Important Changes to Victoria’s Long-Service Leave Laws

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Changes to Victoria’s long-service leave laws are now in effect as of November 1st, 2018. The updated legislation will impact the Long Service Leave entitlements of all Victorian employees who were previously covered by the Long Service Leave Act 1992. Furthermore, the changes will also apply to companies who may be based outside Victoria, but still have staff employed in the state.

This will mean new rights and responsibilities for both employers and employees. How will the changes affect you?

The Important Changes
  • Employees will be able to apply for leave after seven years of work, rather than ten years.
  • The new laws will provide greater flexibility to women, families and those transitioning to retirement.
  • Employees can now take long service leave in smaller increments, i.e. a minimum of one day per occasion.
  • Absences from work including unpaid parental leave will generally not break continuous employment.
  • Certain breaks will now count towards accrual of long service leave, e.g. unpaid parental leave of up to 52 weeks, or longer in certain circumstances.
  • Increased penalties for employers who don’t keep records
Who The Changes Apply To

The Long Service Act applies a base standard for leave in Victoria for casual, seasonal and fixed-term employees with continuous employment.

Most Victorian employees are covered by the LSL Act; however, some may have a different agreement under a federal instrument or other state legislation. Call the Fair Work ombudsman on 131 394 to check.

What Is Continuous Employment?

According to the government, ‘continuous’ employment means that:

  • there must not be an absence of more than 12 weeks between any two instances of employment, unless the employee and the employer so agree before the start of the absence, or
  • the absence is in accordance with the terms of the engagement, or
  • the absence is caused by seasonal factors,
  • the employee has been employed on a regular and systematic basis and has a reasonable expectation of being re-engaged.

Under the new Act, casual or seasonal employees are entitled to take up to 104 weeks’ parental leave before continuous employment is deemed interrupted.

Will The Leave Entitlement Increase?

The basic entitlement has not changed, but employees are now entitled to leave after seven years of continuous employment. The leave entitlement is calculated by dividing the period of employment by 60.

For example, if the employee has worked for 7 years, dividing this by 60 equates to approximately 6.1 weeks.

Can You Take More Leave For Less Cash?

Yes. Employees can apply to take double the long service leave for half the pay. Employers must prove reasonable business grounds for refusing the request.

It doesn’t work both ways though. You can’t take half leave for double pay.

Can You Be Forced To Take It?

Yes. With at least 12 weeks written notice.

Information has been provided from the State Government Website. Contact our office today on  03 9727 6700 if you would like to discuss your situation or to find out more about the changes please visit the Business Victoria website.

This document contains general advice only and is prepared without taking into account your particular objectives, financial circumstances and needs. The information provided is not a substitute for legal, tax and financial product advice. Before making any decision based on this information, you should speak to a licensed financial advisor who should assess its relevance to your individual circumstances.  While The Field Group believes the information is accurate, no warranty is given as to its accuracy and persons who rely on this information do so at their own risk. The information provided in this bulletin is not considered financial product advice for the purposes of the corporations Act 2001.

About the author

Jon has been with The Field Group since 2005 and became a director in 2012. Jon specialises in servicing businesses in the small and medium enterprise (SME) space. This includes advising in the areas of income tax, GST, Fringe Benefits Tax, structuring, cash-flow and business acquisitions.

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