Employees that have shown their commitment to a company for several years deserve a holiday! Long Service Leave provides long-term employees with some time off as a reward for their hard work. Every state and territory in Australia has different legislation surrounding the different types of leave available. Keep reading this Legal Kitz blog to find out more about the specific entitlements for long service leave in NSW.
When is a worker entitled to long service leave?
For long service leave NSW entitles full-time, part-time or casual workers in the jurisdiction of NSW to a 2 month period of paid leave after ten years’ service with the same employer, and further paid leave after each additional period of five years of service with that employer (under the Long Service Leave Act 1955 (the Act)).
Are there long service leave entitlements for employees of less than 10 years of service?
A worker who has completed five years but less than 10 years of service may be entitled to a long service pro-rata payment. In determining whether an employee qualifies for pro-rata long service leave, the court will consider whether the circumstances are eligible for the exception. This will include if they:
- resign as a result of illness, incapacity, domestic or other pressing necessity; or
- are dismissed for any reason except serious and wilful misconduct; or
- passes away.
Additionally, a court will also consider whether the employer’s reason for termination was genuine. This can also include whether:
- the employee could continue their employment by making reasonable accommodations;
- the reason the employee claimed limited their ability to perform their role; and
- the situation was one where a reasonable person might have been compelled to terminate their employment.
What does ‘domestic or other pressing necessity’ mean?
‘Domestic or other pressing necessity’ is not defined in the NSW Long Service Leave Act 1955. Therefore, courts use a subjective test to determine its meaning, which involves examining:
- the state of mind of the claimant employee; and
- whether they genuinely considered that they had no other reasonable alternative but to resign.
In sum, a ‘domestic or other pressing necessity’ is an extenuating circumstance outside of work that forces an employee to resign with no other option. Some examples that the courts have found to be a ‘domestic or other pressing necessity’ include:
- taking care of a sick spouse or child;
- changing jobs to lessen travel expenses during difficult financial circumstances;
- working on night shifts which would strain their familial relationships, despite repeated requests to transfer to the day shift; and
- their employer relocating and adding considerable travel time.
While these are examples of what the court has found to be a domestic or other pressing necessity, an employee’s entitlement ultimately depends on their individual circumstances.
What will a court consider when determining leave entitlements?
They may be eligible if they:
- completed at least five years of service for your organisation;
- the employment was terminated by the employer for reasons other than serious and wilful misconduct;
Is continuous service broken when a worker takes leave?
A break in service does not affect the continuity of the employee’s service or calculation of service when:
- The absence of the worker is under the terms of the worker’s employment; or
- The absence of the worker is on account of illness or injury.
A break in service will not affect continuity but does not count when calculating the length of service when:
- It is made by the employer with the intention of avoiding any obligation imposed on the employer by the Act, or by any obligation in relation to sick leave imposed on the employer by a State instrument;
- It is arising from an industrial dispute;
- It is made by the employer by reason of slackness of trade;
- It is arising from the absence of the worker for any cause by leave of the employer; or
- Where the worker returns to the service of, or is re-employed by the employer within 2 months of the date on which the service was interrupted, other than resignation by the worker.
If long service leave is taken at 10 years of service, how long is it before additional long service leave is accumulated?
If the worker has been employed for more than 10 years, but less than 15, the worker may take paid leave of no more than two months (the 10-year entitlement). After 15 years of service, there is an additional entitlement to a further one month’s leave.
If the worker terminates or ceases work for any reason between 10 or 15 years of service, they are entitled to a pro-rata or proportionate amount on the basis of 3 months for 15 years of service.
Once 15 years of service have been completed, only each complete year of service will count towards long service leave. For example, if a worker has 15 years and 6 months of service completed, only 15 years will be counted as completed years of service.
Legal Advice
Long service leave entitlements in NSW can be somewhat complex. If you believe you are entitled to long service leave or to a pro-rata payment, Legal Kitz can assist you. To arrange a FREE consultation with one of our highly experienced solicitors, click here today, or contact us at [email protected] or 1300 988 954. If you are an employer, our sister company, Business Kitz, can assist with all of your other back-end business needs. Check out our Business Kitz’ subscription service today to access our full range of legal, commercial and employment documents to begin your business with a solid foundation that ensures compliance.