Two significant Supreme Court decisions handed down on 25 March 2025 have confirmed the wide application of Victoria’s construction industry portable long service leave scheme to businesses well beyond the traditional construction sector.
In EnergyAustralia Pty Ltd v CoInvest Ltd [2025] VSC 100 and Detector Inspector Pty Ltd v CoInvest Ltd [2025] VSC 135, the Supreme Court of Victoria rejected arguments from employers seeking declarations that their workers were not covered by the LeavePlus (CoINVEST) portable long service leave scheme established under the Construction Industry Long Service Leave Act 1997 (Vic).
The decisions highlight that employers who are not operating in the traditional construction industry may still be covered by the scheme and required to pay contributions on behalf of their workforce to LeavePlus.
The decisions will have direct implications for employers who employ building, electrical and metal tradespeople in-house to carry out facilities maintenance, and employers providing property services not traditionally considered to be construction work. The cases also serve as a reminder that the scope of the scheme is very broad and covers many business beyond what might commonly be understood as construction businesses.
The Cases: Who’s Covered and Why It Matters
The EnergyAustralia case concerned maintenance workers carrying out maintenance work on the Yallourn Power Station.
The Detector Inspector case concerned workers carrying out mandatory safety checks and maintenance of smoke alarms, gas and electrical appliances in residential rental properties.
In both cases, the employers argued that they did not operate in the “construction industry” and that their workers were not performing “construction work” as defined under the Rules of the scheme. They also relied on the “routine or minor maintenance” exception for “construction work” contained in the Rules.
However, the Court took a broad view of what constitutes both the “construction industry” and “construction work” under the Rules of the scheme:
- EnergyAustralia - Despite being primarily in the electricity generation industry, the Court held the fact that EnergyAustralia’s employees conducted extensive infrastructure maintenance works on the Yallourn Power Station brought EnergyAustralia “substantially within the construction industry”. Further, the scale of the maintenance work meant that the “routine or minor maintenance” exception in the Rules did not apply.
- Detector Inspector - The Court found that the type of work carried out by Detector Inspector’s employees fell within the definition of “construction work” because they were carrying out maintenance on fixtures attached to buildings. Detector Inspector itself was held to be operating substantially in the “construction industry”.
What Do These Decisions Mean for Employers?
1. Broadening of Scheme Coverage
The EnergyAustralia decision is particularly significant because it demonstrates that employers who have employees carrying out trades work in-house can be within the ‘construction industry’ as defined in the Rules, even though the employer’s primary industry is an entirely different industry.
Both decisions highlight the need for businesses with employees carrying out any building, electrical and metal trades work to consider whether they fall within the ‘construction industry’, even if they would not be considered a construction business within the ordinary sense of the term.
2. Potential Retrospective Liabilities
Businesses who fail to pay LeavePlus long service leave contributions for employees covered by the scheme face exposure to unpaid contributions dating back years, including significant interest payments. For example, it has been reported that EnergyAustralia’s liability is estimated at $800,000 per year in back pay for employees at the Yallourn Power Station.
3. Review of Workforce Obligations
All employers who employ employees in Victoria to carry out any building, electrical or metal trades work should review:
- Whether any of their employees are performing "construction work" as defined under the Rules; and
- Whether the employer could be said to be “substantially engaged” in the construction industry.
Specifically, we consider that employers who carry out property maintenance, energy, telecommunications, safety, and infrastructure works in particular may be affected by these decisions.
Employers who employ employees outside Victoria should also consider the equivalent construction industry portable long service leave schemes in their jurisdiction in light of these Victorian decisions.
4. Enforcement Action on the Horizon
LeavePlus has announced it will now engage in educational outreach and targeted audits. We expect that, as a result, many employers who have not previously considered themselves subject to the scheme will be required to assess their current and possible historic obligations on behalf of their employees carrying out trades work.
Key Takeaways
These Court decisions emphasise the very broad scope of Victoria’s construction industry portable long service leave scheme. Employees who employ tradespeople, but previously considered themselves outside the scheme’s scope, should review their position under the LeavePlus Rules in light of these decisions.
We are here to help
If you would like assistance reviewing your obligations under the LeavePlus portable long service leave scheme, or require support engaging with LeavePlus, please contact Russell Kennedy’s Workplace Relations, Employment and Safety team for legal advice.
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