Comprehensive Guide to the Victorian Long Service Leave Act 2018
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Impact of leave/absences on continuous employment and long service leave accrual
For an employee to become entitled to long service leave (LSL), their employment with their employer must be continuous. This does not prevent the employee taking certain breaks from work, paid or unpaid. Also, certain leave and/or absences occur in employment that impact both the continuity of employment on the one hand, and what counts towards the accrual of LSL on the other. Certain absences do not break continuous employment under the Victoria's Long Service Leave Act 2018 (LSL Act 2018), while others do. Similarly, certain absences count towards the period of employment for LSL purposes, while others do not.
There are therefore two key questions that can usefully guide an assessment of a person’s entitlement to long service leave under the LSL Act 2018, as follows:
- Has an employee taken any leave or absences of a type that break continuous employment?
- Do the types of leave or absences an employee takes during employment count towards the period of employment for the purposes of the accrual of LSL?
The LSL Act 2018 applies from 1 November 2018. LSL accrued under the 1992 Act continues.
In some instances, the LSL Act 2018 has rules (called ‘transitional provisions’) that preserve the operation of some provisions of the 1992 Act in relation to continuous employment and what does and does not count towards the period of employment for LSL purposes. These transitional provisions mean that certain types of leave, or absences, from work taken prior to 1 November 2018, continue to affect the continuity of employment and accrual of LSL in the same way that they did when the 1992 Act applied. Reference to transitional provisions occurs throughout this guide where relevant.
Any form of paid or unpaid parental leave – maternity, paternity or adoption leave – will not break continuous employment
Any period of paid parental leave counts towards the period of employment
Unpaid parental leave up to 52 weeks (and longer in certain circumstances) will count towards the period of employment for LSL purposes
Example - Sarah takes parental leave before she resigns
Sarah resigns from her role at ABC Accounting. She commenced her employment 9 years ago. During that time, Sarah took a single period of 64 weeks’ parental leave (made up of paid and unpaid leave) after the birth of her daughter.
ABC Accounting offers their employees 12 weeks’ employer paid parental leave (EPPL) under their parental leave policy.
In this example, the first 52 weeks’ unpaid parental leave counts towards her period of employment, as does the 12 weeks’ of EPPL Sarah took.
For more information on unpaid leave and LSL accrual, see Unpaid leave, below.
Illness or injury
An absence of any duration from work on account of illness or injury – which includes a WorkCover absence – annual leave, or LSL itself will not break continuous employment.
Unpaid leave (including unpaid parental leave) up to 52 weeks will count towards the period of employment for LSL purposes.
Unpaid leave exceeding 52 weeks will not count unless:
- the period of absence is taken to be a period of employment in accordance with the relevant written or oral employment agreement
- the employee and employer agree in writing before the leave is taken that the leave is taken to be a period of employment
- the leave taken is because of illness or injury
- it is any other form of leave provided for in the relevant written or oral employment agreement.
Lack of work
If an employee is stood down by their employer because of a lack of work, their employment will remain unbroken.
Dismissed and re-employed
If an employee is dismissed by their employer but subsequently re-employed before 12 weeks have elapsed, then employment will remain continuous for purposes of long service leave – but that absence will not count towards the period of employment.
Resignation and re-employed
If an employee resigns from their employment but is subsequently re-employed before 12 weeks have elapsed, then employment will be unbroken for purposes of long service leave – but that absence will not count towards the period of employment.
Note: The effect of transitional provisions referred to above, mean that where an employee resigned at their own initiative, this may have broken their period of continuous employment if it occurred before 1 November 2018.
Leave and LSL accrual
Most forms of paid and unpaid leave – including unpaid parental leave up to 52 weeks (and longer in certain circumstances) – will count towards the period of employment, and so LSL will continue to accrue during this time.
Although unpaid parental leave exceeding 52 weeks may not count, any paid parental leave paid by the employer will count towards the period of employment.
Breaks to continuous employment
Continuous employment will be broken where:
- an employee resigns from employment – and is subsequently re-employed after 12 weeks have elapsed.
- an employee is dismissed by their employer and is subsequently re-employed after 12 weeks have elapsed.
Example: Koby resigns – and then asks for his job back
Koby has been an personal trainer at Get Fit Gym for six and a half years. He gets offered a job by a new gym which opens for business down the road.
He accepts the offer and resigns from Get Fit Gym. However, after just one month, Koby realises that he has made a mistake - he's required to work really long hours with minimum wages. He asks for his old job back at Get Fit Gym– and they welcome him back.
In this case, although Koby was gone for one month, the fact that he resigned and was re-employed within 12 weeks means that his employment is continuous for the purposes of LSL.
Example: Silvie is dismissed – and then re-employed
Silvie is employed as a dishwasher at the Happy Valley Coffee House. Her employment is terminated as the employer decides he no longer needs a dishwasher, because the kitchen-hand should be able to do those duties, as well as his own.
After one and a half months, the employer realises that it just isn't working; Silvie did a whole lot more than just dishwashing and the employer asks her to come back.
In this case, as Silvie is re-employed within 12 weeks, this will not break her continuity of employment.
Get help with long service leave
If you own, are looking to purchase, or start a small business with under 20 employees, you may be eligible for our Long Service Leave Small Business Information Service (LSLSBIS).
LSLSBIS offers one-on-one information and advice regarding your responsibilities under Victoria's LSL Act 2018.
Phone or email us for more information
Wage Inspectorate Victoria is responsible for regulating long service leave in Victoria.
We welcome any feedback, comments and suggestions you might like to share.
You also have the option to make an anonymous report if you suspect someone is breaking the rules relating to long service leave but you don’t want to provide personal information.