Fair Work Rules On Unpaid Leave In Australia

At some point, every employer or manager will field a request for unpaid time off. Maybe a team member needs to care for a sick family member, attend jury service, or take extra time following parental leave. Understanding when unpaid leave is a legal entitlement under the National Employment Standards (NES) - and when it’s a discretionary “leave without pay” arrangement - helps you stay compliant and be fair to your people.

In this guide, we break down the Fair Work framework for unpaid leave in Australia, how to approve and document requests, what to watch out for (like accruals and public holidays), and the workplace documents that make the process smoother.

What Counts As Unpaid Leave Under The NES?

The NES (part of the Fair Work Act) sets minimum entitlements for most employees in Australia. Several of these entitlements can be unpaid, depending on the circumstances. Here’s a plain-English rundown.

Unpaid Parental Leave

• Who can take it: Employees with at least 12 months’ continuous service before the expected birth or adoption placement date (including some casuals with a reasonable expectation of ongoing work).
• How much: Up to 12 months of unpaid parental leave, with the right to request an additional 12 months (employers can only refuse on reasonable business grounds). Flexible unpaid parental leave days can also be taken in smaller blocks in certain situations.
• Extras to know: Keeping in Touch (KIT) days are available; “no safe job” arrangements can apply during pregnancy.

Unpaid Carer’s Leave

• Who can take it: All employees when they need to care for or support an immediate family or household member with illness, injury, or an unexpected emergency.
• How much: Two days per permissible occasion if the employee doesn’t have paid carer’s leave available (casuals access this as unpaid only).
• Evidence: Reasonable evidence may be required, such as a medical certificate.

Compassionate (Bereavement) Leave

• Who can take it: All employees when a member of their immediate family or household dies or suffers a life‑threatening illness or injury, or in the event of a miscarriage or stillbirth.
• How much: Two days per permissible occasion. For full-time and part-time employees, it’s paid. For casuals, it’s unpaid.

Community Service Leave

• Who can take it: Employees engaged in eligible community service such as voluntary emergency management activities or jury service.
• How much: Unpaid leave for the period reasonably required. For jury service, employers must provide “make-up pay” for the first 10 days to bridge the gap between the employee’s base pay and jury payment.

Family And Domestic Violence Leave (Update)

• Current position: Under recent reforms, most employees now receive 10 days of paid family and domestic violence leave each year. So this category is no longer an unpaid entitlement under the NES for most workers.

If you need a quick refresher on what qualifies as Unpaid Leave under Australian law, it helps to map requests to one of the NES categories first. If none apply, you’re likely looking at a separate “leave without pay” (LWOP) arrangement by agreement, which we cover next.

When Can An Employee Take Leave Without Pay (By Agreement)?

Leave without pay (LWOP) isn’t a stand‑alone entitlement under the NES. It’s a discretionary arrangement between you and your employee when there’s no applicable paid or unpaid entitlement left (or the employee isn’t eligible).

Common scenarios include extended travel, additional time following parental leave, or personal reasons that don’t fit within carer’s or compassionate leave. In these cases, you decide whether to approve LWOP, for how long, and on what conditions.

It’s helpful to set expectations in a clear Leave Without Pay approach or policy so requests are handled consistently and lawfully. This is particularly important for equity and to reduce the risk of adverse action or discrimination claims. Decisions should be based on legitimate business reasons (staffing, operational impact, peak periods) and the individual’s circumstances, applied fairly across your team.

How Should You Handle Requests For Unpaid Leave?

Approach every request in a structured way so you can be consistent, support employees, and stay fully compliant. A short, repeatable process will save you time and reduce disputes.

1) Identify The Legal Basis

• Is the request an NES entitlement (e.g. unpaid parental leave, carer’s leave, community service leave), or a discretionary LWOP request?
• If it’s an NES entitlement, you must allow it within the rules. If it’s LWOP, you may approve it, with reasonable conditions.

2) Review Contracts, Awards And Policies

• Check the employee’s Employment Contract for any clauses about unpaid leave or evidence requirements.
• Refer to the applicable modern award or enterprise agreement for any additional entitlements or processes.
• Apply your Workplace Policy consistently (e.g. minimum notice for requests, how to apply, who approves, maximum LWOP periods, and how accruals are treated).

3) Ask For Evidence (Where Reasonable)

• For carer’s or compassionate leave, reasonable evidence (e.g. a Medical Certificate) can be requested to confirm the reason.
• For community service leave, evidence may include notices from the court or emergency service organisation.

4) Confirm The Terms In Writing

• State the type of leave (NES entitlement or LWOP), start and end dates, any conditions (e.g. check‑ins, return-to-work plan), and how it affects pay, accruals and benefits.
• Clarify what happens if the employee wants an extension or an earlier return.

5) Keep Records And Update Payroll

• Record the leave accurately in your HR/payroll system (different leave types have different accrual impacts).
• If it’s jury service, remember the make-up pay requirement for the first 10 days.

Special Situations: Parental, Caring, Community Service And Probation

Some unpaid leave categories come with extra rules or practical considerations. Here are the common scenarios we see with small businesses.

Unpaid Parental Leave In Practice

• Notifying and evidence: Employees must give notice (usually 10 weeks before the leave is due to start) and provide evidence (e.g. expected date of birth). Keep an eye on flexible unpaid parental leave options if a shorter, spread-out pattern suits your operations and the employee’s needs.
• During leave: The employee’s position is protected. If a genuine redundancy occurs, you must follow the proper consultation and redeployment obligations.
• Extensions: Employees can request up to an additional 12 months. You can only refuse on reasonable business grounds and should do so in writing with clear reasons.

