Calculating annual leave payments on termination – do you include leave loading or not?
This question is often asked of me by my clients when they are calculating employee termination packages, and until now it has been difficult to advise with sufficient certainty. Helpfully, the recent Federal Court decision of Centennial Northern Mining Services Pty Ltd v Construction, Forestry, Mining and Energy Union (No 2)  FCA 136 (27 February 2015) – resolves the uncertainly once and for all!
The decision handed down in that case makes it clear that annual leave payable on termination is to be paid at the rate equivalent to the amount the employee would have received if he/she had actually taken annual leave during the course of his/her employment. Therefore, if applicable, remember annual leave loading is payable.
For more information on calculating employee termination packages, please contact: