An Employer’s Guide to Annual Leave Obligations Over Christmas

Christmas is a season to be enjoyed and celebrated, and for many, a season to unwind, recuperate and reset for a new year. It is important that in this season, employers are aware of and meet their obligations to employees regarding annual leave. 

As a part of the National Employment Standards [NES], under the Fair Work Act, employers are required to pay all employees [except casuals] their normal rate of pay based on their normal hours of work; this includes public holidays such as Christmas, Boxing Day and New Year Eve [if these days fall on a working day].

In the case an employee does work on these public holidays, employers will need to review their award or agreement, as penalty rates may be due. The NES entitles employees to a minimum of four weeks annual leave. In some cases for shift workers, the entitled period of annual leave may increase to five weeks.

It is generally standard that an agreement between an employee and employer would allow the employee a period of paid annual leave during Christmas. An equitable shutdown period may be from at least Christmas to the New Year.

 In order to ensure an employer meets their obligations to employees over a period of annual leave, a few key factors must be considered:

• Agreements in place 
• The combined needs of the employee and the business 
• The normal trading habits of the business over Christmas, i.e. does it normally shut down for a two week period, or does it operate as normal with the exception of the public holidays? 
• Whether the period notice given for annual leave is fair and well timed for employees [i.e. a couple of days’ notice would be unmerited, as opposed to a couple of weeks to a month] 

Employers may encourage employees to take paid annual leave, so long as it fits their agreement, however in the case the employee does not have enough annual leave accrued, unpaid annual leave may be advised.  

If you are unsure of your responsibilities as an employer around the festive season and New Year, End2end Business Solutions can help you identify the obligations – call Annette on 8977-4002.