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Last month the Full Court of the Federal Court handed down their decision in Mondelez v Automotive, Food, Metals Engineering, Printing and Kindred Industries Union (AMWU) [2019] FCAFC 138 (‘Mondelez decision’). This landmark decision determined the interpretation of the personal/carer’s leave entitlement in the Fair Work Act 2019 (Cth).
The Federal Government and the employer (Mondelez International) have both announced this week that they will be seeking leave to appeal the decision in the High Court. (Click here for a copy of the Federal Government’s Media Release)
The AHA were instrumental in being able to successfully lobby the Federal Government to appeal the decision to the High Court.
The Decision
The Mondelez decision has resulted in significant uncertainty for the business community on how personal/carer’s leave is to be accrued and paid to employees. (Click here to see AHA|SA Member Update.)
The Federal Court determined in the Mondelez decision that full-time and part-time employees under the Fair Work Act 2009 (Cth) (‘FW Act’) can access up to 10 days of paid personal/carer’s leave per year of service irrespective of how many hours they work per week or the number of days they work per week.
The Mondelez decision also determined that the personal/carer’s leave entitlement under the FW Act should be accrued based on days rather than hours and that an employee is entitled to be paid for their absence based on the shift they would have otherwise worked.
As a result of the decision, a part-time employee for example that works only one 12 hour shift per week would be entitled to be paid for 12 hours for any full day of absence up to 10 days per year, which is the equivalent of 120 hours of paid personal/carer’s leave in a year.
The Mondelez decision is inconsistent with long standing industrial practice of how to calculate personal/carer’s leave. Previously, personal/carer’s leave would be calculated based on an employee’s ordinary hours averaged over a 5-day working week. For example, a full-time employee that worked 38 ordinary hours per week would be entitled to a maximum of 76 hours of personal/carer’s leave per year of service. Similarly, a part-time employee that averaged 20 ordinary hours per week would be entitled to a maximum of 40 hours of personal/carer’s leave per year of service.
What happens in the meantime?
As it currently stands the Mondelez decision remains the law on the interpretation of the personal/carer’s leave entitlement under the FW Act. Members therefore need to make suitable adjustments in their payroll to accommodate for the changes that this decision has brought.
We will keep Members abreast of any developments with respect to the appeal.
Members with any enquiries on the Mondelez decision and the appeal to the High Court should contact Owen Webb at the AHA|SA.
