JobKeeper enabling stand down directions and long service leave entitlements

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To be entitled to long service leave under the Long Service Leave Act 1958, an employee’s employment with their employer must be continuous. The amount of long service leave is determined by the employee’s period of continuous employment

Under the Long Service Leave Act, an employee must be paid ‘ordinary pay’ for a period of long service leave or for untaken long service leave on termination of employment. Ordinary pay is remuneration for an employee’s ‘normal weekly number of hours of work’ calculated on their ordinary time rate of pay. If an employee’s normal weekly number of hours of work have varied during their period of employment, their normal weekly number of hours is the average weekly number of hours worked by the employee during their period of employment.

An employee’s period of continuous employment and their ‘ordinary pay’ for long service leave may be impacted if the employee has been issued with a JobKeeper enabling stand down direction.

The effect of a JobKeeper enabling stand down direction on an employee’s long service leave entitlements will depend on whether a WA Award applies, and if so, the nature of any long service leave provisions in that award.

Award free employees

For award free employees, if a JobKeeper enabling direction has been issued which results in an employee being completely stood down for a period (that is, they have not worked any hours), then that period will not count towards the employee’s period of employment for accruing long service leave, but will not break the employee’s continuous employment.

If a JobKeeper enabling direction has been issued which reduces the employee’s hours of work for a period, but they have not been stood down entirely, then that period will count towards the employee’s period of continuous employment for accruing long service leave. However, the employee’s reduced working hours will impact the amount of the employee’s ‘ordinary pay’ for long service leave to be taken or paid out in the future. That is, the employee’s reduced working hours for the period of any JobKeeper enabling stand down direction will need to be taken into account when calculating the normal weekly number of hours worked by the employee during their period of employment, for the purposes of calculating ‘ordinary pay’ for long service leave.

WA award employees

For private sector WA award employees, the effect of a JobKeeper enabling stand down direction on long service leave entitlements depends on the provisions of the relevant WA award.

WA awards providing for long service leave

If the applicable WA award contains a long service leave clause which specifies that an employee is entitled to long service leave, whether in accordance with the Long Service Leave Act, the Long Service Leave General Order, or some other arrangement, then the employee accrues long service leave entitlements based on their usual hours and days of work, as if the JobKeeper enabling stand down direction had not been given.

This means that if a JobKeeper enabling direction has been issued which reduces the employee’s working hours for a period (including where an employee has been completely stood down and has not worked any hours), then that period will count towards the employee’s period of continuous employment for accruing long service leave, and will not impact the amount of the employee’s ‘ordinary pay’ for long service leave to be taken or paid out in the future.

The employee’s reduced working hours for the period of any JobKeeper enabling stand down direction are not to be included in the calculation of the normal weekly number of hours worked by the employee during their period of employment, for the purposes of calculating ‘ordinary pay’ for long service leave. Instead, the calculation should be based on the employee’s usual hours and days of work, as if the JobKeeper enabling stand down direction had not been given.

WA awards which do not provide for long service leave

If the WA award does not contain a long service leave clause which specifies that an employee is entitled to long service leave, then the employee’s long service leave entitlements will be impacted by a JobKeeper enabling stand down direction.

If a JobKeeper enabling direction has been issued which results in the employee being completely stood down for a period (that is, they have not worked any hours), then that period will not count towards the employee’s period of employment for accruing long service leave, but will not break the employee’s continuous employment.

If a JobKeeper enabling direction has been issued which reduces the employee’s hours of work for a period, but they have not been stood down entirely, then that period will count towards the employee’s period of continuous employment for accruing long service leave. However, the employee’s reduced working hours will impact the amount of the employee’s ‘ordinary pay’ for long service leave to be taken or paid out in the future. That is, the employee’s reduced working hours for the period of any JobKeeper enabling stand down direction will need to be taken into account when calculating the normal weekly number of hours worked by the employee during their period of employment, for the purposes of calculating ‘ordinary pay’ for long service leave.

All WA awards are available on the Western Australian Industrial Relations Commission website at www.wairc.wa.gov.au or you can contact Wageline on 1300 655 266 for award specific information.

National system employees

For national system employees, if a JobKeeper enabling direction has been issued which results in an employee being completely stood down for a period (that is, they have not worked any hours), then that period will not count towards the employee’s period of employment for accruing long service leave, but will not break the employee’s continuous employment.

If a JobKeeper enabling direction has been issued which reduces a national system employee’s hours of work for a period, but they have not been stood down entirely, then that period will count towards the employee’s period of continuous employment for accruing long service leave. However, the employee’s reduced working hours will impact the amount of the employee’s ‘ordinary pay’ for long service leave to be taken or paid out in the future. That is, the employee’s reduced working hours for the period of any JobKeeper enabling stand down direction will need to be taken into account when calculating the normal weekly number of hours worked by the employee during their period of employment, for the purposes of calculating ‘ordinary pay’ for long service leave.

 

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