NSW worker entitled to annual leave while on compo

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NSW worker entitled to annual leave while on compo

The Federal Circuit Court has ruled that a NSW worker is allowed to receive annual leave payments while in receipt of workers compensation benefits because the state legislation comes within an exemption to the general prohibition in the Fair Work Act.

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The Federal Circuit Court has ruled a NSW worker can receive annual leave payments while receiving workers compensation because the state legislation is excluded from  the general prohibition in the Fair Work Act.

[Full text of this case: NSW Nurses and Midwives' Association v Anglican Care [2014] FCCA 2580 (11 November 2014)]

The legislation


Justice Emmett noted that s130(1)  of the Fair Work Act purports to restrict the taking or accruing of leave while a worker is receiving workers compensation.

However, s130 provides an exception to the general position in sub-sec (2):

“(1) An employee is not entitled to take or accrue any leave or absence (whether paid or unpaid) under this Part during a period (a compensation period ) when the employee is absent from work because of a personal illness, or a personal injury, for which the employee is receiving compensation payable under a law (a compensation law ) of the Commonwealth, a State or a Territory that is about workers' compensation.

"(2) Subsection (1) does not prevent an employee from taking or accruing leave during a compensation period if the taking or accruing of the leave is permitted by a compensation law….”

The relevant NSW provision is s49 of the NSW Workers Compensation Act 1987 which provides:

“ (1) Compensation is payable under this Division to a worker in respect of any period of incapacity for work even though the worker has received or is entitled to receive in respect of the period any payment, allowance or benefit for holidays, annual holidays or long service leave under any Act (Commonwealth or State), award or industrial agreement under any such Act or contract of employment.”

Opportunity to receive both payments


The court stated: “In fact, s49 does more than merely not prevent a worker from receiving those entitlements. It expressly provides the opportunity for the worker to receive both workers compensation and accrue annual leave.”

Judge Emmett said that while the NSW Act did not create a right to receive annual leave payments while on workers compensation, it provided the "opportunity" for a worker to receive both payments.

The court adopted “a beneficial construction”  of sec 49, saying it permits receipt of both payments by the worker:

“In circumstances where s49 of the Workers Compensation Act does not prevent the worker from receiving both and indeed expressly contemplates receipt of both workers compensation and accrued leave, a beneficial construction of s130(2) of the Fair Work Act would allow for s130(2) to be enlivened by reason of s49 of the Workers Compensation Act because s49 does not prevent it. In that sense, s49 'allows' or 'permits' the receipt of both.”

The bottom line:  Previous thinking on the provisions noted above was that if there was an absence of a specific provision in a relevant state or territory workers compensation law, the Fair Work Act did not allow taking or accruing of annual leave during an employee’s absence on workers compensation. The Federal Circuit Court in this case did not insist on a specific provision elsewhere, but considered that an opportunity for a worker to receive both benefits was sufficient.

NSW Nurses and Midwives' Association v Anglican Care [2014] FCCA 2580 (11 November 2014) 

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