Long service leave and modern awards

Analysis

Long service leave and modern awards

State and territory law remains the principal source of long service leave entitlements under the Fair Work industrial relations system; however, its application can be tricky.

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State and territory law remains the principal source of long service leave entitlements under the Fair Work industrial relations system; however, its application can be tricky.
 
The question below highlights an issue involving some NAPSAs and modern awards.
 
Our business operates in the aged care sector, and employs domestic, personal care and maintenance staff in the facility.
 
Previously, these staff were covered under a NSW NAPSA that provided long service leave on the basis of two months after ten years of service, and five months long service leave after each subsequent ten years of service with the employer.
 
The NSW state long service leave legislation provides for two months of long service leave after ten years of service, but an equivalent total of four months after 20 years of service, meaning the NAPSA was more beneficial with respect to long service leave, in this circumstance.
 
These employees are now covered by the Aged Care Industry Award 2010, which does not provide long service leave entitlements.
 
Because the NAPSA no longer applies, what are the employees entitlements with respect to long service leave?
 
The long service leave conditions for these employees are subject to the NSW Long Service Leave Act from 1 January 2010.
 
Although the Fair Work Act 2009 refers to ‘applicable award-derived long service leave terms’ being covered by the National Employment Standards (NES), a NAPSA is not regarded as ‘award’ for the purposes of the Fair Work Act.
 
This means the long service leave terms in a NAPSA are not preserved under the NES. As stated, a NAPSA ceases to cover an employee when a modern award that covers an employee (other than the Miscellaneous Award 2010) comes into operation.
 
However, if the long service leave provisions related to an award (ie a previous federal award, or a State reference transitional award), then those terms would have been preserved under the NES.
 
In this case, the employees are still entitled to the more generous long service leave entitlements that had accrued under the NAPSA prior to 31 December 2009; however, for service from 1 January 2010, long service leave will accrue subject to the NSW Long Service Leave Act.
 
Source: Paul Munro, IR Consultant.
 
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