QIRC decision explains long service leave entitlements for SMEs in Queensland

An employee within a small business is entitled to long service leave if they have completed 10 years of continuous service according to Section 95(2)(a) of the Industrial Relations Act 2016 (Qld) (IR Act).



‘Continuous service’ is defined under section 93(b) as “the employee’s continuous service with the same employer, whether wholly in the State or partly in and partly outside the State.”



The recent case of  Fox v Infosys Technologies  [2024] QIRC 109  considered the issue of entitlement to long service leave for employees who serve partly in and partly outside Queensland. 



Fox v Infosys Technologies Ltd  [2024] QIRC 109



Facts



The applicant, Craig Fox, was an industrial inspector who brought a claim on behalf of Mr Narendra Gade against Infosys Technologies Ltd ( Infosys ) for unpaid wages representing alleged long service leave entitlements.



Mr Gade is an Indian national, with the following employment history:




from 5 March 2012 to 14 June 2018, he worked for Infosys in Mysore, India



from 14 June 2018 to 28 March 2022, he worked for Infosys in Melbourne



from 28 March 2022 to 14 April 2022, he worked for Infosys in Brisbane.




Mr Gade was employed by Infosys from 5 March 2012 to 14 April 2022. He attained 10 years of continuous service with Infosys on 5 March 2022, 23 days before he began work in Queensland.



Issues



Mr Gade argued he was entitled to long service leave under the Queensland provisions because his continuous service was ‘partly in and partly outside the State’. Mr Gade argued some of his service with Infosys occurred ‘partly in’ Queensland – that is the 18-day period from 28 March 2022 to 14 April 2022. Taken literally, he therefore completed 10 years of continuous service ‘partly in and partly outside the State’.



Infosys argued that the relevant provisions ought to be read so as to require a ‘substantial connection’ between Mr Gade’s service and Queensland. Infosys contended that Mr Gade was primarily employed in India, obtained the benefit of industrial legislation enacted in India, and his employment in Queensland was brief and just an incident of his employment in India. Therefore, Infosys submitted that the 18 days service in Queensland cannot be merged into and counted with Mr Gade’s earlier service, despite he completed 10 years of service prior to working in Queensland.



Decision



Mr Gade was entitled to long service leave.



The Queensland Industrial Relations Commission ( the Commission ) held that service ‘partly in’ or ‘partly outside the State’ may occur at any time during the qualifying 10 years. Once there is service in Queensland, the ‘continuous service’ will be calculated as including past service performed outside the state.



The Commission also ruled that there is no ‘substantial connection’ test imported as a requirement into section 93 of the IR Act. None of the authorities considering interstate legislation are directly relevant to the construction of section 93(b) of the IR Act. The subsection expressly provides that both service within the state and outside of the state counts in the calculation. The trigger is “service … partly in the State”.



The Commission further held that in some cases, an employee’s presence in Queensland may be so short that it does not qualify as constituting any ‘service in the State’.   It is a matter of fact to be determined whether in any particular case, the employee’s presence in the performance of any work can be deemed as ‘service … partly within the State’. To determine whether there has been ‘service … partly in the State’, it is necessary to look at all the circumstances including the contract of service.



While Mr Gade’s employment contract was entered into in India, the terms of his employment expressly provided that he may be required to serve Infosys in other jurisdictions, therefore, he was required to serve the company in Victoria and Queensland. Relying on his employment terms, those 18 days worked in Queensland were part of his ‘service’ which was ‘partly in the State’.



The Commission held that the section has a retrospective effect. The fact which triggers the calculation is service by the employee in Queensland. Once that occurs, then what is taken into account in the calculation includes service ‘partly outside the State’ which may be service predating the service in Queensland.



The Commission held that until there is service in Queensland, service by the employee in another place will not count towards calculation of long service leave under the IR Act, no matter the length of ‘continuous service’ the employee provided. However, once there is service ‘partly in the State’, the next question is whether there is 10 years of service ‘partly outside the State’. For Mr Gade, the answer to that question was yes, being the period from 14 April 2012 to 14 April 2022.



Implications for employers in small businesses



If an employee performs service in Queensland at some point during their employment, they will be entitled to long service leave upon completing 10 years of continuous service. However, if their continuous service is entirely outside Queensland, they will not be entitled to long service leave.



Interestingly, as demonstrated by the above case, if an employee has completed 10 years of continuous service entirely outside Queensland and subsequently served partly in Queensland, they would be entitled to long service leave. Such scenario aligns with the definition of ‘continuous service’ under the IR Act, wherein their service is deemed partly in and partly outside Queensland.



As the Commission in  Fox v Infosys  held, a ‘substantial connection’ test is not relevant when considering section 93 IR Act.



By Rachel Drew , Managing Partner, and Julian Shannon, Graduate



Disclaimer The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.



Keep up to date with our stories on  LinkedIn ,  Twitter ,  Facebook  and  Instagram .