Workers not entitled to use paid sick leave during stand down

In a significant decision, the Federal Court has determined that Qantas Airways does not need to allow its stood down workers access to paid personal/carer’s leave or compassionate leave during the period of stand down.  The decision by Justice Flick clarifies the obligations of employers and the rights of thousands of other stood down workers throughout Australia. 

Background

The Fair Work Act 2009 (Cth)(FW Act) contains provisions that state that an employee is not taken to be stood down during a period when the employee is taking paid or unpaid leave that the employer has authorised, or during a period when the employee is otherwise authorised to be absent.

Qantas stood down almost two-thirds of their 30,000-employee workforce in March this year, following the almost complete cessation of international travel in the wake of COVID-19 travel restrictions.  Qantas advised their stood down employees they were ineligible for paid personal/carer’s leave if they fell ill during the stand down, and could also not access compassionate leave, on the basis they were not attending work during a stand down period.  However, stood down employees could access annual leave, long service leave and the Australian Government’s $1,500 fortnightly JobKeeper payments.

In response, relevant Unions commenced two separate proceedings.  The proceedings, which were heard together, concerned the relevant enterprise agreement and FW Act stand down provisions.  In both proceedings, it was not in dispute that Qantas’ employees were lawfully stood down. 

Decision

Because the paid leave being considered was not authorised by the employer, in order for employees to access it, it would need to be shown for FW Act purposes that such paid leave was during a period when the employees were ‘otherwise authorised to be absent’ from their employment. 

In Justice Flick’s decision, a distinction was drawn between paid personal/carer’s leave and compassionate leave from other forms of absences that he considered would be ‘authorised’ by the FW Act, including for jury service, public holidays and eligible community service activities.  Justice Flick pointed out that the difference rests on the purpose of the FW Act provisions and the intention to establish those circumstances where an employee is not taken to be stood down. Justice Flick agreed with Qantas’ submissions that it would be counterintuitive to the purpose of the relevant FW Act sections to allow stood down employees to access paid personal/carer’s or compassionate leave as they were not attending work to begin with, stating:

‘In circumstances where an employee has been lawfully stood down, and thus in circumstances where there is no work which the employee can perform and thereby derive income, an employee is not entitled to access leave entitlements conferred by section 96 and 105.  To enable the employee to do so would go against the very object and purpose of conferring those entitlements – namely an entitlement to be relieved from the work which the employee was otherwise required to perform.’

There was therefore a difference between taking leave, as opposed to an entitlement to be absent from employment.  Paid personal/carer’s leave and compassionate leave both require an employee to notify their employer of their absence.  Since during a stand down there is no work to perform, an employee does not need to notify their employer if they are not attending work.  Justice Flick went as far as to say that permitting an employee to access personal/carer’s leave during a stand down period would breach the FW Act prohibition against cashing out that leave.

Accordingly, an employee who has been stood down and who seeks to take paid personal/carer’s or compassionate leave is not authorised to be absent from their employment for FW Act purposes.

This reasoning extended to Justice Flick’s interpretation of the stand down provisions and leave entitlements under the applicable enterprise agreement, which were found to be consistent with the FW Act.

Recommendations

There is a strong likelihood of an appeal against this decision, with one union already signalling its intention to do so.  However, for the time being, this decision confirms that:

• during a stand down employees can access FW Act entitlements to jury service, public holidays and leave for eligible community service activities;
  
  
• employers are justified in not allowing stood down employees to access paid personal/carer’s or compassionate leave – and given the FW Act’s provision against cashing out paid personal/carer’s leave, are prohibited from  allowing employees to access it. 

Thanks to Bianca Banchetti for her assistance in putting this article together.

This publication covers legal and technical issues in a general way. It is not designed to express opinions on specific cases. It is intended for information purposes only and should not be regarded as legal advice. Further advice should be obtained before taking action on any issue dealt with in this publication.