With the holiday season upon us, many businesses shut down for the Christmas period leaving employees in limbo about their holiday arrangements. Some employers may force their employees to take their annual leave when their business is closed. But, is this allowed?

What Does The Award or Enterprise Agreement Say?

Whether your employer can force you to take annual leave depends on the terms of your Industry’s Award and registered agreement. You will most likely need to take paid annual leave if your award or agreement says that you must do so during the Christmas break, or that your employer can direct you to take annual leave. You can, however, try to negotiate an alternative arrangement with your manager.

For example, any in-store retail employees will be required to take annual leave during the closure of a business for the holiday period. The employer must, however, give at least four weeks’ notice before the employee takes leave.

Other industries that can also direct employees to take their annual leave during business shut down periods include:

  • Real estate,
  • Hospitality, and
  • Cleaning services.

On the other hand, any health professionals, architects as well as building or construction workers cannot be directed to take their annual leave during any business shut downs (except for employees in dental or medical practices). To find more about your particular industry awards and agreements, we encourage you to visit Fair Work Australia (FWA) or speak with an employment lawyer.

The Award or Agreement Must Be Reasonable

The award or agreement must be reasonable. For example, if the employee has an excessive amount of annual leave saved, then this is sufficient for an employer to force an employee to take their annual leave. FWA have also considered it reasonable to direct employees to take their annual leave during any shut downs that the business has, such as over the Christmas and New Year period.

FWA have considered the following factors are relevant when assessing the reasonableness of the employees award and registered agreement:

  • The needs of the business;
  • The needs of the employee;
  • Any prior agreed arrangement/s between employer and employee;
  • The time of notice given to the employee;
  • The business’ past practices.

Key Takeaways

In short, if your business closes during the Christmas period and your award and agreement allows your employer to direct you to take annual leave, then there may not be too much that you can do.

Your best chance is negotiating alternative arrangements and compromising with your manager or employer to see if they are flexible with annual leave.

Questions? Get in touch on 1300 544 755.

Lachlan McKnight
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