In Mondelez Australia Pty Ltd [2018] FWC 2140 the Fair Work Commission (Commission) confirmed shiftworkers are entitled to 10 days of personal/carer’s leave to be taken and accrued as a daily entitlement based on the hours ordinarily worked by a particular employee in a day. As a result, shiftworkers are entitled to payment for the full duration of their shift whilst on personal/carer’s leave rather than a standard 7.6 hours per day.

The Fair Work Commission reached a similar decision again this year in Australian Workers’ Union, The v AstraZeneca Pty Ltd [2018] FWC 4660 when it was asked to rule on how personal/carer’s leave is to be calculated for shiftworkers at pharmaceutical company, AstraZeneca Pty Ltd. In this case, the Commission held the entitlement to personal/carer’s leave differs between the employer’s rosters of 12 hour shifts and 10.28 hour shifts, and should not be calculated based on an average of hours worked.

Hourly accrual risks inconsistency with National Employment Standards

The Mondelez decision arose out of an application to approve the Mondelez Australia Pty Ltd, Claremont Operations (Confectioners & Stores) Enterprise Agreement 2017 (Mondelez Agreement). If approved, the Mondelez Agreement would apply to shiftworkers working 12 hour shifts at the Mondelez Australia Pty Ltd (Mondelez) chocolate manufacturing plant in Tasmania, Australia.

The Commission expressed concerns that the personal/carer’s leave provision of the Mondelez Agreement meant that employees working 12 hour days would not be entitled to their full 10 day entitlement to personal/carer’s leave under s 96 of National Employment Standards (NES) in the Fair Work Act 2009 (Cth) (the Act). The clause in question provided a personal/carer’s leave entitlement of 80 hours per year, rather than an entitlement expressed as a daily entitlement. The issue for the Commission was that employees working 12 hours per day would not receive their full entitlement to 10 days of personal/carer’s leave if the hours of such leave were capped at 80 hours per year. The Commission sought submissions from the parties after Mondelez refused to provide undertakings on the issue.

Citing inconsistent Commission Full Bench authorities, Mondelez and the Honourable Craig Laundy MP, Minister for Small and Family Business, then sought referral of the issue to a Full Bench of the Commission for determination in the public interest.

No inconsistent authorities – day means day

In rejecting the applications for referral to the Full Bench, Vice President Hatcher held the Full Bench decisions of ASU v Hobson Bay City Council [2014] FWCFB 2823 and RACV Road Services Pty Ltd v ASU [2015] FWCFB 2881 were consistent to the extent each dealt with s 96 of the Act. Further, Vice President Hatcher held the RACV decision comprehensively dealt with the interpretation of s 96 and therefore referral to the Full Bench was not justified on discretionary or public interest grounds. The Modelez Agreement was referred back to Commissioner Cirkovic for approval.

Following comments from Vice President Hatcher that the Mondelez Agreement did not exclude the NES and Mondelez would be required to “top up” the difference between any entitlement under the Mondelez Agreement and the NES, Commissioner Cirkovic approved the Mondelez Agreement on 4 May 2018.

Aftermath

Mondelez has applied for a declaration from the Federal Court of Australia on the interpretation of s 96 of the Act. The Fair Work Ombudsman has also published a disclaimer on its website advising employers to seek independent legal advice on how personal/carer’s leave is to be calculated.

To avoid issues of non-compliance, employers should ensure payroll systems account for the accrual and taking of personal/carer’s leave as a daily entitlement, rather than an hourly entitlement, particularly for shiftworkers, and where in doubt, seek advice.

Thank you to Sonia Costabile, Graduate, for her contribution to this article.