Quick Summary
Quick Summary
- Casual employees are entitled to 4 weeks of paid annual leave per year under the National Employment Standards.
- This entitlement is paid via mandatory 25% casual loading on hourly rates (or higher per modern awards).
- Once casuals work 12+ months of regular hours, they can request to take paid annual leave as actual time off.
- On exit, casuals who worked 12+ months regularly receive a final payout for accrued but unused leave.
- Casual loading covers annual leave entitlement while employed; it does not eliminate final leave payouts for long-term casuals.
Casual annual leave entitlements are a major source of employer confusion. Many businesses think casual employees don’t get paid leave at all. Wrong. Casual employees get 4 weeks of paid annual leave, just like full-time staff. The difference? How it’s paid and when they can take it.
This confusion costs employers thousands. You might think casual staff aren’t entitled to annual leave entitlements, so you avoid setting aside leave accrual. Then a casual walks out on unfair dismissal claim number one, and you’re hit with a $20,000+ liability you never saw coming.
Here’s exactly what casual employees ARE and AREN’T entitled to, straight from the National Employment Standards (NES).
Casual Annual Leave Entitlements: What Employers Must Know
Yes. Casual employees are entitled to 4 weeks of paid annual leave per year under the Fair Work Act 2009. This is the same rate as full-time and part-time employees.
The catch? Casuals don’t receive annual leave as a separate payment or accrued balance. Instead, they’re paid a 25% casual loading on every hour they work. This loading is designed to cover their annual leave entitlement, since they don’t get the same predictable work schedule as permanent staff.
Important: The 25% casual loading is mandatory under the Fair Work Act. If you’re not paying it, you’re breaking the law — even if the casual hasn’t complained yet.
What Is Casual Loading? How It Replaces Annual Leave
Casual loading is a percentage increase on top of a casual employee’s hourly rate. It compensates them for:
- Not receiving paid annual leave
- Not receiving paid sick leave
- The uncertainty of future work (no guaranteed hours)
- No superannuation guarantee (in some older arrangements)
Example: A casual customer service worker earns $25/hour. With 25% casual loading, they earn $31.25/hour. This is the minimum — their modern award or contract may set a higher loading.
The loading is calculated as follows:
Casual hourly rate (with loading) = Base rate × 1.25
When a casual employee finishes their employment, they don’t get a lump-sum payout for unused annual leave (like permanent employees do). Instead, the loading they’ve been paid throughout their employment is considered compensation for that leave.
Can Casuals Actually Take Annual Leave?
This is where it gets tricky for employers.
Casual employees have the right to request annual leave and the right to take it — but with a major difference: they must work regular hours for at least 12 months before they can take paid annual leave.
Once they’ve worked those 12 months of regular shifts, casuals can request to take paid annual leave. If you’ve been paying the 25% loading, you’ve already set aside the funds for it.
What “regular hours” means: The casual works a consistent, recurring pattern of hours. It doesn’t have to be exactly the same every week — just a pattern that repeats. Think “every Tuesday and Thursday” or “weekends only.”
If a casual has been casual for less than 12 months, or if their hours are genuinely sporadic (not regular), they can’t yet request paid annual leave. They only get their 25% loading.
What Casuals CAN’T Get (Even Though They’re Legally Entitled)
Despite being employees, casual workers do NOT receive:
- Paid sick leave (personal/carer’s leave): Casuals don’t get the 10 days of paid personal/carer’s leave that permanent staff receive. They get unpaid carer’s leave instead (2 days per occasion).
- Paid long service leave: Casuals don’t accrue long service leave in the same way. This varies by state and their award.
- Paid compassionate leave: Casuals get 2 days unpaid compassionate leave per occasion (not 2 paid days like permanent staff).
What Casuals DO Get (Full NES Entitlements)
Casual employees are entitled to the full National Employment Standards (NES), including:
- 4 weeks paid annual leave per year (via 25% casual loading, or as paid annual leave if they’ve worked 12+ months regular hours)
- Paid family and domestic violence leave: 10 days paid leave per year for family and domestic violence (same as permanent staff)
- 2 days unpaid carer’s leave per occasion (not annual — as needed)
- 2 days unpaid compassionate leave per occasion
- Jury duty: Entitled to be absent (same as all employees)
- Volunteer emergency service leave: Unpaid leave for volunteer firefighters and SES workers
- Public holiday loading: If a casual works on a public holiday, they get the public holiday rate (1.5× base rate, or higher depending on the award) PLUS their 25% casual loading
The Modern Awards Twist: Some Casuals Get LESS Loading
The 25% casual loading is the minimum required by the Fair Work Act. BUT modern awards can set a HIGHER loading for specific industries.
