Buying and selling leave is an emerging trend among Australia’s Top Companies

Imagine purchasing an extra two weeks of annual leave to spend with family, or cashing in unused days to boost your pay packet. That’s the ethos behind an emerging trend that lets employees buy and sell their annual leave.

Australia’s Top Companies 2018 represent the organisations Australians most want to work for, and this type of flexible leave is increasingly common.

Optus, which ranked number 21 on the list, allows staff to buy and sell up to two weeks' leave; Telstra (13) and Qantas (14) allow staff to buy an extra two weeks’ leave; KPMG (4), ANZ (15), Origin Energy (16) and Commonwealth Bank (2) allow four weeks extra to be purchased; while Westpac (5) offers a whopping 12 weeks of ‘lifestyle leave’ either purchased or unpaid.

Optus HR director David Hamilton said staff were first offered the chance to buy and sell leave 12 years ago when it was a very new concept.

“Since its introduction, we’ve seen a steady increase each year in the number of employees choosing to take this extra time off and they tell us they appreciate being better able to balance work and home life,” Hamilton said.

“Last year, around 10% of eligible employees opted to take advantage of this offer and took some extra time out to spend with their families, travel overseas or pursue hobbies."

This flexibility is often embraced by working parents, said Queensland University of Technology Business School professor Paula McDonald.

“A lot of parents have struggled for a very long time with four weeks of annual leave given the structure of schools allows for 12-14 weeks’ holidays,” McDonald said.

“This misalignment between typical work schedules and the school system might be a really common reason why employees would purchase extra leave.”

So what’s in it for the employer? McDonald said businesses saved money when employees sold annual leave but the benefit was more about keeping a happy workforce.

“It might contribute to retention of employees because they’re better able to manage their work responsibilities and less likely to leave the organisation. It signals to an employee they care about you, not only as an employee but as an entire human being.”

Australia’s Fair Work Ombudsman has strict rules around selling leave, including the requirement that an employee needs to have at least 4 weeks annual leave leftover. This means there is never a situation where an employee forfeits the right to their annual leave, and an employer can’t force someone to buy or sell their leave.

“This legislation is really important because annual leave is there for a very important reason for both the employer and the employee,” McDonald said. “It is time for employees to rest and recuperate and spend extended time with friends and family. It allows people to take time off for an important life event. All of this is really important to avoid burnout which makes for a better workplace.”