Leave Loading

[col_miner]

Hi all,

I'm GM of a diversified agricultural company but many of our employees fall between the Mining and Road Transport awards.

We pay most of our employees above award rates and I'm wondering if we need to pay leave loading. From my reading of the awards we need to pay loading irrespective of wage rate but wanted to check whether that is the correct reading.

Any advice would be appreciated.

[Tiger]

Hi all,

I'm GM of a diversified agricultural company but many of our employees fall between the Mining and Road Transport awards.

We pay most of our employees above award rates and I'm wondering if we need to pay leave loading. From my reading of the awards we need to pay loading irrespective of wage rate but wanted to check whether that is the correct reading.

Any advice would be appreciated.

***********
Award covered employees are entitled to their A/L/L irrespective of pay rate if it is included in the award. Having said that, with agreement of your employees you may be able to offset that via individual flexibility agreements.

To stop the practice going forward, you could consider revising your employment contract templates to include a clause that "Annual Leave Loading is not paid as it has been factored into the salary being offered". This way, you'd gradually ease it out via attrition.

Or, you could do the above AND introduce or amend your company policy on this by removing it. You'd ensure all payments were up to date; ie even if employees hadn't taken leave you'd calculate it on the A/L accrued up to date of payment and pay it as a lump sum and perhaps add a sweetner of a one off increase (equivalent to one year's A/L/L eg) to each employee's base pay rate to offset future A/L/L payments.

You have to look at your workforce and decide whether they would be okay with this, be sure to do lots of consultation - they won't give it up without something worthwhile in return and the fact you are already paying above award is likely not to cut it as being sufficient incentive for them to agree.

I also recommend you check out the Fair Work website and read up on A/L/L.

Tiger

[col_miner]

Thanks Tiger. Makes sense and very much appreciated.

[tempsol]

I always thought that leave loading was payable regarding the rate but my employer rang fairwork and was told that because he pays above award it is not applicable.

I did say to double check again as i think it is still payable unless as stated above it is part of the contract the employee signs.