Australia's peak trade union body is pushing to rewrite one of the most fundamental conditions of employment in the country, arguing the national minimum annual leave standard is half a century out of date and is quietly costing workers weeks of unpaid time every year.
The Australian Council of Trade Unions (ACTU) has submitted to a parliamentary inquiry into the National Employment Standards (NES) calling for the minimum paid annual leave entitlement to rise from four weeks to five, with the longer-term goal of reaching six weeks. The submission marks the union movement's most ambitious play on leave conditions in decades.
The timing is deliberate. The House of Representatives Standing Committee on Employment, Workplace Relations, Skills and Training launched an inquiry in November 2025 into the operation and adequacy of the NES, with the purpose of determining whether those standards continue to meet the needs of workers, employers and the broader economy. The review was a commitment from the 2022 Jobs and Skills Summit. For unions, it is the clearest opportunity in a generation to shift the leave floor.
Under the current NES, full-time and part-time employees are entitled to four weeks of annual leave based on their ordinary hours of work. That standard was set 50 years ago, yet Australians' working hours have only increased over time.
ACTU Secretary Sally McManus framed the campaign around the scale of unpaid work being absorbed by the workforce. Australian workers already perform an extra four and a half weeks of unpaid work on average every year, she said, making a one-week return "fair and reasonable" and one that "will mean a better rested and happier workforce."
The figures from the Centre of Future Work, cited by the ACTU, are particularly pointed when it comes to younger workers. Workers aged 18 to 24 are described as most urgently needing relief, performing an average of 6.4 weeks of unpaid work for their employers each year. McManus drew an international comparison to support the case, pointing out that the majority of European countries have already moved beyond four weeks, with Austria, France and Spain among those recognising the value of rested employees.
The ACTU does not sidestep the cost question. The union body acknowledges that an extra week of leave would add approximately two per cent to employment costs, but argues this would be offset by a reduction in employee turnover and time lost to injury and stress. The argument is essentially that burnout is expensive too, just in ways that do not show up directly on a payroll ledger.
That concession is worth taking seriously from a business perspective. A two per cent uplift to employment costs is not trivial, particularly for small and medium enterprises operating on thin margins. The Business Council of Australia had not issued a formal response at time of publication. Employer groups have historically argued that labour cost increases, however well-intentioned, tend to slow hiring and depress wages growth elsewhere as businesses rebalance their total remuneration budgets.
There is also a structural question about who actually benefits most from a legislated minimum. Workers covered by enterprise agreements at larger companies often already enjoy leave entitlements exceeding the NES floor. Enterprise agreements must always meet the NES, meaning any upward shift in the minimum standards may require employers to recalibrate their bargaining strategies. That could work in workers' favour at the enterprise level, but it also means the reform's real-world impact would be concentrated among lower-paid workers in industries with less union coverage, which is arguably exactly where it is most needed.
Outcomes from the NES inquiry are not yet confirmed, and commentators and industry groups expect the review may result in changes to core employment standards. This will be the first review of the NES since the Fair Work Act 2009 was introduced. Whether a fifth week of annual leave emerges from that process depends heavily on the political appetite of the government and the weight it assigns to competing submissions from unions, employer bodies and independent economists.
The honest tension here is between two legitimate goods. Workers carrying chronic fatigue and unpaid overtime are less productive, more prone to illness, and more likely to leave their jobs, all of which carry real economic costs. At the same time, mandating higher leave floors in a weak productivity environment risks pushing labour costs onto businesses that cannot absorb them. A pragmatic resolution may lie somewhere between the ACTU's ceiling of six weeks and the status quo: a carefully scoped, evidence-driven increase that prioritises the workers with the least bargaining power, phased in at a pace the broader economy can accommodate.