As part of the mandated four yearly review of modern awards, a Full Bench of the Fair Work Commission has announced some key changes to annual leave provisions in the award system.
The decision identifies changes to the timing of annual leave (especially excess accruals), cashing out of excess leave and leave in advance.
The case started when a group of employer organisations made application to provide for a wide range of changes to the annual leave clauses of modern awards. The case traversed many months and submissions, and is still not completely finalised. The remaining debate is now about whether the standard clauses the FWC has devised will be in every award, or if some may not be included in the changes.
A key new feature all employers should be aware of is a capacity of an employee to issue a notice to an employer stipulating when the employee will take their excess leave. This has never been sanctioned at the legislative or award level before. Certain preconditions must be met before this trigger can be pulled, but nevertheless, it is there.
The changes provide business the ability to reduce their leave-accumulated accruals. Noting there is an often-unfunded annual leave bank in this country. The new provisions will provide employers and employees with mechanisms to reduce its size.