cashing-in annual leave

[Louise]

Hi everyone,

Does anyone know if there are any legislation rules in regards to an employee cashing in their annual leave? Is it just an arrangement between the employer and the employee?

Thanks so much for your assistance,

Louise

[CHankins]

Hi Lousie,

I am assuming you fall under the federal industrial relations system and consequently refer to s.233 of the workplace relations act which only allows for the cashing out of annual leave whilst employed under a workplace agreement (AWA/ITEA). Otherwise it is only meant to be paid out upon cessation of employment (s.235).

Cameron

[Louise]

Hi Cameron,

Thanks very much for the info, much appreciated.

Louise

[HeidiC]

Under the new Employment Standards, according to the Master Workplace Relations Guide (3rd Ed.) issued by CCH, section 233 has a provision for an employee to 'cash out' part of their annual leave accumulation.

Previously, it was considered illegal and ineffective - if it was challenged, the annual leave provision would have been reinstated despite the cash payment to the employee. The only exception was the opportunity for some cashing out of leave agreement through the AWA.

The conditions relating to 'cashing out' leave in s 233 of the new National Standards of Employment are:

1. A provision must exist in a workplace agreement binding the employee and the employer entitling the employee to forego the entitlement
2. The empmloyee must give the employer a weitten election to forego the amount of annual leave
3. A provision in the workplace agreement binding the employee and the employer entitling the employee to receive payment in lieu of the amount of the annual leave that prescibes a rate of payment that is no less than the employee's basic periodic rate of pay (expressed as an hourly rate) at the time the election is made
4. The employer authorises the employee to forego the amount of annual leave
5. There isa limit on theamount of cashing out of annual leave that an employee can take - namely, during each 12 month period, the employee is entitled to forego an amount of annual leave credited to the employee that is not more thatn 1/26th of the nominal hourse worked by the employee for the employer during the period (ie in effect half of the annual accumulation)
6. If an employee does forego an amount of annual leave in accordance with the requirementts of the s 233, then the employer must pay the employee the amount of the pay in lieu of the amount of annual leave within a "reasonable period"
7. An employer is prohibited from requiring an employee to forego an entitlement to take an amount of leave or to exert undue pressure or infulence on an employee whether or not to forego any entitlement to take an amount of annual leave