The COVID-19 pandemic is touching every facet of the world as we know it and sport is no different. At the elite level, we have seen the Olympic Games being postponed and interrupted seasons for the AFL and NRL to name just a few. However, the effects are also being felt at a state and local level, with widespread cancellations of sporting competition seasons and events resulting in a downturn or complete stoppage of revenue for sports clubs and organisations.
While just last week, the National Cabinet released the National Principles for the Resumption of Sport and Recreation Activities, many sports clubs and organisations are feeling the effects of COVID-19 and need to take immediate action to bring about relief in these trying times. What follows is information which may assist sports clubs and organisations in dealing with common issues arising in the current uncertain climate.
What do I do with my employees if I cannot pay them?
Many sporting organisations have paid staff on their books. Given the current uncertain climate, with revenues for sporting organisations dropping considerably, the Federal Government’s new JobKeeper payment may assist eligible sporting organisations to deal with the impact of the COVID-19 crisis, specifically in relation to retaining staff. The aim of the payment is to allow eligible employers to more easily afford to pay wages of eligible employees, potentially saving many people from losing their jobs. Affected employers will be able to claim a payment of $1,500 per fortnight per eligible employee from 30 March 2020. The JobKeeper payment system is in place until the end of September 2020, unless extended.
Sporting organisations which consider they may be eligible to receive JobKeeper payments to assist with payroll can register via the ATO’s website.
Sporting organisations receiving JobKeeper payments are able to make use of the new amendments to the Fair Work Act 2009 (Cth) to make “JobKeeper enabling directions” to employees. These can include (amongst other things) requesting employees to:
- work reduced hours;
- work from a different location;
- take accrued but unused annual leave; or
- undertake alternative duties.
If there has been a stoppage of business completely, as opposed to just a downturn, then an employer may be entitled to stand employees down on unpaid leave for a period of time. However, it is strongly recommended that legal advice be sought before taking such a step as doing so without a legal basis to do so may open an employer up to legal liability.
There have also been amendments to most Modern Awards in the country, allowing employees covered by those awards to take ‘pandemic relief’ allowing certain employees to take 2 weeks of unpaid leave if the employee is required by the government or medical authorities or is acting on medical advice to self-isolate, or is otherwise prevented from working by measures taken by government or medical authorities in relation to COVID-19. The changes to the awards also allow certain employees to take annual leave at half pay for the double the time.
We rent commercial premises but cannot pay rent. What do we do?
The Federal Government has released a Code of Conduct for commercial tenancies which sets out a range of principles to be followed as between landlords and tenants in the event rent needs to be negotiated as a result of the impact of COVID-19 on the revenue of the tenant.
To come under the Code of Conduct, a commercial, industrial or retail tenant business must be eligible for the JobKeeper payment and also have annual revenue of under $50 million.
The Code of Conduct contains a set of 14 principles for landlords and tenants, including (amongst other things):
- landlords must not terminate leases for non-payment of rent during the COVID-19 pandemic. This includes during a reasonable recovery period also;
- tenants are to remain committed to the terms of their lease, subject to any negotiated amendments; and
- landlords must offer rent reductions (by way of waiver or deferral) based on calculations taking into account the tenant’s reduction in trade as a result of COVID-19.
We are having difficulty conducting our annual general meeting. What can we do?
The Australian Securities and Investment Commission (ASIC) have introduced temporary measures to allow for greater flexibility for public companies with respect to holding annual general meetings in the current climate. ASIC has announced that it will not be taking enforcement action against public companies required to hold annual general meetings (AGM) before 31 May 2020, provided that the public company holds its AGM by 31 July 2020.
ASIC has also announced that no action will also be taken against a public company if it conducts its AGM entirely or partially online. However, should an AGM be conducted online by a public company, members ought to still have an opportunity to participate in the meeting, for example by way of voting and having the ability to ask questions.
This ‘no action’ position of ASIC would apply to sports organisations set up as public companies limited by guarantee.
ASIC has announced that it is employing measures with a degree of flexible pragmatism, but has noted that its position is under continuous review. It’s therefore advisable to check regularly to see if there are any further announcements by ASIC which may affect your organisation.
What if our teams or athletes need to train?
From late March, most state and territory governments in Australia strongly advised against non-essential interstate travel. More recently, most state and territory governments have been advising against non-essential travel full-stop. While people are still largely permitted to leave their home to exercise, group training may amount to a breach of social distancing rules. Athletes and their coaches may continue to train remotely, using video and other electronic communications to ensure their training continues with necessary adaptations being made to abide by government directives at the given time.
It is recommended that you keep a close eye on any announcements made regarding the tightening or loosening of restrictions and assess how the announcement impacts upon your sport and its operations moving forward.
The raft of measures being rolled out by State and Federal governments in response to the COVID-19 crisis is changing regularly. Sporting organisations ought to familiarise themselves with the relief currently available and ought to be on the lookout for any further measures announced in the coming weeks and months or the rollback of measures listed in this article, given they are largely intended to apply temporarily.
Making use of the relief outlined above may assist sports clubs and organisations to get through this difficult time. With the prospect of a return to sporting competition appearing ever more likely over the coming months, sports organisations at the elite and community levels ought to be planning how a return to sport process looks for their sport/organisation. The Australian Institute of Sport’s resumption of sport guidelines (https://www.pm.gov.au/sites/default/files/files/attachb-ais-framework-rebooting-sport.pdf) may assist in preparing for this eventuality.
This information is general only and is not to be taken as legal advice with respect to your organisation’s specific circumstances. Should you require advice specific to your circumstances, please contact the team at SportsLawyer (a division of PH Solicitor) at email@example.com or by phone on (03) 9642 0435.