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HOW-TO GUIDE

How to calculate long service leave

A complete guide to calculating long service leave entitlements in Australia, including state-by-state requirements, pro-rata calculations, and termination payouts. Links to LSL policy templates.

10 min read
Georgia Morgan

Written by

Georgia Morgan

General information only – not legal advice

This guide provides general information about long service leave in Australia. It does not constitute legal, HR, or professional advice and should not be relied on as a substitute for advice specific to your business, workforce, or circumstances.

What is long service leave?

Long service leave (LSL) is a period of paid leave granted to employees who have worked for the same employer for an extended period — typically 7–10 years depending on the state or territory. Unlike annual leave and personal leave which are part of the National Employment Standards, LSL is governed by state and territory legislation.

This means entitlements vary depending on where the employee works. Awards and enterprise agreements may also provide better entitlements than state minimums — always check award rates and any applicable penalty rates for your industry.

8.67 wks

after 10 years in most states

13 wks

after 10 years in SA and NT

7 yrs

threshold in VIC and ACT (not 10)

NSW and victoria LSL formula quick reference

NSW formula shown. Other states use the same accrual rate but have different thresholds and pro-rata rules — see the state table below.

Full-time employees

Years of service × 0.8667 × ordinary weekly pay = LSL payment

Example: 10 years × 0.8667 = 8.67 weeks

Pro-rata on termination (after 5 years, NSW)

Years of service ÷ 10 × 8.67 = weeks of LSL

Example: 7 years ÷ 10 × 8.67 = 6.07 weeks

Part-time / casual employees

Total ordinary hours worked ÷ 52 ÷ 10 × 0.8667 = weeks of LSL

Unsure about casual vs part-time costs? Use our casual vs part-time cost calculator.

STEP-BY-STEP

How to calculate long service leave in 6 steps

Follow this process to correctly calculate long service leave entitlements.

1

Identify the applicable legislation

Determine which state or territory LSL law applies to your employee based on where they usually work.

Tips

  • LSL is governed by state/territory legislation, not federal
  • The relevant law is usually where the employee primarily works
  • Check if an award or enterprise agreement provides better entitlements
  • Some industries have portable LSL schemes (construction, cleaning)
2

Calculate continuous service

Determine the employee's continuous service period, including any breaks that count as service.

Tips

  • Start date is usually the first day of employment
  • Paid leave (annual, sick, parental) counts as service
  • Unpaid leave usually doesn't count but may not break continuity
  • Check state rules for what breaks continuity vs pauses accrual
3

Determine the entitlement threshold

Check when the employee becomes entitled to LSL in their state or territory.

Tips

  • Most states: 10 years for full entitlement
  • VIC and ACT: 7 years for full entitlement
  • Pro-rata access available after 5–7 years in most states
  • Some awards provide earlier access or additional entitlements
4

Calculate the LSL entitlement

Apply the state formula to calculate the number of weeks of LSL the employee has accrued.

Tips

  • Standard: 8.67 weeks (2 months) for 10 years service
  • NT and SA: 13 weeks for 10 years service
  • Additional accrual continues after the threshold
  • Part-time: calculate based on ordinary hours worked
5

Calculate the payment rate

Determine the pay rate for LSL, which is typically the employee's ordinary pay rate at the time of taking leave.

Tips

  • Usually paid at the employee's ordinary rate at time of leave
  • May include regular overtime or allowances if consistently worked
  • Check state legislation for specific inclusions/exclusions
  • Commission-based employees may have special calculation rules
6

Process the leave or payout

Either allow the employee to take leave or calculate a payout on termination.

Tips

  • LSL can usually be taken as full pay, half pay, or double time at half pay
  • Pro-rata payouts apply on termination after qualifying period
  • Some states require payout even if employee resigns
  • Cashing out restrictions vary by state
Need to calculate pro-rata leave for other leave types? Or final pay on termination including LSL payouts? See our related guides.
BY STATE

Long service leave entitlements by state and territory

Entitlements vary significantly. See also our NSW LSL guide and Victoria LSL guide for state-specific detail.

