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WorkSafe Tasmania

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Pro rata long service leave

This information does not apply to mining employees. Mining employers and employees should see Long service leave for mining employees.

What is pro rata long service leave

An employee (including part-time and casual employees) may be entitled to a payment for pro rata long service leave on termination after completing 7 years but less than 10 years of ‘continuous employment’.

Payment of a pro rata entitlement is not automatic and is only available in certain circumstances.

Most of these circumstances are not straightforward, and depend on each individual case; you should seek advice if you are unsure. WorkSafe’s Helpline can give you some general advice but not specific legal opinion. You can also look at previous decisions made by the Tasmanian Industrial Commission.

An employee will be entitled to a pro rata payment if:

  • the employee reaches retirement age (60 for women, 65 for men)
  • the employee dies (payment is made to the deceased’s estate)
  • employment is terminated by the employer for any reason other than serious and wilful misconduct.

An employee may be entitled to a pro rata payment if:

  • employment ceases due to illness of such a nature as to justify the termination of employment
  • the employee resigns due to incapacity or ‘domestic or other pressing necessity’ that was of such a nature to justify the termination of employment.

Employment terminated by the employer

Serious and wilful misconduct

For an employee to be denied pro rata long service leave, termination must have occurred because of ‘serious and wilful misconduct’. All three components must be shown to exist: that is, the action must be ‘serious’ and ‘wilful’ and constitute ‘misconduct’.

What constitutes serious and wilful misconduct depends on each case. You should seek legal advice if you are unsure.

If agreement cannot be reached, the matter can be heard by the Tasmanian Industrial Commission.

Constructive dismissal

Constructive dismissal takes place when an employee resigns at the suggestion of, or through pressure exerted by, the employer. For example, if an employer says to an employee words such as ‘I want your resignation’ or ‘If you don’t resign I am going to sack you’, that may be considered constructive dismissal, and may mean that an employee has an entitlement for pro rata payment of long service leave.

What constitutes constructive dismissal depends on each case. You should seek legal advice if you are unsure.

If agreement cannot be reached, the matter can be heard by the Tasmanian Industrial Commission.

Illness or incapacity

When resigning due to illness or incapacity, it’s a good idea to give your employer supporting evidence. Your employer should then be able to consider whether you are entitled to a pro rata payment.

What is important is that the illness is of such a nature that the employee has no option but to resign.

If agreement cannot be reached, the matter can be heard by the Tasmanian Industrial Commission.

Domestic or other pressing necessity

When resigning due to domestic or other pressing necessity, it’s a good idea to give your employer supporting evidence. Your employer should then be able to consider whether you are entitled to a pro rata payment.

What constitutes domestic or other pressing necessity depends on each case.

If agreement cannot be reached, the matter can be heard by the Tasmanian Industrial Commission.

How to calculate pro rata entitlement

A pro rata long service leave entitlement is calculated by dividing the employee's period of ‘continuous employment’ in years (including part years) by 10 years and multiplying the result by 8.667 weeks.

Example 1

An employee has been continuously employed for exactly 9 years. They resign because of ill-health. They are eligible for payment of pro rata long service leave on termination.

The calculation is: 9 years x .8667 weeks = 7.8003 weeks

Example 2

An employee has been continuously employed for 13 years 6 months and 14 days. They resign for any reason. They are eligible for payment of pro rata long service leave on termination.

The calculation is: 13.5383 years x .8667 weeks = 11.7336 weeks

Pro rata entitlement when an employee dies

A pro rata entitlement is calculated differently on the death of an employee. Two situations may exist:

  • if the deceased had more than 7 years but less than 10 years of employment at the time of death, the pro rata entitlement is an amount equal to 1/60th of the deceased employee’s ordinary pay for the period of ‘continuous employment’
  • if the deceased had more than 10 years of service at the time of death, the pro rata entitlement is calculated by adding:
    • the payment of any outstanding accrued entitlement, and
    • an amount equal to 1/60th of the deceased employee’s ordinary pay for the period of ‘continuous employment’ which occurred after the last accrual of an entitlement to long service leave.

In both situations, amounts are paid to the estate of the deceased employee.

Last updated: 3 October 2024
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