This guide on understanding Annual Leave for Part-Time Employees helps you calculate your entitlements accurately. In this Legal Kitz blog post, we’ll cover what part-time employees are, what leave entitlements they have, how much annual leave they can get as governed by the Fair Work Commission, and the rights of both employees and employers regarding annual leave
What is annual leave?
Annual leave for part-time employees is an important entitlement, allowing them to take a break from work and rejuvenate. However, not all employees receive the same amount of annual leave, and part-time employees may be unsure about what their entitlements are.
What is a Part-Time Employee?
A part-time employee is someone who works less than full-time hours, usually defined as working fewer than 38 hours per week. Part-time employees receive the same entitlements as full-time employees on a pro-rata basis, meaning their entitlements are calculated based on the number of hours they work. This includes leave entitlements, such as annual leave.
What Leave and Annual Leave is Available to Part-Time Employees?
Part-time employees are entitled to the same types of leave as full-time employees, including annual leave, sick leave, and long service leave. However, their entitlements are calculated on a pro-rata basis. For example, if a full-time employee is entitled to four weeks of annual leave per year, a part-time employee working 20 hours per week would be entitled to two weeks of annual leave per year.
Calculating Annual Leave for Part-time Employees
Under the Fair Work Commission, part-time employees are entitled to a minimum of 4 weeks of paid annual leave per year, based on their ordinary hours of work. This entitlement is calculated on a pro-rata basis, which means that it is based on the number of hours they work compared to a full-time employee.
For example, if a full-time employee works 38 hours per week, and a part-time employee works 19 hours per week, the part-time employee would be entitled to 2 weeks of paid annual leave per year (i.e., 50% of the full-time entitlement).
It’s important to note that some modern awards or enterprise agreements may provide for additional annual leave entitlements for part-time employees. Employers should ensure that they are complying with the relevant industry award or agreement when it comes to annual leave entitlements.
Calculating annual leave entitlements for part-time employees can be a bit more complicated than for full-time employees. The method of calculation for annual leave entitlements is as follows:
- Work out the employee’s ordinary hours of work per week
- Work out the employee’s ordinary hours of work for the year (i.e. ordinary hours per week x 52 weeks)
- Work out the percentage of the year that the employee works (i.e. the number of hours the employee works in a year divided by the number of hours a full-time employee works in a year)
- Multiply the employee’s entitlement to annual leave (i.e. four weeks) by the percentage of the year that they work.
For example, if a part-time employee works 20 hours per week, their ordinary hours of work per year would be 1,040 (20 hours x 52 weeks). If a full-time employee is entitled to four weeks of annual leave per year, the part-time employee would be entitled to two weeks of annual leave per year (i.e. four weeks x (1,040/1,880) = 2.19 weeks, rounded to two weeks).
What Are Employee Rights Regarding Annual Leave?
Part-time employees have the right to take annual leave and be paid their usual rate of pay while on leave. They also have the right to accrue annual leave, meaning their entitlements accumulate over time and they can take longer periods of leave if they choose to. Employers must also give employees the opportunity to take their annual leave, and not force them to work instead.
Employees also have the right to cash out a portion of their annual leave if they have accumulated more than the maximum allowable amount. However, this must be agreed upon by both the employee and employer, and there are strict rules around how much leave can be cashed out
Employer Rights Regarding Annual Leave
Employers have certain rights when it comes to annual leave for their part-time employees. One of these rights is the right to manage annual leave requests. Employers can refuse a request for annual leave if it would cause significant disruption to the business, or if there is already a high volume of leave requests for that time period. However, employers should try to accommodate reasonable requests for annual leave where possible.
Employers also have the right to direct their employees to take annual leave in certain situations. This may occur if the business is closing for a period of time, such as over the Christmas and New Year period, and it is not possible for employees to continue working during this time. Employers must provide reasonable notice to employees before directing them to take annual leave.
Another right that employers have is the option to offer their employees the ability to cash out some of their annual leave entitlements. This option is subject to certain conditions and limitations, and employers cannot force their employees to cash out annual leave.
Lastly, employers have the right to set a minimum period of annual leave that their employees must take at any one time. This can help ensure that employees are taking a sufficient break from work, and can help with workforce planning.
It’s important for employers to ensure that they are meeting their obligations regarding annual leave for their part-time employees, as failure to do so can result in legal action and financial penalties. Employers should also communicate their policies and procedures regarding annual leave clearly to their employees, and be open to discussing any concerns or requests that their employees may have. By doing so, employers can create a positive workplace culture that supports the health and well-being of their employees.
Legal advice
Calculating annual leave entitlements can be confusing, especially for those without legal expertise. You can always contact Legal Kitz to assist you. To arrange a FREE 30-minute consultation with one of our highly experienced solicitors, contact us at [email protected] or 1300 988 954. You can also check out our sister company – Business Kitz’s Subscriptions, to access our full range of legal, commercial and employment document templates to begin your business with a solid foundation that ensures compliance.