Unions demand Albanese hand every worker 25 per cent more holidays
Unions are demanding the Albanian government give workers an extra week of annual paid leave each year, at a time when employers are struggling to encourage people to keep their balance each year; This is the first increase in more than fifty years.
On Wednesday, the Australian Council of Trade Unions (ACTU) will use a government employment standards inquiry to call for standard annual leave to be increased from four weeks to five weeks for full-time workers, despite Australian workers having around 160 million days of annual leave.
If implemented, the change would be the latest in a series of industrial relations concessions Labor has made to unions, including multi-employer bargaining, redundancy protections in the gig economy and the right to disconnect.
But some experts warn that additional paid leave entitlements, which would also increase to six weeks for shift workers under the union model, could be costly and fail to address other concerns about annual leave, including workers’ reluctance to take it.
ACTU secretary Sally McManus said most workers were not alive during the last period when annual leave entitlements were increased in Australia.
“Our annual leave has been frozen for four weeks since the mid-1970s, half a century ago,” he said, noting that most European countries, including Austria, France and Spain, had already gone further.
In Austria and France, employees are entitled to at least five weeks or 25 working days of paid leave, while in Spain workers are entitled to approximately 22 working days of paid leave.
McManus said Australians were working relatively long hours and the extra time off would reduce stress and burnout.
‘Australian workers already do an average of four and a half weeks extra unpaid work each year. ‘It’s fair and reasonable to return for one of these weeks.’
ACTU secretary Sally McManus
“Australian workers already do an average of 4.5 extra weeks of unpaid work each year,” he said. “Returning to one of these weeks is fair and reasonable. It will mean a better-rested and happier workforce.”
Some Australian companies have already increased their annual paid leave entitlements, with the SDA, which represents retail, warehousing and fast food workers, negotiating five weeks of annual leave at Bunnings, Apple and Ikea.
SDA national secretary Gerard Dwyer said the deals the union had negotiated at these companies had helped improve work-life balance.
“Time is one of our most valuable assets, and our members have prioritized an extra week of leave to help them meet family demands,” he said.
Focus on leave balances
Bond University organizational behavior associate professor Libby Sander said Australia already had relatively generous paid leave entitlements and an extra week could be a significant burden, especially for small and medium-sized businesses.
Instead, he said the focus should be on the annual leave balances accrued by Australian workers (which translates into an average of 16 days of bank leave per worker, according to a 2024 report from HR software company ELMO) and why they don’t feel they can take leave, despite its importance to mental and physical health.
“This is a wider cultural issue,” Sander said, noting that one in five Australians takes four or more weeks of annual leave. “People report not taking annual leave due to job security concerns and missing out on promotions, and feel guilty leaving the work to colleagues,” he said.
Young workers aged 18 to 24 are among those most urgently in need of this reform, according to the ACTU, citing data from the Center for Future Work, a think tank run by the left-wing Australia Institute and receiving funding from unions. – It shows this group works 6.4 weeks of unpaid overtime a year, compared to 4½ weeks of extra unpaid work for Australian workers more generally.
The ACTU also argues that Australian workers are owed a real wage increase of around 10 per cent to offset productivity gains since 2000, and that increased paid leave entitlements would help close the gap.
“Increasing annual leave by one week would add an extra 2 per cent to employment costs, which would be offset by the reduction in employee turnover and time lost through injury and stress,” the ACTU said.
But business lobbies have previously warned that any increase in paid leave would ultimately be borne by customers in the form of higher prices.
Cost to employers
University of Melbourne labor economist Jeff Borland said the cost to employers of an extra week’s leave was manageable.
“I used to think an extra week of paid leave was a bit expensive, but that’s only a 2 percent increase [in wage costs]”The question really is: Will workers prefer a 2 percent wage increase or an extra week of leave?”
Borland also said an extra week of leave could lead to an improvement in productivity growth, which has lagged over the past decade, because workers would be better rested and fit.
Unions will push for changes to the National Employment Standards (NES) to introduce an extra week of annual leave as part of the House of Representatives’ inquiry into the NES, which is about to begin. The ACTU has officially committed to pushing for an extra week of leave in 2024.
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Millie Muroi is the economics writer for The Sydney Morning Herald and The Age. He was previously an economic correspondent for the Canberra Press Gallery and a banking writer in Sydney.Connect with: X or email.
