Now lawWork & Super Introduced in the House of Representatives, 26 Nov 2025

Coal employers can now pay old leave debts over six years

This law lets black coal mining bosses pay off years of unpaid long service leave charges bit by bit. If they keep up, 20% is wiped. It also means workers who missed out can finally get their leave counted.

Official name: Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2026

Who it affects

• Workers on the edges of black coal mining, such as repair and electrical workers: Their past years of work can be written down so they can get the long service leave they were owed.
• Employers with old unpaid debts to the fund: They can choose a six-year payment plan with no court action, no late charge and 20% off if they keep up.
• Any coal employer who pays late: The late charge is now worked out from the Reserve Bank's main interest rate plus 2 percentage points.
• The long service leave fund: It will cover the 20% that is wiped, which the government says is unlikely to cost much.

Coal employers skipped leave levies

Long service leave is extra paid time off for working a long time. In most jobs, you earn it by staying with one employer for many years.

Black coal is the hard coal used for power and steel making. Black coal mining works differently. Workers build up leave based on their time in the whole industry. If you move from one coal company to another, your years follow you.

Employers pay for this through a levy, which is a charge. Here it is a share of each covered worker's wages. The money goes into a fund. When a worker takes long service leave, the fund pays the employer back.

A government body runs the fund. It is called the Coal Mining Industry (Long Service Leave Funding) Corporation. This article calls it the fund body.

In 2010 the law changed who counts as a covered worker. After that, some employers said some workers were not covered. They stopped paying for them.

These were often people on the edges of the industry. Some fixed machines. Some did electrical work on coal mine sites.

How old debts piled up

Two cases in the Full Federal Court settled the question. That is a panel of judges in a national court. One was against the company Hitachi in 2024. The other was against the company Orica in 2025. The court said those workers were covered all along.

The Parliamentary Library wrote a guide to the bill. The Library works for all MPs and takes no side. It noted that Orica had asked the High Court, Australia's top court, to look at its case when the guide was written.

That left some employers with large unpaid bills. Some went back more than 15 years. It also left many workers unable to get leave they had earned. Their years of work were never written down.

In 2021 the big business advice firm KPMG did an outside review. It said the government should help bring these employers and workers into the scheme and settle the old debts. This law does that.

A fixed late penalty

If an employer pays late, they owe extra money as a penalty. The law calls this additional levy. It builds up every day the money is late.

The old law set the penalty at 2 percentage points above one Reserve Bank interest rate. That rate was called the "maximum indicator interest rate". The Reserve Bank no longer puts that rate out. So the penalty had nothing to point to.

The new rate is 2 percentage points above the cash rate target. That is the main interest rate the Reserve Bank sets.

The Reserve Bank might stop putting that rate out but put out one that is much the same. Then that rate is used. The government can also set a different rate in detailed rules it writes without a new vote.

Signing up for a plan

The main part of the law creates payment plans for old unpaid debts. Joining is a choice. The plans cover money that was unpaid on the day this part started.

An employer goes through five steps. First, they tell the fund body in writing that they want to join. They must do it within 2 months of the start date.

Second, they send a draft plan within 6 months of that notice. They can ask for up to 3 more months.

Third, the fund body looks at the draft within 2 months and gives advice. Fourth, the employer sends a final plan within 5 months of the draft. They can ask for up to 6 more months. Fifth, the fund body's board says yes or no within 30 days.

The final plan must list each worker, the time it covers and the amount owed. It must come with a report from an auditor. That is a trained checker who confirms the amount is right.

The board must say yes unless the rules were not followed. It can also say no if there is not enough detail to work out workers' leave.

An employer can ask the Administrative Review Tribunal to look at a no. The Tribunal checks government decisions, like a court but less formal.

The plan cannot cover money a court has already ordered the employer to pay. Employers choose which workers and times to include. Any debt left out can still be chased in the usual way.

Easier sums without records

Employers usually only have to keep staff records for 7 years under the Fair Work Act, the main law on work rights. Many of these debts are older than that. So the law allows simpler sums.

Employers use today's meaning of covered wages for every year, even though the meaning changed over time. Most staff are on a base rate of pay. For them, employers use one sum where they would normally work out two and use the bigger one.

Bonus records may be missing. Then employers can assume a bonus paid to a whole group of workers was paid to each person in that group. Say all production workers got a bonus in 2009 to 2010. The employer can assume each production worker got it.

A worker may already have been paid out their long service leave when they left. The employer can take that off what they owe. The amount taken off cannot be more than what was owed for that worker.

In the government's example, Rachel got a $20,000 payout when she quit. Only $7,000 was owed to the fund for her. The employer can take off $7,000.

Six instalments

Once a plan is approved, the employer pays in six parts. The figures are running totals.

By the first due date they must have paid 20% of the amount owed. That is due 30 days after approval. A small business gets 6 months.

Each year after that the total rises, to 35%, then 50%, 60%, 70% and finally 80%. The government gives an example of a company owing $350,000. It pays $70,000 at the start. It has paid $280,000 in total by the fifth year.

Once the employer reaches 80% on time, the rest of the debt for those workers is wiped.

While the plan is running, the fund body cannot sue for that debt. No late penalty builds up. The employer also avoids fines for not sending monthly forms and yearly checked reports for those workers.

An employer may face serious money trouble or other rare events. They can ask to delay one payment by up to 6 months. They must ask at least 2 months before it is due. The board decides within 30 days, and the bar is high.

If an employer misses a payment, the plan ends. The full real debt, minus what they have paid, is due the next day. The late penalty and the right to sue switch back on.

Getting workers their leave

The fund body uses the details in each plan to make or fix workers' records. Those records show how much long service leave each person has earned.

Where records are thin, the fund body can make sensible guesses. For a casual worker, who has no set hours, it might assume 35 hours a week. It might assume a worker took no leave without permission.

The minister can also set these guesses in rules. Parliament can cancel those rules.

Workers get their full leave, even though the employer pays only 80% of the debt. The fund covers the gap.

Privacy

The plans include workers' names, addresses, birth dates, pay and hours. The fund body already collects these details to run the scheme. It must follow the Privacy Act, the main federal privacy law. Auditors who check the plans will also see them.

Start date

The new penalty rate starts the day after the bill became law. The payment plan part starts on the first day of the second month after that. The delay gives the fund body time to tell employers and set up forms.

The government brought the bill in, through the Minister for Employment and Workplace Relations, Amanda Rishworth. It came to the House of Representatives on 26 November 2025.

The House passed it on 28 May 2026 after agreeing to 21 changes from the government. This article is based on the government's notes for the bill as first brought in.

The Senate passed it on 2 July 2026. The Senate is the second house of Parliament, which checks bills.

The Governor-General signed it into law on 6 July 2026. The Governor-General is the King's stand-in in Australia. It is now Act No. 63 of 2026.

Its journey through Parliament

Official sources

• Bill page on aph.gov.au
• Text of the bill
• Explanatory memorandum
• Bills Digest

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