A client recently contacted me in relation to an employee who had been on workers compensation benefits for approximately 18 months. My client was going to dismiss the employee due to frustration of contract and informed me that the employee had only a little over 8 hours of annual leave accrued that would be paid out in her final pay. My client further advised that they had not been accruing leave entitlements for the employee for the period during which she has been in receipt workers compensation.

A client recently contacted me in relation to an employee who had been on workers compensation benefits for approximately 18 months.  My client was going to dismiss the employee due to frustration of contract and informed me that the employee had only a little over 8 hours of annual leave accrued that would be paid out in her final pay.  My client further advised that they had not been accruing leave entitlements for the employee for the period during which she has been in receipt workers compensation.

I explained to my client that this was incorrect, as although Section 130 of the federal Fair Work Act (FWA) provides that an employee is not entitled to take or accrue any leave or absence (whether paid or unpaid) during a period when the employee is absent from work because of illness or injury, for which the employee is receiving compensation payable under a law of the Commonwealth, State or a territory, the Qld Workers Compensation and Rehabilitation Act 2003 takes precedence over FWA, and states:

119A Compensation entitlement does not restrict taking or accrual of leave

• This section applies to a worker who is entitled to compensation, including compensation payable as weekly payments.
• The worker is entitled to take or accrue annual leave, sick leave and long service leave under an Industrial Act or industrial instrument during the period to which the compensation relates.

Note— In relation to entitlements under the Fair Work Act 2009 (Cwlth), this section removes the restriction under section 130(1) of that Act.

In short, as the Qld Workers Compensation and Rehabilitation Act 2003 takes precedence over the federal Fair Work Act 2009, an employee in receipt of workers compensation in Queensland, would continue to accrue annual leave, personal/carer’s leave and long service leave for the time they are receiving workers compensation benefits.

In my client’s case, the employee would need to be paid in her final pay for any annual leave accrued since commencing compensation.