Australia: Doctors: have you considered your entitlement to long service leave?

Long service leave can be a significant entitlement. Doctors (and particularly doctors in the public healthcare system) need to be mindful that their entitlement can be lost – even inadvertently – if their continuity of service is broken.

Key takeaways

• Determining your entitlement to long service leave can be complicated and there are areas in which your entitlement may not be clear-cut.
• Keep track of your entitlement and seek advice early to prevent an inadvertent break in your continuity of service that cancels your accrued entitlement, particularly if you are a doctor employed in the public healthcare system.

Overview

Long service leave (LSL) gives an employee who has worked for an employer for a lengthy period of time an extended paid break from work. The entitlement to LSL most commonly arises under State and Territory legislation but may also arise under the terms of an enterprise agreement or public sector award. It is an entitlement that only employed doctors receive; doctors engaged as independent contractors or under services and facilities arrangements will not be entitled to LSL.

Although State and Territory LSL legislation varies, an employee will generally be eligible to take LSL if the employee has served between seven and 10 years' continuous service with an employer (depending on the applicable legislation). Such legislation will also provide for proportionate payment of an employee's LSL entitlement before an employee has reached their LSL milestone in specific circumstances.

For example, an employed doctor in New South Wales whose employment is subject to that State's LSL legislation will be able to take their full entitlement to two months' paid long service leave when the employee reaches 10 years' unbroken service with their employer. But if that employee only served five years' service with their employer and resigned on account of illness, they would be entitled to a pro-rata entitlement to LSL. This general position could be different if an enterprise agreement or public sector award covered an employed doctor in their particular employment.

Long service leave portability

There has been a significant increase in calls for LSL portability schemes for certain industries. LSL portability means the employee can count service with different employers in the same industry towards achieving their LSL entitlement. An example of this is the longstanding LSL portability scheme in Victoria for employees in the construction industry. Similar schemes have recently been implemented in the community services, contract cleaning and security industries in Victoria.

There are also various LSL portability schemes for doctors employed in the public healthcare system arising under enterprise agreements and public sector awards. For example, in Victoria, both the Medical Specialists (Victorian Public Health Sector) (AMA Victoria/ASMOF) (Single Interest Employers) Enterprise Agreement 2022–2026 (Medical Specialists Agreement) and Doctors in Training (Victorian Public Health Sector) (AMA Victoria/ASMOF) (Single Interest Employers) Enterprise Agreement 2022-2026 include complex terms that provide for LSL portability where a doctor covered by one of those agreements works in the Victorian public healthcare system.

Continuous service and continuity of service

There are two essential and related concepts relevant to determining an employee's LSL entitlement: continuous service and continuity of service.

• continuous service means a period of employment that counts towards an employee's LSL entitlement (e.g. ordinary time worked and certain periods of paid and unpaid leave); and
• continuity of service means an employee's service for the purposes of LSL has not been broken resulting in the loss of their pro-rata LSL entitlement (e.g. because an employee resigned and ceased to be employed by the employer for a certain period).

The applicable legislation or enterprise agreement will set out whether an interruption breaks continuity of service and whether that interruption counts, or does not count, towards an employee's LSL entitlement. The position can vary considerably from State to State.

Some common pitfalls

As noted above, an employee's entitlement to LSL hinges on their unbroken period of continuous service. If there is a break in service, the employee loses their entitlement to LSL and the timer restarts – meaning the employee has to serve the required period of continuous service again to receive LSL.

By way of example, in Victoria under the Medical Specialists Agreement, this can commonly occur where a doctor is absent from work for a period of time that is greater than the "allowable period of absence" (i.e. five weeks in addition to the total period of paid annual leave and/or personal leave the doctor receives on termination) and no relevant exception to this rule under the enterprise agreement applies.

Navigating career moves can present some of the greatest risk to the continuity of a doctor's service for the purposes of LSL. Some practical steps that doctors employed in the public healthcare system can take to reduce the risk that they will inadvertently break their continuity of service for the purposes of LSL include:

• being familiar with the legislation, enterprise agreement or public sector award that governs their LSL entitlement.
• where a portability scheme is operating, obtaining an accurate certificate of service from each employer for each period of employment, which expressly recognises their service for the purposes of LSL under the applicable instrument; and
• seeking appropriate and timely legal advice in relation to their LSL entitlement, particularly if considering, and before accepting, interstate positions, or an unpaid or honorary appointment.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.