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Changes to the Long Service Leave Act

Victorian Employers need to be informed that as of the 1st November 2018 there will be significant changes to Long Service Leave (LSL) Entitlements.

Employees

Employees are now entitled to take Long Service Leave after 7 years of continuous service with one employer as opposed to 10 years.

An employee is able to request Long Service Leave as one or more periods of leave.

Continuity of Service

  • It is still considered as continuous service whereby an employee is re-employed by the employer within 12 weeks of initial termination of employment, even in the case where the employee resigned.
  • Unpaid parental leave will not be classified as a service however it will no break the continuity of employment
  • With regards to business transfer, the definition of assets has been amended to include both tangible and intangible assets. If employer’s business assets are transferred to a new employer, an employee that performs duties in connection with the assets is treated as being under the one employer. 

The following forms of absences will not disrupt continuous service:

  • Parental leave
  • Leave taken for sickness or injury
  • All carer’s leave
  • If an employee is re-employed within 12 of termination or resignation

Employers

Changes in the Long Service Leave Calculation

Current Calculation of Leave

If an employee:

  • Does not have fixed hours of work;

Or

  • Their hours change during the 12 months immediately before the long service leave is taken

The employee’s ordinary hours are to be taken to be the greater of the average weekly hours worked over:

  • The 12 months immediately preceding the long service leave;

Or

  • The 5 years immediately preceding the long service leave

New Calculation of Leave

If an employee:

  • Does not have fixed hours of work;

Or

  • Working hours have changed during the last 24 months (2 years) immediately before taking LSL

The employee’s ordinary hours are to be taken to be the greater of the average weekly hours worked over:

  • The 12 months immediately preceding the long service leave;

Or

  • The 5 years immediately preceding the long service leave
  • The last period of continuous employment immediately before the employee starts long service lease (including paid and unpaid leave)

Operation and Enforcement

  • Employer’s right to apply for any exemptions are abolished
  • Any exiting exemptions will remain in force

Penalties

Civil penalties have been abolished under the new act, however any offences will now attract a criminal penalty.