Stage 4: Industrial-scale hibernation across Victorian businesses

This article was co-authored with Daniel Macpherson.

On 3 August 2020, the Victorian Premier Daniel Andrews made the first of further announcements on the heightened COVID-19 restrictions. The announcements were directed towards business, with significant economic and operational implications for many businesses and consequential impacts on their employees.

Under the new restrictions outlined by the Premier, businesses in metropolitan Melbourne must be closed unless they are part of a permitted industry for the next six weeks. The Premier identified three categories of industries, each to be treated differently under the response. The list of industries permitted to remain open is extensive and is found in the Stage 4 Restrictions – Permitted Work Premises (Stage 4 List). The restrictions on industries permitted to remain open (Permitted Work Premises) are also found in that document.

As of 6 August 2020, the directions giving effect to the Premier’s announcement have been made available. These are, principally among others, the Permitted Worker Permit Scheme and Access to Onsite Childcare/Kindergarten Permit Scheme Directions (PWPS Directions), the Workplace Directions and the Restricted Activity Directions (Restricted Areas) (No 6).

The following summarises some of the key points of the industrial shutdown scheme.

Category 1: Open industries

Businesses in industries permitted to remain open must have enacted their own COVIDSafe plans by midnight on 7 August 2020. These include fuel retail, pharmacies, convenience stores, supermarkets, post offices, vehicle maintenance, banks, critical scientific facilities and certain transport services.

Category 2: Closed industries

Businesses in industries directed to close for ‘on-site work’ must have done so by midnight Wednesday, 5 August 2020. Industries in this category include manufacturing of furniture, wood, textiles and domestic appliances, retail stores not included in the open industries category, and most professional services. Notably, retailers in this category may continue to do business via ‘click and collect’ (pick-up) or delivery service.

Category 3: Reduced capacity industries

Certain industries will be permitted to continue operations but in a reduced capacity as at midnight this Friday, 7 August 2020. These will include meat production facilities, supermarket distribution centres, aged care centres and construction. Businesses in this category must implement COVIDSafe plans and certain industries such as meat processing and construction are required to meet stricter guidelines with a High Risk COVID Safe Plan.

The Premier indicated that the details of this industrial-scale capacity reduction are still being determined through consultation with business. At this stage, the approach is to move certain facilities such as abattoirs to two-thirds production in order to reduce staff numbers. Further safety protocols will include personal protective equipment for meat workers as stringent as those for health workers, temperature checks and COVID testing.

For construction, the Premier signalled that large scale projects (with an already reduced workforce) will be addressed on a project-by-project basis. Large commercial builds greater than three stories will see a reduction in the onsite workforce to the minimum practicable level not above 25 per cent of the workforce. For domestic homes, this will mean no more than five people concurrently on-site.

Business support

For businesses and workers affected by these measures, the Premier outlined a number of support measures. Through the State Government’s Business Support Fund, businesses in regional Victoria may be eligible for a $5,000 grant. Those in Melbourne and the Mitchell Shire may be eligible for the greater amount of $10,000 on the basis of having been subject to restrictions for longer.

Permit system

The Government has introduced a worker permit system from midnight 5 August 2020. The details of this scheme have just been released, with the issuing of the PWPS Directions. Under the PWPS Directions an employee required to work after 5 August 2020 must be issued with a Permitted Worker Permit by their employer (PWP).

A PWP may only be issued to an employee if:

• the organisation is on the list of Permitted Work Premises (Permitted Employer) – these are listed in the Stage 4 List linked to above;
• the employee is working in an approved category for onsite work (Permitted Services) – these are listed in the Stage 4 List; and
• the employee cannot work from home.

Exemptions apply to certain government workers with employer-issued photo ID, such as police and healthcare workers. Those at risk of family violence at home also do not require a permit.

Employers and employees may face fines of $1,652 (on-the-spot) or up to $19,826 for individuals, and $9,913 (on-the-spot) or up to $99,132 for businesses for breaching the scheme, including for issuing PWPs to employees who do not meet the eligibility requirements. It will be an offence for an employee to fail to carry their PWP with them on the commute to and from work.

Next steps

The Premier expects that the new measures will result in a larger number of stood-down workers and job losses. The measures will also require many business to develop and implement stricter control measures, pivot to pick-up and delivery services and manage their workforces in line with any capacity restrictions. The importance for employers of getting this right is at least two-fold – reducing the attendant economic and health risks and avoiding the risk of being fined.