Decision made in the Full Federal Court clarifies how personal/carer’s leave is taken

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The Full Federal Court recently handed down a decision that will impact the accrual of paid personal/carers leave. We have been awaiting the outcome of this decision for some time in order to provide some clarity around personal leave entitlements for those employees who work shift work and whose standard hours are not the typical 9.00am – 5.00pm, Monday to Friday.

The Mondelez Australian Pty Ltd v AMWU [2019] FCAFC 138 (Mondelez case) case will change the way personal/carer’s leave is viewed for permanent (full time and part time) employees.

From now on, personal/carer’s leave will be accrued in 10 full working days per year (or the equivalent thereof).  

Personal/carer’s leave is leave taken when the employee  is ill or suffering from an injury or is required to take care of an immediate family member or household member that is suffering from illness or injury.  

The decision handed down states that the leave is not to be calculated in hours spent working for the employer but instead must be calculated in working days. A working day has been defined as the hours an employee would work within a 24-hour period for the employer. The example used on the Fair Work Ombudsman website is that for every 5.2 weeks, an employee accrues an entitlement to another full day of leave.

In the Mondelez case, the business  had employees working 36 hours per week but in different shift configurations. One group of employees worked 7.2 hours each day for 5 days each week and another group of employees worked 12 hours each day for three days per week. Both groups of employees worked a total 36 hours per week. The personal leave was accrued at 72 hours per year based on the average weekly hours. Mondelez put forward the argument that it was fair for all employees to accrue the same number of personal leave hours per year. This resulted in an employee who worked 12-hour days had to take 12 hours of personal leave to cover the one day off work whereas an employee who worked 7.2 hours per day only took 7.2 hours of leave when they needed a day off. i.e. they still had 9 full days of leave left at the rate of 7.2 hours per day. The employee that worked 12 hours each day for three days a week would have only had enough personal leave hours accrued to take 6 full 12-hour days off each year instead of 10 days per year.

We now therefore have clarification in the interpretation of the working ‘day’ being ‘what the employee would have worked’. This gives employees who work longer hours in a day the ability to have 10 full days of work off each year for personal or carer’s leave. This means for employees that work 12 hours shifts for three days a week are entitled to accrue 10 ‘working days’ a year (which will result in more than the traditional 76 hours).

Decisions made by the Full Federal Court are binding unless the decision is appealed by Mondelez. It is not yet known if Mondelez will appeal the decision. As such, employers moving forward should ensure that they calculate the personal/carer’s leave in accordance with each employee’s particular ‘working day’ based on a “portion of a 24-hour period that would otherwise be allotted to work”.

We can assist if you need further advice on this point.

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