High Court decision passes the pub test

Today the High Court has issued its first decision on the Fair Work Act National Employment Standards since introduced more than 10 years ago, offering welcome relief to businesses around the country by reinstating long-standing law and practice when it comes to calculating leave entitlements for employees.

In overturning last year’s decision by the Federal Court in Mondelez v AMWU, the High Court has recognised that a fair go for all workers means sick leave is based on a working week of 38 hours – no matter how many days or shifts it is worked across.

As the High Court recognised in dispensing with the ‘working day’ approach which would have seen some part-time and shift workers granted access to the same or even more hours of personal leave each year than their full time employee counterparts, such an outcome would have given rise to “absurd results and inequitable outcomes and would be contrary to the legislative purposes of fairness and flexibility”.

“People who work the same amount of hours a week, whether they are full-time, part-time or a shift worker should get the same amount of sick leave – that’s just common sense,” ACCI CEO James Pearson said.

“Employers faced the grim prospect of scrambling to pay extra money following the precedent set by the Federal Court which reversed long standing industry practice and the operation of payroll system utilised by hundreds of thousands of businesses around the country. It didn’t pass the pub test and we’re relieved the High Court has overturned it.

“Let’s not forget who would have been punished had the High Court upheld the decision – people in small businesses who are already on their knees, just trying to do their best to stay open and survive during the current Covid crisis.

“Today decision is also a win for flexible workers with variable hours, including those working part time and parents returning from parental leave as last years’ decision would have served as a major obstacle to family friendly working arrangements and young people seeking flexibility to balance work and study.”