Long Service Leave

Long Service Leave

Long service leave (LSL) is paid leave for employees who have worked for the same employer for a long period of continuous service. Unlike most leave, it isn’t set by the Fair Work Act. The rules come from state and territory legislation, so an employee’s entitlement depends on where they work.

Legislation: State and territory Long Service Leave Acts; Fair Work Act 2009 (Cth) s 113 | Category: Leave

What Is Long Service Leave?

Long service leave rewards employees for staying with one employer over many years. In most states the full entitlement becomes available after 10 years of continuous service. In Victoria and the ACT it’s available after 7 years.

Leave accrues from the first day of employment. The qualifying period only determines when the employee can take it or be paid it out.

The NES doesn’t create a national LSL standard. Section 113 of the Fair Work Act preserves LSL terms found in some older federal awards and agreements. Where those don’t apply, state or territory law governs.

Entitlements by State and Territory

State or territoryLegislationFull entitlementPro-rata on termination
NSWLong Service Leave Act 19558.67 weeks (2 months) after 10 yearsFrom 5 years, for specified reasons
VictoriaLong Service Leave Act 20186.07 weeks after 7 years (1/60th of service)From 7 years, any reason
QueenslandIndustrial Relations Act 20168.67 weeks after 10 yearsFrom 7 years, for specified reasons
Western AustraliaLong Service Leave Act 19588.67 weeks after 10 yearsFrom 7 years, any reason other than serious misconduct
South AustraliaLong Service Leave Act 198713 weeks after 10 yearsFrom 7 years, any reason other than serious and wilful misconduct
TasmaniaLong Service Leave Act 19768.67 weeks after 10 yearsFrom 7 years, for specified reasons
ACTLong Service Leave Act 19766.07 weeks after 7 yearsFrom 5 years, for specified reasons
Northern TerritoryLong Service Leave Act 198113 weeks after 10 yearsFrom 7 years, for specified reasons

“Specified reasons” usually means one of the following:

  • the employer ended the employment other than for serious misconduct
  • the employee died
  • the employee resigned because of illness, incapacity or domestic or other pressing necessity

In most states, every employee gets a full payout after 10 years whatever the reason for leaving.

Key Compliance Points for Employers

  • Apply the right state’s law. For employees who work across state lines, the relevant Act depends on where they are based and where the work is connected to.
  • Accrue it from day one. Leave accrues from the start of employment, so your provisions and balance sheet should reflect it.
  • Casuals can qualify. Long-term casuals with regular, continuous service are generally covered. Each state has its own rules on what gaps between engagements break continuity.
  • Continuity isn’t the same as service. Some absences, such as unpaid parental leave, don’t break continuity but may not count towards the qualifying period. This varies by state.
  • Check for portable schemes. Building and construction workers are covered by a portable scheme in every state and territory. Some states have schemes for community services, contract cleaning and security. Employers in these industries pay a levy instead of accruing leave directly.
  • Cashing out is restricted. Most states limit or ban cashing out LSL during employment. Where it’s allowed, it usually needs written agreement, and in some states tribunal approval.
  • Keep records. Most Acts require LSL records to be kept for the duration of employment and for a set period after it ends.
  • Business sales. Service with the old employer usually carries over on a transfer of business, so you inherit the liability.

Frequently Asked Questions

How much long service leave do employees get?

It depends on the state. Most states give 8.67 weeks after 10 years. South Australia and the Northern Territory give 13 weeks after 10 years. Victoria and the ACT give about 6 weeks after 7 years.

Do casuals get long service leave?

Yes, in most states, if their employment has been regular and continuous. How long the gaps between engagements can be before continuity breaks varies by state.

Is long service leave paid out on resignation?

After 10 years, generally yes in every state. Before that, it depends on the state. In Victoria, a resigning employee is paid out after 7 years. In South Australia and Western Australia, it’s paid out after 7 years unless the employee was dismissed for serious misconduct. Other states only pay pro-rata before 10 years for specific reasons such as illness, pressing necessity or dismissal by the employer.

Does long service leave accrue during parental leave?

Usually not. In most states, unpaid parental leave doesn’t break continuous service but doesn’t count towards it either. Victoria is the main exception, where up to 52 weeks of unpaid parental leave counts as service.

Can an employee cash out long service leave?

Only in limited circumstances, and the rules vary by state. Some states allow it by written agreement once the entitlement has accrued. Others ban it or need tribunal approval. Check the relevant Act before agreeing to it.

Related Terms

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