Australia Day Substitution: The Legal Issues (2024 Edition)
In recent years it has been reported that some of the largest employers in Australia, including Woolworths, Telstra and Network 10, are now giving employees the option of working on Australia Day (January 26) and taking that public holiday at another time.
This development has arisen from both a general trend towards flexibility in the workplace and, more specifically, negative sentiment among a sizeable and increasing proportion of the public to the date on which Australia Day is currently held. (The debate on that underlying issue is beyond the scope of this article.)
This raises the question: if employers want to permit employees to substitute the Australia Day public holiday for another day, what legal issues arise?
For employees not covered by either a modern award or enterprise agreement, the employer and employee can agree to substitute the Australia Day public holiday for another ordinary day (which will then be treated like a public holiday for that employee).
For employees covered by an award or enterprise agreement, the employer and employee can agree to swap the Australia Day public holiday for another ordinary day provided there is a term in the applicable award or agreement permitting the substitution. As such, in those cases it is imperative employers check the award or agreement to see it is allowed before offering the opportunity to substitute to those employees.
An employer cannot compel an employee to substitute the Australia Day public holiday for another date. The employee must agree to the substitution.
Further, it is imperative that employers do not exert undue influence or undue pressure in relation to a decision by an employee to substitute the Australia Day public holiday for another day. This raises an interesting issue where employers have actively advocated for a change of date for Australia Day.
While some employers have adopted a neutral stance on the issue of change of date but nevertheless given employees the option to substitute so they can exercise their own prerogative or conscience on the matter, other employers have adopted a more vocal and emphatic stance, publicly calling for Australia Day to be moved from January 26, and championing a “business as usual” approach in their workplaces on that date. Employers need to be very careful in implementing a policy of permitting employees to swap dates that the avowed philosophical position of the employer on the issue does not lead to undue influence or undue pressure being exerted on an employee to do so. Exhortations from management such as (by way of example) “we expect employees to do the right thing” or “this is a time to show you are aligned with the values of the organisation” should be scrupulously avoided. Employers should emphasise that the decision to swap the public holiday is ultimately one for the employee and any choice made will be respected.
In that regard, and unsurprisingly, employees who decide to take the Australia Day public holiday and not substitute it must not be subject to any adverse action by the employer (such as termination of employment or demotion) for exercising that right.
On a related note, employers also need to keep in mind section 114 of the Fair Work Act 2009 (Cth.) (the Act), which provides that employees are entitled to be absent from work on a public holiday (including Australia Day). Employers may request an employee to work on a public holiday provided that request is reasonable.
The seminal decision of the Full Federal Court last year in Construction, Forestry, Maritime, Mining and Energy Union v OS MCAP Pty Ltd  FCAFC 51 established the principle that such a request by an employer needs to provide an opportunity for the employee to consider it and refuse – for example, merely unilaterally rostering employees to work on a public holiday will not constitute a proper request for the purpose of section 114.
Once a proper request is made, the employee may then refuse to work on the public holiday if either the request by the employer is not reasonable or the refusal by the employee is reasonable. Section 114 sets out various factors that must be taken into account in determining whether this is the case, including the nature of the employer’s workplace and the personal circumstances of the employee. While the specific proposition is yet to be tested in the courts (and may never be), generally speaking it would be highly unlikely that a court would consider a request by an employer that an employee work on Australia Day to be a reasonable request for the purpose of section 114 of the Act if the sole or primary reason for the request was for the employer to adopt or advance a corporate philosophical position on the date of Australia Day.
While employers may want to send a public message about the date of Australia Day, a message with which many would agree, that cannot be at the expense of the right of an employee to take Australia Day as a public holiday if they want to do so. That is a line employers need to be careful not to cross.