Twice the time off? Australia's push for a game-changing leave scheme

A new leave flexibility scheme that could double the holiday leave credits of Australian workers is now being pushed by unions and pro-workers groups with certain trade-offs.

The Fair Work Commission (FWC) is considering a new leave provision that aims to provide Australians with twice the number of holidays than they currently have. Supported by the Australian Council of Trade Unions (ACTU), the scheme gives workers greater flexibility on how they take their leave.

However, if the provision is adopted, workers would have to take the additional annual leave at half pay.

Sally McManus, secretary of the ACTU, believes the new scheme would allow workers to have more options in how they carry out their time off.

"Having annual leave available to be taken at half pay can be a good option which gives workers who want to utilise it more time and flexibility to manage their caring responsibilities and balance work and care," McManus said.

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"We would expect this request to be driven by the needs of the worker and given proper consideration by the employer. As with all leave, it should be properly recorded and it should be clear to the worker how this would impact any future leave and super contributions."

While the ACTU sees numerous upsides to the new leave provision, the group admits that there should also be safeguards that would prevent employers from taking advantage of their employees.

For instance, employees should be the ones to formally ask their boss for double holidays at half the pay, and that it should only be granted at their request. Meanwhile, employers cannot force the scheme on their workers. They also cannot deny their employee’s request unreasonably.

The ACTU is also pushing for any arrangements to be made in writing for documentation. It should also be kept as part of the worker’s employment record.

Support from employers

The ACTU has found an ally in the Australian Chamber of Commerce and Industry (ACCI), which has expressed support for the new leave flexibility scheme.

ACCI Workplace Relations Director Jessica Tinsley said they support the initiative as "commonsense". However, she also clarified that employers should have the ultimate right to refuse any requests for double leave at half pay.

"ACCI is supportive in principle of a variation to modern awards to permit an employer and an employee to agree to an employee taking twice as much annual leave at a proportionately reduced rate of pay," Tinsley said.

"This proposal would be particularly beneficial for employees trying to balance work and caring responsibilities, especially where they have used up their own carer’s leave accrual."

Tinsley pointed out that some employers capable of providing flexibility to their workers already do so.

However, others who might also be considering a similar move are often kept from following suit because of Australia’s rigid workplace relations system. The ACCI official said the ACTU’s proposal is a "commonsense change."

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Changing annual leave approvals

For the new leave provision to be implemented, workplaces must change how they approve workers’ annual leave. "The usual requirement that employers can’t unreasonably refuse their consent should not apply in this special case," Tinsley said.

"Giving an employee the unilateral right to take twice as much annual leave whenever they like could have enormous ramifications on an employer, especially during a busy period or when they are short-staffed."

Innes Willox, CEO of the Australian Industry Group (Ai Group), also supports the additional annual leave for workers. However, he admitted there are "some pitfalls to work through" before such a move could be implemented.

"The big key here, the big caveat that we have to work through with unions is that, you know, who determines in the end whether it’s possible and we would say it’s the employer," Willox said.

"There has to be an agreement between the employer and the employee. So there’s a whole lot of things that have to be taken into account."

While Willox doubts whether changes to the workers’ annual leave system could be made immediately, he is optimistic that the discussions surrounding it could lead to better understanding.

"You just shouldn’t expect people working under awards to rock up to work in a couple of months and say, ‘I want to have the next eight weeks off starting tomorrow,’" the Ai Group CEO said.

"That’s not going to happen, but there’s room, we believe, once these changes are hopefully made for that sort of conversation to occur, about planned leave going longer but being paid less over that longer time."

Willox believes the current labour and skills shortages in Australia should also be considered in the discussions. He said making changes to the annual leave system could affect each employer differently depending on how big or small their workforces are.

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Concerns about giving workers more leave

Not all employers in Australia are keen to give workers double the number of holidays. Some, like former Metropolis Metering Services CEO Marco Bogaers, are worried about how the move could impact work productivity. "The proposal raises obvious concerns," Bogaers said.

"For staff to go on extended periods of leave requires that remaining resources pick up the slack, placing undue pressure on them in the workplace, or the business must increase its resourcing cost base."

Bogaers is also not a big fan of adding provisions to the scheme that would allow employers to deny requests from workers for more time off for half the pay. He said the move would only exacerbate the situation, especially since companies compete for top talent.

"It’s all well and good for the employer to have the right to say no, but when competing for available talent, this proposal tips the balance in favour of existing larger and better-resourced businesses at the expense of the smaller, emerging enterprises, which Australia so desperately needs," Bogaers said.

As the debate surrounding the proposed leave flexibility scheme heats up, workers and employers can only wait and see how things will pan out. The FWC is expected to release its decision over three to four months.