A Police Officer v Queensland Police Service [2003] QIRC 146 (2003) 173 QGIG 1353

22 August, 2003 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 1353 ######################################################################################################################### ## QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Industrial Relations Act 1999 – s. 53 – application for payment of long service leave A Police Officer AND Queensland Police Service (No. B1198 of 2003) COMMISSIONER BLADES 8 August 2003 Cashing out of long service leave entitlement – s.53 Industrial Relations Act 1999 – Financial hardship, compassion – Purpose of long service leave – Application refused. DECISION This application for the cash payment of long service leave is not opposed by the employer. It is made pursuant to s. 53 of the Industrial Relations Act 1999 which provides for payment to be made if grounds of financial hardship or compassion be established. The applicant seeks the payment for 241 days entitlement. He presently resides in rental accommodation with his partner, having been married on two previous occasions with the latest divorce proceedings being finalised in April 2003. His former wife ended up with the matrimonial home. The applicant retained only a motor vehicle, an investment fund worth approximately $6500 and the balance of his superannuation entitlement, which of course he cannot access until retirement. His net fortnightly income exceeds $2,000. The applicant and his partner, who has additional income, are managing to save $200 per month which is credited to the managed funds previously referred to and the balance of which is now about $6,000 (sic). Their combined debts exceed $8,000 with a potential for greater debt when legal expenses associated with the divorce are documented. The applicant seeks access to the long service leave entitlement to assist in raising a deposit to enable him to purchase a home and clear existing debts. He finds that it is impossible to save the required amount for a deposit. -- 1 of 2 -- 1354 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 22 August, 2003 The purpose of the application is to enable the applicant and his partner to be better positioned financially for the future in clearing debts and purchasing a family home. It is clear that the current trend in the upward movement of real estate values is an inviting investment but mere investment in an asset, even the family home, is not sufficient by itself to justify a payment. The discretion of the Commission to grant an application such as this is not unfettered. The application is based upon two grounds, financial hardship and compassion. What constitutes financial hardship is a question of degree and is difficult to define. The phrase is to be interpreted, in my view, by looking at various other considerations relating to long service leave. In the Review of Entitlement to Long Service Leave (2000) 164 QGIG 236, a Full Bench of this Commission looked at the purpose of long service leave and, after referring to a number of decisions, held that long service leave “is intended to be a reward for long service (not long leave after service) and that long service leave is also intended to provide a respite from work”. The decision of the Full Bench of this Commission indicates that there are two purposes for long service leave. That Full Bench then said at p. 244: “9. Should the cashing out of all (or some) long service leave or notionally accrued long service leave be permitted and after what qualifying period? On this issue the employee organisations and the employer organisations (and consultants representing employers) were divided beyond redemption. We unreservedly accept that the ‘cashing out’ of long service leave is incompatible with the purpose for which it is granted. Widespread ‘cashing out’ has the capacity to undermine any campaign by employee organisations for further enhancement of long service leave entitlements and, perhaps, capacity to undermine the current entitlements. That said, we have been acquainted with tales which demand compassion. We are not persuaded that an employee who takes half of 8 2/3 weeks in leave and the other half in cash to pay for an airline ticket will return to work less refreshed and invigorated than an employee who spends 8 2/3 weeks in the back garden. Doubtless, if ‘cashing out’ is possible, some will use it to relieve pressing financial necessity. In our view, we should not seek unduly to control the decision making of adult persons. There have been no tales of horror from jurisdictions, eg Tasmania, where ‘cashing out’ is permitted. We have come to the view that cashing out should be permitted in the case of adult workers.”. An Industrial Instrument may make provision for the cashing out of long service leave where the employer and the employee agree. There is no requirement in the Act that the Industrial Instrument provide for the employee to prove financial hardship or compassion before being entitled to the payment. On the other hand, the grant of an application to the Commission to cash out long service leave is not simply for the asking. The Commission has a discretion which does not depend on the consent of the parties and is fettered by Legislation. As the Full Bench said, the decision making of adult persons should receive some respect in determining what steps should be taken to alleviate financial hardship of varying degrees. But in my view, the purpose for which long service leave is granted should also be taken into account and applications which have the effect of denying one of the main purposes for which long service is granted are required to be treated with some caution. Widespread cashing out is to be discouraged. What constitutes the ground of compassion is not easily ascertained from the application and supporting affidavit. The sudden death of a close relative in a distant place necessitating immediate access to funds may qualify. That may generate “feelings of sorrow or pity for the sufferings or misfortunes of another”. Two divorces does not necessarily do so. In this case the applicant seeks payment for all of the entitlement. There is a capability to save a deposit over a period of time, extended though it may be. He already has an asset of invested funds. The applicant earns a substantial income. His expenses, other than for child support, are mostly of a recurring domestic nature. One of the liabilities is comprised of a loan from a relative. Most of the other liabilities of $8,000 involve credit card debt for which an allowance has previously been taken into account in establishing fortnightly liability payments. The credit card debts are not immediately payable. The use of long service leave to eliminate credit card debt and to thereby avoid one of the purposes for which long service leave is granted is to be discouraged. In all of these circumstances, I remain unconvinced that the grounds of financial hardship or compassion have been established sufficiently to justify an order. I refuse the application. B.J. BLADES, Commissioner. Hearing Details: Appearance: Applicant on his own behalf. Released: 8 August 2003 -- 2 of 2 --