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LONG SERVICE LEAVE IN QUEENSLAND
What laws apply in Queensland for long service leave?
Generally the Industrial Relations Act 1999 ('the Act') is the relevant legislation that applies to Queensland employees. It should however be noted that there may be different laws applicable to the construction industry and those employees covered by a statute, agreement, pre-reform award or transitional award, that regulates long service leave. Check with the AFEI Workplace Hotline.
Who is entitled to long service leave in accordance with the Act?
Employees who work the prescribed period of continuous service with an employer, whether permanent, casual, part-time or any other basis, under one or more contracts of employment are eligible for long service leave. This is provided that, no other statute, agreement, pre-reform award or transitional award, that regulates long service leave, covers the worker.
When does an employee become entitled to long service leave in accordance with the Act?
During employment, an employee initially becomes entitled to an amount of long service leave once they have completed at least 10 years of continuous service with an employer. Once 10 years of continuous service has been completed, an employee must be engaged for an additional five years of continuous service with an employer to again be eligible for further leave.
How much long service leave are employees entitled to?
As from 3 June 2001, an employee who had 10 years of continuous service is entitled to 8.667 weeks of long service leave.
Continuous service accrued prior to 3 June 2001
Only two-thirds of the employee’s continuous service completed before 3 June 2001 will be taken into account in determining when long service leave can be taken.
The Act has provided the following examples in order to assist in calculating amounts of long service leave:
An employee has completed 15 years continuous service immediately before the commencement. The 15 years counts as 10 years continuous service for working out when the employee may take long service leave. The employee may take the leave immediately. The employee's entitlement then is 13 weeks (15 x 0.86667 weeks).
An employee has completed 10 years continuous service immediately before the commencement. The 10 years counts as 6.6667 years continuous service for working out when the employee may take long service leave. The employee may take the leave after completing another 3.3333 years continuous service. The employee's entitlement then will be 11.5556 weeks ([10 + 3.3333] x 0.86667 weeks).
An employee has completed 1 year continuous service immediately before the commencement. The 1 year counts as 0.6667 years continuous service for working out when the employee may take long service leave. The employee may take the leave after completing another 9.3333 years continuous service. The employee's entitlement then will be 8.9556 weeks ([1 + 9.3333] x 0.86667 weeks).
An employee starts employment after the commencement. The employee may take long service leave after completing 10 years continuous service. The employee's entitlement then will be 8.6667 weeks (10 x 0.86667 weeks).
How much notice is required to enable an employer to direct an employee to take long service leave?
If an employer and employee cannot agree on a time when long service leave is to be taken, then the employer may decide when the employee is to take the leave. However, the employer is to give the employee three months' written notice of the date when leave is to commence and further that at least four weeks of long service leave must be taken.
Can an employee ‘cash out’ their accrued long service leave?
An employee may cash out their long service leave in certain situations:
- If the relevant industrial instrument (award or agreement) contains a provision that allows cashing out of long service leave. However the employer and employee must agree and implement the arrangement by a signed agreement.
- In the case of the industrial instrument not containing a provision allowing the cashing out of long service leave, then payment can only occur if the Commission makes an order on application by the employee.
Is an employee who has completed at least seven years but less than 10 years of continuous service, and whose employment is terminated by the employer, eligible for long service leave in accordance with the Act?
The employee will only be eligible for a proportionate payment of long service leave if the employee is:
- dismissed for a reason other than the employee’s conduct, capacity or performance, or
- unfairly dismissed
When an employee who has completed at least five years of continuous service resigns, is the employee eligible for long service leave in accordance with the Act?
The employee with only be entitled to an amount of long service leave if the reason for the resignation was because of illness, incapacity or domestic or other pressing necessity, or because of the death of the employee.
What happens when a public holiday falls within a period of long service leave?
Public holidays are to be exclusive of long service leave. This means that if a public holiday occurs during a period of long service leave the day will count as a public holiday not as long service leave.
What does 'continuous service' mean in accordance with the Act?
In order for an employee to be eligible for long service leave service needs to be continuous for a required amount of time. 'Continuous service' means that an employee works for the same employer. Certain absences can result in continuous service being broken with the result being a loss of entitlement that may have accrued prior to the absence. Service is deemed unbroken even in the following situations:
- transfer of business
- an apprenticeship or traineeship counts as qualifying service if the employee continues or resumes work with the company or another related subsidiary within three months of completing an apprenticeship or traineeship
- service with a partnership
- the employee’s service is temporarily lent or let on hire by the employer to another employer
- the employee is on paid or unpaid leave approved by the employer
- the employee is absent due to illness or injury
- if an employee’s services with a company are terminated by the employer or employee and within three months the employer re-employs the employee
- the employee’s services with a company are terminated by the employer on account of illness or injury and the employer re-employs the employee and the employee has not been employed in that time
- absence arising directly or indirectly from an industrial dispute
- the employee is terminated to avoid long service leave obligations under the Industrial Relations Act 1999 (QLD), an industrial instrument or employment contract
- breaks made because of downturn in business
- service with a corporation and any subsidiaries. Deemed to be service with the same employer.
There are some instances where, even though continuous service has not been broken, the interruption will not count toward accrual of long service leave. Members should contact the AFEI Hotline with such queries.
Continuous service for casual employees
A casual employee who is engaged with the same employer more than once may be eligible for long service leave. Service may be continuous even though:
- employment is broken
- any of the employment is not on a full-time basis
- the employee is employed on one or more contracts of employment
- the employee is regarded as casual
- the employee has another job during the relevant period
However, if the break between the termination of one employment contract and the start of the next employment contract exceeds three months continuous service will end.
A number of legislative amendments were made to long service leave. If a member has a casual employee that was employed:
- prior to 23 June 1990, or
- between June 1990 and 30 March 1994,
service during that time may not be taken into account in calculating the length of continuous service. However, variations will occur in certain situations and members are advised to contact the AFEI Hotline.
An employee is entitled to payment at the employee’s 'ordinary rate' while on a period of long service leave. What is the 'ordinary rate' for the purposes of long service leave?
The ordinary rate of pay is the total amount you would be paying the employee for working their ordinary hours of work had they not gone on the leave. It does not include overtime and penalty rates. When calculating the ordinary rate for long service leave purposes, variations will occur in certain situations.
How is payment calculated for casual and regular part-time employees?
The Act provides the following formula to determine the minimum amount payable to casual or regular part-time employees:
An employee who worked 15,600 ordinary working hours over a 10-year period and is being paid an hourly rate of $12 is entitled to be paid:
'Actual service' means the total ordinary hours actually worked by an employee during the employee’s period of continuous service.
'Hourly rate' means the hourly rate for the ordinary time payable to the employee:
- if the employee takes long service leave on the day that the employee starts the leave, or
- if the employee’s employment is terminated on the day that termination takes effect.