When you resign from your current job since I found a better place, if you retained a large substantial amount of anual leave does anyone know when that gets paid into your account? Is it normally same day as you would received you fortnightly/weekly/month payment?
I have heard a company does not have to pay you this? Or by law they have to?
Why don't they have to pay leave loading it's part of your entitlements.
Correct me if I'm wrong but I thought leave loadings were only paid if and when you took the leave…
Loading is because you worked nights etc. If it's just being paid straight out no loading.
In Victoria, you'll be paid a loading of 17.5% on top of your base rate of pay when on annual leave.
Nooooo, it's the law. You must be paid all accrued annual leave when your role terminates :)
Thanks Dennis for that vibe, remind us all again which law states
when that gets paid into your account?"
and
Is it normally same day as you would received you fortnightly/weekly/month payment?"
Save the discussion about what is law until you are at a 7-11.
I never mentioned when those entitlements would have to be paid by, suffice to say that leave entitlements would be paid by any reasonable employer at the time, or soon after, conclusion of employment.
If the employer is unreasonable to the point where they do not pay an employee's final dues within one or two pay runs following the conclusion of employment, they should contact the FWO.
FWO states that it's best practice to settle these dues on the last day or the next pay run, but some awards specifically govern these matters and the associated timeframes that must be followed.
So you are saying that when the actual payment will be made, will depend on the company
All other considerations aside, MUST to be paid at least within a month after your last pay went in. Covered under Fair Work Act 2009 s323 - Method and frequency of payment which is Commonwealth legislation:
s323 - Method and frequency of payment
(1) An employer must pay an employee amounts payable to the employee in relation to the performance of work:
(c) at least monthly.
Note 2: Amounts referred to in this subsection include the following if they become payable during a relevant period:
(e) leave payments.
Becomes payable within the month of employee leaving because the Act s90(2) - Payment for annual leave says the following:
(2) If, when the employment of an employee ends, the employee has a period of untaken paid annual leave, the employer must pay the employee the amount that would have been payable to the employee had the employee taken that period of leave.
Therefore when you finish employment, your leave balance must be paid out at the very least within 1 month after your last pay was done.
So still depends on the company WHEN they actually pay it.
This was OP's original concern.
does anyone know when that gets paid into your account? Is it normally same day as you would received you fortnightly/weekly/month payment?
Perhaps you can help the op
https://www.ozbargain.com.au/node/223900#comment-3275832
I called up fair work and was told that the employee doesn't not have to pay u and if not given right amount of notice of resignation and if you do want your anual payed u need legal advice?
Please help him with " doesn't not have to pay " means
Depends if you give the required amount of notice specified in your agreement
but if you just up and leave you forfeit all entitlements so i have been told but
cannot confirm this 100%.
So why give misleading information if you don't really know…
Can someone explain what's the benefit of saving up tons of annual leave if you don't use it before resigning from a company?
Because the employer needs to pay out your leave when you go.
Yes but let's say Employer A is a workaholic and he works full time (38 hours) for 52 weeks of the year for 10 years, accumulating annual leave the entire time. He doesn't take a single holiday. He quits the job after 10 years. Employer pays out the leave.
Now let's say the second scenario is the same, except Employer B uses up all of his leave and goes have fun for 1 month each year bangin' hookers in Thailand (and get paids for it) or something. He quits the job after 10 years.
The difference is that Employer A is stuck in a soul-sucking job while being paid the same as Employer B, who at least gets out for a bit and has some fun?
In that scenario, Employer A has 40 weeks (assuming an accumulation of 4 weeks of annual leave per year) of pay that he gets when he leaves his job, Employer B has nothing.
If you're in a company where you are constantly moving up the chain (or get constant pay increases), annual leave increases in value over time.
e.g. if you joined and were on $52K the leave is worth about $1K per week
If by the time you left you're on $104K, the leave is work about $2K per week.
Employee A gets 40 weeks annual leave calculated on the salary he was on after 10 years of service which will be substantially more than employee B who got 4 weeks on Year 1 salary, 4 weeks on year 2 salary etc etc
This is why most companies look for methods to get their employees to use use their annual leave. At my work, you get an extra week annual leave if you finish the year with less than 4 days.
We are actually pretty lucky, many countries have a use it or lose it policy.
Yes. You asked me a factual question, then you follow it up with a lifestyle choice comment?