State/Territory Threshold Entitlement Pro-rata access Cash out
New South Wales 10 years 8.67 weeks (2 months) After 5 years on termination Not permitted
Victoria 7 years 8.67 weeks After 7 years Not permitted
Queensland 10 years 8.67 weeks After 7 years on termination By agreement (QIRC approval)
South Australia 10 years 13 weeks After 7 years on termination By agreement
Western Australia 10 years 8.67 weeks (2 months) After 7 years on termination By agreement
Tasmania 10 years 8.67 weeks After 7 years on termination By agreement
Northern Territory 10 years 13 weeks (3 months) After 7 years on termination Not specified
ACT 7 years 6.07 weeks (approx) After 5 years on termination By agreement

Important: This is a simplified summary. State legislation should always be checked for complete rules, including service calculation methods, exclusions, and special circumstances. Use the Business QLD LSL calculator for QLD, and the NSW calculator linked above for NSW.

EXAMPLES

Long service leave calculation examples

See how LSL calculations work in practice across different scenarios.

Full-time employee, 10 years service (NSW)

Calculation: 10 × 0.8667 = 8.67 weeks

Pay: 8.67 weeks × ordinary weekly rate

Entitled to 8.67 weeks (approximately 2 months) of LSL

Employee resigns after 7 years (NSW)

Calculation: 7 ÷ 10 × 8.67 weeks = 6.07 weeks pro-rata

Pay: 6.07 weeks × ordinary weekly rate

Entitled to 6.07 weeks pro-rata payout on termination

Part-time employee, 10 years (VIC) — 20 hrs/week average

Calculation: (20 hrs × 52 weeks × 10 yrs) ÷ 52 × 0.8667 ÷ 10 = 8.67 weeks at 20 hrs

Pay: 20 hrs/week × ordinary hourly rate × 8.67 weeks

Entitled to 8.67 weeks at their average 20 hours per week

Employee with 15 years service (SA)

Calculation: 13 weeks (first 10 yrs) + (5 × 1.3 weeks) = 19.5 weeks

Pay: 19.5 weeks × ordinary weekly rate

Entitled to 19.5 weeks of LSL

AVOID THESE

Common long service leave calculation mistakes

These errors can lead to underpayment claims and compliance issues.

Applying wrong state legislation

Risk: Incorrect entitlements calculated, potential underpayment claims.

Solution: Use the legislation for where the employee primarily works, not where the business is registered.

Forgetting part-time adjustments

Risk: Overpaying or underpaying part-time employees.

Solution: Calculate LSL based on average ordinary hours worked over the service period.

Not including all service

Risk: Undercalculating entitlements, employee complaints.

Solution: Include all continuous service including periods of paid leave.

Incorrect termination payouts

Risk: Underpayment claims, Fair Work complaints.

Solution: Check state rules for pro-rata payouts on resignation vs dismissal.

Ignoring award entitlements

Risk: Missing additional entitlements that exceed state minimums.

Solution: Check if the applicable award provides better LSL terms.

Use leave management software to track continuous service automatically and flag when employees approach entitlement thresholds. Our casual vs part-time cost calculator helps with workforce cost comparisons.

Track long service leave

RosterElf maintains accurate service records and calculates LSL entitlements based on your state requirements. Built for Australian small businesses.

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FAQ

Frequently asked questions

  • In most Australian states — NSW, VIC, QLD, WA, and TAS — 10 years of continuous service entitles an employee to 8.67 weeks (approximately 2 months) of long service leave. South Australia and the Northern Territory are more generous at 13 weeks (3 months) for 10 years of service. The ACT uses a different formula based on continuous accrual.
  • It depends on your state. In Victoria and the ACT, employees become entitled to long service leave after 7 years of continuous service — so yes, you can take or be paid LSL after 7 years. In other states (NSW, QLD, SA, WA, TAS, NT), the full entitlement threshold is 10 years, but pro-rata payouts on termination are available after 5–7 years depending on the state.
  • 8.67 weeks (approximately 2 months) in most states — NSW, VIC, QLD, WA, and TAS. South Australia and the Northern Territory provide 13 weeks (3 months). Additional leave continues to accrue beyond 10 years at rates that vary by state. Part-time and casual employees receive the same number of weeks but calculated at their average ordinary hours.
  • In NSW, the formula is: Years of service × 0.8667 × ordinary weekly pay. For example, 10 years × 0.8667 = 8.67 weeks. For pro-rata on termination after 5 years: years of service ÷ 10 × 8.67 weeks. For part-time/casual: total ordinary hours worked ÷ 52 ÷ 10 × 0.8667 = weeks of LSL. Use the official NSW Long Service Leave Calculator at nsw.gov.au for exact figures.
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