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Long service leave is a paid entitlement for employees who have long term continuous employment with the same employer.
The long service leave scheme in WA is governed by the Long Service Leave Act (LSL Act). The LSL Act applies to off-site building industry employees only, such as office workers and employees based solely in workshops.
It does not apply to employees who engage in on-site construction work, who are covered under the portable paid long service leave scheme.
The long service leave entitlement for full time, part time and casual employees is:
This entitlement is based on the employee’s ‘normal weekly number of hours’ over their period of continuous employment. If an employee is casual, their normal weekly number of hours is taken as the average weekly number of hours worked over the period of employment.
If the employee’s employment ends after 7 years of continuous employment, the employee will be entitled to receive payment for pro rata long service leave.
Ordinary pay is the rate of pay to which an employee is entitled for ordinary hours of work. For the purposes of long service leave under the LSL Act, the ordinary rate of pay will not include overtime, penalty rates, allowances or similar payments.
Where the employee is casual, their ordinary pay will include casual loading.
There are some absences or interruptions to an employee’s employment that do not break an employee’s continuous employment. However, they will not count towards the employee’s period of employment for the purposes of accruing long service leave.
An employer and employee can agree for the employee to forgo all or part of the employee’s long service leave entitlement if:
For the benefit to be considered adequate, the employee must be paid at least the amount of ordinary pay they would have received had they taken all or part of the leave.
It is important to note that long service leave cannot be cashed out before the entitlement has accrued.
From 20 June 2022, when a business changes ownership, an employee’s period of continuous employment with the old employer transfers to the new employer and the employee’s accrued leave, if any, is also transferred.
This means an employer who buys a business will take on the long service leave obligations for existing employees. This applies regardless of anything written in a sale of business contract.