Carer’s Leave When Paid Entitlements Run Out

• Once paid personal/carer’s leave is exhausted (or for casual employees), the NES allows two days of unpaid carer’s leave per permissible occasion. You can agree to more as LWOP if appropriate.
• Reasonable evidence can be requested. Make sure your policy explains how to provide it and who sees the documents.

Community Service Leave (Emergency & Jury)

• Community service leave is available for emergencies and jury duty. It’s unpaid, but you must make up the pay difference for jury service for the first 10 days.
• Ask for evidence such as call‑out notices or jury summons, and update payroll processes to handle make‑up pay correctly.

Requests During Probation

• Probation doesn’t cancel NES entitlements. If a new team member qualifies for unpaid carer’s leave or community service leave, you must allow it.
• For discretionary LWOP, you can consider whether extended absence affects the purpose of probation. Consistency is key. Our guide on Taking Leave During Probation explains how to balance legal obligations with practical trial periods.

Can Employees Take Unpaid Leave During The Notice Period?

Sometimes an employee resigns or is given notice and asks for unpaid time off before their final day. What happens next depends on the type of leave and your agreement.

• NES entitlements still apply: If the request is for an NES unpaid entitlement (e.g. carer’s leave), you should allow it.
• Discretionary LWOP: You can approve or decline based on legitimate business reasons. Be consistent with past decisions to avoid claims of adverse action.
• Impact on notice: Unpaid leave may pause the work actually performed during the notice period, which can affect pay for those days. Confirm in writing whether the notice end date changes or stays the same.

If you run into a scenario where a team member simply stops attending work during notice without approval, this can trigger separate rights and obligations around pay and potential deductions. This is a nuanced area - see our guide on an employee not working the notice period for practical options that align with Fair Work rules and your contract terms.

Record‑Keeping, Accruals And Practical Compliance Tips

Unpaid leave impacts payroll, entitlements and sometimes super. Getting the admin right is just as important as making a fair decision on the request.

Accruals And Service

• Annual leave and personal/carer’s leave: Generally do not accrue during periods of unpaid leave, including unpaid parental leave (with limited exceptions). However, the employee’s continuous service usually isn’t broken by unpaid leave, which still matters for some entitlements.
• Long service leave: Accrual rules vary by state and territory. Extended unpaid leave can affect accrual in some jurisdictions - get local advice if the period is lengthy.

Public Holidays And Unpaid Leave

• If a public holiday falls while an employee is on unpaid leave, they’re usually not entitled to be paid for that day (because they’re not on paid leave or ordinary hours).
• Be mindful of rostered staff and whether they would otherwise have worked that day.

Superannuation

• No pay means no ordinary time earnings (OTE), so there’s generally no super payable for days of unpaid leave. (Jury service make‑up pay may need specific payroll handling.)

Return-To-Work And Communication

• For longer unpaid absences, consider check‑ins and a return-to-work plan. This helps both parties plan resourcing and reintegration.
• If you offer flexible work or staged returns, set it out in writing with clear review points.

Discrimination And Adverse Action Risks

• Handle all requests on their merits and apply policies consistently. Be especially careful with requests connected to protected attributes (e.g. pregnancy, family responsibilities, disability).
• Keep notes of your reasoning, especially if you decline a discretionary LWOP request based on sound operational needs.

Policies, Contracts And Documents To Put In Place

Clear documents make unpaid leave smoother for everyone - you set expectations upfront, reduce confusion, and demonstrate compliance if an issue arises.

• Employment Contract: Spell out the relationship, reference applicable modern awards, and include how leave requests and evidence will be handled. Tailor for full-time, part-time or casual engagement.
• Workplace Policy: A concise leave policy can explain notice periods for requests, when evidence is required, how LWOP is considered, and how accruals are treated.
• Parental Leave Policy: Outline eligibility, notice, flexible days, KIT days, and return-to-work processes so managers and staff are on the same page.
• Medical Certificates: Set clear and reasonable evidence expectations for carer’s or compassionate leave (including who can view sensitive information).
• Record-Keeping: Ensure your HRIS/payroll settings correctly code different unpaid leave types, manage jury service make‑up pay, and reflect accrual rules.
• Related Arrangements: If your team uses flexible time arrangements, align your unpaid leave policy with any Time Off In Lieu practices to avoid overlap or confusion.

These documents don’t need to be complex - they just need to be accurate, consistent with the NES and any award, and fit how your business operates day to day.

Key Takeaways

• Some unpaid leave is an NES entitlement (like unpaid parental leave, unpaid carer’s leave and community service leave); other requests are discretionary leave without pay (LWOP) by agreement.
• Start by mapping each request to the correct category, then apply your Employment Contract, award and Workplace Policy consistently.
• Ask for reasonable evidence (for example, Medical Certificates for carer’s leave) and confirm approvals in writing, including dates, pay status and accrual impacts.
• Unpaid leave generally pauses annual and personal leave accruals, but it doesn’t usually break continuous service; check state rules for long service leave.
• Jury service is unpaid leave but requires make‑up pay for the first 10 days; set up payroll processes to handle it correctly.
• Good documentation - including clear policies and tailored contracts - reduces disputes and helps you meet Fair Work obligations with confidence.

If you’d like a consultation on managing unpaid leave and leave without pay in your workplace, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no‑obligations chat.