Is it right for employers to force workers to take annual leave over Christmas?

As the year draws to a close, many workplaces will be preparing to shut down over Christmas, and many businesses will force their employees to take personal annual leave.

Finder.com.au research showed 5.3 million Australians (more than a third of all workers) were forced to use their annual leave over Christmas in 2017 — an average of 8.3 days. Of these workers, 21% had to take more than two weeks off. This represents a large chunk of non-casuals’ four-week allotment.

More recent figures are hard to come by, but given many employees accrued higher leave balances during 2020-21 thanks to COVID-19, and reducing said balances during quieter periods is why many businesses close, one can assume the practice has only increased.

Progressive management or corporate control?

Encouraging employees to take leave is not just appropriate, it’s vital.

New research by LinkedIn shows more than 60% of Aussie workers feel burnt out from working too hard in 2022, and the pre-Christmas scramble is a particularly stressful time. We’re all in dire need of a break, and good managers should encourage this so staff are recharged and productive. Too few do — LinkedIn found half of all Aussie workers are “worried” about taking the leave they’re entitled to.

But forcing staff to take most of their allotted leave in December and January can exacerbate burnout by leaving them with little time off from February to November. Some businesses might accept additional unpaid leave for those who have used up their paid entitlements, but this won’t be financially viable for many.

Most managers don’t even respect the Christmas break they force their staff to take. LinkedIn found more than half of Australian workers are contacted about work matters during their holidays. For most businesses, forced Christmas leave is not a means to ensure their staff are well rested, but a cynical ploy to avoid the less-predictable inconvenience of workers having varied and fulfilled external lives throughout the year.

This excessive employer encroachment on workers’ holiday planning diminishes individual autonomy; staff might justifiably want to save some of their leave for other periods that are important to them, like non-Christian religious holidays or important family milestones.

Taking back our free time

One way to ensure workers have flexibility is to reduce the discretion afforded to employers by current laws. Employers are legally able to direct you to take annual leave provided the direction is “reasonable”, unless the employee is covered by an award or enterprise agreement that prohibits such directions (most agreements don’t).

What’s reasonable? The Fair Work Commission will consider factors including prior arrangements and norms, your needs, the business’ needs, and the notice period given. These considerations are pretty fluffy and place no hard limits on the amount of time an employer can direct you to take off. In the right circumstances, an employer could shut down for four weeks in January and zap their staff’s entire leave balances for the year.

To prevent this, the federal government could amend our national employment standards to deem cumulative directions that dictate more than one week, or a quarter of an employee’s yearly leave balance, “unreasonable”. If an employer directs an employee to take any further time off, it should be additional paid leave that doesn’t eat into the employee’s personal entitlements.

In France, if employers want to force employees to take more than one week of leave outside their warmer months (such as over Christmas), they must compensate them with an extra one to two days’ leave. Australia could require similar compensation for dictated leave year-round.

But these technical solutions are downstream of a larger problem.

Australia once mythologised our “laid-back” lifestyle and led the world in putting limits on the working week. But our four-week holiday entitlement has gradually fallen behind and looks pretty stingy compared with many European countries that offer five or six weeks. UK workers, for instance, are entitled to 28 days of annual leave. In Austria, employees get five weeks’ leave for each of their first 25 working years, then six weeks a year thereafter.

Matching these peer nations would ease competing pressures on workers’ limited time off, allowing them to take leave at Christmas and later in the year.

With so many workers limping to the finish line exhausted, we’ve all earned some extra R+R.

This article was first published by Crikey.