Long Service Leave NSW: Your Entitlement, Pro-Rata and Payout

9 min read

Last updated August 2026
Reviewed by the Australian Unions policy team, August 2026

When unions helped NSW workers recover unpaid long service leave, we found a lot of people were confused about what happens when they resign. A common misconception is that you’ll automatically receive a long service leave payout when you leave your job, but the rules are a bit more complicated than that.

Long service leave in NSW at a glance

Employees are entitled to long service leave after an extended period of service with an employer. Your specific entitlements to long service leave will be determined by state or territory long service leave legislation, or (if you are covered by a pre-reform award) by the National Employment Standards under the Fair Work Act.  

This factsheet covers the specific rules for employees in Victoria, primarily under the Long Service Leave Act 2018 (Vic). These rules will apply unless you are covered by a pre-modern award. An enterprise agreement can also provide more generous long service leave entitlements. To learn more about national long service leave entitlements, visit our main Long Service Leave factsheet.

How much long service leave do you get in NSW?

Here’s a breakdown of your long service leave entitlements in New South Wales:

Less than 5 years of service

You are not entitled to long service leave.

After 10 years

After 10 years of continuous service with the same employer, you are entitled to 2 months (8.6667 weeks) of paid long service leave.

After 15 years and beyond

For every further 5 years of continuous service after your initial 10 years, you will be entitled to an additional 1 month (4.33 weeks) of paid long service leave.

Pro-rata after 5 years

You may also be entitled to pro-rata long service leave if your employment ends after 5 years of continuous service, but only under specific circumstances. These circumstances are where NSW differs significantly from other states, as detailed in the next section.

When you can get pro-rata long service leave in NSW

In New South Wales, receiving pro-rata long service leave after 5 years of service is conditional. This is a key difference from other states, where it may be automatically granted upon termination after a certain period.

Illness, incapacity, or domestic or pressing necessity

If your employment ends after 5 years but less than 10 years of continuous service, you are only entitled to pro-rata long service leave if you resign due to illness, incapacity, or domestic or other pressing necessity. This means your reason for leaving must fall into one of these categories to qualify.

If your employer dismisses you

Similarly, if your employer dismisses you after 5 years but less than 10 years of continuous service, you are entitled to pro-rata long service leave, unless the dismissal was for serious and wilful misconduct.

The resignation trap

A common pitfall for workers in NSW is resigning without specific grounds before reaching 10 years of service. If you simply resign because you’ve found another job, or for a reason not covered by “illness, incapacity, or domestic or other pressing necessity,” you will likely forfeit any accrued pro-rata long service leave.

Sarah, a member of the Finance Sector Union (FSU), had worked for her employer for 7 years. She found a better job opportunity and resigned. When she received her final pay, there was no long service leave payout. She contacted her union, and after reviewing her case, her union had to explain that because her resignation was not due to a specified reason like illness or pressing necessity, she wasn’t entitled to the pro-rata payout under the NSW laws. 

How long service leave is calculated in NSW

Long service leave is calculated based on your ordinary gross weekly wage at the time you take the leave, or when your employment ends (for payment out of accrued long service leave).

The ordinary weekly wage

This is your regular weekly pay, including any amounts you regularly receive, but generally excluding allowances and payments for shift-work, overtime or penalty rates. Your ordinary wage for these purposes will be the higher of your ordinary remuneration at the relevant date and your average weekly ordinary remuneration over the previous five years.

If your pay varies, i.e. if you are not paid a fixed rate of pay for ordinary hours of work, an average weekly wage will be calculated.

Worked NSW example

Let’s say you’ve worked for 10 years and your ordinary gross weekly wage is $1,200.

Your entitlement after 10 years is 8.6667 weeks.

Calculation:

$1,200 (ordinary gross weekly wage) x 8.6667 (weeks entitlement) = $10,400.04

So, your long service leave payout would be approximately $10,400.04 before tax.

What counts as continuous service

Continuous service is the unbroken period you have worked for one employer. Understanding what counts as continuous service, and what doesn’t, is crucial for determining your long service leave entitlement.

Leave, transfers and business sales

Most types of paid leave (like annual leave, personal leave, parental leave) and approved unpaid absences will not break your continuous service. If your employer’s business is sold or transferred to a new owner, your service often transfers with it, meaning your years with the previous owner typically still count towards your long service leave.

