Claiming long service payments in the building and construction industry
Find out what you have to do if you are a worker or contractor and plan on claiming long service payments in the building and construction industry in NSW.
How your payment is calculated
Long Service Corporation (LSC) provides a payment to registered workers for long service in the building and construction industry in NSW.
To qualify for a long service payment, you must have enough service credits in the scheme.
The payment for 10 years of recorded service is 8.67 weeks' pay, equivalent to 2 months.
LSC keeps service records for each registered worker, however a registered worker is not entitled to any long service payment from LSC until a point of eligibility for a claim is reached.
Workers paid under an award
The rate of pay used is the appropriate award rate for the type of work that you do (for example, carpenter, plumber, plant operator).
Workers paid under a certified agreement
If you are paid under a certified agreement, LSC will pay you at your ordinary rate of pay according to that agreement.
Supervisors and working directors
If you are a working director or directly supervise workers, then LSC will pay at the rate under the certified agreement or applicable award for the work of the workers being supervised.
Workers earning more than the award rate or with informal arrangements
LSC does not recognise informal or ‘handshake’ arrangements and cannot pay you more than the award or certified agreement rate.
Contractors
Contractors are paid at the award rate for the type of work they do.
Important things to do before claiming a long service payment
Check for any missing service credits
It is your responsibility to ensure your service record is correct before applying for a long service payment. Adjustments cannot be made after a claim has been paid.
Before you apply for a payment, you can:
- Check your service record is up to date in the Worker Portal.
- Learn more about special service credits that may be available to you next, in Step 2.
Credit for work before your registration date
Workers cannot be credited with service before their registration date. The fixing of an earlier registration date is possible where circumstances are accepted by LSC to have prevented a person from registering earlier.
If you think you have circumstances which may allow the fixing of an earlier registration date you should contact us. You will also need to provide the reason why you did not question your recorded service total earlier.
Understand special service Credits
If you are not doing your normal paid work in the industry, you may still be able to get service credits if you are:
- undertaking training courses
- performing voluntary emergency work
- performing light duties after an injury
- engaged in speculative building work.
If you have been unable to work due to sickness or injury
If you have been unable to work due to sickness or injury, you may be able to have that time added to your service record. This applies to both workers on wages and self-employed people.
Learn more about special service credits.
Know what happens if you leave the industry with less than 10 years recorded service
If you leave the industry and claim a pro rata payment with less than 10 years recorded service, your registration will then be cancelled. You will no longer be able to record any service credits.
If you return to work in the building and construction industry, you can re-register and start all over again. However, you cannot start recording service credits again until one year after the date of your long service payment.
Check with us before accepting a payment if your employer is no longer trading
If your employer is no longer trading and you make a claim with LSC, we may contact your current or previous employer to verify information when processing your claim.
If you are offered a long service entitlement as part of a termination payment by a liquidator, we recommend you first check with us before accepting this payment.
Sometimes payments offered by the liquidators are less than your full entitlement.
Also note the following:
- If an employer paid you only part of the long service entitlement you should have received, a top-up payment from LSC may be possible. This payment can only be made if you were eligible to make a claim for a long service payment from us at the time you accepted the part-paid benefit from your employer. You must apply for this top-up payment within 3 months of taking the alternative benefit from your employer.
- If you are not entitled to make a claim for a long service payment from LSC, then those years for which you have received any long service benefit from your employer cannot be claimed as part of your total service at any time in future. In this situation, you should consider if the amount received from your employer exceeds the amount which could be claimed from us in the future when your eligibility for a claim is reached.
For more information, read What you should do if your employer ceases trading.
When you can claim a long service payment
You can apply for a long service payment after:
- 10 years of service, and then every 5 years after this if you are still working in the building and construction industry
- 5 years if you're permanently leaving the building and construction industry
- 55 days if you are medically unfit and cannot work in building and construction again
- 55 days if you are retiring from building and construction and are aged 55 and over
- 55 days and you are retiring from the industry with a veteran’s pension.
