Are you in a Portable Long Leave Scheme? You probably should be
Many electrical contractors are not aware of their state’s portable long service leave scheme. By and large Master Electricians should probably be in one.
These schemes are helpful to electrical contractors: they offset the obligations of employers to have funds set aside to pay for Long Service Leave when the entitlement falls due.
Each jurisdiction has its own version of these schemes and in most states electrical contractors are required to be part of the scheme. To be eligible the work needs to meet a broad definition of ‘building and construction’.
In some states there are no levies at all, just the registration and reporting of service for workers. In other states the contribution levy is a small percentage of the workers’ wages.
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What is Portable LSL?
Portable long service leave is where service is recorded in a particular industry rather than continuous employment with a single employer. Employers must register their eligible employees with the scheme and report/contribute on their service.
Once the employee has completed the required service they are entitled to take LSL. The funds from the scheme will offset the employer’s payment obligations either through a direct payment to the employee or by reimbursement to the employer.
Who is covered by the scheme?
All employees including casuals and apprentices are entitled to LSL, subject to certain conditions. An employee’s entitlement to LSL varies from state to state and it is important to check the relevant legislation or industrial instrument to ensure compliance.
Some schemes will also allow working directors, who are working ‘on the tools’ to be covered by the scheme.
The criterion for coverage typically includes a definition such as: The “building and construction industry” is the industry of constructing, deconstructing, reconstructing, renovating, altering, demolishing, relocating, maintaining or repairing of a multitude of different types of structures. Or it lists the Electrical Award as an eligible award.
Note: Portable LSL schemes do not apply for office staff. The employer is responsible for accruing and paying LSL for these clerical/admin employees.
What is my state/territory’s portable LSL scheme?
Long Service Leave Authority
|The scheme is funded by a levy imposed on employers and contractors. The levy is paid every quarter and is currently equal to 2.1 per cent from April 2018. (except apprentice wages where the Authority covers all levies on behalf of employer).
Long Service Corporation
|The corporation is funded by a levy imposed on building and construction projects costing $25,000 or more.
The current rate of the levy is 0.35 per cent of the value of the building work.
|Under NT Build workers have access to portable long service leave funded by a levy imposed on construction work in the Northern Territory:
• $200,000 or more in value for projects that started before 7 April 2014, regardless of the completion date; or
• $1 million or more in value for projects that started on or after 7 April 2014.
The levy is paid by the project developers. For construction projects starting on or after 7 April 2014 (regardless of completion date) the applicable levy is 0.1 per cent.
|The scheme is funded by a levy of 0.575 per cent charged on all building and construction work performed in Queensland where the total of the cost of the work is $150,000 or more.
The levy is payable by the party for whom the work is to be done.
Portable Long Service Leave
|Workers in the construction industry qualify for long service leave based on service to the industry rather than service to one
employer. Under Construction Benefit Services (CBS) long service leave is portable.
CBS is funded by a levy imposed on employers, which from 1 July 2019 is 2.0 per cent.
|The scheme is funded by compulsory contributions from employers, at approximately 2.5 per cent of an ordinary weekly wage.
A subsidised rate of 1.8 per cent may be available to employers who submit returns and pay their invoice on time.
|The portable long service leave scheme is funded by employer contributions equivalent to a percentage of wages paid to employees in the construction industry.
The levy is currently 2.5 per cent.
|The scheme in WA is funded by compulsory contributions from employers every 3 months.
From 1 January 2022 to 31 Decemeber 2022 the contribution rate is 0.1 per cent (half a per cent) of the ordinary rate of pay paid to the employee.
Are you doing any work on black coal mine sites?
Some employers may be subject to the Black Coal LSL Scheme based on the type and location of their work.
The Black Coal Mining LSL is based on the coverage clause in the Black Coal Mining Industry Award. The coverage, clause 4 of the Black Coal Mining Award states employees who are employed in the black coal mining industry by an employer engaged in the black coal mining industry, whose duties are directly connected with the day-to-day operation of a black coal mine.
The Administration Act was amended from 1 January 2010 to include the definition of ‘black coal mining industry’ as the same meaning as in the Black Coal Mining Industry Award.
If you need more information about the various schemes and what is required contact the state authority or the MEA Employer Advice Line on 1300 889 198.