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Written by The performHR Team
on August 31, 2018

performHR blog- Changes to Long Service Leave

Changes to the Long Service Leave Act 2018 are set to become law in Victoria, later this year.

There are several significant potential changes to the Act that employers will need to be aware of and make changes accordingly to comply.

The performHR team are monitoring these legislative changes and will provide an update of the exact date of change and any other significant matters when they are announced. 

A summary of the impending changes that will affect Victorian Businesses can be found below:

Matter Current Law New Law (From Nov 1)

Accrual of Long Service Leave

Employees are entitled to take Long Service Leave after 10 years of continuous service.

Employees that cease employment after 7 years must be paid the equivalent of the amount of Long Service Leave they have accrued in this time

Employees are entitled to take Long Service Leave after 7 years of continuous service.

Payment of Long Service Leave

Long Service Leave is based on an Employee’s ordinary hours. If these fluctuate in the 12 months before taking Long Service Leave, the average hours worked in the past 12 months or in the past 5 years will be paid – whichever is the higher amount. 

If the Employees ordinary hours have fluctuated in the last 48 months before taking Long Service Leave, the average hours worked in the past 12 months, the past 5 years or the entire employment will be paid – whichever is the higher amount

Flexibility to Long Service Leave Long Service Leave must be taken in one period unless there is an agreement between the employee and employer to take separate periods. Employees are able to request Long Service Leave for a minimum of one day.
Continuity of Employment

Periods of unpaid parental leave will not count towards calculating continuous employment

The definition of assets includes tangible assets only.

Employment is continuous if the employer has dismissed an employee, but the employee is reemployed within 12 weeks after the dismissal.

Periods of unpaid parental leave up to 52 weeks will count as service. Periods beyond this time will not count toward service but will not break the continuity of employment. 

Assets now include both tangible and intangible assets. This is important when there is an asset changeover when a business is sold as employees that perform their role within these assets will be treated as being employed by ‘one employer’.

Employment is continuous if the employee has been dismissed or has resigned and reemployed within 12 weeks after the event. This also includes fixed term contracts and apprenticeships.

 

These changes have an impact on all Victorian employees, and it will be important that you are aware of the new employee entitlements when the law changes. 

If you have any questions or queries regarding these changes. Please get in touch with our team on 1300 406 005.

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