All Australian employees (except casual workers) are entitled to a minimum of four weeks of annual leave each year. For part-time employees, annual leave accrues on a pro-rata basis, based on their ordinary hours of work. Annual leave starts to accumulate from the first day of employment, even when an employee is in a probationary period. If an employee does not take their full entitlement of annual leave during the year, any unused balances will roll over to the next year. If an employee resigns or is terminated from their employment any annual leave that has not been taken is paid out to the employee.

The process for taking annual leave may be set out in a modern award, contract of employment or internal policy. Generally, employers will request that employees provide a period of notice before taking annual leave. Employers can decline an employees request to take annual leave, providing they have a fair reason to do so. 

When can an employer decline a request for annual leave?

Under the Fair Work Act 2009 an employer must not unreasonably refuse to agree to a request by an employee to take paid annual leave.

What constitutes a ‘reasonable’ refusal is not explicitly stated, but the following factors may be taken into consideration:

• Whether the request was placed with a reasonable amount of time prior to the commencement of the proposed leave;
• The time of year at which the employee is requesting to take their leave;
• The requirements of the business from an operational perspective over the period which the employee has requested leave; and
• Whether the employee taking their leave at the requested time would be of detriment to the

If, for example, a retail worker who was employed by a small boutique shop requested in the first week of December to take leave from the 17^th to the 24^th of December, their request may be reasonably denied due to:

• The proximity of the proposed leave period being the week before Christmas and likely the employers busiest period of trade;
• the short amount of notice given;
• the potential difficulty of employing a casual staff member for this busy period; and
• the fact that the business’ operations may suffer due to there not being enough staff on hand.

However, if the same employee requested in February that they take leave in June and the request is denied, that rejection may be deemed as unreasonable.

Another example of a business reasonably denying a request for leave may be if an employee is playing a crucial role in a project that is due to launch at the time they are requesting leave. If the team member’s absence could be detrimental to the project being completed, this may have an adverse effect on the business and therefore the business is reasonably refusing the agree to a request for leave.

What can an employee do if their request for annual leave has been declined?

If a request for annual leave is declined without being given a reason, an employee should in the first instance seek an explanation from their manager as to why the leave request was declined. If they are not provided with a reason, or the reason is not a convincing argument for how that employee’s absence would affect the business’ operations, the employer may be found to have unreasonably refused to agree to a request by an employee to take their paid annual leave.

If you would like advice on taking annual leave or reasonably refusing requests for annual leave, contact our HR Consultants at Preston HR today.