The Federal Circuit Court has found employers can deduct annual leave and personal / carer’s leave on public holidays, but only where an enterprise agreement provides more generous leave entitlements than the National Employment Standards (NES), writes AMMA senior policy adviser Lisa Matthews.

Lisa Matthews

Lisa Matthews

IN HIS 23 December 2015 decision, Judge Tom Altobelli upheld arguments by Glendell Mining Pty Ltd about the application of s89 and s98 of the Fair Work Act.

The CFMEU, on behalf of a worker at the Ravensworth mine in the Northern District Coalfields of NSW, argued those sections of the Act meant Glendell Mining had adjusted the worker’s annual leave balance downwards in breach of the Act.

Section 89 says an employee is not taken to be on paid annual leave on public holidays. If public holidays occur during a period of annual leave, an employee is taken not to be on annual leave that day.

Section 98 says an employee is not taken to be on paid personal / carer’s leave on public holidays.

The man was taken to be on leave on eight public holidays including Australia Day and Anzac Day in 2014.

The CFMEU argued that under s89 and s98, the company was required to treat the worker as not being on annual leave or personal / carer’s leave on those public holidays. The union argued the prohibition on deducting leave on public holidays applied to all leave without restriction.

EA provided more generous leave entitlements

The company pointed out the enterprise agreement (EA) covering the worker provided “significantly superior” leave entitlements to the NES. On those public holidays when the man had been rostered on to work but took leave, that leave was “in excess” of the NES.

It argued s89 and s98 were confined in their scope to the four weeks’ annual leave entitlement and 10 days’ personal / carer’s leave entitlement under the NES and did not apply to leave in excess of those amounts.

As long as leave deducted for public holidays did not cut into minimum leave entitlements under the NES, leave could be deducted from accrued leave balances, the company argued.

The CFMEU argued that given leave was “pooled”, it was impossible to know whether a public holiday was using minimum leave entitlements under the NES or extra leave entitlements under an EA.

Justice Altobelli said that was a “mechanical” issue and should not dictate how the plain words of the Act were interpreted, which would be like “the tail wagging the dog”.

The judge agreed with the company that s89 and s98 were confined in their scope to leave under s87 and s96, which specified minimum leave entitlements under the Act.

At all relevant times on the public holidays in question, the man was in receipt of the more generous leave entitlements under the EA, not the minimum entitlements under the NES.

The protections under s89 and s98 did not apply to that extra leave and did not prevent leave being deducted on public holidays.

The judge noted, however, that if the worker had not been in receipt of more generous leave entitlements than the NES, the public holidays would not have been able to be deducted for those public holidays.

Implications for employers

This decision will have implications for employers not only in the coal mining industry but in other industries. It clarifies that the only annual leave and personal / carer’s leave entitlements that cannot be deducted for public holidays are the minimum entitlements under the NES. Where workers receive more generous leave entitlements under an EA, leave can be deducted if it falls on a public holiday.

For the full Federal Circuit Court decision, click here.

If you have any questions about annual leave in your workplace, contact an AMMA consultant via your local AMMA office.