General Employment: Goodstart Early Learning Enterprise Agreement [2012] FWA 2408

Goodstart Early Learning Enterprise Agreement [2012] FWA 2408

This matter concerned an application pursuant to s185 of the Fair Work Act 2009 to determine whether an enterprise agreement by Goodstart Early Learning Limited was consistent with the National Employment Standards (NES). This agreement applies to 16 000 employees within the employer's 656 child care centres stationed around Australia. The issue at hand was whether employers are required to pay leave loading for annual leave upon termination of an employee.

The provision in contention was clause 36, which stated that 'unused annual leave entitlements are paid out on termination however loading is not paid on leave paid out on termination.' This provision was read in light of s90(2) of the Fair Work Act 2009, which provides that upon termination an employee is due the amount payable had that employee taken their leave (assuming that they have accrued annual leave). This section falls under the NES, which intends to provide minimum national standards and as such may not be excluded by any modern award, agreement or other instrument. However, particular emphasis was placed on the words 'the amount that would have been payable to the employee had the employee taken that period of leave' and were read to mean that, in this particular agreement, the absence of leave loading shall form the applicable base minimum standard.

Fair Work Australia cannot approve an agreement that would contravene the interaction rules for the NES, however through an analysis of statutory interpretation, where the Fair Work Act 2009 and NES standards were viewed alongside the enterprise agreement itself, it was held that such leave loading would not be contrary to the national standards and will in fact form the minimum standard in this case.

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