Personal Leave Explained: What It Is and How It Works

Personal Leave Explained: What It Is and How It Works

Table of content

  1. What is personal leave?
  2. What does personal leave cover?
  3. How much personal leave do employees get?
  4. How does personal leave accrue?
  5. Can employee cash out their accrued personal leave?
  6. What payments are required when personal leave is taken?
  7. What’s the difference between personal leave and annual leave?
  8. Personal leave FAQs
  9. How does Workstem simplify leave management?

As an employer, it’s crucial to understand the National Employment Standards (NES) and employees’ rights regarding personal and carer’s leave. In this blog post, we will provide an overview of personal leave, including requirements and procedures, to ensure both employers and employees are aware of their rights and responsibilities.

What is personal leave?

Personal leave refers to a period of time off granted to employees for personal reasons that are typically unrelated to their regular work duties.

It is a form of paid or unpaid leave that allows employees to attend to personal emergencies or take care of their well-being without worrying about work obligations.

Personal leave can encompass various types of leave, including sick leave, carer’s leave, and compassionate leave.

What does personal leave cover?

Personal leave covers various circumstances, including:

Sick Leave

Personal leave can be taken when an employee is unable to work due to their own illness or injury, including sickness caused by pregnancy.

Carer’s Leave

Personal leave can be used to take care of an immediate family member or household member who is injured, ill, or experiencing an emergency. This allows employees to take time off to provide necessary support and assistance.

Compassionate Leave

Personal leave can be taken when an employee experiences the death or life-threatening illness or injury of an immediate family member or household member. It provides time off to deal with the emotional and practical aspects of such situations.

Unpaid Personal Leave

In addition to paid personal leave, employees, both casual and permanent, are entitled to unpaid personal leave for circumstances such as compassionate leave, carer’s leave, and domestic violence and family leave.

It’s important to note that employers may require notice and evidence for granting personal leave, and the specific entitlements and conditions may vary depending on the jurisdiction and employment agreements.

*It is recommended to consult the Fair Work Ombudsman website or relevant employment laws for detailed information.

How much personal leave do employees get?

Personal leave can be either paid or unpaid, and it accrues progressively based on the time worked by employees. This means that employees start earning leave from their first day of work and accumulate it over time.

Paid and unpaid personal leave is governed by the National Employment Standards (NES) in Australia. The NES sets the minimum conditions for most employees in the country, including personal leave entitlements.

Under the National Employment Standards (NES) in Australia:

  • Full-time and part-time employees are entitled to at least 10 days of paid personal leave each year. For part-timers, paid leave is accrued pro rata.
  • Full-time and part-time employees are entitled to an additional 2 days of paid compassionate and bereavement leave any time they meet the compassionate leave criteria.
  • Casual employees are entitled to 2 days of unpaid compassionate and bereavement leave any time they meet the compassionate leave criteria.

These entitlements might be different if the employee is covered by an award, enterprise agreement or employment contract that allows for more leave.

Additionally, the Victorian Sick Pay Guarantee provides paid sick and carer’s pay for eligible casual, contract, and self-employed workers in certain occupations. This guarantee can provide up to 38 hours of paid sick leave. Eligibility should be checked based on specific criteria and occupation.

How does personal leave accrue?

Personal leave accrues hourly as an employee works. An employee earns a certain amount of personal leave for every hour worked, according to the employment agreement or company policy.

Accrued personal leave can be utilised by the employee when they have accumulated enough hours and have a valid reason for taking the leave. Acceptable reasons may include personal illness, medical appointments, family emergencies, or other satisfactory circumstances.

Personal leave carries over from year to year, allowing the employee to accumulate and carry forward unused leave for future use. However, when the employee’s employment relationship ends, any accrued personal leave is typically not paid out.

In summary, personal leave accrues hourly as an employee works, can be taken with a valid reason and enough accrued hours, carries over from year to year, but is not paid out upon the termination of the employment relationship.

Can employee cash out their accrued personal leave?

Employees can cash out their accrued personal leave if there is a clause in their contract, an award, or an enterprise agreement that permits it.

However, cashing out may not be allowed if it would result in the employee having less than 15 days of paid personal leave remaining.

Example 

Claire has been working with the same employer for 20 years. Over this time, she has accumulated over 50 days of personal leave. Claire decides to cash in some of her personal leave, as allowed under her Enterprise Agreement.

However, there is a limitation in place. According to the agreement, Claire can only cash out 35 days of personal leave. If she cashes out any more, she will be left with less than 15 days of paid personal leave.

What payments are required when personal leave is taken?

When taking personal leave, employees are required to be paid at least their base rate of pay for the regular hours they would have worked. Additional entitlements may include:

  • Loadings
  • Allowances
  • Overtime or penalty rates
  • Other identifiable amounts specified in the award or employment contract

*The specific payment requirements may vary based on factors such as location, industry award, and individual employment agreements.

What’s the difference between personal leave and annual leave?

Personal Leave vs Annual Leave: Key Differences as per Fair Work

Personal Leave

Annual Leave

Purpose

Illness, injury, caring for a family member, family emergency Rest, relaxation, and vacation

Planned

No Yes

Entitlement

Varies depending on employee’s needs Accrued based on length of service and employment contract
Approval Employer’s approval required

Employer’s approval required

Record Keeping Employer maintains a record of leave taken and type

Employer maintains a record of leave taken and type

Paid/Unpaid Paid, subject to Fair Work Act and company policies

Paid

Personal leave FAQs

Q: How much Personal Leave can an employee have per year?

A: An employee who is full-time is entitled to 10 days of paid personal/ carer’s leave per year, and part-time employees receive a prorated entitlement of personal/carer’s leave.

Q: What is the Personal Leave limit in Australia?

A: Personal Leave entitlements in Australia are 10 days of paid Personal Leave for full-time employees per year and for part-time employees, the entitlements are prorated based on the hours worked.

How does Workstem simplify leave management?

Streamline your leave request submission and approval process, reduce administrative burden, and cut costs with Workstem’s leave management feature. Our platform offers default leave types such as annual leave, parental leave, jury duty leave, and long service leave, and allows for additional special leaves as needed.

Stay up-to-date with auto-updates for public holidays and let Workstem handle the calculations for leave balances, entitlements, and leave accrual. Our seamless integration with payroll ensures accurate payment of leave entitlements and proper tax treatment.

Ready to experience the benefits of Workstem?

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