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How is personal (sick) leave calculated?


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The National Employment Standards (NES) which provide the statutory minimum entitlements that apply to almost all employees in Australia, specifies that all permanent employees (that is, employees who are not casual) are entitled to “10 days” of paid personal leave per year.  (Personal leave includes sick leave and carer’s leave.)

In the past employers have generally interpreted “10 days” as 10 days for a full-time worker or, 76 hours per year, and have applied this pro-rata to part-time employees.  So, for example, in the past most employers have interpreted this to mean that an employee works for only 19 hours per week (half time) is only entitled to 38 hours of paid personal leave per year.

In a recent Decision the Full Federal Court has confirmed that this approach is wrong.  Instead, the Full Federal Court has ruled that “10 days” means what it says – that is 10 full days, regardless of how many hours a particular employee works per week or per day.  So, for example:

  • for an employee who regularly works 12 hours per week in 4 hour shifts over 3 days, a “day” is 4 hours and that employee is entitled to 10 days (of 4 hours) or 40 hours of paid personal leave per year;
  • for an employee (like the employees in the case before the Full Federal Court) who work 36 hours per week in 12 hour shifts over 3 days, a “day” is 12 hours and that employee is entitled to 10 days (of 12 hours) or 120 hours of paid personal leave per year; and
  • for an employee who works 38 hours per week over 5 days of 7.6 hours per day, a “day” is 7.6 hours and that employee is entitled to 10 days (of 7.6 hours) or 76 hours of paid personal leave per year.

The case: Mondelez v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) [2019] FCAFC138

The case which the Full Federal Court was considering was called Mondelez v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) [2019] FCAFC138.  In that case, the full time employees of the employer, Cadbury, all worked 36 hours per week.  Some of the employees worked 36 hours per week over 5 days, working 7.2 hour shifts, and others worked 36 hours over 3 days, working 12 hour shifts.  The employer argued that all employees were only entitled to 72 hours of paid personal leave per year regardless of whether they worked 12 hour shifts or 7.2 hour shifts.  The Full Federal Court said that this was not correct.  Instead, it found that those employees who regularly worked 36 hours over 3 shifts of 12 hours per week were entitled to be paid for 10 full days of personal leave per year and, as for those workers a “day” was 12 hours, their entitlement amounted to 120 hours per year.  On the other hand, those employees who worked 36 hours per week over 5 days and who were also entitled to 10 full “days” of paid personal leave per year, were only entitled to 72 hours of paid personal leave each year.

This decision has the most significance for part-time employees because, as detailed above, many employers have in the past treated the paid personal leave entitlement of part-time employees on a pro-rata basis.  However, this decision makes clear that if you are a part-time employee, you are still entitled to 10 days of paid personal leave per year, with a “day” amounting to your usual shift. 

Please note: Prime Minister, Scott Morrison, has sought leave to appeal to the High Court of Australia against this decision – watch this space!

If you have any questions about paid leave please contact Andersons Solicitors Employment and Industrial Law team.

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Get in touch with today's blog writer :
Margaret Kaukas 

Special Counsel in Employment and Industrial Law

Please note, this Blog is posted in Adelaide, South Australia by Andersons Solicitors. It relates to Australian Federal and South Australian legislation. Andersons Solicitors is a medium sized law firm servicing metropolitan Adelaide and regional South Australia across all areas of law for individuals and businesses.