Dear Reader,
There’s no doubt about it – employees who accrue too much annual leave can place a huge strain on your business.
Why? Because if too much accrued liability builds up, it can cause your business significant cash flow problems.
But there are ways you can get around this happening in your workplace…
How to stop accrued annual leave being a burden on your business
One way of getting around the issue of accrued annual leave liability is to direct employees to take annual leave.
For example, if your employees are covered by a modern award or enterprise agreement, there may be a provision allowing you to direct them to take annual leave – even if they don’t want to!
If your employees are award or agreement free, you can also direct them to take annual leave – but only if the requirement is reasonable.
Generally, a requirement will be considered reasonable if the employee has accrued an excessive amount of leave. Excessive can mean anything more than 6 weeks.
However, if you do direct an employee to take annual leave, you must give them sufficient notice. As a general rule, giving an employee 4 months to make necessary arrangements will be reasonable.
But directing an employee to take annual leave is just one way you can reduce accrued liability in your workplace…
Check out Charles’ article below for more ways you can stop your employees accruing too much leave.
And, for even more great tips on annual leave, just refer to the Annual Leave chapter in your Employment Law Practical Handbook.
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Until next time…
Claire Berry
Workplace Bulletin
