Payment for sick & carer's leave

On 21 August 2019, the Full Federal Court of Australia handed down a decision in Mondelez Australia Pty Ltd v AMWU [2019] FCAFC 138. The decision deals with the method of accruing and taking paid personal/carer’s leave for the purposes of the National Employment Standards under the Fair Work Act 2009.

Although the Full Federal Court’s decision is the most recent authority on the current state of the law, the Australian Government and Mondelez Australia Pty Ltd have applied to the High Court seeking special leave to appeal the decision. As the outcome of those applications (and any subsequent appeal) may impact upon the FWO’s advice in these matters, the FWO will review its advice at the conclusion of those proceedings. In the interim, you may wish to seek your own legal advice on this issue.

In the decision, the majority of the Full Federal Court determined:

  • Full-time and part-time employees are entitled to 10 working days of paid personal/carer’s leave for each year of employment.
  • The leave protects those employees’ income when they are entitled to be absent from work due to illness or injury (or providing care or support to a family or household member who is ill, injured or suffering from an unexpected emergency).
  • The leave must be calculated in working days, not hours. A working day is the portion of a 24 hour period that an employee would otherwise be working.
  • An employee’s entitlement is expressly based upon time working for the employer and is expressly calculated in days.
  • For every day of personal/carer’s leave taken, an employer deducts a day from the employee’s accrued leave balance. If an employee takes a part-day of leave, then an equivalent part-day is deducted from the employee’s accrued leave balance.

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Read the Federal Court of Australia’s decision in Mondelez Australia Pty Ltd v AMWU [2019] FCAFC 138 external-icon.png .

Sick and carer’s leave is paid at an employee’s base pay rate for each day or part day of leave they take.

An employee who takes paid sick or carer’s leave is paid for the hours they would normally work (not including overtime hours).

A base pay rate doesn't include separate entitlements such as:

  • incentive-based payments
  • bonuses
  • loadings
  • allowances
  • overtime
  • penalty rates.

Example: Paid sick and carer’s leave on ordinary hours

Steve works 9am-5pm Monday to Friday every week. For the last 6 months he has been working overtime on Wednesday night until 7pm. Steve became sick with a cold and couldn't come into work on Wednesday. When he received his pay, he noticed his employer paid him his normal hours between 9am-5pm as sick leave and did not pay his 2 hours of overtime. This is correct as his overtime is not included in his base pay rate.

Employees have to give notice to get paid for sick and carer’s leave. An employer can ask an employee to give evidence that shows the employee took the leave because they:

  • weren’t able to work because of an illness or injury, or
  • needed to provide care or support to an immediate family or household member (because of an illness, injury, or unexpected emergency affecting the member).

Think a mistake might have been made?

Mistakes can happen. The best way to fix them usually starts with talking.

Check out our Help resolving workplace issues section for practical advice on:

  • figuring out if a mistake has been made
  • talking to your employer or employee about fixing it
  • getting help from us if you can't resolve it.

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