The owners of Cadbury have had a High Court win, triumphing in a landmark case which saw them go head-to-head with two of their employees and a trade union.
The decision regarding paid leave entitlements has been welcomed by the nation’s peak industry association but criticised by the union movement.
Mondelez International took two Cadbury employees, Natasha Triffitt and Brendon McCormack, based at the chocolatier’s Claremont factory, as well as the Australian Manufacturing Workers’ Union, to the Federal Court over a disagreement regarding paid leave.
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Together with the union, the employees, who work three 12-hour shifts per week, argued that they should be entitled to more personal and carer’s leave than their colleagues due to working these longer shifts.
Workers are entitled to 10 days (or 96 hours) of this leave a year under the National Employment Standards.
Mondelez told the Federal Court that if the workers took a day of personal or carer’s leave, they should have the full rostered 12 hours deducted from their 96-hour total.
However, the AMWU said this put the workers at a disadvantage to those who worked standard 7.2-hour days, due to the fact their leave would dry up quicker because they worked longer shifts.
The union told the court that the workers should be entitled to 120 hours of unpaid leave, equivalent to 10 12-hour shifts.
The Federal Court ruled in their favour.
But on Thursday, the High Court overturned the original decision on appeal.
In a 4-1 decision, it was concluded the entitlement to 10 days’ leave was calculated based on an employee’s hours of work rather than days.
Chief Justice Susan Kiefel, Justice Geoffrey Nettle and Justice Michelle Gordon disagreed with the union’s contention that all employees were entitled to 10 “working” days (time worked in a 24-hour period) of personal and carer’s leave as opposed to Mondelez’s contention that they were entitled to 10 “notional” days (an employee’s average weekly ordinary hours divided by five).
“It would give rise to absurd results and inequitable outcomes,” they said of the union’s argument.
Australian Industry Group chief executive Innes Wilcox said the High Court judgment prevented “major cost implications for a very large number of businesses”.
Meanwhile, Australian Council of Trade Unions secretary Sally McManus said the decision was a “very disappointing outcome”.
“The federal government must amend the Fair Work Act so that every worker has access to 10 days of paid personal leave every year, no matter what hours they work,” she said.
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