Australia: Curly questions for HR managers: Leave

Last Updated: 2 March 2016
Article by Emily Dempster

Most, if not all, HR managers encounter moments where they are asked 'curly' questions by employees in relation to their leave entitlements. Knowledge is paramount and being prepared is the best way in which to handle situations and questions such as these.

To assist you with some basic Q&A's, we've outlined some of the more common 'curly' leave questions that we encounter on a regular basis.

Annual Leave

Q. Does annual leave accrue during a period of workers' compensation?

Section 130 of the Fair Work Act 2009 (Cth) (Act) provides that an employee is not entitled to accrue annual leave when they are receiving workers' compensation unless the relevant workers compensation law in their jurisdiction 'permits' it. Therefore, whether or not annual leave accrues during a period of workers' compensation depends on the applicable State or Territory workers' compensation legislation.

Currently, the workers' compensation legislation in Queensland, South Australia, the Australian Capital Territory, and Tasmania permit the accrual of annual leave during a period of workers' compensation. Additionally, in accordance with a recent Full Court of the Federal Court decision1, New South Wales employees can take and accrue annual leave during a period of workers' compensation.

The applicable legislation in Victoria and Western Australia does not specifically permit the accrual of annual leave during a period of workers' compensation. However, you should 'watch this space' as the wording of the legislation in Victoria and Western Australia is similar to that of the New South Wales legislation. It is therefore possible that a Full Court of the Federal Court may ultimately determine that Victorian and Western Australian employees can take and accrue annual leave during a period of workers' compensation.

The workers' compensation legislation in the Northern Territory does not permit the accrual of annual leave during a period of workers' compensation.

Q. Is annual leave loading payable on termination of employment?

In accordance with section 90(2) of the Act, upon termination of employment an employee is entitled to payment for accrued but unused annual leave and, if applicable, annual leave loading.

Despite the above, some modern awards and enterprise agreements contain clauses requiring payment of annual leave loading during annual leave, but not when paying out accrued annual leave upon termination of employment. However, a recent decision of the Federal Court2 has confirmed that regardless of any terms of a modern award or enterprise agreement to the contrary, annual leave loading is payable on accrued but unused annual leave paid out on termination of employment if the employee would have been entitled to the annual leave loading whilst still employed.

Q. What do you do if an employee's accrued annual leave is insufficient for a shutdown (such as during the Christmas and New Year period)?

If an employee is not covered by a modern award or enterprise agreement, an employer is unable to direct the employee to take unpaid leave. The employer may however reach an agreement with the employee to this effect or even to, at its discretion, allow the employee to take annual leave in advance of accrual.

If an employee is covered by a modern award or enterprise agreement, the answer will depend on the terms of the relevant modern award or enterprise agreement. As an example, the terms of the Manufacturing and Associated Industries and Occupations Award 2010 allow an employer to direct an employee to take unpaid leave. As another example, the Clerks - Private Sector Award 2010 is silent on whether or not an employee may be directed to take unpaid leave but it does specifically provide for the taking of annual leave in advance of accrual.

Personal/carer's leave

Q. What is an 'unexpected emergency' for the purpose of personal leave?

In accordance with the National Employment Standards (NES) in the Act, carer's leave may be taken to provide care or support to a member of the employee's immediate family or household because of, among other things, an 'unexpected emergency' affecting the member.

The more common type of 'unexpected emergency' is where there is some sort of medical emergency that affects the member. However, it is important to note that an 'unexpected emergency' can also refer to a non-medical emergency. As an example, in a 2013 decision3, the Fair Work Commission (Commission) ruled that a mining company should have allowed a fly-in fly-out employee to take carer's leave when child-minding arrangements fell through. Whilst the child of the fly-in fly-out employee was not unwell, the Commission found that the unavailability of the child minder on short notice did amount to an unexpected emergency affecting the employee's son.

Q. What is reasonable evidence of illness for the purposes of personal leave?

Section 107 of the Act does not limit the form of evidence that an employee may provide to an employer to satisfy it that the leave is taken for a permissible reason. However, it is generally accepted that a statutory declaration (for a day's absence) and/or a medical certificate (for longer absences) will be considered to be reasonable evidence.

With respect to backdated medical certificates, whilst they would generally breach the Australian Medical Association's Guidelines for Medical Practitioners on Certificates Certifying Illness (2011), they may be justified in certain circumstances. Furthermore, countermanding medical certificates (even backdated ones) requires sufficient evidence. A 2014 Commission decision4 found that the terms of a company policy or enterprise agreement which provides an employer with the unilateral right to reject backdated medical certificates as reasonable evidence would breach the Act. Therefore, backdated medical certificates would generally be considered to be reasonable evidence of illness unless the employer had sufficient evidence to demonstrate that the backdated medical certificate was false or fraudulent or otherwise unacceptable.

Q. Does personal leave accrue during a workers compensation absence?

An employee does not accrue personal/carer's leave during an absence on workers compensation, unless otherwise provided by the relevant state or territory workers compensation law.5

Currently, the workers' compensation legislation in Queensland, South Australia and Tasmania permits the accrual of personal leave during a period of workers' compensation. Given the absence of any such provisions in the other jurisdictions, it would appear that personal leave does not accrue during a period of workers' compensation in the Australian Capital Territory, New South Wales, Victoria, the Northern Territory and Tasmania.

Long Service Leave (specific to Victoria)

Q. How does unpaid parental leave affect continuous service?

In accordance with section 62 of the Long Service Leave Act 1992 (Vic), a period of unpaid parental leave does not break an employee's continuous service with his or her employer. However, any such leave period does not count towards the length of the employee's continuous service.

Q. What happens if a public holiday occurs during long service leave?

An extra day must be included in the long service leave if it is a day the employee would have worked had they not been on long service leave.

Q. Can an employer direct an employee to take long service leave?

In accordance with section 66 of the Long Service Leave Act 1992 (Vic), if an agreement cannot be reached about when long service leave is to be taken once entitlement to long service leave has accrued, an employer may direct an employee to take leave at a particular time by giving at least 3 months written notice. An employee can, however, seek an order from the Magistrate's Court regarding the taking of their leave.

Public Holidays

Q. Can an employer direct an employee to work on a public holiday?

In accordance with section 114(2) of the Act, an employer may request an employee to work on a public holiday, if the request is reasonable. In accordance with section 114(3) of the Act, an employee may refuse any such request if the request is not reasonable or if the refusal is reasonable.

In determining whether a request, or refusal, is reasonable, a number of factors must be taken into account including the nature of workplace and employee's work; the employee's personal circumstances (such as whether the employee has family responsibilities); whether the employee could reasonably expect a request to work; whether the employee's entitlements reflects an expectation to work public holidays (for example, whether the employee receive penalty pay); the amount of notice given by employer; the amount of notice given by the employee when refusing, and the type of employment (full time, part time, casual).


1 Anglican Care v NSW Nurses and Midwives' Association [2015] FCAFC 81

2 Centennial Northern Mining Services Pty Ltd. v CFMEU (No. 2) [2015] FCA 136

3 Klowss v Groote Eylandt Mining Company Pty Ltd (C 2013/1515)

4 MUA v DP World Sydney Ltd [2014] FWC 2862

5 Section 130 of the Fair Work Act 2009 (Cth) (Act)

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Madgwicks is a member of Meritas, one of the world's largest law firm alliances.

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