Accruing annual leave while on workers' compensation
A New South Wales Full Federal Court has confirmed that an employee on workers’ compensation will also accrue annual leave during that period.
Section 130 of the Fair Work Act 2009 (Cth) (the FW Act) provides that an employee is not entitled to take any paid or unpaid leave under the National Employment Standards whilst they are receiving workers’ compensation, unless provided otherwise by the relevant Commonwealth or State compensation law. There has been some uncertainty between the interaction between the FW Act and the different State compensation laws. This decision resolves the uncertainty.
In the decision of Anglican Care v NSW Nurses and Midwives’ Association, Anglican Care did not pay the former employee any annual leave that she accrued for the period she was on workers’ compensation benefits.
The Court held that the New South Wales’ Workers Compensation Act 1987 (the NSW Act) did allow for an employee to take leave or accrue leave whilst on workers’ compensation, even though the NSW Act did not expressly permit the taking or accruing of leave.
What about workers in Queensland?
The Workers’ Compensation and Rehabilitation Act 2003 (Qld) (the Qld Act) is much clearer than other States. Section 119A of the Qld Act provides that a worker, who is entitled to compensation, is entitled to take and accrue annual leave, sick leave and long service leave during the period of compensation. There is also a note to the section that expressly states that the restriction under s130(1) of the FW Act does not apply.
Lessons for Employers
If you have workers in Queensland or New South Wales who are on workers’ compensation, ensure you count that period as service and continue to accrue their leave entitlements or permit them to take leave.
If you have workers in other States or Territories in Australia, double check the legislation to ensure you are not falling foul of the FW Act and any workers’ compensation laws.