The High Court of Australia

AMMA has joined the broader business community in welcoming confirmation that the Federal Court’s controversial decision in 
Mondelez v AMWU
 
will be tested before the nation’s highest legal authority.

On Friday (13 December) the High Court of Australia granted Mondelēz International and the Australian Government special leave to appeal the Federal Court’s August decision, which effectively overturned the longstanding accepted practice for calculating personal/carer’s leave entitlements.

In a 2-1 majority judgement, the Full Court of the Federal Court found the National Employment Standards require all employees to be provided with enough personal leave to allow them to take 10 working days of personal/carer’s leave per year, irrespective of how many hours they work each day.

In effect, this decision would provide employees working long shifts and/or industry-specific rosters with far greater leave entitlements than those who work a standard 38-hour week. It also raises uncertainty on leave entitlements for part-time employees across all industries.

“The Federal Court’s interpretation in Mondelez is not only inconsistent with longstanding practice, it would expose all sectors of the Australian economy to significant cost impacts and create great inequities between different groups of employees,” Steve Knott, Chief Executive of AMMA, said.

“The decision is grossly unfair to employees working a standard 38-hour week. The inequities it creates would be damaging to workplace culture and harmony – clearly this is not what Parliament intended when it passed the Fair Work Act into law.

“The Government is currently exploring ways in which the industrial relations system can better support cooperative and harmonious workplaces. If allowed to stand, the Federal Court’s decision in Mondelez would do little to promote these goals.”

Employers will hope the High Court’s ruling aligns to the strong dissenting judgement by Justice O’Callaghan, in which he found:

“…the position advanced by the union produces an outcome that creates inequities between different classes of employees that Parliament did not intend.”

In a statement released on Friday, Mondelēz International said the High Court appeal was important “not only for Mondelēz International but for all Australian employers with non-standard shift arrangements… who would also be impacted by the original Federal Court decision”.

The company pointed to examples across the nursing, mining, building and construction and transport and distribution industries.

Shortly after the Federal Court decision was handed down, Attorney-General and Minister for Industrial Relations Christian Porter said the decision needed to be appealed because it had created significant inequities between employees, while also exposing employers to cost increases estimated up to $2 billion per year.

AMMA is closely monitoring this matter and will advise its members of the High Court’s decision and the implications for employers as soon as it is handed down. For further information contact [email protected]