The Treatment of Long Service Leave
The value of accrued long service leave can be large and can therefore be a significant factor in a property settlement. But how is it treated? The Appeal Court has recently considered the question.
The parties had a relationship of 14 years. At commencement the wife had savings of $50,000, superannuation and accumulated long service leave from her position at a bank which she had had since finishing high school. The wife sought a percentage adjustment in her favour for this initial contribution.
Some 8 years after the commencement of the relationship, the wife was made redundant and received a redundancy package of $110,000 net. The wife sought a further percentage adjustment of 10% for this payment.
At the trial, the Judge provided the wife with an overall adjustment of 15% (or 65% of the pool). There was no differentiation between the initial contributions and contributions during the marriage. No adjustment was made to either spouse for ‘future needs’.
The husband appealed, on the basis that the Judge had mischaracterised the wife’s redundancy entitlement as an initial contribution when she had no right to the redundancy package at the commencement of the relationship.
The Court Found
The Appeal Court agreed that when identifying property of the parties, accumulated long service leave cannot be treated as property and was satisfied that the trial Judge did not do this.
The Court found that it was open to the trial Judge to consider ‘accumulated long service’ which ultimately leads to a ‘redundancy payment’ as an initial contribution percentage. However, the Judge must ensure that ‘double dipping’ does not occur.
As the trial Judge had not specified a percentage adjustment to the wife separately for ‘initial contribution’ and the ‘redundancy’ just an overall contribution adjustment, the Appeal Court was satisfied that double dipping had not occurred in this case.
The Court Ordered
The Husband’s appeal was dismissed.