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What Are The Options For An Employee When They Are Directed To Take Annual Leave?

June 17, 2021   Philip Evangelou

Understanding your entitlements are crucial to navigating questions around annual leave. National Employment Standards (NES) guarantee full-time employees a minimum of 4 weeks of annual leave and part-time employees get the same duration which is prorated according to their work hours. Annual leave can be higher if your contract/ enterprise agreement entitles you to more leave. Additionally, you can also check if you are covered by a modern award that has a higher leave entitlement.

The NES along with the modern awards do not spell out the procedure around how to take annual leave. This leaves room for a situation when your employment contract is also silent on this aspect and the employer directs the employee to take accrued annual leave.

Accruing annual leave

An employee is usually not entitled to the entirety of annual leave at the start of the employment. Over a period of time you accrue annual leave. Most workplaces operate this way unless the employment contract states otherwise. You can use the online calculator on the Fair Work Ombudsman website to calculate employees’ accrued annual leave. 

Direction to take annual leave

If your employment contract addresses how and when an employer can make an employee take annual leave, then the direction has to be in accordance with those contract terms and also be reasonable. However, if the contract only states that an employee can be made to take annual leave but does not make any rules about it, the test is whether the direction is reasonable. 

Examples of reasonable circumstances:

  1. When the employee has accumulated excessive leave.
  2. When the business is shut down (temporarily). Closing during the Christmas and New Year period would fall under this.  

What to consider when directed to take annual leave

  • The leave period has to be accrued. The employer cannot ask the employee to take leave that has not yet been accrued. 
  • The relevant contract provisions or any internal policies that cover the procedure of annual leave. These could be the notice period, mode of notice (written or verbal), number of leave days, etc. The employer cannot circumvent the agreed provisions while directing the employee. 
  • The direction needs to be reasonable even if it is in line with the contract. You might need legal advice while considering the reasonableness of the direction. 
  • Sometimes it may sound like a direction but it is actually a request from the employer. Nature of the statement should be analysed. 
  • Employees should have a transparent conversation with their employers if they cannot take leave as directed. It is possible that the period is revised if you provide reasons and have a constructive discussion.

In Summary

Being well versed with your entitlements and the applicable legislation, award and agreement is the best starting point for questions related to leave entitlements. Employees should not feel cornered in a difficult situation and rather feel confident while discussing concerns with their employers. Annual leave and the period of leave can be a sensitive issue that can adversely affect business stability and employee satisfaction. It would be helpful for both sides to identify overlapping interests as opposed to seeing it as a competing interest.

About Philip Evangelou

phillipPhil is a director at OpenLegal. He has over 16 years experience working in private practice and in-house counsel in Sydney and London, giving him expertise in employment law, IP, finance, leases, dispute resolution, insurance and contracts.