Common variations:
- Hospitality: Often 25–30% casual loading
- Aged care: 25% loading + additional entitlements in some awards
- Retail: Usually 25%, but some awards specify higher rates
- Security: Often 30% loading
Action for employers: Check your employees’ modern award or registered enterprise agreement. If the award says 30% loading, you must pay 30%, not the 25% minimum.
Key Takeaways
Key Takeaways for Employers
- ✓Pay minimum 25% casual loading on every hour (check modern award for higher rates)
- ✓Keep detailed records of casual work hours from day one — you’ll need them for the 12-month trigger
- ✓After 12 months of regular shifts, inform casuals they can request paid annual leave
- ✓Don’t refuse leave requests without genuine operational hardship — unreasonable refusal can trigger FWC claims
- ✓Calculate final leave payouts correctly: (rate + loading) × ordinary hours × accrued weeks
- ✓Separate superannuation (11.5%) from casual loading — both are mandatory, independent entitlements
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Casual Annual Leave — When They’ve Worked 12+ Months of Regular Hours
Once a casual has worked regular hours for 12 months straight, they can request paid annual leave. Here’s how it works:
Step 1: They request annual leave in writing (email is fine).
Step 2: You cannot unreasonably refuse. You can refuse if it causes genuine operational hardship, but “we’re busy” usually isn’t enough.
Step 3: Calculate the leave payment as follows:
Annual leave payment = (Hourly rate including casual loading) × 4 weeks × ordinary hours per week
Example: A casual has worked regular hours (16 hours per week) at $31.25/hour (including 25% loading) for 14 months. They request 3 weeks of annual leave.
Calculation:
- Hourly rate (with loading): $31.25
- Ordinary hours per week: 16
- Weeks of leave: 3
- Payment: $31.25 × 16 × 3 = $1,500
You’re paying from the 25% loading you’ve been setting aside all year.
What Happens When a Casual Leaves — Annual Leave Payout
When a casual finishes employment, do they get a payout for unused annual leave?
It depends:
If they worked less than 12 months or sporadic hours: No payout. The 25% loading they received is their compensation for annual leave.
If they worked 12+ months of regular hours: Yes, they get a payout for accrued annual leave. The calculation is the same as above — pro-rata based on how much leave they’ve taken vs. earned.
Example: A casual worked 2 years of regular 20-hour weeks at $30/hour + 25% loading ($37.50/hour). They took 2 weeks of leave. On exit:
- Entitled to annual leave: 52 weeks × 1 week per 13 weeks = 4 weeks per year × 2 years = 8 weeks total
- Taken: 2 weeks
- Accrued: 6 weeks unused
- Payment: $37.50 × 20 hours × 6 weeks = $4,500
Superannuation and Casuals — A Separate Entitlement
Casual employees are entitled to superannuation contributions, just like permanent staff. Employers must pay 11.5% of ordinary time earnings into the casual’s superannuation fund (as of 1 July 2026).
Important: Superannuation contributions are separate from casual loading. The 25% loading does NOT cover super.
State-Specific Rules: Long Service Leave for Casuals
Long service leave rules for casual employees vary by state:
- NSW, Victoria, Queensland, WA, SA, NT: Casuals aren’t entitled to long service leave under the National System. However, some modern awards provide it.
- Tasmania: State-based long service leave may apply to some casuals.
Always check your modern award — some industry awards (aged care, healthcare) provide pro-rata long service leave for casuals.
Common Employer Mistakes (and How to Avoid Them)
Mistake 1: Not paying casual loading. You must pay 25% (or higher per the award). If you don’t and the casual complains, the Fair Work Commission can order back-pay.
Mistake 2: Refusing annual leave requests without good reason. Once a casual has worked 12 months regular hours, you can’t just say no. You need genuine operational hardship.
Mistake 3: Ignoring records of regular hours. If a casual works consistent shifts (even if not full-time), you need to document them. After 12 months, they can argue they’re owed paid annual leave and you’ll need proof.
Mistake 4: Forgetting to pay a final annual leave payout. If they’ve worked 12+ months regular hours, calculate and pay their accrued leave on exit. Miss this and you’re facing an underpayment claim.
Mistake 5: Not checking the modern award for higher loading. Just because 25% is the minimum doesn’t mean it’s what you owe. Some awards require 30% or more.
Practical Checklist: Casual Leave Compliance
For more guidance on employer obligations, see our guides on HR best practice and National Employment Standards.
