The answer differed for two kinds of leave, and one balance has to be restored
A coal mining dispute over leave during a strike has produced a split decision - and a clear rule for employers running enterprise agreements.
In a decision dated July 28, 2026, the Fair Work Commission drew a line between two kinds of leave when employees take industrial action - and the distinction is one every enterprise agreement holder should note.
The dispute arose at the Rix's Creek Open Cut Mine in New South Wales, part of the Bloomfield Group. After the site's enterprise agreement passed its nominal expiry date in May 2025, the Mining and Energy Union began bargaining for a replacement. Union members took protected industrial action - lawful strike activity - from late September to mid-November 2025. The company responded with employer response action, a lockout that kept employees off rostered shifts.
For those periods, the company reduced employees' annual leave accruals and deducted personal and carer's leave that had already been credited. The union said this showed on payslips as annual leave "added" and then "taken," with matching reductions in personal leave balances, and argued the treatment was inconsistent with clauses 18 and 25 of the agreement.
The Commission divided the question in two, and the result was mixed.
On annual leave, the Commission found in line with the employer's position. Annual leave, it held, accrues progressively based on hours actually worked, so it did not build up while employees were on strike. The Commission reached the same conclusion for the lockout period. The commissioner noted he felt bound by a Full Bench ruling, the Carter Appeal Decision, while expressing a personal reservation about it: "I do not necessarily agree with this decision," he wrote, adding that an employee who was "ready, willing and able to work" but locked out should not, in his view, be penalised. Precedent, he said, required the finding.
On personal leave, the Commission found in the union's favour. That leave, it held, is credited up front - three weeks each year - rather than earned week by week, so it could not be reduced because of a strike or a lockout. The Commission rejected the argument that leaving personal leave intact amounted to prohibited "strike pay" under section 470 of the Fair Work Act, describing that section as directed at wages rather than at "the accrual of 0.44 hours of personal leave for every day" of action. It directed the company to rectify the personal leave balances within 14 days.
The employer had also raised a jurisdictional objection, arguing the union had not worked through every step of the agreement's dispute settlement procedure before coming to the Commission. The Commission read that procedure practically, found that the circumstances made strict step-by-step compliance unnecessary, and held that it had jurisdiction to decide the dispute.
For HR and industrial relations teams, the practical lesson sits in the drafting. How an agreement frames each leave type can decide the outcome. Language that credits leave up front behaves very differently from language that accrues it progressively, and front-loaded entitlements are difficult to reduce, even during industrial action.
The case is also a reminder about process. Dispute settlement procedures are designed to encourage genuine discussion, and the Commission signalled it will look at their purpose rather than treat a missed step as an automatic bar to arbitration.
The decision was made by a single member of the Fair Work Commission and included an order for the company to restore the personal leave balances within 14 days.
