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BlackBay Insights

  • Writer's pictureVictoria-Jane Otavski

Can annual leave be converted to sick leave?

The end-of-year and early year period typically sees hundred of thousand of Australians taking annual leave. With the wave of COVID-19 Omicron variant resulting in Australians being sick or having to isolate across December and January, the holidays for many have been cancelled or derailed.

Employees who didn’t get the holiday they had hoped for and who keen to conserve annual leave for less turbulent times are asking whether they can convert their annual leave to personal leave but can they do this?

Yes they can - subject to complying with the usual notice and evidentiary requirements for personal leave prescribed by the Fair Work Act 2009 (the FW Act), any applicable workplace policy, modern award or enterprise agreement.

Section 97 of the FW Act provides that an employee may take paid personal/carer’s leave if the leave is taken:


  1. because the employee is not fit for work because of a personal illness, or personal injury, affecting the employer (sick leave); or

  2. to provide care or support to a member of the employee’s immediate family, or a member of the employee’s household, who requires are or support because of a personal illness, or personal injury, affectng the member or an unexpected emergency affecting the member (carer’s leave).


Section 89 of the FW Act provides, amongst other things, if the period during which an employee takes paid annual leave includes a period of any other leave (other than unpaid parental leave), the employee is taken not to be on paid annual leave for the period of that other leave or absence. This means that:


  1. if an employee is able to take sick leave within the paid annual leave period, the sick leave should not be deducted from the annual leave balance;

  2. where an employee provides care to immediate family members suffering with COVID-19 during the employee’s paid annual leave period, that period of care should be deducted from their annual leave balance; and

  3. if a public holiday falls during the period of time an employee is on personal leave, this shouldn’t be deducted from their personal leave balance.


What about notice and evidentiary requirements?


With respect to notice, section 107(2) of the FW Act requires employees taking any personal leave (e.g. sick leave and carers leave) to give notice to the employer as soon as practicable (which may be a time after the leave has started) and must advise the employer of the period, or expected period, of the leave.


As for evidence, section 107(3) of the FW Act provides that if required by the employer, an employee who has given notice of the taking of personal leave must give the employer evidence that would satisfy a reasonable person of the basis or circumstances justifying the leave.


Ordinarily, employees needed to provide a medical certificate or statutory declaration as evidence of the need for leave. Since the COVID-19 pandemic and up until recently, positive PCR test results have largely been deemed sufficient evidence. However, since the strain on the PCR testing capacities and the government suggestions that individuals confirm any COVID-19 diagnosis using a rapid antigen test, it may be that employers will need to accept an email or text message confirming a positive diagnosis or an image of a positive rapid antigen test result as sufficient evidence.


If provided with any reasonable evidence by an employee of the need for sick leave or carer’s leave during a period of paid annual leave, employers ought reverse or recredit the employee’s annual leave for the relevant period.


What about time spent in isolation pending a COVID-19 test result?


Isolating oneself due to governmental requirements whilst awaiting a COVID-19 test result is not something likely to be considered a personal illness or injury, particularly if they are not yet exhibiting symptoms rendering them unfit for work or where they return a negative COVID-19 test result.


However, and despite there presently being no legal requirement to do so, it may be that employers adopt a policy of permitting a set period or maximum period of sick leave to be used for periods of isolation pending a COVID-19 test result.


In such instances, employers are encouraged to use discretion and balance the need to remain sensitive to an employee’s particular circumstances, any talent retention considerations as well as business needs. It may be that introducing a workplace policy identifying evidentiary requirements for taking leave for periods of isolation (such as providing evidence of being contact traced or exposed) may be a useful tool for employers to adopt.


What about a casual workforce?


Casual workers who don’t accrue sick leave or annual leave may be entitled to the Pandemic Leave Disaster Payments.


Effective from 18 January 2022, individuals who have lost at least one day of work due to having to isolate due to being COVID-19 positive, having to care for someone who is COVID-19 positive or meets the definition of a close contact may be eligible for the Pandemic Leave Disaster Payment. These payments are scaled according to the number of hours of work the individual has lost or expects to lose during an isolation period of up to 7 days. Specifically:


  1. individuals who have lost or expect to lose 20 hours or more will continue to be entitled to payment of $750; and

  2. individuals who have lost or expect to lose at least 1 day of work up to 19 hours of work will be entitled to payment of $450.


What can or should employers do?


Navigating the regulations around sick and carer’s leave and understanding what notice and evidentiary requirements will suffice particularly since rapid antigen tests can be used to confirm a diagnosis has become more complex for employers. Employer’s should consider reviewing or implementing a workplace policy governing the taking of sick leave and personal leave to ensure that it is compliant with the FW Act and any applicable enterprise agreement or modern award, and with a view to ensuring that it is fair and balanced having regard to employee and the employer’s business interests.

Blackbay Lawyers can assist by providing advice on what employers can and cannot do in relation to leave and associated notice and evidentiary requirements, advising on any modern award or enterprise agreement consequences and in reviewing or implementing a workplace leave policy. Should you require any further information or assistance, please contact Victoria-Jane Otavski, Managing Partner at victoria.jane@blackbaylawyers.com.au or see www.blackbaylawyers.com.au/contact-us


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