Minimum leave entitlements within Australia are set out in the NES (
Nintendo Entertainment System National Employment Standards). These include:
- 20 days paid annual leave (if employed full-time; or a proportionally equivalent amount if employed part-time).
- 10 days of paid sick/carer's leave each year (if full-time; as above).
- 2 days of paid compassionate leave each time a relative dies or "suffers a life-threatening illness or injury".
- 2 days unpaid carer's leave each time a family/household member requires support.
- 12 months unpaid parental leave (note that separate legislation also allows for paid parental leave on top of this).
Both annual leave and sick leave roll over from year to year (if you have unused balances remaining at the end of the year). In certain situations, an employer can direct an employee to take a portion of their annual leave, or can pay out a portion of the balance outright if a significant amount has accrued.
Note that if your employment is covered by a Modern Award (which it probably is, unless you are working in a heavily-unionized industry), then you should also check the Award agreement that pertains to your industry as it may provide slightly different (though generally, more generous) entitlements than the minimum that the NES calls for.
Or, if you are in a heavily-unionized industry, then your employment terms may be set out in an Enterprise Agreement. You'd probably know if this applies to you or not (your employment contract should clearly indicate which situation applies).
If your employment falls under an Award contract, you are free to make limited variations to the terms provided that:
- Both the employee and the employer agree to the change; and
- The change passes a "better off overall" test (i.e. the change can't result in the employee having fewer entitlements than the award guarantees).
Notably, the way that leave accrues is not something that can be varied.
Based on the above, and assuming that you're not on an Enterprise Agreement, there are some possible issues:
- Australian employment law doesn't allow employers to unilaterally vary the terms of employment for their employees. The variation needs to be agreed to by each employee the change applies to.
- The functioning of leave isn't something that employers are generally permitted to vary, in any case.
- If the general pool of leave accrues 20 days/year instead of 30 days/year, then the policy is basically shortchanging on leave entitlements.
- If leave days are treated generally, employees who don't get sick often may take longer holidays and resignations/terminations may cost more in terms of paying out accrued entitlements (normally only annual leave is paid out when employment ends; but if you have everything in a single pool you'll have to pay out the whole thing).
The first two items are probably irrelevant, as from a certain perspective what the policy actually changes is the accounting of leave days, but not any of the underlying mechanics of how the leave system operates.
What matters is that full-time employees accrue 20 days of annual leave and 10 days of sick leave for each year of employment. If this is treated as having 30 days of "general" leave that employees accrue each year, it seems like that would be fine (in my opinion, at least), so long as nobody is kept from accessing their full leave entitlements.
And the fourth item actually benefits employees, so shouldn't be an issue as long as there are funds there to cover the increased amount of entitlements being paid out. If anything, it can be a point of differentiation to make the company more appealing to prospective hires (if you don't get sick often, you get more general leave days to use for your holidays).
So the third item is the only real sticking point. And there's not enough information provided in the question to know if there's an issue or not.
Is the policy proposing that employees will accrue 30 "general" leave days each year? If so, nothing to worry about.
Or does it propose an accrual of 20, basically replacing 10 annual leave days with sick days? That would be an underpayment of entitlements, which won't fly. Employees would likely complain, and if the policy wasn't promptly changed might take the matter to the Fair Work Ombudsman.