In the 1800s, it took a long while for civil servants to travel from Australia to England to rest and recuperate after an arduous time in the colonies – and hence the concept of “long service leave” (LSL) was born.

That premise is no longer the case but the merits of giving employees a significant break after extensive service with a single company prevails today, and should remain so.

But in Victoria the first steps towards breaking down this fundamental principle are being taken with a Parliamentary inquiry instigated by the Labor Government now underway. The inquiry has been tasked with investigating the idea of “portable long service leave schemes”.

Put simply, such a scheme would allow employees to accumulate their LSL entitlements – which provide for 13 weeks leave in SA upon the completion of 10 years’ service with an employer – as they move from one employer to another.

Earlier this month, Victoria’s Minister for Industrial Relations Natalie Hutchins said the inquiry would “consider the economic and social impacts of any change” to LSL provisions and report to Parliament within a year.

“Workers are no longer staying in the same job and with the same company for their entire working lives,” Hutchins said.

“We’re making sure that workers aren’t short-changed, and that entitlements such as long service leave aren’t eroded as a result of the shifting way in which we work,” she said.

To say the Minister has missed the point would be an understatement.

Long service leave is precisely what it says – it is an entitlement to leave after “long” service with the same employer.

We have a highly mobile workforce today and individual employees may not accumulate the years of service required to receive LSL. But that is their choice. Presumably the decision to forego the LSL they had accumulated was influenced by the inherent appeal of their new position. It outweighed the value to that individual of the LSL.

To allow “service” leave to be accumulated across employers is unreasonable, unfair, and very costly. It’s unreasonable because it would no longer require an employee to show the loyalty that the current regime implies for which the employee is rewarded.

It is unfair because an employee just shy of the threshold for LSL arrives on the doorstep of a new employer and promptly heads off on leave, at that company’s cost.

And it’s costly because all employees will ultimately receive LSL and be paid for that leave regardless of how many employers they work with. At present, some people do not ever receive LSL because they choose to change jobs.

So a portable LSL scheme would impose additional costs on employers and the economy, to the detriment of jobs.

The question of broad LSL portability has been considered in the past and rejected. A research paper prepared for the Labour Ministers Council in 1999, drafted by WA state officials “in liaison” with their Federal counterparts, canvassed a number of LSL issues, including portability.

The report says: “It should be recognised that portability of leave between employers is at odds with the long service leave concept and should only be countenanced in exceptional circumstances”.

There are some historical exceptional circumstances which have seen construction workers for example – who are often hired on a short term basis by different employers – able to carry their LSL entitlement between jobs.

But that’s where portability should end. To do otherwise is to add another layer of cost that business cannot afford that will have the inevitable result of lost jobs. Those individuals losing jobs might think that’s a high price to pay for someone else to choose to change their jobs.

Rick Cairney is Director of Policy at Business SA