By Charles Power (Partner, Holding Redlich)
The Personal/Carer’s Leave National Employment Standard (NES) in the Fair Work Act 2009 (Cth) entitles an employee to 10 days of paid personal/carer’s leave for each year of service with his or her employer.
Does this mean that someone who works more than 7.6 hours a day (e.g. a 12 hour shift worker) only receive 10 times 7.6 hours as their entitlement? Or are they entitled to (for example in the case of the 12 hour shift worker) 10 times 12 hours?
This question was canvassed in Mondelez Australia Pty Ltd ( FWC 2140), when the Fair Work Commision (FWC) had to determine an application to approve an enterprise agreement. The agreement expressed the personal/carer’s leave entitlement as 80 hours per annum, rather than 10 days per annum as provided for under the NES. The FWC expressed concern that employees covered by the proposed agreement working 12-hour days would not be entitled to their full 10 day NES entitlement. Given an enterprise agreement cannot exclude the NES or any provision of it, the FWC requested an undertaking to be provided by the employer to address this issue. The employer, with the support of the Australian Industry Group and the Federal Government, requested the President of the FWC to refer the matter to a Full Bench of the FWC.
The President asked Vice President Hatcher to deal with the request. The Vice President dealt with it by rejecting it. In doing so, the Vice President observed that the issue had already been determined in RACV v ASU ( FWCFB 2881) and other decisions of the FWC and the Courts. In particular, it had been determined that, for the purpose of the NES paid leave entitlements:
- a “week” of annual leave is an authorised absence from work during the working days falling in a seven day period, and a “day” of leave (whether of annual or personal/carer’s leave) is an authorised absence from the working time in a 24 hour period
- the reference to “10 days” of personal/carer’s leave is not to be read as meaning 10 periods of 7.6 hours each, or an entitlement to 760 paid hours of leave per annum
- for example, if the number of hours normally worked by an 8-hour day worker and a 12-hour shift worker on a normal or rostered day of work are different, the statutory entitlement to 10 days leave (and pay) may result in a greater hourly entitlement (and overall pay) in some cases than in others
- the amount of leave deducted from an employee’s leave balance necessarily correlates with the amount of leave taken, so that if a week’s annual leave is taken, a week is deducted from the employee’s accrued annual leave balance, and if a day of annual leave or personal/carer’s leave is taken, a day is deducted from the employee’s accrued annual leave or personal/carer’s leave balance.
Lessons for employers
If you express a personal/carer’s leave or annual leave entitlement in an enterprise agreement or an employment contract in terms of hours per annum (for example, 76 or 80 hours per annum in the case of personal/carer’s leave), you will need to also have a mechanism for this leave entitlement to be ‘topped up’ for 12 hour shift workers. In the Mondelez decision this was achieved by the inclusion of a clause that provided for any more beneficial provision of the NES to take precedence where there is an inconsistency between the agreement and the NES. This clause ‘saved’ the clause expressing the personal/carer’s leave entitlement as 80 hours per annum.
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This article first appeared on the Holding Redlich website and has been reproduced with permission.