News & Insights

Over the past year, there has been a degree of uncertainty when it comes to personal/carer’s leave entitlements. This confusion has stemmed from the Full Court of the Federal Court of Australia’s decision in Mondelez v AMWU [2019] FCAFC 138, where it was determined Mondelez shift workers who, on average, worked three 12-hour shifts per week, were entitled to 120-hours of personal/carer’s leave per year. This potentially had far reaching implications for employers, including with respect to personal/carer’s leave entitlements for part-time employees.

high Court appeal

Mondelez and the Minister for Jobs and Industrial Relations appealed the decision to the High Court of Australia.

On 13 August 2020, the High Court handed down its decision, overturning the Full Federal Court’s decision (Mondelez Australia Pty Ltd v. AMWU & Ors Minister for Jobs and Industrial Relations v. AMWU & Ors) and determining the entitlement to 10 days of personal/carer’s leave is based on “notional days”, and can be calculated as:

• one day being the equivalent of 1/10 of an employee’s ordinary hours of work in a two-week period; or
• ten days being the equivalent of 1/26 of an employee’s ordinary hours of work in a year.

It was held  the “working day” construction adopted by the Full Federal Court was inconsistent with the stated objectives of the Fair Work Act 2009 (Cth) of fairness, flexibility, certainty and stability.

what does this decision mean for employers?

This decision can be viewed as a win for employers. The primary impact is  employers no longer need to be concerned about adjusting leave balances, changing accrual methodology, or being exposed to risks associated with potential underpayments flowing from prior treatment of leave entitlements that were inconsistent with the Full Federal Court’s analysis.

As was commonly understood prior to that decision, employees will continue to accrue personal/carer’s leave based on the ordinary hours which they work.

Any employers who changed their employment contracts, policies or practices as a result of the Full Federal Court’s Mondelez decision should re-visit any such amendments and practices, with a view to aligning them with the now settled position.

we are here to help

Please contact our Employment, Safety and Migration team at Macpherson Kelley if you would like further advice in relation to the High Court’s decision in Mondelez.

The information contained in this article is general in nature and cannot be relied on as legal advice nor does it create an engagement. Please contact one of our lawyers listed above for advice about your specific situation.