The Restaurant Industry Award 2020 covers thousands of restaurants, cafes, and catering businesses across Australia — and its leave provisions are more complex than most employers expect. Between the 17.5% leave loading, the shiftworker definition that grants a fifth week of annual leave, minimum engagement periods for casuals, and the casual conversion rules, getting leave wrong in this industry is both common and expensive.

This guide covers the Restaurant Award’s leave entitlements in 2026: the NES baseline it builds on, the award-specific additions, and the compliance pitfalls that drive underpayment claims in the hospitality sector.

Key takeaways

The Restaurant Industry Award 2020 provides 17.5% leave loading on annual leave, paid on the employee’s base rate.
Full-time employees receive 4 weeks annual leave; qualifying shiftworkers receive 5 weeks.
Full-time employees accrue 10 days personal/carer’s leave per year, consistent with the NES.
Casual employees receive no paid leave but are entitled to the 25% casual loading and must be offered permanent conversion after 12 months of regular employment.
Minimum engagement periods of 3 hours apply for most casual employees per shift.

Annual leave under the Restaurant Award

Full-time employees in the Restaurant Industry Award receive the NES minimum of 4 weeks (152 hours for a 38-hour week) of paid annual leave, accruing progressively based on ordinary hours worked.

The award defines “shiftworker” for the purpose of the additional fifth week as an employee who works across all seven days of the week on rotating shifts, including weekends and public holidays. If your roster requires staff to work Saturdays, Sundays, and public holidays on a rotating basis, they likely qualify for 5 weeks (190 hours).

Leave loading of 17.5% is payable on annual leave taken, calculated on the base rate of pay. The Restaurant Award includes a “greater of” provision — the employee receives whichever is higher: the 17.5% loading or the penalty rates they would have earned if working during that period.

Worked example

Sam works full-time at a restaurant, earning $26.50/hour base rate, and regularly works weekends at 150% penalty rates.

One week of annual leave: 38 hours × $26.50 = $1,007.00 base
Leave loading at 17.5%: $1,007.00 × 17.5% = $176.23
Penalty equivalent for a typical week: higher than $176.23 due to weekend rates
Sam receives: the penalty rate equivalent (the “greater of”)

Personal and carer’s leave

The Restaurant Award follows the NES for personal/carer’s leave: 10 days per year for full-time employees, accrued progressively and accumulating year to year. Part-time employees receive a pro-rata amount based on their ordinary hours.

Employees can use personal/carer’s leave for their own illness or injury, to care for an immediate family member or household member, or for unexpected family emergencies. The employer can request evidence — typically a medical certificate or statutory declaration — but must not demand evidence for every minor absence.

Casual employees are not entitled to paid personal leave but can take 2 days unpaid carer’s leave per occasion.

Compassionate leave

All employees, including casuals, are entitled to 2 days of compassionate leave per occasion when a member of their immediate family or household has a life-threatening illness or injury, passes away, or in cases of miscarriage or stillbirth.

Full-time and part-time employees receive paid compassionate leave. Casual employees receive unpaid leave. The leave does not accumulate and can be taken as a single 2-day block or two separate days.

Long service leave

Long service leave is governed by state legislation, not the Restaurant Award. Entitlements depend on the employee’s state or territory:

Victoria: 8.67 weeks after 7 years of continuous service
New South Wales: 2 months after 10 years
Queensland: 8.67 weeks after 10 years
South Australia: 13 weeks after 10 years

Restaurant employers with staff across multiple states need to track state-specific entitlements separately.

Casual employee entitlements

Casual employees in the restaurant industry receive the 25% casual loading in lieu of paid leave. However, the Restaurant Award imposes important minimum engagement requirements:

3-hour minimum engagement for most casual employees per shift
Casual employees who have worked a regular pattern of hours for 12 months must be offered permanent conversion under the casual conversion clause
The employer can refuse conversion only on reasonable business grounds and must provide the offer in writing

Cashing out and payout

During employment, annual leave can be cashed out only if the award permits it and the employee retains a minimum 4-week balance. Each cash-out requires a separate written agreement.

On termination, all accrued unused annual leave must be paid out at the employee’s base rate. Leave loading on termination depends on the award provision — check whether your Restaurant Award clause requires loading on unused leave at termination.

Common compliance traps in restaurants

1. Ignoring weekend penalty rates in the “greater of” calculation

When an employee takes annual leave, you must compare 17.5% loading against the penalty rates they would have earned. For employees who regularly work weekends, the penalty rate equivalent is almost always higher.

2. Not offering casual conversion

After 12 months of regular casual employment, the award requires you to proactively offer permanent conversion. Failing to do so is a breach, and the employee may have a claim for permanent employment from the date conversion should have been offered.

3. Undermining the 3-hour minimum engagement

Scheduling a casual employee for a 2-hour shift and paying only 2 hours violates the minimum engagement clause. You must pay for the full 3-hour minimum.

4. Forgetting leave loading on termination

If the Restaurant Award requires leave loading on unused annual leave at termination, failing to include it in the final pay creates an underpayment.

Putting it into practice

Five checks cover most Restaurant Award leave compliance:

Identify which employees qualify as “shiftworkers” for the fifth week of annual leave.
Apply the “greater of” test for leave loading against penalty rates every time annual leave is paid.
Track the 12-month casual conversion trigger and proactively make the offer.
Enforce the 3-hour minimum engagement for all casual shifts.
Verify leave loading is included in termination payouts where the award requires it.

You can take advantage of the free 14 days trial and explore Leave Balance.

Tracking the “greater of” leave loading calculation against penalty rates across a rotating restaurant roster is exactly the kind of complexity that creates payroll risk. A leave management system built for Australian awards automates this comparison and flags compliance gaps before they become underpayment claims.

Sources

Last updated: 26 July 2026. This article is general guidance, not legal advice. Confirm current award provisions with the Fair Work Ombudsman or an employment lawyer.

Frequently asked questions

What is the leave loading for restaurant employees?

The Restaurant Industry Award provides 17.5% leave loading on annual leave, paid on the employee’s base rate. Many awards, including this one, use a “greater of” provision — the employee receives whichever is higher: 17.5% or the penalty rates they would have earned if working.

Do casual restaurant employees get paid sick leave?

No. Casual employees do not receive paid personal/carer’s leave. They are entitled to 2 days unpaid carer’s leave per occasion and 2 days paid compassionate leave per occasion.

When must a casual restaurant employee be offered permanent conversion?

After 12 months of regular casual employment, the employer must proactively offer permanent conversion. The employer can refuse only on reasonable business grounds and must provide the offer in writing.

How much annual leave do restaurant employees get?

Full-time employees receive 4 weeks (152 hours for a 38-hour week). Employees who qualify as shiftworkers under the award — working rotating shifts across all days including weekends and public holidays — receive 5 weeks (190 hours).

What is the minimum engagement period for casuals?

Most casual employees in the restaurant industry have a minimum engagement of 3 hours per shift. The employer must pay for the full 3 hours even if the actual work finishes earlier.

Australia Restaurant Award: Leave Entitlements Guide