We've very sadly lost a colleague. No funeral arrangements as yet, we only heard about the death this week.
Staff are bombarding boss with demands of what we should do. E.g we should close for the funeral, we should have a balloon release, pay for a commemorative plaque in a public place etc etc.
Boss has said yes, we absolutely will do something, but let's wait and see what the family want. Boss has put a call out to family but isn't going to chase them up at present. We will arrange for people to go to the funeral, if that's what the family want, we will arrange a memorial if wanted, but they might have a charity they'd prefer to support. Absolutely no balloons, bad for wildlife and she loved her animals.
Staff have interpreted this as boss doesn't care and they're not allowed to pay their respects. 
I wouldn't have her job for all the tea....
Isn't it usual to have the funeral before these kinds of thing are arranged anyway?