Annual Sick Leave in Australia: Employer Entitlements and Evidence

Managing sick leave well is part of running a healthy, compliant workplace. But the rules can feel confusing, especially if you’re balancing rosters, payroll and a growing team.

This guide breaks down how annual sick leave works in Australia (technically called paid personal/carer’s leave under the National Employment Standards), what you can ask from staff, and the processes you should have in place to stay on top of compliance.

We’ll keep it simple and actionable, so you can focus on your business while making fair, lawful decisions when employees are unwell.

What Is “Annual Sick Leave” In Australia?

Under the National Employment Standards (NES), most full-time and part-time employees are entitled to paid personal/carer’s leave. Many people call this “sick leave”. It covers two main situations:

• When an employee is unfit for work due to personal illness or injury (sick leave), and
• When an employee needs to provide care or support to an immediate family or household member who is ill, injured or affected by an unexpected emergency (carer’s leave).

Personal/carer’s leave is a single, pooled entitlement and accrues over time. It’s separate from annual leave and long service leave.

Casual employees don’t get paid personal/carer’s leave, but they can usually take two days of unpaid carer’s leave per occasion (and two days of compassionate leave) under the NES.

Personal/carer’s leave generally carries over year to year if unused. It’s typically not paid out on termination. In limited cases, cashing out may be allowed if a modern award or enterprise agreement specifically permits it and strict conditions are met-get tailored advice before considering this approach.

How Much Sick Leave Do Employees Accrue?

Full-time employees accrue 10 days of paid personal/carer’s leave for each year of service. For a standard 38-hour week, that’s 76 hours per year, accruing progressively with each pay cycle.

Part-time employees accrue leave on a pro-rata basis, based on their ordinary hours. For example, a 20-hour-per-week part-timer accrues 20/38 of the full-time entitlement across the year.

Key points to keep in mind:

• Accrual is based on ordinary hours of work (not overtime).
• Leave accumulates and carries over year to year.
• When taken, sick leave is paid at the employee’s base rate for their ordinary hours they would have worked (no penalties or loadings unless your award/EA says otherwise).
• Public holidays that fall during a period of sick leave are treated as public holidays (not deducted from sick leave).

If you use payroll software, make sure accrual settings match the correct rules for each employment type and award.

What Notice And Evidence Can You Require?

Employees must let you know they’re taking sick leave as soon as practicable and tell you how long they expect to be away. For short, unexpected absences, a quick call, text or email is usually acceptable, as long as it’s consistent with your policy.

You’re entitled to ask for evidence that would satisfy a reasonable person the leave is genuine. Common examples are medical certificates or a statutory declaration.

• Medical certificates: These are commonly requested when an employee is absent for more than a day, or if your policy requires it for any absence.
• Statutory declarations: In situations where a doctor’s appointment isn’t feasible, a signed declaration can be reasonable evidence, depending on your policy and the circumstances.

Having clear rules helps avoid confusion. Set out when you require evidence, the types you will accept, how employees should notify you, and what happens if they don’t comply. A documented Workplace Policy keeps expectations consistent across your team.

It’s also wise to clarify when a certificate is required for partial days or if the employee was rostered for a public holiday. Where relevant to casuals, be clear about when you’ll expect Medical Certificates to confirm an absence (even though paid sick leave doesn’t apply to casual employees).

If a medical certificate isn’t available, consider whether a statutory declaration is appropriate in the circumstances and consistent with your policy.

How To Manage Sick Leave Requests, Rosters And Pay

When an employee calls in sick, you’ll often need to move quickly to maintain operations. Here’s a simple process that works for many small businesses:

1. Record the notification: Log the time/date of the call or message, the expected duration and any evidence requested. Good records protect you if a dispute arises later.
2. Confirm the entitlement: Check their current accrual balance, employment type, and applicable award or enterprise agreement requirements.
3. Adjust the roster: Reassign shifts and notify affected team members. Keep communications professional and avoid sharing health details.
4. Process pay correctly: Pay sick leave at the employee’s base rate for ordinary hours they would have worked. Do not include overtime or penalties unless required by an award/EA.

Your Employment Contract should outline expectations around notice and evidence, and point employees to your leave policy. This creates a clear framework that supports fair decisions and consistent payroll treatment.

Privacy matters here. Any health information should be handled confidentially and only shared on a need-to-know basis within your business.

Common Sick Leave Scenarios Employers Ask About

What If Sick Leave Is Taken During a Notice Period?

If an employee has resigned (or has been terminated) and then takes sick leave during their notice period, the usual rules still apply. They remain entitled to paid personal leave if they have a balance available and provide reasonable evidence when requested. For more on handling timing and pay, see practical guidance on Sick Leave During Notice Period.

What If An Employee Runs Out Of Paid Sick Leave?