- ☐ Check the casual employee’s modern award. What’s the minimum casual loading required?
- ☐ Confirm you’re paying at least 25% loading on all casual wages. (More if the award says so.)
- ☐ Keep detailed records of when the casual started and their ordinary hours each week.
- ☐ After 12 months of regular hours, inform the casual they can request annual leave.
- ☐ When they request leave, review your operational needs. You can refuse only if it causes genuine hardship.
- ☐ Calculate and pay annual leave at (hourly rate including loading) × ordinary hours × weeks of leave.
- ☐ When the casual leaves, pay any accrued annual leave (if 12+ months of regular hours). If under 12 months or sporadic hours, no payout.
- ☐ Don’t forget superannuation — 11.5% minimum, paid separately from casual loading.
For official guidance, refer to the Fair Work Ombudsman’s National Employment Standards page and the Fair Work Act 2009.
Key Takeaway
Casual employees are entitled to 4 weeks of paid annual leave per year. You cover this via 25% casual loading on their hourly rate (or higher per the award). After they’ve worked 12 months of regular hours, they can request to actually take that leave as paid time off. On exit, if they’ve worked 12+ months regularly, you owe a payout for any accrued leave. Miss these obligations and you’re looking at Fair Work claims.
Get it wrong, and it’s underpayment claims, unfair dismissal liability, and backpay with interest. Get it right, and casual leave is straightforward.
Frequently Asked Questions
Yes. Casual employees are entitled to 4 weeks of paid annual leave per year under the National Employment Standards, the same as full-time employees. However, instead of accruing and taking leave like permanent staff, casuals are paid a 25% loading on their hourly rate to compensate for this entitlement. Once they’ve worked regular hours for 12 months, they can request to take paid annual leave.
Casual loading is a mandatory 25% increase (minimum) on a casual employee’s hourly rate. It compensates them for not receiving paid annual leave, paid sick leave, and the uncertainty of future work hours. For example, if a casual earns $25/hour, you must pay them at least $31.25/hour. This loading covers their annual leave entitlement throughout their employment.
Casual loading is an ongoing percentage added to every hour a casual works. It’s paid weekly in their regular wages. Annual leave is the actual time off they can request (after 12 months of regular hours) or the final payout they receive on exit. The loading is the mechanism employers use to ‘set aside’ funds for annual leave, since casuals don’t accrue it like permanent staff.
Not unreasonably. Once a casual has worked regular hours for at least 12 months, they have the right to request paid annual leave. You can refuse only if it causes genuine operational hardship — ‘we’re busy’ usually isn’t enough. The request must be unreasonably refused for you to decline it. If you refuse and it’s deemed unreasonable, the Fair Work Commission can order you to grant the leave.
If the casual worked less than 12 months or had sporadic (non-regular) hours, they receive no annual leave payout — the 25% loading they received is considered their compensation. If they worked 12+ months of regular hours, they’re entitled to a payout for any accrued but unused annual leave. Calculate this as: (hourly rate including loading) × ordinary hours per week × number of weeks of accrued leave.
No. Casual employees do not receive paid personal/carer’s leave (sick leave) or paid compassionate leave. They are entitled to 2 days of unpaid carer’s leave per occasion and 2 days of unpaid compassionate leave per occasion. However, they do receive 10 days of paid family and domestic violence leave per year, the same as permanent employees.
Yes. Casual employees are entitled to superannuation contributions at a minimum of 11.5% of ordinary time earnings (as of 1 July 2026). This is separate from casual loading and is a mandatory employer contribution. Do not include casual loading in the superannuation calculation — these are two separate entitlements.
You must pay the higher rate. The 25% casual loading is the Fair Work Act minimum, but many modern awards specify 30%, 35%, or even higher loadings depending on the industry. Hospitality, security, and aged care often have higher loadings. Always check your employee’s modern award or enterprise agreement — paying only 25% when the award requires more is underpayment.
Only if they worked less than 12 months or had genuinely sporadic (non-regular) hours. If they worked 12+ months of regular shifts, the loading you paid doesn’t eliminate their right to a payout for accrued leave. The loading covers their leave entitlement while employed; on exit, they’re owed payment for any leave they didn’t take.
Regular hours mean the casual works a consistent, recurring pattern of shifts. It doesn’t have to be the same hours every week, but it must be predictable — e.g., ‘every Tuesday and Thursday,’ ‘weekends only,’ or ’16 hours every week.’ If hours are truly sporadic with no pattern, the casual hasn’t worked regular hours yet and can’t claim paid annual leave.
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