Each month, we tap into the AHRI:ASSIST resource centre and find the most topical questions members are asking. This month, just in time for the holiday break, we take a look at annual leave.
Q. An employee wants to take unpaid leave to go on a holiday, but the person hasn’t accrued sufficient leave. Do I have to approve this? What do I do if the employee threatens to take the leave anyway?
You don’t have to approve unpaid leave for employees wanting a holiday. If they threaten to take the leave anyway, you can warn them that you will terminate their employment if they take an unauthorized absence from work. You could offer to advance them paid annual leave on condition that they authorise you to deduct the advance from whatever is otherwise owed to them should their employment end before they accrue the amount of leave advanced.
Q. An employee has taken approved annual leave and fallen ill during this period. Should the person be paid annual leave or personal leave for that period?
Employees are not entitled to take personal leave during paid annual leave.
Q. What factors are taken into account in determining whether an employer can ‘reasonably’ refuse a request for annual leave?
This is not defined in the Fair Work Act. However, it would depend on the notice the employee has given of the intention to take leave, the notice the employer has given of the refusal, the grounds for the refusal and the impact the refusal will have on the employee.
Q. Does an employee who is absent from work and receiving workers’ compensation payments accrue annual leave during this time?
Yes, if the compensation is paid under Commonwealth or Queensland workers’ compensation legislation. In other cases, no.
Q. Can I direct my employees to take annual leave and, if so, in what circumstances?
You can require employees to take annual leave if the requirement is reasonable. Factors determining whether it’s reasonable include the reasons for imposing the requirement and the notice given. It will be reasonable during Christmas shutdowns or when accrual is excessive (provided employees understand when leave is excessive and are given reasonable warning that they need to run down accrual).
Modern awards and enterprise agreements often provide clauses dealing with directions to take annual leave, which should be consulted when considering a directive of this nature.
Q. When do I have to pay leave loading?
You need to check whether this entitlement arises under a modern award, enterprise agreement or employment contract. If there is such an entitlement, you would normally have to pay this when the employee takes approved annual leave, as well as on unused accrued leave paid out on termination of employment.
Q. An employee booked annual leave some time ago to visit her mother overseas. Her mother is now terminally ill and the employee wishes to take a portion of her leave as compassionate leave as her mother might not live past Christmas (although she might also survive). The employee’s manager doesn’t think the situation is urgent enough to qualify for compassionate leave. Do you have any guidance?
Given the circumstances, compassionate leave is reasonable in this situation. Under the Fair Work Act, employees are entitled to two days compassionate leave for each occasion that a member of their immediate family or household passes away or suffers a serious illness or injury. It would appear that this situation qualifies as a serious illness.
If you’re grappling with an HR issue, AHRI:ASSIST is an HR guidance and support centre, with information sheets, checklists, guidelines, templates and much more.
This article is an edited version. The full article was first published in the December 2014/January 2015 issue of HRMonthly magazine as ‘AHRI:ASSIST’. AHRI members receive HRMonthly 11 times per year as part of their membership. Find out more about AHRI membership here.
Depending on how section 89 (2) of the Fair Work Act is interpreted, there is no strict legal entitlement for an employee to take personal leave during a period of annual leave. However, there is room for HR intervention, and that happens. So in many cases where a person becomes sick during annual leave, a decision is made on the basis of evidence and good HR judgement to cancel the annual leave and replace it with personal leave.
I should clarify that the above comment is written in my capacity as HR Manager for AHRI.
Hayley I encourage you to get some legal advice on your interpretation of Section 89 (2). It’s not a matter of ‘room for HR intervention’ or ‘good HR judgement’. I’ve just spoken with a lawyer to clarify my understanding and they confirmed that if someone can prove they were ill (ie provision of a medical certificate)then they are entitled to have their annual leave reversed and personal leave applied.
Thanks Kate. It’s been an interesting discussion. We have taken legal advice on this and for that reason I stand by my earlier post. Prepare for some legalese but the advice we received is as follows: “If an employee takes a sick leave day during a period of annual leave, this will not be an annual leave day. However, we think there is some doubt on the question as to whether an employee who falls ill during annual leave can take sick leave. Sick leave is leave taken because the employee is unfit for work because of personal illness or… Read more »