Most modern awards say that employees get paid annual leave loading on top of their minimum hourly rate when they take annual leave.

Some awards say that employees get paid the higher of:

• a 17.5% loading, or
• the weekend or shift penalty rates the employee normally gets.

The particular rates that need to be compared depend on what the award says. Check your award for details.

The comparison needs to be made over the whole period of leave, and not on a daily basis.

Annual leave can’t be taken on public holidays, so annual leave loading isn’t paid on public holidays that fall during the period of leave.

Example

Katya works 5 hours each day from Tuesday to Saturday, which is a total of 25 hours each week. Her minimum hourly rate is $30 per hour. She also gets paid a 25% weekend penalty on Saturday. Her Saturday pay rate is $37.50 per hour.

Katya takes one week of annual leave. No public holidays fall during her leave. She checks her award and sees that she gets paid the higher of:

• her minimum weekly rate plus 17.5% leave loading, or
• her minimum weekly rate plus weekend penalties.

Minimum weekly pay without weekend penalties

25 hours x $30 = $750

Minimum weekly pay plus leave loading

$750 + 17.5% = $881.25

Minimum weekly pay plus weekend penalties

20 hours x $30 = $600

5 hours x $37.50 = $187.50

$600 + $187.50 = $787.50

Katya’s minimum weekly pay plus leave loading is higher than her minimum weekly pay plus weekend penalties.

Katya gets paid $881.25 for her week of annual leave.

Annual leave loading at the end of employment

An employee’s accumulated annual leave is paid out when their employment ends.

The employee is entitled to the same annual leave pay when ending employment that they would have received if they took the leave.

This is calculated the same way as during employment and includes any annual leave loading, penalty rates or shift loading that would have applied.

See Final pay for more information.

Example

When Katya resigned from her job, she was owed 2 weeks’ annual leave.

The pay for her unused annual leave included the 17.5% annual leave loading, because it was higher than the weekend penalties she would have received if she’d worked for the 2 weeks.