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Employers have new annual leave rights

Leave entitlementsJune 12, 2015

Employers have new annual leave rights (Last Updated On: August 9, 2016)

A new decision has been passed by the Fair Work Commission. Business owners will now be allowed to direct employees to take annual leave where employees have excessive annual leave accrued.  Employers and employees will also be able to agree to cash out annual leave in certain circumstances.

The decision has been criticised by unions, however Ian Ross who heads the Fair Work Commission, outlined that the change will provide financial flexibility to employers as well as employees. Business owners can reduce leave liabilities (often representing a significant liability in their accounts) and employees can increase their cash flow by cashing out annual leave they do not wish to take.

There are a number of safeguards surrounding these new provisions. All employers must give their employees 8 weeks’ notice of the requirement to take excessive leave and an official agreement must be made between the employer and the employee. Employers cannot exert undue influence or undue pressure on an employee or make a false or misleading representation in relation to cashing out annual leave or taking excessive leave.

The Commission also indicated that it would consider allowing employers to direct that employees must take annual leave during a period of close down on an industry by industry basis.

All employers who would like to discuss the changes to annual leave and their options to pay out employees who have excess leave owed, call Employsure today on 1300 651 415.

Sourced: The Australian Financial Review

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