Taking annual leave in advance
Where an employer intends to shut down over the festive season and employees do not have enough annual leave to cover the entire period, an option may be for the employee to take annual leave in advance.
Many modern awards contain provisions which allow an employer and an employee to agree in writing to the employee taking a period of paid annual leave before they have accrued the entitlement.
This arrangement is commonly referred to as “annual leave in advance”.
What is required to take annual leave in advance?
Agreement can be reached between an employer and employee for the employee to take annual leave in advance. The agreement must be in writing and include the following:
- it must state the amount of leave to be taken in advance and the date on which the leave will commence; and
- it must be signed by the employer and the employee, and if the employee is under the age of 18, by their parent or guardian.
The employer must keep a copy of this written agreement.
Is there a template that an employer and employee can use for annual leave in advance?
The Fair Work Ombudsman have a template available: https://services.fairwork.gov.au/tools-and-resources/templates/agreement-to-take-annual-leave-in-advance
What if an employee takes annual leave in advance and then they resign or their employment ends?
If an employee takes annual leave in advance and their employment ends before they have accrued that period, some awards allow the employer to deduct the amount still owing from their final pay.
Employers should check the relevant award that applies to their workers to confirm their specific rights and obligations.