Consider this

An employee with more than 10 years’ service applies for two months’ long service leave. About six months ago, they changed from full-time to part-time employment. How should long service leave be calculated?

It all depends on what state or territory your business is located. The following is a summary of each state and territory long service leave legislation: 

Long Service Leave Act 1976 [ACT] (s7(3)) – if, within two years of becoming entitled to leave, a full-time employee becomes part-time or casual, the ordinary pay for the leave is calculated by dividing by five the total amount of salary or wages paid to the employee in the five years preceding the leave. This means the employee’s rate of pay is the weekly average of 4 ½ years’ full-time pay and six months’ part-time pay. 

Long Service Leave Act 1955 [NSW] – payment is based on an employee’s ordinary pay for the last pay period prior to the leave being taken, or the average weekly ordinary rate of pay earned during the previous five years, whichever is the greater.

Long Service Leave Act [NT] – an employee is paid at their current weekly rate of pay and the average number of weekly hours worked by the employee. 

Industrial Relations Act 1999 [Qld] – for part-time employees, payment is calculated by dividing the total ordinary hours worked during the period of service by 52, and multiplying this amount by 8.6667/10. For example, a part-time employee who worked 15,600 ordinary hours during a 10-year period of service and was paid an hourly rate of $20 at the time of taking the leave would be entitled to (15,600/52 x 8.6667/10) = 260.001 hours x $20 = $5,200.02.

Long Service Leave Act 1987 [SA] – if an employee’s employment status changed from full-time to part-time, or vice versa, the employee’s hours are averaged over the previous three years, on the following basis:

  • whole weeks of unpaid leave are disregarded from the averaging provisions
  • the averaging period is taken over the previous 12 months or three years of actual service (as the case may be), after any unpaid leave is disregarded
  • any weeks when the worker was on paid leave are included as service. 

Long Service Leave Act 1976 [Tas] – the employee is paid at their current rate of pay at the time long service leave is taken.

Long Service Leave Act [Vic] 2018 – If employees’ ordinary hours per week have changed in the past 104 weeks use the highest of these three: 

  • Average weekly hours worked over past one year
  • Average weekly hours worked over past five years
  • Average weekly hours worked over total period of continuous service

If the hours haven’t changed in the past 104 weeks, use the employee’s current ordinary hours per week. 

Long Service Leave Act 1958 [WA] – where an employee’s number of weekly hours has varied over the course of their employment, e.g. full-time to part-time, ordinary pay is calculated on the average number of hours worked over the period of employment.