What Does a Day of Paid Personal Leave Mean?

by | Sep 18, 2019 | Business Law

Employers and employees will be well aware that under section 96 of the Fair Work Act employees are entitled to 10 days of paid personal/ carer’s leave for each year of service, accrued progressively during the year according to the employee’s ordinary hours of work.

For most employees who work a standard 38 hours plus reasonable additional hours per week, personal/carer’s leave is calculated on the basis of 7.6 hours per day spread across a standard 5 day working week which makes 76 hours (10 notional days) personal/carer’s leave per week.

However, for employees working more than 7.6 ordinary hours per day, such as shift workers, the calculation of personal/carer’s leave entitlements is not so simple.

In a recent case the AMWU and two Cadbury shift workers commenced proceedings against their employer seeking to clarify their entitlement to paid personal/carer’s leave under the relevant enterprise agreement and section 96(1) of the Fair Work Act.

The employees in questions worked 12 hour shifts three times per week for a total of 36 hours per week. When an employee took a day of personal/carer’s leave, the employer would pay him for 7.2 hours of work (36 hours divided by 5 days) based on its interpretation of a day as an industrial one referred to as a ‘notional’ day.

The union argued that the employer had incorrectly interpreted what constituted a ‘day’ and subsequently had been underpaying their shift workers for personal/carer’s leave.

The Full Federal Court found that a day is categorised as a ‘working day’ meaning the hours allotted to work in a 24-hour period. In this case the Court found that these employees were entitled to 10 days of paid personal/carer’s leave at 12 hours per day.

What the decision means for employers

Unless overturned by a High Court appeal, this decision reflects the current status of the law and has the following implications:

  • Employers should review their internal processes on how personal/carer’s leave is accrued and paid and should review their employment contracts and any applicable awards or enterprise agreements.
  • Employers will need to ensure that shift workers are compensated for their entire shift on which a personal leave day is taken and only one day is taken from their allotted 10 days.
  • In addition, employers need to be mindful that personal/carer’s leave will accrue on the basis of days or part-days rather than hours worked.

Important Disclaimer: The content of this publication is general in nature and for reference purposes only. It is current at the date of publication. It does not constitute legal advice and should not be relied upon as such. Legal advice about your specific circumstances should always be obtained before taking any action based on this publication.

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