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COVID-19 | First JobKeeper Decision Clarifies Annual Leave Request
In McCreedy v Village Roadshow Theme Parks Pty Ltd [2020] FWC 2480, the Fair Work Commission handed down its first decision dealing with a dispute arising under the JobKeeper scheme.
The applicant, Ms McCreedy, had been employed by Village Roadshow Theme Parks Pty Ltd (Village Roadshow) on a part time basis, working around 15 hours over two days each week for approximately 22 years. During that time, Ms McCreedy had accrued approximately 9.3 weeks of annual leave and 8.6 weeks of long service leave.
As a result of COVID-19, Village Roadshow was no longer able to operate its theme parks and Ms McCreedy was stood down and issued with a JobKeeper enabling direction to not attend work. During this time, Ms McCreedy became eligible to receive the JobKeeper payment. As a result, she started to receive $750 per week in JobKeeper payments which was well in excess of her usual weekly take-home pay of $375.
In late April, Ms McCreedy was issued a request under the JobKeeper scheme, this time requesting her to take annual leave for half her ordinary hours of work. For Ms McCreedy, this equated to one day of annual leave per week until 27 September 2020 (when the COVID-19 economic response plan would cease to take effect) or when Ms McCreedy’s annual leave balance was reduced to two weeks (being fours days), whichever came first. Ms McCreedy was advised to consider the request. Being a request made pursuant to the rules relating to the JobKeeper scheme, Ms McCreedy could not unreasonably refuse it.
Ms McCreedy refused the request to take annual leave on several grounds. When the dispute could not be resolved with her employer, she lodged an application with the Fair Work Commission pursuant to Part 6 – 4C of the Act which was introduced in conjunction with the Federal Government’s JobKeeper scheme. Part 6 – 4C of the Act provides employers the power to issue JobKeeper enabling directions and requests to employees and grants the Fair Work Commission jurisdiction to deal with JobKeeper disputes.
During the proceedings, Ms McCreedy noted her refusal of the request to take annual leave on the basis that she had already booked several holidays, including a six-week trip to Europe in 2021, which would require use of her annual leave. Notably, Ms McCreedy had not yet been granted approval for these holidays. She submitted that the request particularly disadvantaged long-serving employees who had accrued large leave balances, and that the JobKeeper payment was not intended to be used by larger employers, such as Village Roadshow, to set-off against the annual leave entitlements of employees. In addition, Ms McCreedy also cited a medical condition as part of her refusal to accept the request.
Ultimately, Commissioner Hunt found that Ms McCreedy had unreasonably refused Village Roadshow’s request. In her reasoning, Commissioner Hunt noted that Ms McCreedy had not sought formal approval for her annual leave requests, and that the Village Roadshow policy discouraged employees from booking holidays prior to being granted leave approval.
Commissioner Hunt also rejected Ms McCreedy’s submissions that Village Roadshow’s request was unreasonable, noting that “[t]he test is not, however, whether [Village Roadshow] has acted reasonably or unreasonably; it is whether Ms McCreedy has unreasonably refused the request of [Village Roadshow]”.
Furthermore, Ms McCreedy’s submission that such requests under the provisions of the JobKeeper scheme should only be available to smaller employers was also rejected on that basis that such an argument was not supported by the Explanatory Memorandum. To put it mildly, these submissions did not find favour. Commissioner Hunt stated (at [56]):
“I consider that during the hearing and in material filed, Ms McCreedy made incredibly unsympathetic, and in my view, belligerent and unwarranted attacks on [Village Roadshow], despite the JobKeeper provisions being available for all eligible employers, small or large. The package has been introduced to put eligible organisations into hibernation, to allow for continued employment of eligible employees.”
Notably, the fact Ms McCreedy benefited from a greater weekly wage under the JobKeeper payment than she received under her usual take-home pay was not considered a relevant factor and was, therefore, not taken into consideration.
The case of McCreedy v Village Roadshow Theme Parks Pty Ltd [2020] FWC 2480 is likely to be the first of many applications heard by the Fair Work Commission with respect to JobKeeper directions and requests. Importantly, it demonstrates that in similar disputes regarding JobKeeper requests, an employer does not necessarily need to prove that the JobKeeper request was reasonable. Rather, the onus is on the employee to demonstrate that they have not unreasonably refused such a request.