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Request to Cash Out Leave

Version 1.0 Updated 18 Mar 2020
Forms & Checklists Manage

Who can use this document 

This document can be used by all employers throughout Australia, except the following excluded employers:

  • Non-constitutional corporation employers in Western Australia;
  • State public sector employees — except in Victoria (ie employees of a Minister, the Governor, or the Crown); and
  • Local Government employers — except in the Northern Territory, Victoria and Tasmania.


Excluded employers may, however, wish to use this document, but they should first obtain legal advice as cashing out annual leave may be prohibited.



The option whether or not to have leave cashed out is at the absolute discretion of the individual employee. The employer must not force or coerce an employee to make such an election.

Paid annual leave or personal/carer’s leave must not be cashed out, except in accordance with:

  • the cashing out terms included in a modern award; or
  • the cashing out terms included in an enterprise agreement.


Annual leave an also be cashed out by agreement between the employer and an award/agreement free employee.

Employee Annual Leave Personal/carer’s leave
Covered by modern award Yes, if the modern award contains provision allowing employees to cash out. No, unless the employee is covered the 1 or 2 modern awards that permit cashing out of personal/carer's leave.
Covered by enterprise agreement Yes, if the enterprise agreement contains provision allowing employees to cash out. Yes, if the enterprise agreement contains provision allowing employees to cash out.
Contract of employment only (award and agreement free) By agreement between employer and employee where the employee has accrued in excess of 4 weeks annual leave.  After the cash out, the employee must have a remaining leave balance of no less than 4 weeks of annual leave accrued. Not able to cash out personal/carer’s leave.

*Only annual leave that has been accrued in excess of 4 weeks may be cashed out. After the cash out, the employee must have a remaining leave balance of no less than 4 weeks of annual leave accrued. Most awards cap cashing out of annual leave at 2 weeks per year and require employers to have a written record of any such agreement.

Requirements for cashing out include:

  • leave must not be cashed out if the cashing out would result in the employee’s remaining accrued entitlement to:
  • annual leave - being less than 4 weeks; or
  • personal leave - less than 15 days.
  • each cashing out must be by a separate agreement in writing between the employer and employee (the document accompanying this commentary); and
  • the value of the forgone leave is paid in full.


If the employee is covered by a modern award or enterprise agreement the employer must ensure any cashing out is done in accordance with the terms of that instrument.


Important note to subscribers 

The commentaries and documents in Workplace are updated as necessary, to keep them relevant. You should familiarise yourself with the relevant commentary each time you create a document. 

This document has been drafted to suit a wide variety of businesses, with a number of options available to enable you to customise the document to better suit your business. Nevertheless, you may need to make other changes to the document so that it suits the specific needs of your business. If you make additional changes, we cannot guarantee that the changes and modifications you make to the document will be legally compliant or enforceable. 

This commentary and any additional information provided to assist you in creating this document, does not constitute legal advice. 

If you are unsure about any aspect of this document (including the changes or amendments you make to it), you should seek appropriate advice from a lawyer, skilled in these issues. You should consult with your financial advisor in relation to any relevant taxation or financial issues concerning the document you create. 

After creating this document, you should read through it carefully to make sure it meets your business needs and is consistent with other industrial instruments, policies and procedures which operate in your workplace. This commentary is not designed to be provided to employees or other workplace participants.


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