COVID-19 – Employees receiving JobKeeper cannot unreasonably refuse requests to take Annual Leave!

COVID-19 has financially devastated  employers  across Australia. In trying to meet these commercial challenges employers have had to consider all avenues available to them and act decisively.

The Federal Government has also implemented a number of initiatives to support employers.  The JobKeeper Scheme is providing employers with a $1,500 per fortnight wage subsidy for over six million employees.  The Scheme is also supporting amendments to the Fair Work Act 2009 which allow employers to make JobKeeper enabling directions changing an employee’s hours of work and duties or requesting them to take accrued annual leave.  In the first arbitrated JobKeeper dispute  before the Fair Work Commission, Commissioner Hunt ruled that an employee could not unreasonably refuse a request by their employer to take annual leave while they were stood down and being paid JobKeeper.

The employee was a long term employee of Village Roadshow Theme Parks.  The employee was stood down when the theme parks were shut down due to the imposition of COVID-19 social distancing restrictions. The employee was requested to take one day of accrued annual leave each week, until 27 September, or the employee’s annual leave balance was reduced to two weeks entitlement, whichever came first.

The part time employee, who earned almost double their normal wage while in receipt of  JobKeeper payments, argued that the legislation was not intended to allow large employers to set-off annual leave accruals against the  JobKeeper payments. Additionally, the employee argued that she needed to maintain her annual leave balance for  holidays she had planned and paid for over the coming twelve months.

Commissioner Hunt made it clear that the issue at hand was not whether the employer had acted reasonably in requesting the taking of annual leave, the issue at hand was whether the employee had been reasonable in refusing the request? In determining that the employee did unreasonably refuse the request to take annual leave the Commissioner considered the following factors:-

• The employee had not complied with the company leave policy prior to booking and paying for travel and accommodation;
• The employee did not have prior approval for future periods of annual leave;
• The employee would still have significant periods of leave (annual and long service) available at the end of the JobKeeper period;
• The employee’s medical condition did not warrant the retention of annual leave in excess of 2 weeks;
• That the legislation applied equally small and large employers.

This decision reflects the stated intent of the JobKeeper reforms, which are to “assist employers who qualify for the JobKeeper scheme to deal with the economic impact of the Coronavirus known as COVID-19”. That is; to assist them to weather the Covid-19 storm. The full decision can be found here.

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