Berkeley Challenge Pty Ltd v United Workers Union; Spotless Services Australia v Fair Work Ombudsman

Berkeley Challenge Pty Ltd and Spotless Services Australia (the employers) sought judicial review of decisions made by the Fair Work Ombudsman (FWO) and the United Workers Union (UWU). The dispute concerned the interpretation and application of the Fair Work Act 2009 (Cth) (the Act) in relation to the employers' obligations to provide paid leave to employees who had been stood down during the COVID-19 pandemic. The employers contended that the FWO and UWU had acted unlawfully in their dealings with them, particularly concerning the accrual of paid leave entitlements during periods of stand-down. The matter was heard by the High Court of Australia.

The central legal issues before the High Court were: (1) whether the Act permitted or required the accrual of paid leave entitlements for employees who had been stood down under s 524 of the Act; and (2) whether the FWO and UWU had engaged in conduct that was contrary to law or otherwise unlawful in their respective approaches to the employers' obligations regarding paid leave during stand-down periods. The employers argued that stand-down provisions in industrial instruments, when validly invoked, suspended the employment relationship to such an extent that leave could not accrue.

The High Court held that the Act, specifically s 524, did not suspend the accrual of paid leave entitlements during a period of stand-down. The Court reasoned that the statutory framework for paid leave, including provisions for accrual, was not displaced by the operation of a stand-down provision. The Court found that the employers' interpretation of the Act, which would have prevented leave accrual, was not supported by the text or purpose of the legislation. Consequently, the employers' applications for judicial review were dismissed.