Long Service Leave (Tasmania)
Whether you are an employer or employee in Tasmania, it is important to understand when an entitlement to Long Service Leave arises.
Long Service Leave (LSL) is an entitlement to an extended period of paid leave, provided a specified minimum period of service has been performed by an employee.
LSL within the private sector is typically regulated by State and Territory legislation.
In Tasmania, the main piece of legislation regulating LSL is the Long Service Leave Act 1976 (Tas) (“the Act”).
Full LSL Entitlement
Under section 8 (2) (a) (i) of the Act, the LSL entitlement for an employee is equal to 8⅔ weeks of paid leave after the employee has completed 10 years of continuous employment.
Also, by section 8 (2) (a) (ii) of the Act, after each additional 5 years of continuous employment, an employee’s entitlement is equal to 4⅓ weeks of leave.
10 years x .8667 weeks = 8.667 weeks
** The calculation is based on an example of an employee with 10 years of continuous service**
Pro-Rata LSL Entitlement
Under section 8 (2) (b) of the Act an employee may have an entitlement to payment for pro rata LSL where the employee’s employment is terminated after completing 7 years, but less than 10 years, of continuous employment.
An employee will be entitled to pro-rata LSL if:
the employee reaches retirement age (60 years for women, 65 years for men) – section 8 (3) (a) of the Act;
employment ceases due to illness of such a nature as to justify the termination of employment – section 8 (3) (b) of the Act;
the employee resigns due to incapacity or ‘domestic or other pressing necessity’ that was of such a nature to justify the termination of employment – section 8 (3) (c) of the Act;
employment is terminated by the employer for any reason other than serious and wilful misconduct - section 8 (3) (d) of the Act.
To determine the pro rata LSL amount, the following calculation can be used:
8 years x .8667 weeks = 6.9336 weeks
** The calculation is based on an example of an employee with 8 years of continuous service**
A key component to being entitled to LSL is the concept of continuous employment.
Generally, continuous employment involves an employee having unbroken employment with the one employer.
However, for the purpose of determining continuous employment section 5 (1) of the Act provides the following events are not deemed to break continuous employment:
annual leave or long service leave
any absence due to illness or injury that has been certified as necessary by a medical practitioner
any interruption or termination of employment by the employer, if done to avoid annual leave or long service leave obligations
any interruption arising directly or indirectly from an industrial dispute
any absence from work, by leave of the employer, for the purpose of the employee attending a meeting of a committee established under the Training and Workforce Development Act 2013
termination for any reason, except for slackness of trade, but only if the employee is re-employed by the employer within 3 months of the date of termination
stand down or termination due to slackness of trade, provided that the employee returns to work or is re-engaged within 6 months and within 14 days of an offer by the employer to return to work or be re-engaged
prescribed attendance at court;
any other absence approved by the employer.
Once an employee becomes entitled to LSL, that leave should be granted by the employer as soon as practicable after the employee becomes entitled to it, having regard to the needs of the employer's Business.
The Act permits an employee:
to ”cash-in” their LSL by receiving a monetary payment instead of taking the leave; or
cashing in a portion of their LSL by way of payment and taking the balance LSL as leave.
Any ”cash-in” must by agreement between the employer and employee.
Under the Act, when determining an employee’s LSL amount, it is the employee’s “ordinary pay” that is used in calculating the amount to be paid entitlement.
Casual And Part-Time Employees
Under the Act, an employee is considered to be continuously employed even if they are part-time or casual employees, provided they have been regularly working for 32 hours or more in each consecutive period of 4 weeks.
Accordingly, a casual or part-time employee may have an entitlement to:
LSL if they have completed 10 years of continuous employment; or
pro rata LSL if employment is terminated after completing 7 years, but less than 10 years, of continuous employment
Need employment law advice? Contact Greyson Legal | Commercial Lawyers | Tasmania.