Under the Act, long service leave accrues progressively at a rate of one week for every 60 weeks of continuous employment with one employer, that is approximately 0.866 of a week per year.
Casual, seasonal and specified term employees
Casual and seasonal employees, and employees engaged for a specified term, are entitled to long service leave under the Act. Their employment must still be ‘continuous’ under the Act.
The rules for casual and seasonal employees mean that employment will be deemed continuous providing there is no absence of more than 12 weeks between any two instances of employment. A casual or seasonal employee’s employment will also remain continuous for long service leave purposes, despite an absence from work exceeding 12 weeks, if:
- the employee and the employer so agree before the start of the absence
- the absence is in accordance with the terms of the engagement
- the absence is caused by seasonal factors
- the employee has been employed by the employer on a regular and systematic basis and has a reasonable expectation of being re-engaged by the employer
- the absence is due to the employee taking up to 104 weeks’ paid or unpaid parental leave.
Paid or unpaid absences of any duration because of illness or injury will also not break continuous employment.
The casual hourly rate does not include an amount to cover long service leave. A casual hourly rate cannot be loaded to compensate for non-payment of long service leave. In most cases, it is also unlawful to cash out an employee’s long service leave entitlement instead of allowing the employee to access the leave as a break from work, though some exceptions apply such as where the employment has ended.
Specified term employees
The Act provides that where employment terminates because of the expiration of a specified term (known commonly as ‘fixed term’) of an employment contract, but the employee is re-employed within 12 weeks, employment will be deemed continuous for the purposes of long service leave.
Example one – Casual or seasonal employee and employer agree
Paul is a casual zoology tutor at a Victorian university. He has been employed by the same university for 13 years.
Paul and the university have an agreement that Paul does not teach between November and March, due to the university non-teaching period. Paul therefore has a four-month break from work each year. However, this is in accordance with his employment agreement and his employment is therefore deemed to be continuous.
Paul is eligible for long service leave despite the absences of more than 12 weeks between instances of employment every year. This is because Paul and his employer have agreed that his employment continues despite the regular absences of more than 12 weeks.
Example two – Seasonal employment
Russell works on a seasonal basis at Ruth’s Plant Nursery. Russell has worked at the nursery for eight years.
Russell does not work in the coldest winter months when there is a dormant period for the plants. During his employment at Ruth’s, these non-working periods have ranged from five weeks to a few months each year. On at least three occasions, the winter break has lasted for more than three months. However, Russell’s regular work always recommences after the winter shutdown.
Russell is eligible for long service leave because his absences are caused by seasonal factors.
Example three – Regular and systematic casual employment
Leo works as a casual employee at his local supermarket. He is regularly rostered to work
Mondays in accordance with a rostering system established in consultation with his employer, and has done so for the last two years.
Leo’s mother unfortunately falls ill, and Leo must take four months off work. He tells his employer this, and his employer assures him they will make shifts available to him again once he is able to return. Leo then returns to work four months later when his mother is feeling better.
Although there is no explicit agreement that his employment will not be broken for the purposes of long service leave, his service will be deemed continuous under the Act. This is because Leo’s work is regular and systematic, and he has a reasonable expectation of being re-engaged following the absence.
Example four – Casual or seasonal employee takes unpaid parental leave
Ashanti works as a casual ski instructor during each Victorian ski season. Ashanti has worked every ski season for the past six years.
Ashanti takes an initial period of 52 weeks’ unpaid parental leave. Before the end of the initial 52 weeks’ unpaid parental leave, Ashanti applies to extend her period of leave by a further 52 weeks – making a combined total of 104 weeks’ unpaid parental leave. Ashanti returns to work at the start of the next ski season after her 104 weeks’ unpaid parental leave.
In this example, Ashanti’s period of unpaid parental leave does not break her continuous employment for long service leave purposes under the Act. Additionally, any further period beyond 104 weeks’ unpaid parental leave that elapsed before Ashanti could return to work also won’t break her continuous employment if the further absence was caused by seasonal factors.
Example five – Specified-term employment
Karina works at an accountant’s business in the city. Karina has been employed at her job
for eight years. Karina is currently employed on an ongoing basis, but for the first three years she was employed on a series of 12-month fixed-term contracts. Karina was re-employed at the end of each fixed-term contract. On the first two occasions, the new employment contract commenced immediately after the expiration of the previous fixed term. However, on the last occasion there was a break of four weeks between the expiration of Karina’s third fixed-term contract and the commencement of her ongoing employment.
Despite Karina being employed under a total of four separate employment contracts, the first three being fixed-term engagements, her entire period of employment under each successive period of employment, and any gap between them, is deemed continuous under the Act. This is because on each occasion Karina was re-employed within 12 weeks.
Paid absence from work
All periods of paid leave count towards the period of continuous employment for long service leave purposes. Examples include annual leave, personal/carer’s leave, and long service leave itself.
Unpaid absence from work
Any period of up to 52 weeks’ unpaid leave (including unpaid parental leave) counts towards an employee’s period of continuous employment and does not break continuous employment. Where a longer period of unpaid leave is taken, only the first 52 weeks is taken to be included in the period of employment unless:
- the absence is taken to be a period of employment under an employment agreement or fair work instrument
- the employer and employee agree in writing before the leave is taken that the period is taken to be a period of employment
- the leave is taken on account of illness or injury
- the leave is otherwise provided for under an employment agreement or fair work instrument.
Absence on sick leave or WorkCover
Under the Act, any paid or unpaid absence from work because of illness or injury occurring on and from the commencement of the Act on 1 November 2018 counts towards the period of continuous employment for long service leave purposes. Unpaid leave due to illness or injury includes a WorkCover absence.
Where the unpaid absence because of illness or injury occurred before the commencement of the Act, only 48 weeks’ unpaid absence for that reason in any year counts towards the period of employment, as it occurred under the previous 1992 Act.
The tables below identify common absences from work or interruptions to employment, state their effect on continuous employment and what counts towards the period of continuous employment for long service leave purposes. The absences identified are not an exhaustive list of all circumstances that may affect long service leave.
The tables separately address each absence and interruption identified by reference to both the Act (from 1 November 2018) and the 1992 Act (as it previously applied).
Tables: how common absences affect continuous employment
Does count towards the period of employment
Does not count towards the period of employment
|Unpaid leave exceeding 52 weeks unless the leave is provided for under the relevant employment contract or fair work instrument or is on account of illness or injury|
Unpaid leave (including unpaid parental leave) up to 52 weeks, or longer if the leave is provided for under the relevant employment contract or fair work instrument
Where an employee’s employment ends, and the employee is re-employed within 12 weeks, the period during which the employee was not employed
Leave on account of illness or injury
Does count towards the period of employment
Does not count towards the period of employment
The taking of any annual leave or long service leave
|Unpaid parental leave|
Any other paid or unpaid absence from work approved by the employer, including personal/carer’s leave but not including adoption, maternity or paternity leave
Where an employee is dismissed at the employer’s initiative and the employee is re-employed within three months, the intervening period
Any absence from work of not more than 48 weeks in any year on account of illness or injury
Any absence from work exceeding 48 weeks in any year on account of illness or injury