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JobKeeper dispute: worker refused to take annual leave

First dispute over the JobKeeper provisions to be resolved by the FWC.
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JobKeeper dispute: worker refused to take annual leave

JobKeeper dispute: worker refused to take annual leave

25 May 2020

A long-serving employee with a large annual leave balance has failed in her claim that her employer could not force her to use up some of her accrued annual leave. The employer’s request was for her to use up her annual leave at the rate of one day per week for 16 weeks, at which point she would reach the minimum balance required under JobKeeper legislation provisions. The employee’s remuneration under JobKeeper was about double what she received when employed.

This case is the first dispute over the JobKeeper provisions to be resolved by the Fair Work Commission (FWC).


Facts of case

The employer was a large leisure and theme park operator. The employee worked part-time, usually two days per week, and had 22 years' service. She was stood down when COVID-19 restrictions were implemented, and the stand-down notice enabled her to register for the JobKeeper subsidy program.

Later she was asked to take one day per week annual leave until either her annual leave balance reduced to four days or COVID-19 restrictions ended (expected after six months). The former would have taken 16 weeks.

The employee lodged a dispute with the FWC, claiming that JobKeeper was not intended to allow employers to require employees to set off leave accruals against its payments, and that doing so disadvantaged long-serving employees with large leave accruals. By comparison, the employer did not make the same request to casual employees. She had been saving her accrued leave for a long overseas holiday in 2021 and had also already booked and paid for shorter holidays. The employer’s policy was not to approve leave requests more than 12 months in advance. She claimed that requesting employees to reduce their annual leave balances may have been a reasonable strategy for a small business, but not for a large one like her employer.

The employer claimed that the employee had unreasonably refused its request for her to take annual leave. It had not yet granted approval for her to take a holiday in 2021 because of its abovementioned policy. It had requested all permanent employees receiving JobKeeper to take some of their annual leave accruals, and had also warned employees not to book or pay for future holidays, as approval to take them was not guaranteed. The employee had accrued enough long service leave to cover the overseas holiday without needing to take annual leave.

Of note was that the employee was typically paid about $375 per week, but under JobKeeper she was being paid $750. However, the FWC said that this did not influence the decision it made.


Decision

The FWC rejected the employee’s case and ordered her not to refuse the employer’s request to take annual leave on a one-day-per-week basis. It said that the law (in this case new provisions in the Fair Work Act 2009 inserted when JobKeeper was implemented) required her to seriously consider the employer’s request to take annual leave, and not to unreasonably refuse it. It described the employee’s conduct as attacking the employer in an unwarranted, unsympathetic and belligerent manner – for example by being one of several employees who attacked the employer on its closed employee Facebook page.

The bottom line: The test relating to JobKeeper provisions is not whether the employer made a reasonable request, but whether the employee acted unreasonably in refusing the request. The employer was entitled to make its request for as long as it considered it necessary.

It appears from this decision that employers can request employees on JobKeeper to use up leave entitlements as a business mitigation strategy. However, the employee must be able to retain an accrual of at least 10 days (for full-time employees, pro rata for part-time ones). As above, an employee cannot unreasonably refuse such a request.


Read the judgment

McCreedy v Village Roadshow Theme Parks Pty Ltd [2020] FWC 2480, 13 May 2020

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