Leave loading payable on accrued leave at termination

Employers are obliged to pay employees their accrued but untaken annual leave on termination of employment at the rate the employee would have been paid had they taken annual leave during their employment, even if such a rate is higher than the employee’s base rate of pay. This interpretation will prevail over any terms to the contrary contained in an award, enterprise agreement or even an employment contract. Until this case was decided, there was a controversy about whether the calculation was to be made on the employee’s base rate of pay excluding for example an annual leave loading or the higher amount. Unless this case is overturned on appeal, this will be the law henceforth.
Centennial Northern Mining Services Pty Ltd v CFMEU (No 2) [2015] FCA 136 per Buchanan J