It’s common for employees to exhaust their accrual during longer illnesses or injuries. When that happens, you have a few options depending on your policy, the nature of the absence and any applicable award or EA:

• Allow (or require) the use of accrued annual leave
• Offer unpaid leave for a defined period
• Explore flexible arrangements like temporarily reduced hours (with a written variation)
• Request medical clearance before a return to full duties

Have a process that balances compassion with business needs. Start with a supportive check-in, confirm what the employee needs, and document any agreed path forward. For practical steps, see our guidance on managing leave when entitlements run out and how Unpaid Leave can be used in a compliant way.

Can You Request A Medical Clearance To Return To Work?

Yes, in some cases it’s reasonable to seek a “fit for work” note-especially after a longer absence, surgery or a condition that may affect safety or the ability to perform inherent job requirements.

Make sure your policy clearly sets out when a clearance may be required and the type of information you need (e.g. capacity to perform specific duties), and only collect what’s necessary. Here’s a deeper dive into when employers can request medical clearance.

Do Casual Employees Get Paid Sick Leave?

No, casuals don’t receive paid personal/carer’s leave. However, they can usually access two days of unpaid carer’s leave per occasion (and compassionate leave), and you can still require reasonable evidence where appropriate-see the rules and expectations around Medical Certificates.

What Happens To Unused Sick Leave On Termination?

Generally, unused paid personal/carer’s leave is not paid out when employment ends. There are some exceptions in enterprise agreements or specific contractual terms, so check your documents. You can learn more about the typical position on unused sick leave.

Setting Up Your Contracts, Policies And Processes

Good documentation is the simplest way to prevent confusion, manage risk and keep things fair. At a minimum, consider the following:

• Employment Contract: Sets out the role, ordinary hours, base rate, award/EA coverage if applicable, probation, leave entitlements in plain language and how to notify absences.
• Workplace Policy: Explains your leave processes (notice, evidence, how partial days are handled, when medical clearance may be required) and supports consistent, lawful decisions.
• Roster and Payroll Procedure: Documents internal steps for approving leave, finding cover, recording absences and processing payments correctly.
• Privacy Practices: Limit who sees medical information and store it securely. Only collect what you reasonably need to manage the absence.
• Communication Templates: Keep friendly, consistent email or SMS templates for requesting evidence, checking in during longer absences and confirming return-to-work arrangements.

If your business uses performance or conduct management processes and things escalate, make sure your approach lines up with your contracts and policies before taking any formal step.

Sick Leave And Other Leave Types: How They Interact

Because personal/carer’s leave is pooled, employees may use it for either their own illness or to care for a household or immediate family member. Keep the following interactions in mind:

• Annual Leave: With your agreement, an employee may choose to use annual leave if their paid sick leave balance is exhausted. Document any change to pay classification or hours for the period.
• Compassionate Leave: Separate to sick leave, compassionate leave applies when a member of the employee’s immediate family or household dies or has a life‑threatening illness or injury.
• Public Holidays: If a public holiday falls during a period of approved sick leave, the day is treated as a public holiday (not deducted from the sick leave balance).
• Long-Term Injury/Illness: Extended absences may involve medical clearances, reasonable adjustments or exploring redeployment. Keep a clear paper trail and apply your processes consistently.

If an employee gives notice of resignation and then becomes unwell, the NES entitlements still apply. Check your policy and refer to the guidance around Sick Leave During Notice Period so payroll and communications remain consistent.

Practical Tips For Small Employers

• Lead with clarity: Make sure every employee gets their contract and your current leave policy on day one. Set expectations early around notice and evidence.
• Use consistent processes: A single intake channel for sick notifications (for example, a shared email or phone number) helps with record-keeping and reduces miscommunication.
• Train your supervisors: Managers should know when to ask for evidence, how to escalate longer absences and what they can and can’t say about an employee’s health.
• Protect privacy: Store medical information securely and only share it when needed for rostering or safety decisions.
• Plan for longer absences: Have a light-touch framework for check-ins, reasonable adjustments and when to request fitness-for-duty information, aligned with your policy.
• Be consistent, not rigid: The “reasonable person” test matters in sick leave decisions. Apply your policies fairly and document why any exception was made.

Key Takeaways

• Paid personal/carer’s leave (often called “sick leave”) accrues for full-time and part-time staff under the NES and carries over year to year; casuals don’t receive paid sick leave.
• Employees must notify you as soon as practicable and you can request reasonable evidence such as medical certificates or a statutory declaration, as set out in your policy.
• Pay sick leave at the base rate for ordinary hours the employee would have worked, and keep strong records to support payroll and compliance.
• Have clear documents in place-your Employment Contract and Workplace Policy should outline notice, evidence and return-to-work expectations.
• Plan for common scenarios, including when entitlements run out, requesting medical clearance and handling sick leave during notice periods.
• Unused sick leave is generally not paid out on termination, but always check your contract and any applicable award/EA-see the rules around unused sick leave.

If you’d like a consultation about setting up your sick leave contracts, policies and processes the right way for your business, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no‑obligations chat.