New Victorian workplace legislation introduced on 1 November 2018 has given more flexibility to long service leave (LSL) entitlements.

Australian Workplace Strategies experienced advocate, advisor and nationally accredited mediator Roland Müller says with the commencement of the Long Service Leave Act 2018 on 1 November, some restrictions on how Victorian workers can use their long service leave have been removed.

The Act applies to most but not all Victorian employees. Most significantly, the new legislation changes how LSL may be taken, as well as allowing workers to access LSL entitlements earlier.
Previously, most employees were entitled to take LSL after 10 years of continuous service, but were entitled to be paid out accrued LSL entitlements upon termination if their employment ended after at least seven years. Under the new legislation, workers may take LSL after seven years of employment.

Mr Müller says this shortens the period of continuous service required to access LSL from 10 to seven years.

“Employers may also agree to LSL being advanced, or taken before it is accrued, but there is no obligation to do so.

“Another major change affects how LSL may be taken once accrued. Previously, long service leave was required to be taken in one block, unless the employer and employee agreed that the first 13 weeks could be taken in two or three separate blocks and any additional LSL in up to two further blocks.

“Under the new legislation, LSL can be used upon the request of the employee, for as little as one day at a time. An employer may refuse a request for LSL on reasonable business grounds,” Mr Müller says.

Restrictions on cashing out LSL or working while on LSL remain in place. The restrictions on cashing out and alternative work maintain the recreational character of the entitlement as one of leave from paid work.

Mr Müller says the changes may seem to favour workers, but he maintains, they can also benefit employers.

“Removing some restrictions on how LSL may be taken helps employers and employees to make arrangements to suit their circumstances,” he says.

“While taking one day of LSL may sound strange, being able to take a regular day per week or fortnight may suit workers with family commitments or those transitioning to retirement.

“Particularly in professional and academic roles, an experienced employee being absent for three or four months at a time can significantly impact an organisation. Being lawfully able to agree to shorter absences where the employee requests it can lessen the impact on the workplace.”

Mr Müller suggests how employers work with the new LSL laws can positively or negatively affect the recruitment and retention of talent and the stability of their workforce.

“Despite media commentary on the emergence of the ‘gig economy’ and increased use of short-term contracts in some sectors, many workers value longer term employment.

“Employers who can make use of the more flexible approach to LSL to accommodate the needs of loyal and experienced employees have another way to help retain established staff.”
The new legislation also provides for penalties for those who fail to pay employees on LSL, fail to honour pay increases while employees are taking LSL, take adverse action against employees because they have LSL entitlements or employ people who are on LSL from other employment.

“Knowing and complying with employment obligations are baseline requirements for any employer.

“In working with LSL legislation, as with any obligation, the way to add value is to combine compliance with finding ways to use it to benefit the business,” Mr Müller says.

Australian Workplace Strategies can assist employers to ensure compliance with industrial relations obligations and help to resolve disputes regarding employee entitlements.