ACTU pushes Albanese government to increase annual leave to five weeks

Unions are pushing the Albanese government to lift the minimum level of annual leave from four to five weeks for Australian workers.

The Australian Council of Trade Unions (ACTU) has entered a new bid with the federal government to increase annual leave by an extra week, giving Australians five weeks of leave rather than four.

The ACTU is pushing for full-time workers to have their annual leave increased to five weeks, and six weeks for shift workers, in what would be the first increase in half a century.

Annual leave was introduced in Australia in 1906 but became widespread for workers in 1935. It wasn’t until 1974 when four weeks of paid leave was adopted across the entire country.

Many European countries have since increased their annual leave allowance, including Denmark, Iceland and Norway.

Giving staff an extra week of annual leave would increase employment costs by 2 per cent, but the union said this would be offset by the reduction in costs caused by employee turnover, and stress and injury-related sick days.

While some businesses have already adopted five weeks of annual leave, such as Ikea and Bunnings, the federal government would need to sign off on the agreement before it is adopted across the country’s workforce.

ACTU secretary Sally McManus said Australians had increased their workload in recent years, giving them a greater chance of burning out and stress-related sickness.

“Australia should increase annual leave to a minimum of five weeks for full-time workers. Australians work relatively long hours, which has only increased over time, yet the four-week annual leave standard was set 50 years ago,” she said.

She explained adding an extra week of annual leave could help “decrease stress and burnout”, particularly impacting workers aged 18-24.

“Australian workers already do an extra four and a half weeks of unpaid work on average every year. Getting back one of these weeks is fair and reasonable. It will mean a better rested and happier workforce,” she said.

“Younger workers – from 18 to 24 years old – most urgently need to see this burden start to lift. They are the ones doing the most unpaid work – an average of 6.4 weeks of free work for their employers each year.”

She said while Australians had increased their workload in recent years, there was an increasing “productivity gap” and workers’ wages had failed to increase for more than 25 years.

The increase in annual leave would address that, she said.

“The average Australian would need to see their real wage increase by 10 per cent to make up the difference between productivity improvements and real wage growth since 2000,” she said.

“An extra week of annual leave would help to reduce that gap.”

Ms McManus said European countries such as Austria, France and Spain had upped their leave, and have “already recognised the importance of rested, healthier employees” and are “some of the most productive and competitive economies in the Organisation for Economic Co-operation and Development (OECD)”.

“It’s time Australia caught up, our annual leave has been frozen at four weeks since the mid-1970s, half a century ago,” she said.

“Most workers weren’t alive when annual leave last went up in Australia.”