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Long Service Leave Changes in New South Wales

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Author: James Sanders, Principal

The Supreme Court of New South Wales has changed the requirements for service to be included in calculating long service leave New South Wales.

On 14 December 2022, the New South Wales Court of Appeal handed down its decision in Wipro Limited v State of New South Wales [2022] NSWCA 265.

The case concerned an employee who had undertaken 5 years and 11 months of service within Wipro Limited in India, before transferring to New South Wales for a further 4 years and 9 months, at which time his employment ended.

The employee sought assistance from the New South Wales Government for payment of his long service leave entitlements on termination as he perceived his employment to exceed the 10 year continuous service requirement.

In accordance with previous decisions handed down in New South Wales, (including International Computers (Australia) Pty Ltd v Weaving [1981] 2 NSWLR 64), the regulator argued that service by an employee outside of New South Wales should be counted for the purposes of long service leave where there was a substantial connection to New South Wales at the time of termination.

Wipro argued that the time served in India should not be counted as there was no substantial connection to New South Wales during the employee’s initial 5 years and 11 months of service.

The Court of Appeal agreed with Wipro.

As a result, employees in New South Wales must now have had a substantial connection to New South Wales when the service is performed (i.e. throughout the employment), rather than at the time the benefit is sought (e.g. termination).

This decision brings New South Wales inline with the interpretation in Victoria as determined by Infosys Technologies Limited v State of Victoria [2021] 64 VR 61.

Importantly employers in New South Wales should undertake a review of any employee who has worked outside of New South Wales to correctly determine the employee’s long service leave entitlement.

If you have any questions in relation to this article or employment practices in general, please contact the MST LawyersEmployment Law team on +61 3 8540 0200 or email workplace@mst.com.au.