Shutting down over Christmas/New Year

Posted by Andrew Schoenfeld on

Are you shutting down over Christmas/New Year?

Employees need to be given up to 2 months’ notice in some industries. Is your workplace ready? Check our info on shut down rules and directing employees to take leave.

An employee can be directed to take annual leave during a shut down if their award or registered agreement allows it.

Most awards have rules about how and when an employer can direct an employee to take leave. For example, an employer may need to give the employee a set amount of notice (eg. 4 weeks) that they will need to take annual leave.

If an employee isn't covered by an award or an agreement, their employer can direct them to take annual leave if the direction is reasonable.

What if an employee doesn't have enough annual leave?

If the award or agreement provides for it, an employer can direct an employee to take annual leave in advance of accrual, or unpaid leave, for some or all of the time.

What if an award or agreement doesn't have rules about shut downs?

If your award or agreement doesn't have rules about annual leave during shut downs, an employer can't direct an employee to take leave.

However, an employer and employee can agree that the employee takes annual leave (including in advance of accrual) or unpaid leave for the shut down time. The employee can't be forced to take unpaid leave, so if an agreement can't be reached with their employer, they need to be paid their ordinary pay for the time.

What happens if a public holiday falls during an employee's annual leave?

If a public holiday falls during an employee's annual leave, they need to be paid for the public holiday - not annual leave. This means that an employee should be paid their base pay rate for the day and it shouldn't be taken off their annual leave balance.

Working during a shut down

If employees continue to work when a business shuts down they should be paid as normal. If any of the days are public holidays, these days are treated as public holidays. This means the employee should be given the day off without loss of pay or they should be paid public holiday rates as per their award or agreement.

How does annual leave accumulate?

Annual leave accumulates from the first day of employment, even if an employee is in a probation period.

The leave accumulates gradually during the year and any unused annual leave will roll over from year to year.

Annual leave accumulates when an employee is on:

  • paid leave such as paid annual leave and paid sick and carer's leave
  • community service leave including jury duty
  • long service leave.

Annual leave does not accumulate when the employee is on:

  • unpaid annual leave
  • unpaid sick/carer's leave
  • unpaid parental leave
  • unpaid family and domestic violence leave

Who is entitled to annual leave?

All employees (except for casual employees) get paid annual leave.

How much annual leave does an employee get?

Full-time and part-time employees get 4 weeks of annual leave, based on their ordinary hours of work.


Shiftworkers may get up to 5 weeks of annual leave per year.

Getting Christmas casual pay rates right

The award rate for an adult casual in retail starts at $26.76 with higher rates applying for weekend or late night work. If you’re hiring this holiday season, our Ombudsman Pay Calculator can help you get it right. (LINK)



Andrew Schoenfeld

Level 8, Tower 1, 1341 Dandenong Road, Chadstone Victoria 3148 Australia