Landmark court decision on paid personal and carer’s leave 

    The Federal Court of Australia has handed down a decision which clarifies the operation of paid personal/carer’s leave under the Fair Work Act 2009.

    According to Employsure Senior Employment Relations Adviser Messina Angelis, Mondelez has appealed the decision to the High Court, which could take many months to finalise.

    “In the meantime, the findings of the Federal Court decision stand and must be applied or risk fines for underpayment of entitlements,” Ms Angelis said.

    “As an employer, you must ensure that employees other than casuals are provided with personal/carer’s leave in accordance with the Fair Work Act 2009 and this decision. Failure to do so may lead to underpayment of wages claims, and penalties against yourself and/or your business.”

    How should sick leave be calculated?

    The decision clarified that all permanent employees full time and part time national system employees are entitled to 10 days of paid personal/carer’s leave for each year of service. This leave is not pro-rated for part time employees, meaning part time employees are entitled to the full 10 days per year regardless of how many days or hours they work per week. This leave must be accrued, and taken, in days (rather than hours, as is common practice).

    The basic principles are as follows: personal/carer’s leave must be accrued in days, not hours; the accrual rate is one day of personal/carer’s leave for every 5.2 weeks of service; any unused personal/carer’s leave in a year carries over into the next year; and unused personal/carer’s leave is not paid on termination of employment, unless specified in an applicable industrial instrument, contract or policy.

    “For businesses with significant shift or part-time workforces, it is recommended they seek specialist advice on their specific circumstances to ensure no cases of breach arise.”

    For more information, including converting personal/carer’s leave hours to days, consult  Personal/Carer’s Leave E-guide

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