Incoming changes to long service leave for certain industries in the ACT – what do you need to know?

WRITTEN BY Rebecca Richardson

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Typically, long service leave has been considered a ‘reward’ for an employee’s loyalty to their employer. For example, if an individual has been employed by the same employer for seven years or more in the ACT (the period of service varies between jurisdictions) they will become eligible for long service leave.

This traditional idea of long service leave failed to account for employees in industries which typically have itinerant work patterns – for example, construction workers. To account for these workers, all jurisdictions across Australia have ‘portable schemes’ regimes – which operate differently to the traditional idea of long service leave. These portable schemes reward employees for their commitment to a particular industry (rather than a particular employer) by providing them with an entitlement that they would not otherwise receive. These schemes support skills retention in relevant industries.

What are portable long service leave schemes?

This article will focus on the portable long service leave scheme in the ACT, which is governed by the Long Service Leave (Portable Schemes) Act 2009 (ACT). State portable long service leave schemes were inspired by the national portable long service leave scheme established by the coal mining industry in 1949.[1] The Coal Long Service Leave scheme remains the only nationally regulated portable scheme.[2] Schemes across Australia are largely similar, but may differ in some respects, it is important you check the applicable laws in your jurisdiction.

The scheme allows workers to move from employer to employer in covered industries without losing credit for the period worked within the covered industry. In the ACT, the scheme currently applies to workers employed in:

  • the building and construction industry;
  • the contract cleaning industry;
  • the community sector industry; and
  • the security industry.

How do portable long service leave schemes work?

Traditionally, long service leave entitlements are paid directly by an employer to the employee. However, under the ACT scheme, relevant employers must register with ACT Leave Authority (‘the Authority’). Employers pay a levy to the Authority each quarter. The current levy rate is estimated as 1.07% of ordinary renumeration.[3] Every quarter, relevant employers must provide a report to the Authority that:

  • lists the people who worked for them in that period;
  • their contact details; and
  • the ordinary renumeration paid during that period.

Once an employee completes seven years of service in an industry, they can elect to take their long service leave entitlement. It is the Authority (not the employer) who will pay the employee their long service leave entitlement. Workers may have a continuous non-service break of four years before their accrual of service is affected.

What are potential complexities with the scheme?

A common issue is whether an employer/employee falls within a covered industry. For example, in Paull & Warner Resources Pty Ltd v Construction Industry Long Service Leave Payments Board,[4] the Court had to determine whether the maintenance work Mr Mapleson undertook fell within an exception under the relevant long service leave legislation – the exception excluded the carrying out of maintenance or repairs of a routine or minor nature. The Court stated at [70]:

Therefore, both the purpose of, and the major and substantial work of, inspection and testing by Mr Mapleson were not maintenance work. The maintenance or repair work he did undertake was ancillary to and minor compared with the remainder of his work. It was also minor of itself, which Mr Mapleson acknowledged. He described some of those tasks as falling within the routine maintenance set out in the Australian Standard.

Therefore, the Mr Mapleson’s work fell within the exception, and his employer was not required to make contributions to the scheme in relation to his employment.

What happens if an employer works in a covered industry but engages workers who work outside the industry or interstate?

Relevant employers are only obliged to make contributions for their workers who are engaged to work in the covered industry in the ACT. Every jurisidiction around Australia has some form of a portable long service leave scheme so if an employer is operating interstate, they should be aware that they may have to comply with the relevant legislation in that jurisdiction.

What are the incoming changes to the portable long service leave scheme in the ACT?

Due to commence in 2025, the scheme has been expanded to include ‘the services industry’. The services industry combines the existing contract cleaning industry, with:

  • hairdressing and beauty services employers, and
  • accommodation, food, beverage and hospitality employers.

This amendment will have implications for a significant number of employers across the ACT.

Implications for employers?

Employers in the services industry will be required to pay quarterly contributions to the Authority. Employers will not receive these funds back, even if an employee does not become eligible for the long service leave entitlement the future. Employers should consider whether the scheme is applicable to them and be prepared for the upcoming changes. There are penalties for non-compliance, so there is an incentive to ensure that employers understand their obligations.

If you have any questions or wish to discuss your circumstances with a lawyer, please contact the BAL Lawyers Employment Law & Investigations team on 02 6274 0999.


[2] See ibid.


[4] [2017] WAIRC 449.

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