“No work as directed, no pay” must be reasonable

The Fair Work Commission has recently affirmed the ability for an employer to not provide pay to an employee who does not undertake work as directed.

This case involves a unique set of circumstances. The employee’s drivers’ licence was suspended, for three weeks, due to his failure to pay registration. The employer had a policy that required all employees who performed driving duties on the employer’s private property to hold a valid drivers’ licence.  As a result of his licence suspension, the employer put the employee on an unpaid stand down on the basis that he was unable to perform his driving work on the employer’s private property as directed.

The Commission in its capacity as a private arbitrator considered whether the enterprise agreement modified the common law right of “no work as directed, no pay” – finding that it did not. The Commission held however that the common law right of an employer to refuse to pay an employee when the employee does not work as directed is conditional upon the employer’s direction to undertake work being a lawful and reasonable direction.

The Commission went on to find that in the circumstances of the present case, the direction of the employer was not a lawful and reasonable direction as the employer had failed to inform the employee that he could apply for an exemption from the employer’s policy to drive on the employer’s private property unlicensed. Nor did the employer consider any alternative duties the employee could have performed during the three-week suspension period.

This decision is good news for employers as it reaffirms the ability of an employer to apply the “no work, no pay” principle, it also reminds employers that the application of the principle must come after careful consideration of the lawfulness and reasonableness of the employers direction.

Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd T/A BHP Billiton [2018] FWC 1453 (9 March 2018)

National Workplace Lawyers

Note — this is for information purposes only and does not purport to be comprehensive or to render legal advice.