Casual and irregular work

Casual employees in NSW can also accrue long service leave entitlements, provided they have a period of continuous service with the same employer. This typically means showing a pattern or series of regular engagements to perform work rather than sporadic shifts.

NSW vs other states

Long service leave entitlements are primarily governed by state and territory legislation, meaning the rules can vary significantly across Australia. For example, in NSW, pro-rata long service leave after 5 years is only available under specific circumstances (illness, incapacity, domestic/pressing necessity, or dismissal not for serious misconduct), whereas in Victoria, employees are generally entitled to pro-rata long service leave after 7 years of continuous service regardless of the reason for termination. For more information on Victoria’s rules, check out our long service leave in Victoria factsheet.

Portable long service leave in NSW

While most NSW workers accrue long service leave by staying with a single employer, portable long service leave schemes exist in certain industries. These schemes allow workers to accrue entitlements across multiple employers within the same industry. In NSW, these portable schemes currently cover workers in the building and construction, contract cleaning, and community services sectors.

When long service leave is paid out

Untaken long service leave is generally paid out on termination of employment once you are entitled to it. This means if you have met the minimum continuous service requirements (10 years for full entitlement, or 5 years under specific conditions for pro-rata), any accrued but untaken leave will be included in your final pay.

What to do if your NSW long service leave is wrong

If you suspect there’s an issue with your long service leave entitlement or payout in NSW, follow these steps:

Step 1: Confirm your continuous service dates

Pin down your exact start date with your employer and any significant breaks in service. Gather any employment contracts, payslips, or other documents that verify your employment period.

Step 2: Calculate what you are owed

Using the formulas provided above and your ordinary gross weekly wage, calculate the amount of long service leave you believe you are owed.

Step 3: Raise it with your employer in writing

Politely raise your concerns with your employer. A brief email can be effective: “I’m writing to inquire about my long service leave entitlement/payout. Based on my records, I believe there may be a discrepancy. Could you please review this?”

Step 4: Get your union involved

If you’re unable to resolve the issue directly with your employer, or if you need assistance at any step, contact your union. Unions routinely chase unpaid long service leave and dispute service calculations for members, often resolving complex cases free of charge.

Step 5: SafeWork NSW or the Long Service Corporation

As a last resort, if your union is unable to resolve the issue, you can contact SafeWork NSW or the NSW Long Service Corporation for further assistance. These government bodies can investigate disputes and provide official determinations.

Frequently asked questions

How much long service leave do you get in NSW?

In NSW, you are entitled to 2 months (8.6667 weeks) of paid long service leave after 10 years of continuous service with the same employer. You then accrue an additional 1 month for every further 5 years of service

Do you get pro-rata long service leave in NSW if you resign?

Yes, but only under specific conditions. If you resign after 5 but less than 10 years of continuous service, you’re entitled to pro-rata leave if your resignation is due to illness, incapacity, or domestic or other pressing necessity. A simple resignation without these grounds typically forfeits your pro-rata entitlement.

When are you entitled to long service leave in NSW?

You become fully entitled to take long service leave after completing 10 years of continuous service with one employer. You can apply to take this leave, or it will be paid out upon termination of employment.

Can casual employees get long service leave in NSW?

Yes, casual employees in NSW can be entitled to long service leave. This applies if they have consistently worked for the same employer under a pattern or series of regular engagements for the required period of continuous service.

Can long service leave be cashed out in NSW?

No, generally, long service leave cannot be cashed out in NSW. You must take the leave as time off, or it will be paid out upon the termination of your employment once you are entitled to it.

Is long service leave taxed in NSW?

Yes, long service leave payments are generally subject to income tax. However, the tax treatment can vary depending on whether it’s paid out on termination or taken as leave, and your individual tax circumstances.

Do you accrue long service leave while on unpaid leave in NSW?

Generally, periods of unpaid leave (like unpaid parental leave) will not break continuous service, however, the period of the absence may not be able to be counted for the purposes of long service leave accrual. However, certain approved absences, such as paid leave, do count towards accruals.

Think your long service leave is wrong? Your union can help

Don’t let employers short-change you on your hard-earned entitlements. Just like Sarah who lost out on her pro-rata LSL because of a technicality, many workers in NSW miss out on what they’re owed. Your union offers expert advice and representation to ensure your long service leave is correctly calculated and paid. Join your union today and let us help you protect your rights.

Are you already a union member?

Reach out to your union for more specific information about how you and your workmates can make the most of your rights at work.

Not yet a member?

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