Leave Management > Leave Types and Entitlements > Sick Leave

Leave Cycle

The BCEA provides that an employee’s sick leave cycle is the 36 month period following their appointment date. SimplePay, therefore, uses the appointment date captured for each employee to determine their individual leave cycles.

However, some employers prefer to standardise this so that all employees are on the same leave cycle, e.g. 1 January to 31 December. Although this is not strictly correct, it shouldn’t be a problem as long as the employees are not receiving fewer leave days than the minimum entitlement below.

Entitlement

In terms of the BCEA, sick leave is paid leave and an employee is entitled to the same number of days that they would ordinarily work in a six week period. Practically, this means that their sick leave entitlement is calculated by multiplying their regular working days by six – e.g. if an employee works five days a week, they are entitled to 30 days (5 x 6 = 30) of sick leave every 36 months.

The Act provides that, for the first six months of employment, an employee’s sick leave accrues at a rate of one day for every 26 days worked. This entitlement can be calculated as regular working days x (52 / pay periods in the year) / 26:

  • A monthly-paid employee, working five days a week, will accrue sick leave at a rate of 0.83 days per month, which is calculated as 5 x 4.3333 / 26. 4.3333 is the average number of weeks in a month, calculated as 52 / 12.
  • A fortnightly-paid employee, working three days a week, will accrue sick leave at a rate of 0.23 days per fortnight, which is calculated as 3 x 2 / 26. 2 is the average number of weeks in a fortnight, calculated as 52 / 26.
  • A weekly-paid employee, working seven days a week, will accrue sick leave at a rate of 0.26 days per week, which is calculated as 7 / 26, where 7 represents the number of days the employee works in a week.

After this initial six-month period, the employee is entitled to their full amount of sick leave, less any sick days taken. The difference between their balance and their entitlement will, therefore, accrue to them. For example, a monthly-paid employee working five days a week will have a balance of five days after the first six months (assuming no leave was taken) and will accrue the remaining 25 days on the first day of their seventh month of employment.

The above calculations and entitlements represent the minimums which must be granted to employees; however, the employer and employee are free to agree to different terms as long as they do not result in the employee receiving less leave than the minimum. It is, for example, not legally correct to agree that an employee receives their sick leave entitlement in three equal portions in each of the 12 month periods making up their 36 month cycle.

By default, SimplePay calculates employees’ leave entitlement based on the above rules using their full days per week, as configured in their regular hours. It is, therefore, important that this has been correctly set up. Please see the following article for more detail:

Medical Certificates

To prevent abuse of sick leave policies, employers may require that an employee produce a medical certificate if they are off sick for more than two consecutive days (i.e. three or more consecutive days). If such a certificate is not produced, the employer may treat the period as unpaid leave and the employee is not entitled to have it treated as paid annual leave. More information on these other leave types is available in the following articles:

An employer may not demand a medical certificate if the employee is off sick for fewer than three consecutive days – weekends and / or public holidays do not count as consecutive days. It is, therefore, unlawful to require that such a certificate be produced in cases where employees are off on a Friday and / or Monday or the day before or after a public holiday if these are the only days they are off. The only exception to this rule is the case where an employee has already taken sick leave on two previous occasions in the same eight-week period. In such instances, the employer may demand a medical certificate for any further sick days, even if the employee only takes one day.

If you would like to record employees’ medical certificates on SimplePay, you can do so using the employee notes function, discussed in the section below:

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