You can claim a combination of service recorded across all states and territories, however the application for payment must be issued and lodged to the scheme where the most recent service is recorded.
The estate of a deceased worker can claim where there is a minimum of 55 days recorded service.
Please note LSC may contact your current or previous employer to verify information when processing your claim.
Lodge your claim online either through:
- the Worker Portal, or
- call us on 13 14 41 to request a paper form.
You can apply for a payment at any time if you have:
- 10 or more years of service recorded with the scheme, or
- a combined total of 10 or more years of recorded service with this scheme and equivalent schemes in other Australian states and territories.
If you have service recorded in more than 1 state or territory, you must lodge your claim in the state or territory where your most recent service was recorded.
You do not need to apply as soon as you reach 10 years of recorded service. If you wait, your payment may continue to grow.
The amount you receive is based on the type of work you performed during your last 55 days of recorded service. When calculating your payment, the scheme uses the work type recorded for those 55 days, regardless of the type of work you performed earlier in your service history.
After receiving a 10-year payment, you can apply for another payment each time you record an additional 5 years of service.
If you are leaving the building and construction industry permanently you may claim a long service payment from LSC.
To be eligible you must have:
- at least 5 years' service recorded with this scheme, or
- a total of at least 5 years' service recorded in this scheme together with any service you have recorded in the equivalent schemes of other states and territories of Australia, and
- permanently ceased building and construction work.
If you are totally and permanently unable to work due to illness or injury, you may claim a long service payment from LSC.
To be eligible you must have:
- at least 55 days service recorded with this scheme, or
- a total of at least 55 days service recorded in this scheme together with any service you have recorded in the equivalent schemes of other states and territories, and
- a medical practitioner certify that you are totally and permanently unable to perform building and construction work.
If you are retiring from the building and construction industry you may claim a long service payment from LSC.
To be eligible, you must:
- have at least 55 days service recorded with this scheme, or
- have a total of at least 55 days service recorded in this scheme together with any service you have recorded in the equivalent schemes of other states and territories, and
- be 55 years of age, or you must be in receipt of a veteran's pension.
In the event of your death, your personal representative may apply to LSC for a long service payment based on your service record.
We will pay a long service payment if the registered worker has:
- at least 55 days of service recorded with this scheme or
- a total of at least 55 of days service recorded in this scheme together with any service the worker recorded in the equivalent schemes of other states and territories.
How much tax you pay on long service payments
PAYG Withholding (tax) is deducted from payments at the applicable marginal rate as required by Australian taxation laws. The amount withheld will be calculated from the Australian Taxation Office's (ATO's) weekly tax table using the average weekly wage of your payment.
Details of your payment will be provided to the ATO. You will be able to view these details in your online Income Statement by logging into your myGov account. The payment must be included in your income tax return for the year in which the payment was received.
For further advice on marginal tax rates contact the ATO or you read their Tax tables overview.
Workers who are also eligible under the Long Service Leave Act 1955
The scheme does not override the obligations of the Long Service Leave Act 1955 (the 1955 Act). Under the 1955 Act, workers are entitled to long service leave if they work for one employer for 10 consecutive years.
Read more about worker eligibility and the 1955 Act.
Choosing whether to receive payment from LSC or your employer
Workers eligible for benefits under both Acts must nominate whether to take payment from LSC or their employer. Both relevant Acts state that a worker can only receive one benefit for any period of work.
If you have been with the same employer for at least 10 years, you can receive a benefit from that employer. In certain circumstances, benefits may be available for shorter periods.
This must be a period of paid leave.
Read more about your employer's obligations when paying your long service leave under the 1955 Act.
You can choose receive a long service payment directly from LSC which includes any service with your current employer.
Payments made by LSC are calculated:
- at the worker's applicable award rate of pay or,
- where a certified agreement is in place, at the worker's rate of pay under that agreement.
Payments made by LSC do not include:
- over award payments, or
- other informal arrangements to pay higher than the award or certified agreement rate.