Employee Entitlements
Now more than ever, its important to have an accurate payroll management system that accrues leave entitlements correctly for each employee from their start date.
Casual employees are generally not entitled to leave, only part-time and full-time employees. You can refer to the following link for further information about casual employees and how they differ from part-time and full time employees: https://www.fairwork.gov.au/employee-entitlements/types-of-employees/casual-part-time-and-full-time/casual-employees
Part-time and full-time employees are generally entitled to the following from the date they commence work:
Sick/personal leave: the standard is 2 weeks full-time equivalent per year (NB. The entitlement is pro-rata based on the actual hours worked)
Annual leave: the standard is 4 weeks full-time equivalent per year (NB. The entitlement is pro-rata based on the actual hours worked)
Long service leave: 8.667 weeks for 10 years of services (the entitlement is generally payable pro-rata after 7 years of service)
Please note that certain Awards and workplace agreements will have additional entitlements so its advisable to get specific advice based on your specific circumstances.
Employee leave entitlements generally accrue each time you pay them (i.e. your system should be calculating the hours accrued for each entitlement) and your payroll system should have a running balance of the entitlements accrued and the balances owing. If your payroll system has not been set up properly, you may need to manually trace back the payroll data to determine the correct leave entitlement balances.
There are many situations where your employees may need to use their entitlements in order to continue being paid and as a business owner, you will need to ensure you know exactly how much.
Tips:
Review your payroll system to confirm that your employee entitlements have been calculating properly over time. If you are in doubt, seek the assistance of a bookkeeper or accountant to help confirm
Determine the exact entitlement balances per employee (sick/personal leave, annual leave and long service leave)
Communicate with your employees so they understand exactly how much their entitlements are and for how many days or weeks they can continue to be paid if they need to use their entitlements
Once your employees have used up their entitlements, they may need to be on ‘unpaid leave’ (they don’t get paid anything)
Remember to keep calculating/accruing leave entitlements whilst staff are either on leave or during a stand down period