hasn’t accrued enough leave.
In these situations, you have some options:
- Only close on the public holidays, and open on the normal business days; or
- Reach an agreement with the employee to take unpaid leave; or
- Reach an agreement with the employee to take annual leave in advance.
If you reach an agreement with the employee under option 2 or 3, this agreement should be in writing.
If an employee does not agree to take unpaid leave or annual leave in advance, and you are not able to have them work in another part of the business that is not closing down, they will need to be paid their ordinary pay for the period.
If your employees are covered by the state award, inform them upfront and remind them throughout the year that they will be required to take annual leave during the Christmas close down.
Closing down for Christmas and providing employees with notice
Under the modern award, you must give four weeks’ notice to employees.
Employers in the WA state system (businesses in WA which are not Pty Ltd companies) should try to provide employees with as much notice as possible.
It is recommended that all salons put the notice in writing and make sure it is given to all employees.
The following is an example of a notice you can provide to employees about an annual close down:
Christmas/New Year close down
Employees are advised that the salon will close down for the purposes of granting annual leave, from the close of business on Friday 24 December 2021.
Work will resume at the normal start time on Tuesday 4 January 2022.
Payment for public holidays
An employee that has ordinary hours that fall on a public holiday is entitled to be absent from work and paid for these hours at their base rate of pay. The “base rate of pay” is the rate paid for ordinary hours of work and excludes the following:
- incentive-based payments and bonuses
- monetary allowances
- overtime or penalty rates
- any other separately identifiable amounts.
If an employee does not have ordinary hours on the public holiday, the employee is not entitled to payment under the National Employment Standards (NES). For example, an employee would not be entitled to payment if they are:
- a casual employee who is not rostered to work on the public holiday; or
- a part-time employee whose part-time hours do not include the day of the week on which the public holiday occurs.
Under the Hair and Beauty Industry Award 2010, if an employee is required to work on the public holiday, they must be paid at the penalty rate of double time and a half.
Please see the below table of wage rates, which take effect from the first full pay period on or after 1 November 2021. You can also read our blog post on the updated wage rates.
We want to answer your questions
Our advisers are standing by and ready to answer your questions. For further advice or assistance on this topic, or any workplace relations matter, please call us on 02 9221 9911, 8:30am – 5:30pm Monday to Friday.
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