Correct. That's why organisations want you to use your leave. The value of the unused leave rises with your salary - becoming an increased liability for them.
FYI employer is the job provider
Banging hookers in thailand and gets paid for it, haha
How often do you frequent Thailand?
spot on, some ppl at my works have 16+ weeks, never go on a holiday
one dude quit got 12 weeks pay started new job next monday, after tax would have got 8 weeks pay….big deal.
good to have 4 weeks or so for rainy day, but gotta use them
Annual leave that is not taken by employees is a liability on the company's balance sheet and can affect the performance of a business.
Another consideration is superannuation and accruing leave. I'm not sure about other states, but in WA (or under my contract anyway) if I take my leave while working i get paid superannuation and also accrue leave while I take leave. If I am paid out my leave, I don't get super on that period and I don't accrue extra leave on it. This is something to consider if you're considering resigning but could take your leave before you resign - it depends on your circumstances of course.
If you accumulate your annual leave before resigning your annual leave will act like a "savings account" that will save you 4 weeks of pay every year. After say 10 years 40 weeks of pay as a lump sum would be awesome. However, most companies won't allow their workers to accumulate annual leaves like that.
don't forget it all gets taxed, and that large sum would be taxed at a very high bracket.
You would get a chunk of it back at tax time, but as a PAYG person, you pay tax based on that pay period.
Personally, I found over the years that overpaying the tax office is a great way to save. Money which I would have spent on a daily basis because I don't have spending disciplines at all.
I used to tick the box to say I have claimed the tax free threshold to get the higher tax bracket…
but then I realised I could use the money and not let the ATO use it.
Most company policies wouldn't allow that anyway. As an auditor we always bring it up to management whenever employees have a huge amount of annual leave hours. Different story for LSL of course.
You'll find that most companies find that a large amount of leave is a tangible liability and will push you to take it.
Your annual leave is your entitlement which must be paid on or before the last day of your employment just like your normal pay which the employer can not withhold.
It can be paid on your last pay run, which may occur after termination of employment.
Just to point out that it is only Annual/Long service which is paid, and not sick/carers leave. Just in case OP was curious
True :)
Just as an aside, give some thought to deciding when to resign, as superannuation does not have to be paid on Accrued Annual Leave when paid out.
Perhaps schedule a holiday before giving notice.
Just take a nice holiday and then give your notice.
As robbiejuve said ( We are pretty lucky in this country} . Thank goodness for our right to negotiate with Greedy employers. It's a pity workers rights are slowly deteriorating.
Leave loading isn't added on separation of employment. Leave loading is only paid when you take leave.
When I retired I stopped going to work but I had enough annual leave and long service leave to keep being paid for 19 months.
Advantages
My Superannuation was based on length of service so if I had taken a lump sum I wouldn't have received the extra Super.
I didn't know (or have forgotten - I retired 8 years ago) that you didn't receive leave loading on lump sum AL.
I kept my work mobile phone, PC and Internet connection until I stopped being an employee since I was theoretically on call. It was a shock to the system to find out that you had to PAY for such things.
I did do quite a bit of work for them after I left. I was webmaster, server admin, PC support, etc so there was a lot of info to transfer. It didn't help that my replacement died of lung cancer 6 months after I left (we told him not to smoke) so I had to train the replacement.
The Tricks
At the time if you took LSL over or adjacent to a public holiday you lost the leave so I had to interweave AL and LSL so that I was on AL over PHs.
LSL was calculated as 13 weeks but it was taken as days. For example, if you had 2 weeks LSL it was 14 days. If you take it as weeks of LSL you get 10 days off. If you take LSL Monday to Friday you get 14 days off.
I believe at my semi-goverment organisation both of the above anomalies have been corrected but it would be worth your while to see how the system works at you place.
The Hotel California effect (you can check out at any time but you can never leave) applies. While you are on AL and LSL you continue to accrue AL and LSL and while you are taking that leave you accrue more and so on. I stopped calculating the extra leave when it got below 1 day so it wasn't an infinite series.
Zeno's Paradox
http://platonicrealms.com/encyclopedia/zenos-paradox-of-the-…
The Bastards
HR decided they had had enough of me so they terminated me without my agreement or having filled out a "retirement" form on 30 June and paid out my remaining 5 weeks leave. I lost the opportunity to accrue Super and, I hadn't thought about before this moment, I may not have received the leave loading (it was mainly LSL so it wasn't a big deal).
