People + Culture Strategies

On 18 May 2020, Justice Flick of the Federal Court handed down its decision in relation to the treatment of personal/carer’s leave and compassionate leave during periods of stand down (Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia & Ors v Qantas Airways Limited [2020] FCA 656).

The case came about as a result of a decision by Qantas to stand down around two-thirds of its workforce due to COVID-19 and its decision not to provide those employees with access to their paid personal/carer’s leave or compassionate leave entitlement during the period, a decision that was subsequently challenged by a number of unions.

While the controversial Mondelez decision is still subject to appeal, Justice Flick confirmed that it is authoritative in the way it addresses the role of the personal/carer’s leave entitlement conferred by the Fair Work Act 2009 (Cth) (the “Act”) under section 96. In particular, the personal/carer’s leave entitlement is a “form of income protection which presupposes that an employee is in receipt of income”. This is predicated on the employee being able to “take leave from otherwise performing the work they are required to perform”. Justice Flick agreed with Qantas’ interpretation that the very heart of this entitlement requires there to be work available or required “from which to derive income in the first place” [at para 31].

Justice Flick made it clear that the source of the ability to stand down employees without pay arises from either legislative provisions or in the terms of an industrial instrument. Standing down employees lawfully under the Act means that there is no useful work which the employee can perform or be absent from. In these circumstances, where there is no work available, there is no income and accordingly there can be no entitlement to access the personal/carer’s leave entitlement under the Act. The source of the stand down power applicable to Qantas under the relevant enterprise agreement in question did not alter this conclusion.

This supports the view held by PCS that given there is no work for employees to do during periods of stand down, there is no relevance arising from the employee being sick or unfit for work. In our view, while the judgment did not delve into this issue, we consider that the position held by Justice Flick also supports the position taken with respect to the treatment of personal/carer’s leave during a period of unpaid parental leave provided in the Act, which expressly prohibits the entitlement to personal/carer’s leave being available during such a period (see section 79(2) of the Act). It would be entirely inconsistent and unjust for an employee who is stood down to receive personal/carer’s leave where an employee on unpaid parental leave cannot.

Importantly, this case does not consider the availability of the personal/carer’s leave entitlement during periods of stand down authorised pursuant to a Jobkeeper enabling stand down direction under the Jobkeeper scheme.