Accrual of leave on workers compensation: Your go to guide

Image of person calculating leave entitlements for workers compensation

Do you accrue leave while on Workers Compensation in NSW? 

In Australia, compensation payments may affect your entitlement to standard pre-injury employment benefits. This article covers the availability of different types of leave in NSW when on workers compensation, and how access to leave benefits may differ from state to state. 

In short, most Australian states permit injured workers recovering on workers compensation payments to receive in tandem the same leave benefits and payments they would have received pre-injury. In NSW in particular, annual leave, sick leave, and long service leave payments are available to you even while you are on workers’ compensation. 

What does Section 130 of the Fair Work Act 2009 say?

Whether you are entitled to accrue leave while on Workers Compensation in NSW depends on two provisions of legislation. The first is section 130 of the Fair Work Act 2009 (Cth), which specifies that you are not entitled to leave or payment during the time you take off of work to recover from an injury if you are already receiving compensation payments for your injury. 

However, sub-section (2) of the same provision specifies that any compensation law allowing an injured person to both accrue leave and receive compensation payments overrides this ban on leave accrual. 

What does Section 49 of the Workers Compensation Act 1987 say?

In NSW, Section 49 of the Workers Compensation Act 1987 (NSW) enables injured workers to receive compensation payments for their injuries even when they have already accrued benefits, such as annual leave, which they could use to recover from their injury. 

More precisely, the legislation demands that any amount an injured worker receives in compensation payments is not affected by the value of any other entitlements (such annual leave) they have accrued and can access — i.e. your workers compensation payments in NSW must be calculated as if you did not receive an form of payment, allowance, or benefit for annual or long service leave. 

Does annual leave accrue while on Workers Compensation?

In summary, NSW and Federal legislation allow an injured worker in NSW to take and accrue annual leave whilst they are recovering from an injury and receiving compensation payments. Section 49 of the Workers Compensation Act (‘the Act’) is a compensation law that allows injured workers in NSW to do so. 

This function of section 49 of the Act was confirmed in the case of NSW Nurses & Midwives Association v Anglican Care [2014] FCCA, where the court emphasised the Act’s purpose to ensure the compensation of injured workers, even while they receive pre-injury benefits, and the need to interpret each provision of the Act accordingly. 

Please note that if you are an employee of the Commonwealth, e.g. a member of the Australian Defence Force, your entitlements to accrue and take all kinds of leave may differ. Members of the ADF, for instance, are entitled to take and accrue annual and sick leave for up to 45 weeks after the determination of their claim (see section 116 of the Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988). 

Is annual leave paid while on Workers Compensation?

Yes, annual leave is paid in NSW while on workers compensation.

Any existing annual leave accrued from before your injury can be paid to you while on workers compensation. You also accrue and are paid annual leave at the same rate that you would if you were working at your pre-injury capacity. For example, if you are totally unable to work but previously held a full-time position, you would continue to accrue throughout your recovery period about 2.9 hours of annual leave per week so that you can receive payment for four weeks of annual leave per year as usual. 

In all states except in Tasmania and the Northern Territory, injured workers receive leave payments while receiving worker’s compensation payments (in Tasmania, you cannot receive leave payments at the same time as compensation payments, whilst in the Northern Territory an injured worker cannot accrue annual leave while absent from work). 

What happens if annual leave isn’t paid to me during Workers Comp?

If you notice that you are not accruing or being paid annual leave during the period of recovery on Workers Compensation, you can contact your employer to request annual leave payments from the start of your recovery period. 

If your employer refuses to pay your leave entitlements, you can seek assistance from your relevant industrial relations disputes body (e.g. the Fair Work Commission). You should also consider speaking to a workers compensation lawyer on more effective ways to communicate and claim your entitlements. 

Call us today at 02 8764 1776 if you have any issues with your leave entitlements during your workers compensation claim. 

Do you accrue long service while on Workers Compensation?

In NSW, an injured worker absent from work on workers compensation continues to accrue long service leave hours at the same rate as they would pre-injury. Both section 49 of the Act and the Long Service Leave Act 1995 (NSW) enable injured workers absent from work on workers compensation to do so. 

The rule should apply in all other states, however in some states (Tasmania, the Northern Territory, and the Australian Capital Territory) legislation does not explicitly address long service leave and therefore entitlement to accrual over the period of workers compensation remains upheld on the level of assumption rather than explicit law. Injured workers in the latter category of states should therefore be more prepared for alterations to their long service leave accrual entitlements. 

