Why more industries may now be liable to pay Portable Long Service Leave
Heads up Victorian employers – recent Supreme Court decisions may mean you owe Portable Long Service Leave (PLSL) entitlements to staff you never thought were covered. A couple of landmark decisions by the Victorian Supreme Court have shaken things up, confirming that PLSL isn’t just for traditional building and construction businesses anymore.
Here’s what’s going on and why you might need to take a closer look at your payroll obligations.
What is “Portable” Long Service Leave?
Traditionally LSL is tied to how long someone stays with a single employer. However in industries where staff often move around, such as construction, PLSL allows workers to carry their entitlements with them job to job. Employers pay into a fund (in Victoria, it’s called LeavePlus), and workers still get their entitlements when they reach seven years of service across the industry, even if they have worked at multiple workplaces during those years.
You might already know PLSL applies to tradies on building sites. But a recent court ruling has broadened that definition.
Why this matters
Two large employers, EnergyAustralia and Detector Inspector, challenged whether they needed to pay into the LeavePlus fund for their workers, arguing they weren’t in the building industry. The Court disagreed holding it doesn’t matter what the main business is, if any part of your workforce is doing what could reasonably be called construction, maintenance or inspection work, then you’re likely covered.
To put it plainly: It’s the work, not the industry label, that counts. This has left both companies with annual bills of $700,000 – $800,000. Ouch.
What does “construction work” now include?
Based on the court decisions and guidance from LeavePlus, PLSL could now apply to workers involved in:
- Power station maintenance
- Electrical repairs
- Smoke alarm inspections
- Gas fitting
- Plumbing
- Any similar “repair or maintenance of structures.”
If you have staff performing these kinds of tasks – even as part of a broader business like energy supply, telecommunications or residential services – you may already be liable.
How far back could your liability go?
Here’s the kicker: these liabilities aren’t just from now on – they could go back years. The LeavePlus authority has made it clear they’ll be auditing businesses and enforcing compliance. In the last financial year they issued over 10,000 legal notices and prosecuted 250 employers.
Their view is simple: not paying into the scheme = wage theft.
What should employers do now?
- Review your workforce activities. Do you have employees doing work that might now be classed as “construction activity”? Look closely – job titles don’t matter as much as what the workers are actually doing.
- Seek professional advice. This area is changing fast. If you’re unsure whether you’re affected, it’s worth getting tailored legal advice from our Business Lawyers before audits come knocking.
- Get compliant. If you do fall within the scheme, it’s time to register with LeavePlus and start making the required 2.7% contributions on applicable wages.
Disclaimer: This article is general in nature and does not constitute legal advice. Always seek legal advice specific to your circumstances.
Need help untangling your obligations?
If this ruling has left you wondering where your business stands, you’re not alone. At OFRM Lawyers, we help employers across industries understand and manage their workplace obligations – before they become a legal or financial headache.
