Fair Work and long service leave

What the National Employment Standards say

Division 9 of Part 2-2 of the Fair Work Act 2009 lists long service leave as one of the National Employment Standards. The Fair Work Ombudsman calls it a transitional entitlement, until there is a uniform national long service standard.

Section 113 does not give a number of weeks. Instead, if there are 'applicable award-derived long service leave terms', you are entitled to long service leave under those terms (s 113(1)).

These terms are long service leave terms in an award, or in a State reference transitional award. The terms must be ones that would have applied to you just before the National Employment Standards started. The test assumes that you had your current job then (s 113(3), (3A)). The Fair Work Ombudsman calls these awards pre-modern awards. They are awards that existed before 1 January 2010.

Modern awards cannot fill the gap. A modern award must not include terms about long service leave (s 155).

Pre-modern award and agreement terms that still apply

The pre-modern award terms do not apply while some older instruments cover you (s 113(2)). One type is a workplace agreement or AWA that started before the National Employment Standards. The other type is an older instrument that expressly deals with long service leave. Examples are a pre-reform certified agreement, a preserved State agreement, or an enterprise agreement that the parties made before then.

When that instrument stops, the pre-modern award terms apply again (s 113(2), note).

There is a second, narrower route. The Fair Work Commission can order that long service leave terms in a pre-2010 collective agreement continue to apply. The Commission can do this only if two conditions are true (s 113(4)-(6)). The terms must form a scheme that applies in more than one state or territory. Overall, the scheme must be no less beneficial than the state and territory laws. The Fair Work Ombudsman says that these preserved terms prevail over the state or territory Act.

The Fair Work Ombudsman gives the example of Lesley. She is a part-time worker with 12 years at a Melbourne butcher chain. Her federal pre-modern meat award had a long service leave clause. Thus her entitlement comes from that award, not from the Victorian Act.

When the state or territory Act applies instead

The Fair Work Act does not override state and territory long service leave laws. The exception is employees who are entitled to long service leave under the National Employment Standards (s 27(2)(g); s 113(1), note). Thus, if no pre-modern award or preserved agreement term applies to you, your entitlement comes from the state or territory Act. The Fair Work Ombudsman says that most employees get long service leave in this way.

Enterprise agreements made from 1 January 2010 can include long service leave terms. These can include terms on portable long service leave and on cashing out. But the Fair Work Ombudsman says that state and territory laws generally prevail over inconsistent enterprise agreement terms. The exception is agreements made between 1 July and 31 December 2009. These agreements prevail over state and territory laws.

Each state Act also has its own rule for awards and agreements:

Service that an agreement can discount

Section 113A deals with one situation. Before the National Employment Standards started, some agreements said that you were not entitled to long service leave. That agreement can stop and an enterprise agreement can replace it immediately. Then the new agreement can say that some or all service in the period of the old agreement does not count (s 113A(1)-(2)).

If the new agreement says this, that period never counts towards long service leave under the National Employment Standards or a state or territory law. The exception is if a later agreement says otherwise (s 113A(3)). The Fair Work Ombudsman says that a later enterprise agreement or employment contract can reinstate the period.

What the Fair Work Ombudsman does and does not do

The Fair Work Ombudsman promotes and monitors compliance with the Fair Work Act and fair work instruments. It also investigates breaches and takes court action to enforce them (s 682(1)). An employer must not breach the National Employment Standards (s 44).

Thus the Ombudsman can help if your long service leave comes from a pre-modern award or other federal instrument. Its website asks you to call about federal pre-modern award entitlements.

For entitlements under a state or territory Act, the Fair Work Ombudsman sends you to the state agency. The state agencies are NSW Industrial Relations, Workforce Inspectorate Victoria, Queensland's Office of Industrial Relations and WA's Department of Local Government, Industry Regulation and Safety. They also include SafeWork SA, WorkSafe Tasmania, WorkSafe ACT and the NT Government. For questions about a portable scheme, contact the scheme body.

Transfer of business under the Fair Work Act

A business can change owners. The Fair Work Ombudsman says that the new employer must then usually recognise your service with the old employer for most entitlements.

For long service leave, the Fair Work Ombudsman says that the new employer may not have to recognise your service in one case. All three of these conditions must be true. At 31 December 2009, you had no long service leave under a registered agreement. An agreement made on or after 1 January 2010 replaced that agreement. The new agreement says that the earlier service does not count.

For most transfer questions, the transfer-of-business rules in the state Act give the answer. See our page on transferring long service leave. If you are not sure which law covers you, contact the Fair Work Infoline on 13 13 94 or your state agency.