In a nutshell, yes it is, but…….it is important that employers understand there are different rules for different types of employees & it is in a practical sense only really available to longer term employees.

The National Employment Standard (NES) sets out the minimum entitlement to annual leave as 20 days per annum for permanent, full time employees. An employee (other than a casual employee) is entitled to four weeks of paid annual leave for each year of service with the employer. An employee’s entitlement to annual leave accrues on a continuous basis according to the number of ordinary hours they worked. Annual leave continues to accrue when an employee takes a period of paid annual leave or paid personal/carer’s leave. Annual leave will not accrue on unpaid leave unless it is community service leave or it is provided for in an award or agreement.

Employees who are employed under an Award or Agreement can cash out their annual leave entitlement providing:

  • both the employer and employee agree
  • the employee is not left with an accrued entitlement of less than 4 weeks leave remaining after the cash out
  • the agreement to cash out the annual leave must be in writing
  • the employer must pay the employee at least the full amount that would have been payable had the employee taken the leave (ie. must include leave loading)
  • a maximum of 2 weeks can only be cashed out each 12 months
  • specific records are kept
  • if the employee is under 18, a signature from their parent must be obtained
  • the employer cannot unduly influence the employee forcing them to cash out paid annual leave

Employees that are award free can cash out their annual leave entitlement providing:

  • both the employer and employee agree
  • the employee is not left with an accrued entitlement of less than 4 weeks leave remaining after the cash out
  • the agreement to cash out the annual leave must be in writing
  • the employer must pay the employee at least the full amount that would have been payable had the employee taken the leave

Need advice?  For timely, cost effective advice, contact Lisa Lee at Classic Recruitment & Human Resources or at the office on (07) 4638 3599.