Who’s covered by the scheme?
Registration is compulsory for individuals, partnerships, companies or trusts employing workers:
- full time, part time or casually for at least 3 days in any month each of at least 5 hours;
- at least half of their time on-site in any 3 month period;
- performing building work or electrical or metal trades work defined in the Act;
- where one of the following Awards prescribes a weekly rate of pay for the kind of work performed (note these Awards do not need to regulate your worker’s pay)
- Building and Construction General On-Site Award 2010
- Joinery and Building Trades Award 2010
- Plumbing and Fire Sprinklers Award 2010
- Electrical, Electronic and Communications Contracting Award 2010
Building work means:
- the construction or erection of a building or structure that is or is to be fixed to the ground and wholly or partially fabricated on-site;
- any preliminary site preparation work (including pile driving) for the construction or erection of any such building or structure;
- the alteration, maintenance, repair or demolition of any building or structure;
- the laying of pipes and other prefabricated materials in the ground, and any associated excavation work
Electrical or metal trades work means:
- electrical or metal work associated with the construction or erection of a building or structure that is to be fixed to the ground and wholly or partially constructed on site;
- electrical or metal work associated with the alteration or demolition of a building or structure;
- the construction, erection, installation, extension, alteration or dismantling of a transmission or distribution line, or plant, plant facility or equipment used in connection with the supply of electricity;
- the construction, erection, installation, extension, alteration or dismantling of an air-conditioning, ventilation or refrigeration system;
- the construction, erection, installation, extension, alteration, servicing, repairing, replacing of parts or dismantling of a lift or escalator;
- electrical or metal work associated with other engineering projects
Structures include:
- a tank or other structure for the storage or supply of water;
- sewerage or effluent drains and associated structures;
- a bridge, viaduct, aquaduct or tunnel;
- a chimney stack or cooling tower;
- a silo;
- a dock, jetty, pier or wharf
As this definition is inclusive, we have adopted the following definition of structure:
“A structure is a permanent or semipermanent object which is constructed from one or more component parts and fixed in or on the ground.”
The Act defines ‘Building’ to include part of a building.
Why does portable long service leave exist?
Portable long service leave exists because the construction industry is mostly project-based meaning workers frequently move from project to project and employer to employer.
Back in the 1970’s, industry groups (both employers and employees) recognised this unique aspect and that for most workers in construction, long service leave would be unachievable. Wanting to ensure a strong, vibrant, and attractive industry to existing workers and newcomers, they adopted a portable model and Portable Long Service Leave was born. This meant long service leave could be taken from employer to employer as long as you stayed in the industry.
Pro’s of portable long service leave:
- It’s portable – providing a fluid and efficient market of labour and skills throughout the industry when and where they are needed most, without losing entitlement.
- Attraction and retention – ensures construction can compete with other industries by offering equivalent benefits.
- Refresh and reinvigorate – although a highly rewarding industry, construction can also be stressful. Constant problem solving, long hours, safety risks, billion dollar projects, million dollar equipment, and uncertainty between projects can manifest in costs to business of turnover, burnout, productivity and injury. Even small routine installation or service and maintenance tasks can be repetitious and take their toll through boredom and de-motivation. 13 weeks leave after 10 years service provides sufficient time to relax, recharge and then return to the industry boosting morale, reducing safety risks and increasing productivity.
- Cost certainty – portable long service leave provides cost certainty and allows an employer to discharge long service leave obligations through payment of a levy so you don’t have to worry about making a large payment sometime in the future. The levy is also tax deductible.
- Administration – Portable Long Service Leave handles all the tracking of long service leave, calculation of the payment, and withholding tax.
Con’s of portable long service leave:
- It’s portable – some employers see portability as a disincentive for workers to remain with them.
- Cost – portable long service leave is a cost to business. Portable Long Service Leave acknowledges this and that’s why it focuses on being a cost effective operation in order to keep the levy as low as possible whilst maintaining the viability of the fund. This in turn enables the industry to remain competitive.
- Administration – every two months you need to complete an employer return in order to track portable long service for your workers and calculate the appropriate levy. Portable Long Service Leave tries to make this as easy and quick as possible with online returns and easy payment options.
- Cashflow – every two months you need to pay the appropriate portable long service leave levy. This represents 2% of employee remuneration for that period (excluding apprentices) and undoubtedly needs to be planned for. However it’s a small amount in comparison with a claim for long service leave of which we manage and have responsibility for.
Over the years there have been hundreds of studies both locally and internationally on the effect of both paid and unpaid leave on the workforce. Most centre around annual leave, sick leave, and parental leave but the premise applies to long service leave as well.
And that is, whether paid or unpaid, leave can have a significant positive effect on long term productivity through improvement in health and wellbeing.
With tight margins and timeframes, construction has to be an industry with high productivity. Downtime associated with unplanned sick leave, stress and mental health issues, injury, low morale and motivation can mean the difference in delivery of a successful project.
It stands to reason that long service leave has an important part to play in the industry.
Fortunately, in construction, long service leave is portable meaning it is more achievable and readily accessible providing a valuable tool to refresh and recharge your workforce and industry. Paying a bimonthly levy means there is no large payment to make when an employee takes leave either.
As it is compulsory for long or short term employers, you contribute equivalently and share the dividends of a highly productive workforce.
Other industries are catching onto the benefits this brings to an industry and construction has been doing it for 40 years!
Discuss Long Service Leave openly with your employees and plan and encourage with them to utilise it for a decent break ready to return to the workforce rested, motivated and productive. You can both share in the benefits it will bring!
Information provided by Portable Long Service Leave. For more information, contact them on 08 8332 6111 or visit their website at portableleave.org.au.
For further information or assistance, please contact Dain Venning, Workplace Relations Advisor at NECA SA/NT, via email or on (08) 8272 2966.
