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Q&A: Do we have to pay super on long service leave?

By Andrew Hobbs on October 11th, 2017

Superannuation payments on long service leave

Q

Do we pay super on long service leave payments?

 

A
Yes, if the long service leave is taken and not paid out on termination of employment.

Superannuation contributions are required to be made in addition to the long service leave entitlement on ordinary pay. If long service leave is paid out upon termination of employment, superannuation contributions are not required to be made.

 

Calculating Long Service Leave entitlements – casual vs full-time

Q
We have a staff member in NSW who has worked for us on both a casual and permanent basis – permanent from 2003–2005, casual from 2007–2010 and permanent from 2010 to the present.

What date do we calculate long service leave from?

 

A
It appears there was a break in the employee’s service with you from 2005 to 2007.

If the employee was re-employed by you within a two-month period from the date of employment termination, you should count the long service leave from the date they were initially engaged in 2003. Otherwise, you would count it from the date they began casual employment in 2007.

 

Long service leave entitlements for employees in other States

Q
We are an Adelaide-based company but two of our 29 employees are based in home offices in Victoria and Queensland. Does long service leave for these employees accrue based on SA laws or on the laws relating to the State where they live and work?

Also, at what point can an SA employee can start taking long service leave? I’ve been told that pro-rata entitlements start at seven years, but I thought that only related to being paid out if the employee should leave.

 

A
Generally, an employment agreement will set out the jurisdiction that covers the employment and this will determine which long service leave act applies.

In the absence of this, you will need to assess which State the employee’s service as a whole could be considered to be substantially connected to. Other factors might include which State the head office or parent company is located in.

An employee is eligible to take paid long service leave in South Australia when they have worked continuously for 10 years with the one employer. They are able to access pro-rata long service leave after seven years if their employment ends other than by termination for serious misconduct, or resignation with insufficient notice.





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