Long service leave - What is the entitlement when employment ends?

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  • Under the WA Long Service Leave Act, after 7 years of continuous employment an employee may have an entitlement to payment of long service leave when their employment ends due to resignation, dismissal, redundancy or if the employee dies.
  • This entitlement applies to full time, part time and casual employees.
  • This entitlement depends on the length of the employee’s continuous employment, which may include service with a previous employer where there has been a change of business ownership.
  • If the employee is dismissed, the entitlement also depends on whether they were dismissed for serious misconduct.

You can check the coverage of the Long Service Leave Act on the Long service leave – Who is covered by the Long Service Leave Act? page and find links to other information on our main Long service leave page.

Watch our video on this topic

The Long service leave when employment ends video discusses long service leave entitlements when employment ends.

 

If an employee’s employment ends before they have completed 7 years of continuous employment, they do not have an entitlement to long service leave.

After 7 years of continuous employment, an employee (full time, part time or casual) may have an entitlement to payment of long service leave when their employment ends due to resignation, dismissal, redundancy or if the employee dies. This is based on:

  • the length of their continuous employment; and
  • if the employee is dismissed, whether they were dismissed for serious misconduct.

The term continuous employment has a specific meaning and some absences do not count towards an employee’s period of continuous employment. Continuous employment may include service with a previous employer where there has been a change of business ownership. 

You can get details about continuous employment on the Long service leave – What is continuous employment? page, and learn about changes of business ownership on the Long service leave – What happens when business ownership changes page.

Employees with at least 7 years but less than 10 years' continuous employment 

If a full time, part time or casual employee has at least 7 years but less than 10 years of continuous employment, they are entitled to receive payment of pro-rata long service leave when their employment ends. 

The only exception is where the employee has been dismissed for serious misconduct, in which case the employee is not entitled to any pro-rata long service leave. Serious misconduct is unacceptable or improper behaviour of a substantial nature. The onus is on the employer to prove that dismissal for serious misconduct was warranted. Determining whether an employer has justifiably dismissed an employee for serious misconduct is always assessed according to the facts particular to that situation.

The pro-rata long service leave entitlement is calculated as a proportion of a full long service leave entitlement. A full entitlement is 8.667 weeks of leave for 10 years of continuous employment.

When the employee has had at least 7 years but less than 10 years continuous employment, pro-rata long service leave when employment ends is based on the number of years, months, weeks and days of continuous employment the employee has completed.

An example:

Riley resigned from her job at a local supermarket after 8 years, 4 months and 5 days of continuous employment. As Riley has more than 7 years continuous employment, she is entitled to receive payment of pro-rata long service leave on resignation. Riley’s pro-rata long service leave entitlement works out to be 7.24 weeks of leave. This entitlement is paid out at Riley’s ordinary pay.

You can use the Between 7 and 10 years of continuous employment section of the WA long service leave calculator to estimate the number of weeks of pro-rata long service leave an employee must receive payment for when their employment ends.

An employee must receive their ordinary pay when pro-rata long service leave is being paid out. Ordinary pay is based on the employee’s normal weekly number of hours of work and is calculated using their ordinary rate of pay at the time the long service leave is paid. For casual employees, an employee’s ordinary pay includes any casual loading. Visit Long service leave – What do employees get paid? for more details on calculating long service leave payments.

Employees who have not received their entitlement to pro-rata long service leave when employment ends can make an underpayment complaint to Private Sector Labour Relations at the Department of Energy, Mines, Industry Regulation and Safety. Learn about the steps in making an underpayment complaint on the Making a complaint about underpayment of wages or entitlements page.

Visit the Australian Taxation Office website if you are seeking information on tax and superannuation arrangements relating to pro-rata long service leave payments when employment ends.

Employees with 10 or more years' continuous employment

When a full time, part time or casual employee completes 10 years of continuous employment, they fully accrue a long service leave entitlement of 8.667 weeks of long service leave. An employee will accrue a further 4.333 weeks of long service leave for every 5 years of continuous employment they complete after the initial 10 years.

When employment ends, any long service leave that has not been taken must be paid out to the employee.

An employee with more than 10 years of continuous employment may also be entitled to receive payment of pro-rata long service when employment ends. After 10 years, pro-rata long service leave accrues at a rate of 0.8666 weeks of leave for each completed year of continuous employment. The pro-rata entitlement is calculated on completed years of employment only.

The pro-rata entitlement will also apply to each year of continuous employment after the employee accrues each further 4.333 weeks of long service leave for every 5 years of continuous employment – i.e. after 15, 20, 25 years etc. of employment.

An example:

Lee has been made redundant after 12 years of continuous employment. Lee’s employer works out the long service leave entitlement due on termination is 10.40 weeks. This is on the basis of a full entitlement of 8.667 weeks for the first 10 years of continuous employment plus a pro-rata amount for the other 2 years calculated at 0.8666 for each year. If Lee had taken any long service leave this would be deducted from the total amount he is due to be paid out.

An employee who is dismissed for serious misconduct is only entitled to be paid for any part of their last full entitlement which has not been taken and is not entitled to receive payment of pro-rata long service leave.

Serious misconduct is unacceptable or improper behaviour of a substantial nature. The onus is on the employer to prove that dismissal for serious misconduct was warranted. Determining whether an employer has justifiably dismissed an employee for serious misconduct is always assessed according to the facts particular to that situation.

You can use the 10 or more years of continuous employment section of the WA long service leave calculator to estimate the number of weeks of long service leave an employee must receive payment for when their employment ends.

An employee must receive their ordinary pay when long service leave is being paid out. Ordinary pay is based on the employee’s ‘normal weekly number of hours of work’ and is calculated using their ordinary rate of pay at the time the long service leave is paid. For casual employees, an employee’s ordinary pay includes any casual loading. Visit Long service leave – What do employees get paid? for more details on calculating long service leave payments.

Employees who have not received their entitlement to long service leave when employment ends can make an underpayment complaint to Private Sector Labour Relations at the Department of Energy, Mines, Industry Regulation and Safety. Learn about the steps in making an underpayment complaint on the Making a complaint about underpayment of wages or entitlements page.

Visit the Australian Taxation Office website if you are seeking information on tax and superannuation arrangements relating to payment of long service leave when employment ends.

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