Sick pay in Australia: what employers must provide
Reviewed by Mellow Editorial Team, HR & payroll content team
Employees in Australia have a statutory right to paid personal/carer's leave under the National Employment Standards. Full-time employees accrue 10 days per year, and the entitlement carries over if unused.
What the law requires
The National Employment Standards (NES), set out in the Fair Work Act 2009, establish the minimum sick leave entitlements that apply to all national system employees. The formal name is personal/carer's leave, which covers both personal illness or injury and caring for an immediate family or household member who is sick or injured.
Full-time employees accrue 10 days of paid personal/carer's leave per year. Part-time employees accrue the same entitlement on a pro-rata basis — so a part-timer working half the hours of a full-timer accrues 5 days per year. Casual employees are not entitled to paid personal/carer's leave, though they receive a casual loading in lieu of these entitlements.
Accrual starts from the first day of employment. Unused leave accumulates and carries over from year to year with no cap, so an employee who rarely takes sick leave can build up a significant balance over time.
Carer's leave and unpaid carer's leave
The 10-day entitlement is a combined pool. An employee can draw on it when they are personally unwell or when they need to care for or support a member of their immediate family or household who requires care due to illness, injury or an unexpected emergency.
On top of the paid entitlement, employees are also entitled to 2 days of unpaid carer's leave per occasion. This is available when an employee has exhausted their paid balance or when a casual employee needs to care for someone. Unpaid carer's leave is available as needed, not subject to an annual limit.
Compassionate leave
Compassionate leave sits alongside personal/carer's leave but is separate. Employees are entitled to 2 days of paid compassionate leave per occasion when a member of their immediate family or household dies, or when that person sustains a life-threatening illness or injury. This leave does not come out of the personal/carer's leave balance.
Notice and evidence requirements
Employers can require employees to give notice as soon as reasonably practicable and to provide evidence that would satisfy a reasonable person that the leave is genuine. In practice, this usually means a medical certificate or statutory declaration.
You cannot require an employee to obtain a medical certificate for every single day of absence — Fair Work guidance is clear that evidence requirements must be reasonable. A common approach is to require a certificate for absences longer than two consecutive days, or after a pattern of single-day absences raises genuine concern. Whatever your policy, state it clearly in your employment contracts or workplace policies so employees know what is expected.
How sick leave interacts with payroll
Paid personal/carer's leave is paid at the employee's base rate of pay for the ordinary hours they would have worked. It does not include overtime, allowances or bonuses.
For payroll purposes:
- Sick leave payments are subject to PAYG withholding in the same way as ordinary wages.
- Superannuation Guarantee contributions apply to sick leave payments because they form part of ordinary time earnings. From 2026 the Super Guarantee rate is 12%.
- If an employee has a HECS/HELP debt, the repayment obligations apply to sick leave pay in the same way as regular pay.
- Each pay event where sick leave is paid must be reported through Single Touch Payroll (STP) as usual.
Leave balances and accruals need to be tracked accurately in your payroll system. Errors in leave records are one of the most common sources of underpayment claims, so keeping accurate accrual data matters as much as getting the payment rate right. If you manage payroll across multiple countries, how Mellow runs payroll across six countries on one platform explains how to keep local entitlements straight without manual reconciliation.
What employers commonly get wrong
A few mistakes come up repeatedly:
Resetting balances at the end of a year. Leave carries over. You cannot zero out an employee's balance on 1 July or any other anniversary date.
Not paying the correct rate. Sick leave is paid at the base rate, but make sure your base rate reflects any pay increases that have occurred since the employee started. An outdated rate is a compliance risk.
Excluding part-timers from accrual. Part-time employees accrue on a pro-rata basis but they are fully entitled to paid leave. Treating them the same as casuals is a common and costly error.
Asking for evidence for very short absences without a written policy. You are entitled to request reasonable evidence, but applying this inconsistently or without notice can create friction and, in some cases, a claim that you are acting unreasonably.
Award or enterprise agreement conditions can provide entitlements above the NES minimums. Always check the applicable modern award or agreement for your industry — the NES is a floor, not a ceiling.
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