I contacted the union rep but in the end I decided it wasn't worth the hassle of pursuing the issue.
Any annual leave will be paid out when you resign, whether you receive loading will depend on the company as loading is not an entitlement.
Your grammar is not well, but, in the scheme of things, she'll be right mate…
They have to pay out your annual leave. They can (and will if it's a bad employer) withhold your payments if you didn't give the appropriate notice of termination according to your employment contract. According to the fairwork act, they are able to legally withhold your payments: https://www.fairwork.gov.au/ending-employment/notice-and-fin…
Fair Work Act 2009 only says how much notice an employer has to provide (s117). The Act does not state how much notice an employee has to give to resign, this is specified by your industrial instrument (award, agreement, etc).
For example:
GENERAL RETAIL INDUSTRY AWARD 2010 (MA000004)
s14 - Termination of employment
* 14.1 Notice of termination is provided for in the NES -> Fair Work Act 2009 s117
* 14.2 Notice of termination by an employee
The notice of termination required to be given by an employee is the same as that required of an employer except that there is no requirement on the employee to give additional notice based on the age of the employee concerned. If an employee fails to give the required notice the employer may withhold from any monies due to the employee on termination under this award or the NES, an amount not exceeding the amount the employee would have been paid under this award in respect of the period of notice required by this clause less any period of notice actually given by the employee.
Thanks for clarifying that Serapis! You clearly know the acts :) I did mean that the employee had to give the sufficient notice as mentioned in their employment contract (is this the same as award?). I was just suggesting by recent experience of my wife. In our case, we gave doctor's certificate and used sick leave in lieu of two week's termination notice according to my wife's employment contract. Everything got paid okay in the end without any delays.
Was probably procedurally different. When you give 2 weeks notice you're still working there for those 2 weeks. So you can use sick leave during your notice AFTER you've given notice.
You don't really use sick leave in lieu of notice, that's not how it works. They might've been nice, let her finish on the spot and just pay her the 2 weeks =)
I called up fair work and was told that the employee doesn't not have to pay u and if not given right amount of notice of resignation and if you do want your anual payed u need legal advice?
I received my payment today but not the anual leave, I resigned last week.
It sounds like your situation is a bit more complicated than anticipated. You're probably better off calling one of the legalaid helplines:
https://www.moneysmart.gov.au/managing-your-money/managing-d…
That is correct. If you did not give the right amount of notice, the employer can withhold your final payments which can include annual leave, long service leave and so on.
The employer can withhold pay using the annual leave, for however many weeks the employee didn't give enough notice.
I.e. if you give only 1 week's notice when you were meant to give 2, the employer can withhold the second week's amount of pay from the annual leave, but still has to pay the rest of the annual leave.
why not just change ur resignation date a week or two out, and blaze through some sick days….
That's the Aussie spirit!
Go see Dr. How-long for your certificate as well.
stress leave, cant prove you not stressed….or migraines
When I left my last job, my next pay period was on a Friday and also my last day(fortnightly), however I was only paid up until Wednesday on that pay period as per normal.
Had to wait till the next period before I was paid those few days, and the remainder of my leave. I do think technically there is a legal requirement to have it paid out asap, or next pay period? If it's actually an issue for you call fair work. They have been great for these matters in the past.
So much misinformation / partly correct information here… Let me clarify and sum all this up:
To clarify, Commonwealth law, this is dealt with under the Fair Work Act 2009 s90(2) - Payment for annual leave
Payment for annual leave
(2) If, when the employment of an employee ends, the employee has a period of untaken paid annual leave, the employer must pay the employee the amount that would have been payable to the employee had the employee taken that period of leave.
Because of the wording of s90(2), if your related industrial instrument (aka award / EBA / Collective agreement) offers leave loading when you normally take annual leave, the leave loading component is also payable on your final leave balance.
One of which includes when you resign without letting them know (notice period) when your industrial instrument requires it. This is based around the Fair Work Act 2009 s324(1) - Permitted deductions, mainly:
(1) An employer may deduct an amount from an amount payable to an employee in accordance with subsection 323(1) if:
(b) the deduction is authorised by the employee in accordance with an enterprise agreement; or
(c) the deduction is authorised by or under a modern award or an FWA order; or
Most industrial instruments require an employee (full time and part time) to give notice when they resign. It's most commonly from 1 week to 4 weeks notice but can vary. Therefore if an employee fails to provide notice, the employer can deduct, in accordance with their industrial instrument, the appropriate amount of pay from pay and annual leave. This deduction is normally limited to the amount of notice the employee was actually required to give by said industrial instrument or the difference between what was given and the required notice if it was partially given.
