The Federal Court in its decision in Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Qantas Airways Limited  FCA 656, handed down on 18 May 2020, has ruled definitively that employees are not entitled to be paid personal/carer’s leave (ss.96 and 97 of the Act) or compassionate leave (s.105) during any time they are stood down pursuant to section 524 of the Fair Work Act (Act). Justice Flick considered two union applications which claimed that Qantas was obliged to continue to provide access to paid personal and carer’s leave for employees who had been stood down due to the COVID-19 pandemic.
Justice Flick considered that the heart of the proceeding was the intersection of the object and purpose of an ability to stand down employees and the entitlement of those employees to access personal/carer’s leave or compassionate leave.
Given that the purpose of sick and compassionate leave is to provide income protection (Mondelez v AMWU 2019 FCAFC 138), which assumed that the employee is earning income, the purpose of income protection cannot be fulfilled where no income is being earnt because no work is available for the employee to perform.
Justice Flick stated:
“ … and at the very heart of the ultimate conclusion, namely that an employee cannot access such leave entitlements whilst stood down, is the determination that such leave entitlements are an entitlement on the part of the employee to take leave from otherwise performing the work they are required to perform.”
Justice Flick also said:
“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 the leave entitlements conferred by ss 96 or 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. If there is no work available to be performed by the employee, there is no income and no protection against that which has not been lost. Conversely, to expose the employer to a liability to pay leave entitlements after lawfully having invoked the power to stand down an employee would defeat one of the two principal purposes of standing the employee down – namely, to protect the employer against such claims.”
Subject to any appeal, Justice Flick’s decision provides important guidance on the meaning of the stand down provisions in the Act. We expect that this decision of the Federal Court will have significant consequences for many employees who have been stood down under the Act due to the COVID-19 pandemic.
It is important to note that the decision does not apply to other forms of paid leave such as annual or long service authorised by the employer to be taken during a period of stand down.
Whilst the decision is clear that there is no legal obligation on an employer to allow employees it has stood down to continue to access personal/carer’s leave or compassionate leave, there is nothing prohibiting an employer who chooses to provide access to these entitlements from doing so.
We understand that the Transport Workers Union has indicated that it may appeal the decision and Pointon Partners will keep you updated if any such appeal eventuates.