Paying staff while your business is closed or disrupted

When the doors close, payroll is often the first hard decision. Your staff have bills too, some may have been affected by the same event, and good people are hard to find again. At the same time, paying a full team with no income can drain the business fast.

There’s no one right answer. This page sets out the options, the help that may exist, and how businesses fund payroll when they choose to keep their team together.

What should you do first?

1. Talk to your staff early. Tell them what’s happened, what you know and when you’ll update them. Uncertainty drives people to look elsewhere.
2. Check your obligations before changing anything. Pay, leave, stand-downs and changes to hours are governed by the Fair Work Act, awards and agreements. business.gov.au points employers to the Fair Work Ombudsman for pay and entitlements after an emergency.
3. Work out how long you’ll be closed or disrupted — even a rough estimate.
4. Look at your cash against payroll for that period. The shutdown cash runway tool makes this quick.

What help might be available for wages?

Help	Who it’s for	Notes
Disaster Recovery Allowance	People who lost income as a direct result of certain declared disasters	Short-term income support via Services Australia; event-specific
Essential Working Capital Loans (QRIDA)	Eligible Queensland businesses after certain events	Low-interest loans to cover salaries, rent, rates and other essential expenses
ATO support	Businesses affected by disasters	Call 1800 806 218 before PAYG or super dates you can’t meet
Business interruption insurance	Policyholders	May cover wages as part of standing charges — check wording

Check business.gov.au’s list of disaster assistance for what’s active for your event, and our concessional loans page for more on Queensland’s working capital loans.

What are your options for the team?

• Keep everyone on full pay — protects the team, most expensive.
• Redeploy staff — clean-up, stocktake, rebuilding records, working from another site or from home.
• Agreed changes — reduced hours or leave, where your obligations and the employees’ agreement allow.
• Stand-downs — permitted only in limited circumstances; check with the Fair Work Ombudsman first.
• Temporary reduction of the team — sometimes unavoidable, but consider the cost of rehiring and retraining later.

Whatever you decide, document it and keep staff informed.

Why fund payroll rather than let people go?

Owners who’ve been through a disaster often say the same thing: the team was the hardest thing to rebuild. Recruiting, training and getting a new team to full speed can cost more than carrying the old one for a few weeks. And when you reopen, you want experienced people ready on day one.

If keeping your team is the plan, a short enquiry lets a real person look at how to fund it — there’s no credit check when you first enquire.

How do businesses fund wages through a crisis?

Situation	Common approach
Still trading at reduced levels	Unsecured cash-flow funding or a line of credit, typically $5,000 to $500,000
Fully closed, owner has property	Property-secured loan, $20,000 to $5,000,000
Waiting on business interruption payout	Short-term funding repaid from the payout
Queensland, event activated	Check QRIDA’s Essential Working Capital Loan first; bridge if timing requires

Size the facility to the realistic number of weeks until trade returns, plus a buffer. Remember super and PAYG withholding on the wages you pay.

Illustrative example only: a restaurant with twelve staff is closed for five weeks after a kitchen fire. The owner redeploys four staff to help with the clean-up and a temporary catering setup, agrees reduced hours with others, and funds the remaining payroll with a short property-secured loan. The team is intact on reopening night.

How do you talk to staff about pay during a closure?

Honest, regular communication keeps people loyal through a hard period. A few principles that help:

• Tell them what you know and what you don’t. “We expect to be closed for at least three weeks. I’ll update you every Friday.”
• Be clear about pay. Exactly what they’ll receive and when, in writing.
• Offer options where you can. Redeployment, leave, reduced hours — within your obligations.
• Point them to support. The Disaster Recovery Allowance where it’s activated, and wellbeing services such as Lifeline (13 11 14) and Beyond Blue (1300 224 636). Our free support services page has more.
• Invite them back early. Share the reopening plan so they can plan too.

Staff who feel informed and respected are much more likely to be there on reopening day.

What about the owner’s own income?

Owners often forget to include themselves. If you draw wages or regular drawings to cover your household, put them in the forecast. The Disaster Recovery Allowance may also be worth checking for sole traders who lost income directly because of a declared disaster — Services Australia sets the eligibility for each event.

What records should you keep?

• Rosters, timesheets and pay records throughout the closure
• Written agreements about any changes to hours or leave
• Notes of what you told staff and when
• Business interruption claim details
• Any grant or concessional loan applications

Want to keep your team together?

If you’ve decided your team is worth protecting through the closure, we can help you fund the payroll gap.

Looking at options carries no downside: we don’t check credit at the enquiry stage. We don’t farm out enquiries — one team holds your file from start to finish. The person who rings you back will have read what you wrote and will want the full story.

Please take a moment to get the amount, purpose, state and property details right; a well-filled form is the quickest route to a useful answer. See if you qualify.