All employees (other than casual employees) are entitled to paid annual leave.
An employer must not unreasonably refuse to agree to a request by the employee to take their paid annual leave entitlement.
However, you can refuse an employee’s request to take annual leave based on reasonable business grounds. That should be supported by an annual leave policy.
You can take into account:
The business requirements during the time of the leave request (e.g. are other staff available that could be rostered to cover the leave during that period).
Whether the leave, if granted, would create a problem for the business, i.e. a time-crucial project may not be delivered on time.
Whether reasonable notice of the request was given by the employee. This should be stipulated in an annual leave policy to avoid ambiguity of expectations.
The amount of leave the employee has accrued.
When the employee last went on leave.
If other staff already have leave approved for the same period and granting additional leave will create problems covering operational requirements.
If the employee always takes school holidays off which then stops other staff who also want leave over school holidays from being able to take time off, that can be taken into consideration as well. Ensure leave approvals over in-demand times (e.g. school holidays) are equitably shared amongst employees.
Employers have no unilateral right to cancel leave that has already been approved. However, with the employee’s consent, you can cancel or adjust the periods of any approved leave. You cannot force or coerce the employee to cancel their holidays to suit your business – approved leave can only be cancelled or amended by agreement. This is important because the employee may have already made their own personal holiday plans.
Annual leave is an employee entitlement and needs to be treated with openness and transparency with all employees.
Always review all leave applications promptly.
Remember that delaying approval or refusal of an annual leave application has been found by the Fair Work Commission to be an unreasonable action and the Commission has penalised workplaces for the delay.
If you need to refuse an application, do so in a timely manner and in writing, stating the reasons for the refusal. Always meet with the employee to discuss the reasons in-person to ensure there is a clear understanding of the reasons.
A policy is important to specify if your business has a leave block out period in place (e.g. the business is not open during Christmas or New Year and there is a compulsory shut down period). This should be expressed in an annual leave policy and letter in advance to your employees.
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