New Long Service Leave Act 2018 (Victoria State)

All employees in Australia, including permanent and casual, are entitled to receive long service leave when they have completed an extended period of service with their employers.

Long service leave is paid leave available to employees beyond an employee’s yearly annual and personal leave entitlements.

Long service leave is one of the few areas of employment law in Australia that are still governed by state-based legislation. As a result, employees in each state and/or territory receive varying amounts of long service leave at different points in their employment.

The following table provides a brief summary of the entitlements to long service leave in each state and/or territory:

Employees in most jurisdictions will receive prorated long service leave if their employment ends prior to 10 years. However, this is dependent on the reasons for termination and the state and/or territory in which the employee was employed.

New Long Service Leave Act for Victoria

Victoria has recently passed the Long Service Leave Act 2018 (Vic) (LSL Act 2018), which will replace the Long Service Leave Act 1992 (Vic) (LSL Act 1992) and affect employees’ leave entitlements.

The LSL Act 2018 is scheduled to take effect November 1, 2018 (unless proclaimed earlier by the Victorian government) and make a number of significant changes to the LSL Act 1992.

Included in the changes being introduced by the LSL Act 2018 are the following:

• Employees will be entitled to take long service leave after completing 7 years’—instead of 10 years’—continuous employment.
• Employees will be able to take leave in single-day increments rather than in a maximum of three periods.
• When an employee’s employment is outsourced, the second employer must recognize the employee’s completed service with the first employer.
• Up to 52 weeks of parental leave will now be counted as “continuous service” and therefore used in calculating an employee’s entitlement to long service leave.

Employees in Victoria will continue to accrue long service leave at the same rate; namely, 1/60 of their continuous employment, which equates to 8 2/3 weeks for every 10 years of employment.

Comment

Prior to making any payment for long service leave, particularly when an employee’s employment is coming to an end, employers may want to carefully consider the amount of long service leave owed. This is an area in which a lot of employers, especially foreign ones, may need assistance.

Written by James Sanders of MST Lawyers and Roger James of Ogletree Deakins