The accrual of leave entitlements (such as, personal leave, long service leave, and annual leave), whilst receiving workers compensation payments is a matter which is dealt with by the National Employment Standards (‘NES’) in the Fair Work Act 2009 (Cth) (‘FWAct’).
Section 130 of the FWAct provides that an employee is not entitled to take, or accrue, any leave entitlements during a compensation period when the employee is absent from work because of personal illness or injury for which the employee is receiving compensation under a relevant State’ compensation law, unless that same compensation law permits the accrual, or taking, of leave.
Each States’ compensation law treats the issue of taking and/or accruing of leave slightly differently. In most cases the States’ legislation is silent on how the matter is to be treated. Let’s consider the following States:
• South Australia – annual leave continues to accrue for the first 12 months of incapacity and for incapacity extending beyond 12 months, that leave is deemed to have been taken and no more accrues.
• Western Australia – workers compensation legislation does not provide for annual or other forms of leave. Annual leave and long service leave only accrues for the first 15 days of incapacity, but being on compensation leave does not break a period that counts towards long service leave.
• Tasmania – workplace standards advise that it is an industrial relations matter and unless an award or agreement stipulates that annual leave or long service ceases to accrue after a certain period of absence it will continue to accrue.
• Victoria – legislation is silent on the issue of leave accrual and the inference is that entitlements cannot be taken nor do they accrue.
• New South Wales and Queensland – all entitlements, such as leave continue to accrue as long as the contract of employment exists, irrespective of whether workers compensation is being paid.
Section 130 of the FWAct only provides that an employee has no entitlement to take or accrue such leave, however, it is possible that an enterprise agreement (EA) may be reached between an employer and employee to allow the taking or accrual of leave entitlements. In this regard although the entitlement is not permitted by the FWAct, nevertheless, the FWAct does not act as a bar to an agreement providing such an entitlement for an employee. You should consider whether your agreement provides for the taking or accrual of such leave.
Finally, in respect of long service leave entitlements, it appears that all of the States’ legislation pertaining to long service leave provides for accrual during a period of absence for injury or sickness.