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H&M worker ordered to take annual leave after JobKeeper dispute goes to Fair Work

Hanover, Germany – June 8, 2019: Close-up of H&M logo. H & M Hennes & Mauritz AB is a Swedish multinational retail-clothing company.

An H&M retail worker has been ordered to take annual leave after disputing whether the Swedish company was able to force workers to draw down on their entitlements while receiving JobKeeper payments.

In its latest ruling about JobKeeper and leave entitlements, the Fair Work Commission (FWC) has again sided with businesses, finding workers cannot cite an unwillingness to support the financial position of their employer, or a desire to take leave at another time, as reasons for denying annual leave requests.

Under the rules of the $70 billion wage subsidy scheme, employers can ask employees to take their annual leave while receiving JobKeeper payments.

Workers are not allowed to refuse these requests unreasonably, and can have their leave drawn down until two weeks worth is remaining.

But this provision has emerged as one of the more controversial elements of the JobKeeper program, spurring several FWC cases over the last month about what constitutes a reasonable excuse for retaining leave entitlements.Get COVID-19 news you can use delivered to your inbox.SubscribeYou’ll also receive special offers from our partners. You can opt-out at any time.

Annual leave and JobKeeper

Details of the latest case, which was heard in May but published by the FWC on Monday, reveal the part-time staff member argued against at H&M’s request to draw down on their annual leave entitlements so the retailer could reduce its liabilities and support its overall financial position amid the COVID-19 pandemic.

The worker, who had accrued five-weeks worth of annual leave, typically works 2.5 days per week at H&M Indoorpilly in Brisbane, but was stood down when stores closed in April and only brought back in early May.

H&M paid stood-down workers an additional two-weeks leave amid the pandemic, but has since moved staff onto JobKeeper payments after its application was processed by the Australian Taxation Office in early May.

It wants permanent staff to take paid leave to offset its employment costs while receiving JobKeeeper payments, in accordance with program rules set out by the federal government.

The staff member disputed the request, saying they felt it was unfair employee entitlements were being valued less than the financial position of H&M. They also said they would need to use the leave in future, including for personal reasons related to an anticipated family separation.

But the FWC found this was not a reasonable excuse for denying H&M’s request, giving further guidance on reasons workers are able to provide for protecting their leave entitlements while under JobKeeper.

“The need to support business continuity and job security for all employees of H&M outweighs the inconvenience to [the worker] of not being able to plan her annual leave at a time of her choosing,” Commissioner McKinnon said.

“While she may have a future need for leave to deal with family issues, there is no certainty as to when that might arise or how much leave will be required if it does”

The case follows earlier FWC rulings about JobKeeper and annual leave, including one involving Village Roadshow Theme Parks, where a part-time worker was also ordered to draw down on their entitlements after disputing a leave request.

In both cases, the FWC took a dim view towards arguments put forward by workers that it is not their responsibility to financially support their employer by taking annual leave.

SmartCompany has contacted H&M for comment.

This story first appeared in SmartCompany and has been published with permission.

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