Issue No. 32 - December/January
Carers leave rule changes sets pay trap
Employers unaware of recent changes to the payment calculation for accrued sick, carer’s and compassionate leave under new WorkChoices legislation may be underpaying staff for accrued leave entitlements.
David Thompson, employment law partner at national law firm Hunt & Hunt, says the new Australian Fair Pay and Conditions Standard uses a different method of calculation for paying personal, carer’s and compassionate leave than for regular accrued annual leave.
Under the new regulations, leave payments are calculated on the basis of what the employee would reasonably have expected to earn if he or she had worked during that period.
“(An employee is entitled to) overtime payments, shift allowance and penalties if these would reasonably have been paid to the employee on the day(s) the leave was taken,” David says.
“This has the potential to significantly increase the amount of leave payments owed, especially in workplaces where overtime, shift allowance and penalties are common.”
David says the new calculations could place an additional administrative burden on employers, as each time an employee takes personal, carer’s or compassionate leave, the employer must assess what the employee would reasonably have been paid for each day of leave had they worked instead.
To complicate matters further, the different calculation method only applies to leave accruing from 27 March 2006 — the date the WorkChoices legislation...