This is dealt with in Fair Work Act 2009 s323 - Method and frequency of payment.
Method and frequency of payment
(1) An employer must pay an employee amounts payable to the employee in relation to the performance of work:
(a) in full (except as provided by section 324); and
(b) in money by one, or a combination, of the methods referred to in subsection (2); and
(c) at least monthly.
Note 2: Amounts referred to in this subsection include the following if they become payable during a relevant period:
(a) incentive‑based payments and bonuses;
(b) loadings;
(c) monetary allowances;
(d) overtime or penalty rates;
(e) leave payments.
I hope this helps to strike out many myths and misconceptions about annual leave that I've seen in this thread.
Wow assuming I would have to give 2 weeks notice and I did not, and I did have more than 130hours leave, is there anything I can do about this? Would getting a doctor certif help? I left last Wednesday submitted a resign email.
No, retracting it is up to them.
However they have to pay you the remaining 54 hrs of leave (130-38*2=54).
My wife had recently resigned using sick leave in lieu of termination notice. Here is what we did:
1. Called her boss and said she was unwell
2. Went to doctor and got 1 week's medical certificate (she was actually suffering from anxiety and we believe most contributing factor was her workplace, so the doctor was happy to write the certificate)
3. Submitted the certificate to her workplace
4. Next morning, submitted the resignation
5. Got email from HR saying, she didn't have to go to work again and they will let her have the time off (i.e. termination notice 2 weeks wasn't required)
6. Following week, we went to doctor again and got another medical certificate for 1 week + 1 working day to cover off her two weeks termination notice. Even though the employer said they did not require it, we preferred to provide it as my wife was legitimately ill
7. She was paid the proper sick leave and her remaining annual leave as lump sum in the pay run after her last day (according to the letter of resignation)
If you've already resigned, providing a medical certificate and citing medical reasons now will be hard I think. Depends on the employer though.
One thing I have heard is that the company doesn't have to give the 9.5% of super on the leave amount.
e.g. Say your salary is $1000 per week + $95 super and you have 8 weeks of leave accumulated. If you had taken the leave you get the full amount + super, i.e. 8 * (1095) = $8760.
But if you leave with accumulated leave then they will only pay out 8 * 1000 = $8000.
Is this true ? I am hoping good big businesses will not do this but what does the law says. The 9.5% is over Ordinary Time Earnings, is leave remaining considered OTE?
Ok, I received my annual leave within this month, almost two months after" are you also meant to get some sort of pay slip from the annual leave payment seperatly?as my last pay slip I was not paid with annual leave, i will need this for tax returns. I won't not going back there as it takes awhile to travel.
I have a question about accruing leave during leave.
1) Does this happen? I'm pretty sure it does because my leave has grown at the contracted days/year (e.g. the 20 standard days) even in years where I have taken more leave than normal
2) With respect to termination, does it make more sense to take leave to drag out your theoretical end date by taking time after your practical end date as "leave" to accrue leave during that leave period? Or is this factored into the leave payout? (The difference is worth around $75 for me)
2a) I also want to know how PAYG treatment differs if paid lump-sum vs. over each month, because don't want to forgo the interest on the deferred portion I'll get back on tax since that will be 10 months later in my scenario (The difference seems to only be worth about $15 for me depending on severity of PAYG on lump-sum, weighing it against lost interest from deferred payments)
3) Any other implications to how the termination payout works (e.g. is super is payable on it, etc.)
1) Yes, as long as you are taking paid leave, as opposed to say leave without pay.
2) If you are under an EBA/award/contract with mandated pay increases, it may be better wait for your payout as your leave payout may be worth more in the future due the pay increases - although it sounds like you only have a short period you're considering. However, you need to factor in opportunity cost as you could take the lump sum and invest elsewhere at a potentialhigher return
3) See https://www.ato.gov.au/individuals/working/in-detail/leaving…
they have to pay your annual leave out for the days owing and if you have leave loading on your job then this is the bit they aren't liable to pay. They would normally pay you on your last payday. So if you get fortnightly pay it will be included in your last pay.