More than $1 million in unpaid long service leave returned to Victorian workers

The Victorian wages watchdog secured more than $1 million of unpaid long service leave for workers last financial year, shining a spotlight on an often overlooked employee entitlement.

Under Victorian law, workers are entitled to long service leave if they complete more than seven years of continuous employment with one business.

It accumulates at the rate of one week for every 60 weeks of continuous service, giving workers a baseline entitlement of approximately 6.1 weeks of long service leave once they pass the seven-year milestone.

Employers are required to pay out the unused portion of a worker’s long service leave once their employment ends.

While the vast majority of Victorian businesses comply with those rules, not every employer followed those regulations in 2022-2023.

On Monday, Wage Inspectorate Victoria (WIV) on Monday revealed it had assisted more than 1,400 workers reclaim more than $1 million over the financial year.

In one case, the WIV assisted a worker reclaim $20,000 in unpaid entitlements.

Underpayment of those entitlements was not confined to one industry, with the WIV noting major clawbacks from finance firms, a hairdressing business, and a solar panel company.

Victorian Minister for Industrial Relations Tim Pallas said the WIV, in only its second year of operation, supported workers navigate their entitlements.

“The vast of majority of businesses are good employers, but the Inspectorate is there to ensure the minority that seek to get an unfair advantage at the expense of their workers are held to account,” he said.

Businesses and workers can assess their long service leave obligations and entitlements here.

Beyond its efforts on unpaid long service leave last financial year, the WIV noted it issued almost 10,000 child employment permits, enabling children under the age of 15 to undertake paid work.

Employers have long been free to hire children under strict conditions, but the pressures of an unusually tight labour market saw many businesses turn to younger staff for the first time.

Not every business complied with those rules, either: Wage Inspectorate Victoria is pressing hundreds of criminal charges against fast food restaurants accused of employing children without the right permits or working conditions.

A new permit system, administrated by the WIV, came into effect on July 1 this year, streamlining the ways employers can safely recruit staff under the age of 15.