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HR Help Desk Managing excess leave

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MEMBER SPOTLIGHT

MEMBER SPOTLIGHT

Managing excessive leave

By Melissa Hay, HR Specialist

With the onset of a new year, businesses will need to consider leave requests while ensuring adequate staffing levels to maintain operational requirements.

The impact of managing COVID19 outbreaks over the last 18 months, through government ‘stay at home’ orders and isolation requirement has seen many employees working from home. Many employees have been restricted in taking holiday breaks, or have been reluctant to take leave when there’s nowhere to go, so employers may likely be dealing with excessive leave accruals that will need careful management.

In considering leave requests, businesses need to contemplate various factors to ensure minimal impact on operating capacity. These include: l Typical patterns of customer demand during the leave period; l Frontline staffing numbers required to manage customer needs; l Support functions staffing numbers (Admin, IT, Finance); l Management of staff and/or temporary reporting line changes; l Relief resources if skeleton staffing arrangements are insufficient due to unexpected absences or events; l Expertise/delegations required to be arranged before leave commencement; and l Any 2022/2023 Christmas/New

Year closedown provisions listed in awards or employment contracts

What is defined as excessive leave accruals?

Many of the Federal Awards have defined excess leave as having an annual leave balance of 8 weeks or more, or ten weeks for shift workers.

How do I know that some employees have excessive leave accruals? Employers need to review the leave accruals of their employees. As part of this review, employers need to look at: l Current leave balance l Any accrued leave to date not included l Dates for next accrual l Any known leave plans of the employee l Dates when last leave was taken l What award provisions, if any, are listed in relation to excess annual leave.

What can I do to manage employee excess annual leave?

Following that review, it may be a key priority to approve leave plans for employees with excessive leave balances. That is one measure for managing leave excessive leave balances. However, employees may be banking their leave for a future extended holiday. As the employer, you need to discuss with your employee what those plans are and how far in advance the leave will be taken. Consulting with the employee and getting their commitment to a written leave plan is another strategy for managing leave accruals.

Where an employer and employee cannot come to an agreement to manage the leave, if provided for in the relevant Award, an employer can direct an employee to take some of the leave. In this event, the employer must give the employee a minimum of 8 weeks’ notice of the start date of that leave. Employees can be directed to take at least one week of leave, but must retain a minimum of 6 weeks of annual leave in balance. Award provisions may vary slightly, so checking the specific award is the first step. Some awards or agreements may also have provisions for cashing out annual leave. Specific rules apply: l an employee needs to have at least four weeks of annual leave leftover l a written agreement needs to be made each time annual leave is cashed out l an employer can’t force or pressure an employee to cash out annual leave The payment for cashed out annual leave has to be the same as what the employee would have been paid if they took the leave. If employees are not covered by an award (award-free), they can also enter into these arrangements to cash out annual leave.

The benefits of managing excessive leave

Ensuring that employees have taken breaks away from the workplace to remain productive upon their return is integral for both their physical and emotional well-being. Excessive leave accruals may be symptomatic of an overworked workforce and can represent health and safety risks for which an employer may be liable. Work-life balance is often discussed and highlighted as a factor in positive workplace cultures. If employees are not taking annual leave but taking sick or personal leave, this may indicate a problem. There are also financial benefits or cost savings when employers manage excess leave accruals. Many employees have salary increases and CPI increases if they remain with an employer for some years. If annual leave is not managed well, it means employers have to pay out annual leave at the date when leave is taken or if an employee exits. This will often be payable at a greater salary rate than when the leave was accrued.

At the end of the day, it is good business practice to manage excessive leave accruals for the well-being of your employees and the health of the business. l

If you would like any further information call the SSAA

HR HELP DESK

1300 01 SSAA / 1300 017 722

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