By: Michael Bailey

It’s extremely good news for Australian business that the Federal Government will appeal the Mondelez decision to the High Court. The full implications of the Federal Court’s Mondelez decision have only become apparent in recent weeks.

On August 21, the Full Federal Court ruled on a clarification relating to the personal/carers leave entitlement for shift workers at Cadburys, which is operated by Mondelez.

Mondelez argued that shift workers, who worked three 12 hour shifts per week (36 hours total), should accrue 76 hours of personal leave per year, like all other full-time employees.

The Federal Court, in a 2-1 majority, rejected Mondelez’ interpretation, stating that it was inconsistent with the wording of the National Employment Standards in the Fair Work Act (2009).

The Court instead held that all employees are entitled to 10 working days personal/carers’ leave per year, regardless of how many hours are worked in a particular day.
Under this approach, Mondelez shift workers are entitled to 10 x 12 hours (120 hours) of personal/carers’ leave per year, significantly higher than full-time employees, who would be entitled to 72 hours.

This ruling has significant implications for all businesses in Tasmania and our nation, including:

  • Under this ruling, every part-time worker is entitled to personal/carers leave based on their working day;
  • Under this ruling, a one full day a week part-time worker is entitled to ten full days of annual leave per year. Two part-time workers working the same total hours per week can get very different personal/carers leave.
  • And under this ruling, workers may be able to claim compensation back to 2009, when the Act was enacted.

What this will mean is:

  • Reduction in part-time employment and job sharing – and pressures on business to offer more jobs on a casual basis;
  • Much more complexity in payroll, and added costs for employers trying to comply with the law;
  • An unfair situation where some workers get more than others, causing workplace friction;
    Huge pressure on business to manage this ruling financially.

So what are we doing about this crazy situation?
The Federal Government must also amend the Fair Work Act to fix this technicality.
Clearly no one intended for part-time workers to have the same personal/carers leave conditions as full-time workers when the Fair Work Act was written. This crazy situation must be fixed, and must be fixed quickly.