diff --git a/spring-batch-core/src/test/java/org/springframework/batch/core/configuration/xml/StopAndRestartFailedJobParserTests.java b/spring-batch-core/src/test/java/org/springframework/batch/core/configuration/xml/StopAndRestartFailedJobParserTests.java
new file mode 100644
index 000000000..3081cdb76
--- /dev/null
+++ b/spring-batch-core/src/test/java/org/springframework/batch/core/configuration/xml/StopAndRestartFailedJobParserTests.java
@@ -0,0 +1,70 @@
+/*
+ * Copyright 2006-2007 the original author or authors.
+ *
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *      http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+package org.springframework.batch.core.configuration.xml;
+
+import static org.junit.Assert.assertEquals;
+
+import org.junit.Test;
+import org.junit.runner.RunWith;
+import org.springframework.batch.core.BatchStatus;
+import org.springframework.batch.core.ExitStatus;
+import org.springframework.batch.core.JobExecution;
+import org.springframework.batch.core.StepExecution;
+import org.springframework.batch.core.repository.JobExecutionAlreadyRunningException;
+import org.springframework.batch.core.repository.JobInstanceAlreadyCompleteException;
+import org.springframework.batch.core.repository.JobRestartException;
+import org.springframework.test.context.ContextConfiguration;
+import org.springframework.test.context.junit4.SpringJUnit4ClassRunner;
+
+/**
+ * @author Dave Syer
+ * 
+ */
+@ContextConfiguration
+@RunWith(SpringJUnit4ClassRunner.class)
+public class StopAndRestartFailedJobParserTests extends AbstractJobParserTests {
+
+	@Test
+	public void testStopRestartOnCompletedStep() throws Exception {
+
+		//
+		// First Launch
+		//
+		JobExecution jobExecution = launchAndAssert("[s1]");
+		StepExecution stepExecution = getStepExecution(jobExecution, "s1");
+		assertEquals(BatchStatus.ABANDONED, stepExecution.getStatus());
+		assertEquals(ExitStatus.FAILED.getExitCode(), stepExecution.getExitStatus().getExitCode());
+
+		//
+		// Second Launch
+		//
+		stepNamesList.clear();
+		jobExecution = launchAndAssert("[s2]");
+		stepExecution = getStepExecution(jobExecution, "s2");
+		assertEquals(BatchStatus.COMPLETED, stepExecution.getStatus());
+		assertEquals(ExitStatus.COMPLETED.getExitCode(), stepExecution.getExitStatus().getExitCode());
+
+	}
+
+	private JobExecution launchAndAssert(String stepNames) throws JobInstanceAlreadyCompleteException, JobRestartException,
+			JobExecutionAlreadyRunningException {
+		JobExecution jobExecution = createJobExecution();
+		job.execute(jobExecution);
+		assertEquals(stepNames, stepNamesList.toString());
+		return jobExecution;
+	}
+
+}
diff --git a/spring-batch-core/src/test/resources/org/springframework/batch/core/configuration/xml/StopAndRestartFailedJobParserTests-context.xml b/spring-batch-core/src/test/resources/org/springframework/batch/core/configuration/xml/StopAndRestartFailedJobParserTests-context.xml
new file mode 100644
index 000000000..e089e1f69
--- /dev/null
+++ b/spring-batch-core/src/test/resources/org/springframework/batch/core/configuration/xml/StopAndRestartFailedJobParserTests-context.xml
@@ -0,0 +1,17 @@
+<?xml version="1.0" encoding="UTF-8"?>
+<beans:beans xmlns="http://www.springframework.org/schema/batch" xmlns:beans="http://www.springframework.org/schema/beans"
+	xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance"
+	xsi:schemaLocation="http://www.springframework.org/schema/batch http://www.springframework.org/schema/batch/spring-batch-2.0.xsd
+	http://www.springframework.org/schema/beans http://www.springframework.org/schema/beans/spring-beans-2.5.xsd">
+
+	<beans:import resource="common-context.xml" />
+	
+	<job id="job">
+		<step id="s1" parent="failingStep">
+			<stop on="FAILED" restart="s2"/>
+			<end on="*"/>
+		</step>
+		<step id="s2" parent="step2"/>
+	</job>
+
+</beans:beans>
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