Important information about changes to accrual of personal/carer’s leave.
The High Court has handed down a decision on August 13th which clarifies how paid personal/carer’s leave is accrued for part time and full time staff. The changes brought about by this case are essential for business owners to understand, so we’ve created this guide to assist.
So, what did the High Court decide?
The High Court’s decision has overturned a previous decision that said personal/carers leave was calculated in working days, not hours. Now this decision has been reversed, the following now applies:
- The 10 days of personal/carers leave employees are entitled to under the National Employment Standards (NES) is calculated based on an employee’s ordinary hours work, not their working days (as was previously the case).
- 10 days of personal/carer’s leave can be calculated at 1/26th of an employee’s ordinary working hours within a year.
Whilst there is no published effective date for this to apply to business owners, we recommend applying it ASAP going forward.
What does this mean for my business and employees?
For the majority of employers this will not have a major effect on personal/carer’s leave. It does, however, slightly change the way leave is calculated.
You should check that the personal/carer’s leave your employees receive has been calculated correctly to meet the amount they are entitled to. This amount is 1/26th of their ordinary hours, which should equal to 10 full working days.
Suzanne is a full-time employee who works 38 hours, 5 days a week. Rebecca is a part-time employee who works an average of 19 hours per week, working a 5-day fortnight. Suzanne gets 76 hours of paid sick and carer's leave per year. Rebecca gets half of Suzanne’s paid sick and carer's leave (38 hours) per year as she works half the hours Suzanne works.
The Fair Work Australia website has a page which outlines the changes brought about by this decision and includes guides on applying the rules to your business. You can access it here.
The Fair Work Australia leave calculator can be accessed here.
These changes are important for all employers to take note of. It is important that you begin calculating leave based on the ordinary hours your employee works in order to ensure you are providing at least 10 days’ worth of personal/carers leave. This may not be as simple as 10 days x 7.5 standard hours)
If you need any advice to ensure you are meeting your employer obligations and providing your employees with the right entitlements give one of our Advisors a call.