Hello {{First name}},
Welcome to another issue of The Employers’ Briefing – short insights and guidance on employment, safety and business law for Australian employers.
In this issue:
📌 Quick updates – Redundancy now requires broader redeployment analysis; NSW proposes new WHS obligations for algorithm-driven and digital work systems; and the Fair Work Commission warns of an unsustainable surge in general protections claims.
⚖️ The Long read – A Q&A guide to annual leave, including some lesser-known and compliance sensitive points.
✏️ From my desk – Reflections on a milestone year and a sign-off before year’s end.
Let’s get into it ⬇️
Quick Updates
Redeployment obligations in case of redundancy extend beyond existing vacancies
Under the Fair Work Act, a redundancy is genuine only if a job is no longer required due to operational changes, there was no reasonable redeployment opportunity in the employer's enterprise, and any applicable consultation obligations have been met.
In Helensburgh Coal Pty Ltd v Bartley [2025] HCA 29, the High Court confirmed that the Fair Work Commission may assess whether reasonable operational changes could have created redeployment opportunities - even if no role formally existed at the time. This includes examining workforce structure, task allocation and the employer’s use of contractors.
👉 For employers: This means that redeployment is a broader inquiry than simply checking for available positions. Employers must show they actively considered whether redeployment was reasonably possible in the circumstances.
NSW proposes new WHS duties for algorithm-driven and digital work systems
Under the WHS Act, PCBUs must eliminate or minimise risks to health and safety so far as is reasonably practicable. A new NSW Bill would explicitly extend these duties to risks created by digital work systems.
In particular, the Work Health and Safety Amendment (Digital Work Systems) Bill 2025 would require PCBUs to ensure that work allocated through digital systems does not expose workers to unreasonable workloads, unsafe performance metrics, excessive surveillance, or discriminatory outcomes. The Bill would also give union entry permit holders clearer powers to access digital systems during WHS inspections, subject to SafeWork NSW guidelines.
This is the first Australian attempt to regulate psychosocial risks created by algorithmic work design.
👉 Why it matters: This Bill signals a shift toward regulating digital management tools. If passed, employers should review any systems used for scheduling, performance monitoring or work allocation to ensure they do not inadvertently create psychosocial risks.
FWC flags unustainable sourge in general protections dismissal claim
Under the 𝘍𝘢𝘪𝘳 𝘞𝘰𝘳𝘬 𝘈𝘤𝘵, the Fair Work Commission must deal with general protections dismissal applications promptly through conciliation and, if unresolved, referral to court. A new statement from President Hatcher has warned that the volume of filings is now placing the Commission under severe strain and has triggered a multi-stage review of its case-management processes.
The data is significant: total lodgements in 2024–25 were 24% above the five-year average, with general protections dismissal claims up 13% on the previous financial year. Early figures for 2025–26 show a further steep increase. If the current trend continues, the Commission expects more than 50,000 total filings this financial year - including over 8,000 general protections dismissal applications.
To manage the pressure, the Commission has already revised its forms (Stage 1), is trialling new conference procedures (Stage 2), and will next review its information and education materials (Stage 3).
👉 Takeaway: The rise in general protections claims increases litigation risk, intensifies scrutiny during early conciliation, and will likely lead to tighter case-management processes.
The Long Read
Annual Leave: A Practical Q&A for Employers
With year-end approaching, questions about annual leave become more frequent - not just the basics of accrual and approval, but the trickier points around sick leave during annual leave, when employers can refuse or direct leave, and the additional rules that sit in modern awards.
This guide summarises the key provisions of the the Fair Work Act 2009 (Cth) (the FW Act) and Fair Work Regulations 2009 (Cth) (the Regulations) that govern annual leave, with brief notes on how modern awards can affect those rules.
Q: Where are the relevant legislative provisions?
A: The key provisions are contained in sections 86 to 94 of the FW Act. Additional rules are contained in Part 3-6 of the Regulations, and in modern awards.
Q: What is the entitlement to annual leave?
A: Employees other than casuals are entitled to four weeks of paid annual leave for each year of service (or 5, if they are classified as “shiftworkers” under the FW Act, an applicable award or an enterprise agreement).
Q: How does annual leave accrue?
Leave accrues progressively during a year of service, beginning on commencement of employment. For example, if a full-time employee starts on 1 January 2025 and takes no leave, by 31 December 2025 the employee will have accrued 4 weeks of paid annual leave. Part-time employees accrue leave on a pro-rata basis.
