Annual leave policy template
The essential leave policy for every Australian workplace. Covers NES entitlements, accrual calculations, leave loading, request procedures and approval processes — aligned with the Fair Work Act.
Annual leave policy
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Why every business needs an annual leave policy
Under the National Employment Standards, all Australian employees (except casuals) are entitled to annual leave. A documented annual leave policy ensures consistent, fair management of leave entitlements and prevents confusion about request procedures.
Without clear guidelines, businesses face disputes over leave approvals, confusion about accrual calculations, and difficulties managing peak periods. A proper policy protects both employer operational needs and employee entitlements.
A well-drafted policy also addresses excessive leave balances — a growing issue where employees accumulate significant leave, creating financial liability and affecting workforce planning.
Key elements of an annual leave policy
What your annual leave policy should include
NES entitlements
Clear statement of the minimum 4 weeks annual leave under National Employment Standards.
Accrual calculations
How annual leave accrues based on hours worked and service period.
Leave loading
When and how the 17.5% leave loading applies to your employees.
Request procedures
Clear process for employees to request and book annual leave.
Approval process
How managers assess and respond to annual leave requests.
Excessive leave management
Framework for managing employees with excessive leave balances.
What's included in this template
Comprehensive coverage of annual leave requirements
Purpose & scope
Why the policy exists and who it applies to.
Policy statement
The organisation's commitment to fair leave management.
Entitlements under NES
Minimum 4 weeks per year for full-time employees, pro-rata for part-time.
Accrual of annual leave
How leave accrues progressively during employment.
Leave loading
Application of 17.5% loading or shift penalties, whichever is greater.
Requesting annual leave
Notice periods, request process and supporting documentation.
Approval process
How requests are assessed considering business needs and employee preferences.
Excessive leave
Direction to take leave when balances exceed 8 weeks.
Cashing out annual leave
Conditions under which leave can be cashed out (if permitted).
Payment on termination
Entitlement to payment of accrued leave upon employment ending.
Who should use this template?
Essential for every Australian employer
Legal disclaimer
This template is designed to reflect Australian employment law requirements at the time of publication. It is provided as a general guide only and does not constitute legal advice.
You should review and tailor this template to suit your business, industry, applicable awards and enterprise agreements. Seek independent legal or HR advice to support compliance with all relevant employment laws.
Regulatory sources
This template is aligned with the National Employment Standards under the Fair Work Act.
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Disclaimer
This document is a general HR template provided for informational purposes only. It is not legal advice and may not reflect the latest changes in legislation or apply to every workplace situation. RosterElf Pty Ltd and the template provider accept no liability for any loss arising from reliance on this document. Users should seek independent legal advice and customise the template to ensure it complies with all relevant laws, awards and workplace requirements.