Does sick leave accrue while on Workers Compensation?

In NSW, an injured worker does not accrue sick leave if absent on Workers compensation. Sick leave accrual is also unavailable in all other states except Queensland and South Australia (where it is protected under Section 50(2) of the Return to Work Act 2014 (QLD). 

Is sick leave paid while on workers compensation?

As an injured worker in NSW, you are entitled to receive sick leave payments only if your weekly rate of payment for sick leave is higher than your weekly payments for workers compensation. In that case, you will be paid the difference between the value of your workers compensation payments and your sick leave entitlement. 

Breakdown of leave while on Workers Comp per state

State or TerritoryDoes Annual Leave accrue?Does sick leave accrue? Does long service leave accrue?Can I take leave?Can I receive leave payments?
New South WalesYes NoYesYes (annual leave and sick leave)Yes: 
– Annual leave and long service leave (s 49 of the workers Compensation Act 1987
– Sick leave where leave payment is higher than compensation payment 
Victoria YesNoYesYes for annual leave, no for sick leaveYes: 
– Annual leave and long service leave (ss 174(d) and 185(4) of the Workplace Injury Rehabilitation and Compensation Act 2013)
– Sick leave  
QueenslandYesYesYesYes (annual leave and sick leave)Yes:
– Annual leave, sick leave, and long service leave (s 119A of the Workers’ Compensation and Rehabilitation Act 2003)
South AustraliaYesYesYesYes (annual leave for 52 weeks, sick leave for 52 weeks) Yes:
– Annual leave and long service leave (s 50(1) of the Return to Work Act 2014
– Sick leave 
Western AustraliaYesNoYesYes (annual leave and sick leave)Yes:
– Annual leave and long service leave (s 80(1) of the Workers Compensation and Injury Management Act 1981
– Sick leave (s 80(2) of the Workers Compensation and Injury Management Act 1981)
TasmaniaYesNoYesYes (annual leave (but weekly compensation payments will cease) and sick leave)No: 
– Annual leave and long service leave (s 84(2) of the Workers Rehabilitation and Compensation Act 1988)
Northern TerritoryNoNoYesNoYes:
– Annual leave and long service leave 
– Sick leave
Australian Capital Territory YesNoYesNo Yes:
– Annual leave and long service leave (s 46 of the Workers Compensation Act 1951
– Sick leave 
This table is a summary of leave entitlements whilst on workers compensation for all states in Australia.

Can I take annual leave or sick leave while on workers compensation?

Yes, as an injured worker receiving workers compensation payments in NSW and QLD, you are entitled to take annual leave and sick leave. This is a choice available to you as an alternative to receiving payment for annual and sick leave in tandem with compensation payments. 

In NSW and QLD, this entitlement has been confirmed in the cases of Anglican Care v NSW Nurses and Midwives’ Association [2015] FCAFC and Leonard v State of Queensland (Queensland Health) & Anor [2020] QIRC 207. Those cases permit access to standard work entitlements in tandem with workers compensation payments by interpreting compensation law as additional to and not a replacement for standard work rights.  

The option to take annual leave whilst on workers compensation is also available to you if you are on workers compensation in Tasmania, South Australia, Victoria, and Western Australia. Your entitlement to taking sick leave whilst receiving workers compensation payments in those states however varies from state to state (see the table above). 

Do you get paid for Public holidays on Workers Compensation?

You are not entitled to payments for Public holidays whilst on Workers Compensation in any Australian state. 

No state legislation thus far, including section 49 of the Workers Compensation Act 1987 (NSW) sufficiently protects or provides for public holiday payment to override the refusal of concurrent work and compensation benefits in section 130 of Fair Work Act 2009 (Cth). 

Contact Alliance Compensation & Litigation Lawyers today

Alliance Compensation & Litigation Lawyers can help you determine which payments and benefits you have the right to access over the course of recovery on workers compensation. We are experienced with representing and assisting injured workers with communicating their rights to employers and receiving the most support they can.

If you wish to claim workers compensation or dispute an aspect of your payments, we invite you to book a no obligations consultation with us. Call us on 02 8764 1776 or email us at refer@alliancecomplawyers.com.au

Get in touch to find out more HERE … or call 02 8764 1776
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We can help.
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