Q: When does annual leave does/does not accrue?
A: Paid annual leave accrues only during a period of “service”. Under the FW Act, “service”:
includes any period during which an employee is employed by the employer; but
does not include any period of authorised unpaid absence (except for community service leave, stand-downs under an industrial instrument, and any other period prescribed by the Regulations) and unauthorised absences.
For example, if a full-time employee takes one month as unpaid leave in a year, annual leave will accrue over 11 months, resulting in ~18.33 days of accrued paid annual leave (assuming no other absences).
Q: Does annual leave accrue while an employee is on workers compensation?
A: Generally no, unless the applicable State or Territory workers compensation legislation allows it.
Q: How is annual leave paid?
A: Annual leave is paid at the employee’s base rate of pay for the ordinary hours they would have worked had they not been on leave. The “base rate of pay” is defined in the FW Act as excluding incentive-based payments, loadings, allowances, overtime and penalty rates, and any other separately identifiable amount.
Q: Are employers obliged to allow employees to take annual leave?
A: Employers may refuse a request to take annual leave, provided that the refusal is not unreasonable.
A refusal will genuinely be reasonable if it aligns with genuine business needs (for example, maintain staff during peak periods). A refusal made arbitrarily or without a legitimate reason would be unreasonable.
Q: Can employers require employees to take annual leave?
A: Yes - but only if the direction is reasonable. Scenarios typically considered reasonable include:
annual shutdowns (for example, between Christmas and New Year);
where the employee has accrued an excessive amount of paid annual leave (“excessive” is not defined in the FW act, so the definition adopted under many awards - more than 8 weeks’ paid annual leave, or 10 for shiftworkers - is often applied); and
during a notice period where the employee is not required to perform any work, and has more than 4 weeks’ accrued paid annual leave.
Q: What is “negative” annual leave?
A: This occurs when an employer agrees to let an employee take paid annual leave in advance of accrual.
For example: Tom starts on 1 January 2025 and takes 4 weeks paid annual leave in July 2025. By then he has accrued only 2 weeks, so the balance becomes -2 weeks. If he takes no further leave, his balance will return to nil by 31 December 2025.
Q: Can accrued but unused annual leave be cashed out?
A: Generally speaking, yes – subject to certain limitations in the FW act, namely:
the employee must maintain at least 4 weeks of accrued leave after cashing out;
each agreement to cash-out must be in writing; and
the employee must be paid at least the full amount that would have been payable if the leave had been taken.
Q: Can an employee take paid personal (sick) leave while on annual leave?
A: Yes. If an employee becomes ill or injured during a period of annual leave, that part of the absence can convert to personal leave, provided that the evidence requirements are met.
Example: Jerry takes two weeks’ annual leave but becomes sick for 5 days during the second week. He can use 5 days’ annual leave and 5 days’ personal leave, not 10 days’ annual leave.
Q: What if a period of leave includes a public holiday?
A: A public holiday does not count as annual leave. For example, if Tom and Jerry take two weeks of paid annual leave and one day is a public holiday in their work location, they will use 9 days of annual leave, not 10.
Q: Are there any record-keeping requirements?
A: Yes. Under the Regulations, employers must keep records of:
the leave taken by each employee; and
the balance of accrued but unused annual leave (if any).
Additional records must also be kept in certain circumstances, such as in case of agreements to cash-out annual leave and annual leave loading payable under modern awards.
Q: Do modern awards contain provisions regarding annual leave as well?
A: Yes, modern awards regulate matters such as: cashing out annual leave; directing employees to take annual leave and annual shutdowns. Sometimes awards also set out additional entitlements regarding annual leave.
For example, many awards require the payment of “annual leave loading”, typically 17.5% of either:
the minimum rates under the award (e.g., the Clerks - Private Sector Award 2020); or
the employee’s ordinary pay including certain allowances (e.g., the Manufacturing and Associated Industries and Occupations Award 2020).
Where weekend or shift penalties would have resulted in higher pay during the leave period however, awards generally require those higher amounts to be used instead of the 17.5% loading.
From my desk
This is the final issue before Christmas. I started my practice at the end of March, and the months since have been intense and fulfilling. Launching this briefing has been a valuable way to share practical guidance, and I look forward to continuing it next year. Wishing you a safe Christmas and a productive beginning to 2026.
Thanks for taking the time to read this edition of The Employers’ Briefing.
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Until next time,
