Section 96 of the Fair Work Act 2009 (Cth) (the Act) provides that “for each year of service with his or her employer, an employee [excluding casual employees] is entitled to 10 days of paid personal/carer’s leave”. This entitlement accrues progressively during a year of service according to the employee’s ordinary hours of work and it accumulates from year to year.
What is a day?
In a recent case the Full Court of the Federal Court of Australia had to consider the meaning of “day” in section 96 of the Act.
The case related to a group of employees who worked 38 ordinary hours per week, but did so over 3 working days of 12 hours (plus unpaid break time).
In accruing for personal/carers leave the employer credited the employees with 76 hours of leave in each year of service. Hence the employer acted on the basis that “day” in section 96 of the Act meant a notional day made up of 7.6 hours of work. As a result the affected employees “used up” their annual accrual of leave after they had been absent from work for 6.3 of the 12-hour days.
The employees complained that this was less than the 10 days referred to in section 96 of the Act. The employees contended that “day” means a period of 24 hours in which ordinary work is performed and not a notional day of 7.6 working hours.
By a 2-1 majority, the Full Court ruled that a “day” for the purposes of the leave provision in the Act meant a 24-hour period in which ordinary hours of work is carried out.
Impact of the decision
The decision has implications for thousands of employees who work shift work, particularly in the healthcare and manufacturing sectors, and could see huge back-pay bills for employers.
Employers who engage workers who work non-standard hours (ie. shiftworkers) should, in light of this decision, review their personal leave accrual, deduction and payroll systems to ensure that such employees could, in theory, take 10 shifts as personal leave from work every year, without loss of pay.