What is long service leave
Long service leave is paid leave granted to employees for ‘long service’ to an employer.
Entitlements come from state legislation or federal awards or agreements. In Tasmania, the main piece of legislation covering employees in the private sector is the Long Service Leave Act 1976 (external link). Some employees not covered by this Act include:
- employees covered by federal awards or agreements that contain long service leave provisions (check with FairWork on 13 13 94)
- employees covered by other Tasmanian long service leave legislation, such as the Construction Industry (Long Service) Act 1997 (external link)
- state service employees covered by the Long Service Leave (State Employees) Act 1994 (external link)
- local government employees covered by the Local Government (Building and Miscellaneous Provisions) Act 1993 (external link)
- commonwealth government employees covered by Commonwealth legislation.
The Long Service Leave Act 1976 contains different provisions for mining employees and these are covered in Long service leave for mining employees.
Entitlement (not mining employees)
The long service leave entitlement is 8⅔ weeks of paid leave after completing 10 years of ‘continuous employment’.
After each additional 5 years of ‘continuous employment’, an employee’s entitlement is 4⅓ weeks of leave.
An employee may have an entitlement to payment for pro rata long service leave on termination of employment after completing 7, but less than 10 years, of ‘continuous employment’. See Pro rata long service leave.
‘Continuous employment’ is the period of employment that must be completed to establish an entitlement to leave or payment of pro rata leave on termination of employment.
Continuous employment generally means unbroken employment with one employer. However, employment may be continuous in circumstances where it appears to have been broken:
Absences and interruptions
The following absences and interruptions do not break continuous employment and ARE counted as part of your service:
- annual leave or long service leave
- public holidays
- any absence due to illness or injury that has been certified as necessary by a medical practitioner
- any interruption or termination of employment by the employer, if done to avoid annual leave or long service leave obligations
- any period of approved leave to attend meetings of either the Tasmanian State Training Authority or committees established under the Vocational and Education Training Act 1994
- jury service or other prescribed attendance at court .
The following absences also do not break continuous employment but they do NOT count as part of your service; you would need to work the extra time:
- maternity leave
- any interruption arising from an industrial dispute
- termination for any reason, except for slackness of trade, but only if the employee is re-employed by the employer within 3 months of the date of termination
- stand down or termination due to slackness of trade, provided that the employee returns to work or is re-engaged within 6 months and within 14 days of an offer by the employer to return to work or be re-engaged
- any other absence approved by the employer.
Work performed for more than one employer
Although an employee may have worked for more than one employer, the employee may be considered to be ‘continuously employed’ and have a long service leave entitlement.
It is important that employers are aware of these circumstances because it is possible to incur a significant fine otherwise.
- When an employee transfers between ‘associated’ corporations, the employee’s previous employment counts towards the period of ‘continuous employment’.
- When a ‘transmission of business’ occurs, which means one employer taking over the business of another employer. The transmission of a business does not affect an employee’s long service leave entitlement. All prior continuous employment must be recognised by a new employer.
- An employee is terminated by one employer and is re-engaged to work in the same place of business, and in substantially the same kind of business, with another employer. If the re-engagement takes place within a period of 2 months from the date of termination from the former employer, the employee is deemed to be continuously employed.
Granting long service leave
When an employee has reached an entitlement to long service leave, they may apply to the employer to take the leave at an agreed time. If agreement cannot be reached, WorkSafe can be asked to adjudicate.
Long service leave must be taken in one period unless the employer and employee agree that it will be taken in two periods.
Cashing-in long service leave
By agreement with their employer, employees may ‘cash-in’ long service leave by receiving payment instead of taking leave. An employee may also take a mixture of cash and leave.
Payment for long service leave
An employee is to be paid their ‘ordinary pay’ for a period of long service leave. ‘Ordinary pay’ is the pay that the employee would receive if the employee stayed at work during that period.
Ordinary pay includes:
- shift penalties
- part-time and casual loadings
- allowances which are generally paid both for all hours worked and for all purposes of the award
- the cash value of board and lodging, other than board and lodging provided by the employer for work in localities distant from the employee’s genuine place of residence.
The following payments are excluded from ordinary pay and are not payable during periods of leave:
- overtime payments
- award special rates such as danger, hardship or inconvenience type allowances
- travel payments and allowances
- bonus payments
- living away from home allowance
- meal allowances.
The ordinary pay for a casual employee is based on the average number of hours worked over the 12 months immediately before the start of leave. That is, the total hours worked over the past 12 months divided by 52 (weeks).
Ordinary pay is calculated differently for an employee on commission, such as real estate salesperson. It is based on the average weekly remuneration received over the 3 months immediately before the start of leave.
Casual and part-time employees
Casual and part-time employees are entitled to long service leave if they have completed 10 years of continuous employment. They are considered to be continuously employed if they have been regularly working for 32 hours or more in each consecutive period of four weeks.
Casual and part-time employees may have an entitlement to pro rata long service leave if employment is terminated after 7 years of continuous employment. See Pro rata long service leave.