Workers' Comp and Annual Leave — Can You Take Both at the Same Time?
Generally you can't take paid annual leave while on workers' compensation. Rules vary by state. Here's a state-by-state breakdown of how they interact.
The general rule
In most Australian states and territories, you cannot take paid annual leave at the same time as receiving workers' compensation payments. The logic is simple: workers' compensation is designed to replace your income while you're unable to work due to a workplace injury. Annual leave is designed for rest and recreation during periods when you would otherwise be working. Receiving both simultaneously would amount to double-dipping. However, this general rule has important nuances that vary significantly by state, and there are several scenarios where the interaction becomes complicated.
Do you still accrue leave while on workers' comp?
This is where it gets complicated, because the answer depends on your state. In NSW, you continue to accrue annual leave for the first 12 months of workers' compensation (but not after). In Victoria, you generally continue to accrue leave while receiving weekly payments. In Queensland, you accrue leave during any period you receive workers' comp payments for full normal earnings, but not during partial payments. In Western Australia, leave accrual is generally paused during workers' comp. In South Australia, you accrue leave for the first 12 months. Check your specific state's workers' compensation legislation, as these rules change periodically.
State-by-state breakdown
NSW: Accrue leave for first 12 months on comp. Cannot take annual leave while receiving comp payments. VIC: Generally continue accruing leave. Cannot take annual leave while on comp. QLD: Accrue during full-pay comp periods. Employer cannot force you to use annual leave instead of comp. WA: Leave accrual generally paused. Cannot take leave while on comp. SA: Accrue for first 12 months. Cannot take leave while on comp. TAS: Check the Workers Rehabilitation and Compensation Act 1988. ACT: Similar to NSW — 12-month accrual period. NT: Check the Return to Work Act 1986. In all states, your employer CANNOT force you to use your annual leave instead of making a workers' comp claim.
What about super during workers' comp?
A common but often overlooked issue: most employers do not pay superannuation contributions while you're on workers' compensation. This is because workers' comp payments are generally not considered 'ordinary time earnings' for SG purposes. This means extended periods on workers' comp can create significant gaps in your super accumulation. Some enterprise agreements and contracts do require employers to continue super contributions during workers' comp — check yours. If you're returning to work on reduced hours (a graduated return to work plan), super should be paid on the hours you actually work.
What if your employer pressures you to use annual leave?
This is unfortunately common. Some employers pressure injured employees to take annual leave or sick leave instead of lodging a workers' comp claim. This is problematic for several reasons: it depletes your leave balances, it means the employer avoids their workers' comp insurance obligations, it leaves no record of a workplace injury (which matters if symptoms worsen later), and it may be illegal depending on your state. If you've been injured at work, you have the right to lodge a workers' comp claim. Your employer cannot penalise you for doing so — this is protected under General Protections (s.340-341 of the Fair Work Act). Report any pressure to your state's workers' comp authority.
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Official resources
General information and estimates only — not legal, financial, or tax advice. Always verify with the Fair Work Ombudsman (13 13 94) or a qualified professional.
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