Can we ask an employee to cash out their long service leave?
You cannot insist that the employee takes the long service leave (LSL) as a payment. Under Tasmanian law, cashing out can only take place via agreement with the employee.
Generally in Tasmania, an employee is only allowed to take LSL in one continuous period, or two separate periods by agreement between the employer and the employee. You may be able to point to your policy and ask the employee to take their LSL in a 3-week period and then a 2-week period later in the year.
However, noting your policy states the exception rather than the norm, it seems likely that an employee’s entitlement accrued over 25 years of service could qualify as an exceptional circumstance.