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Last updated: 29 November 1999

Public Service Act 1999 Advice No. 12: Managing non-SES excess employees

Introduction

This advice is one of a series of advices to be issued by the Public Service and Merit Protection Commission (PSMPC) concerning the Public Service Act 1999 (the new PS Act) and the Public Employment (Consequential and Transitional) Amendment Act 1999 (the PECTA Act). It is proposed that the new legislation will come into operation on 5 December 1999 and the information contained in this advice takes effect on commencement of the legislation.

2 This advice should be read in conjunction with separate advices on:

• Termination of Employment (Advice No.9) and
• Staffing Actions: Non-ongoing Employees (Advice No.7).

3 This advice deals only with the management of ongoing non-SES excess employees. Information on the management of displaced SES employees is set out in Chapter 6 of the Commissioner's Direction and in separate advice on SES Employment Arrangements (Advice No.8).

4 Information on the termination of non-ongoing non-SES employees is covered in the advice on Termination of Employment. Details on arrangements for compensation for early termination of specified term contracts is included in the advice on Staffing Actions: Non-ongoing Employees.

5 This advice replaces that contained in the PSMPC's booklet titled Management of Excess Staff Situations in the APS - Human Resource Management Principles, Guidelines, Good Practice, issued in December 1996. The good practice advice contained in that Booklet, however, may still be useful in assisting agencies to manage excess staff situations effectively.

Relevant provisions concerning excess employees

New PS Act

6 The following sections of the new PS Act are relevant to the management of excess staff:

• s. 25 provides that an Agency Head may determine the duties of an APS employee in the Agency and the place at which those duties are to be performed.
• s. 26 allows an Agency Head to move an APS employee (with their consent) from another Agency to the Agency Head's Agency.
• s. 27 provides that the Public Service Commissioner may, by direction in writing, move an excess APS employee to another Agency without anyone's consent.
• s. 29 enables an Agency Head to terminate an ongoing APS employee on the grounds that the employee is excess to the requirements of the Agency.

Note an Agency Head's powers under s. 25 can be used to reduce the classification level of an APS employee, without the employee's consent, on the grounds that the employee is excess to the requirements of the Agency at the higher classification level - see s. 23(4)(c).

Certified agreements and AWAs

7 Detailed provisions relating to the management of excess staff are now generally found in agency specific certified agreements or in Australian Workplace Agreements (AWAs) and agencies will need to refer to any relevant provisions of these documents in managing their excess employees.

APS Award

8 With passage of the new PS Act, the clause dealing with Redundancy Pay and Notice of Termination in the Australian Public Service Award 1998 (the APS Award) has been amended to reflect the terminology of the new PS Act. The APS Award remains relevant because it:

• provides the default arrangements where there is no agency agreement; and
• sets the standard for the 'no-disadvantage test'.

9 The APS Award also contains a definition of an excess employee which agencies are encouraged to use. A copy of clause 23 of the APS Award is at Attachment A.

• Agencies should note that the transitional arrangements under subclause 23.8 of the Award still operate to the extent that an employee was offered voluntary retrenchment or advised in writing that they were excess in accordance clauses 11 and 12 of the APS General Employment Conditions Award 1995, on or before 29 September 1998.

Policy parameters

10 Parameter 5 of the Government's Policy Parameters for Agreement Making in the APS continues to apply to the redeployment, reduction and retrenchment provisions of agency agreements and AWAs. The advice about Statutory Obligations included in the supporting guidance material on Parameter 5, however, is being revised to reflect the changed legislative arrangements and will be re-issued shortly by DEWRSB.

Movement, assignment of duties and termination

11 The following arrangements will apply to the movement (transfer at or below their classification level between agencies), assignment of duties (transfer at or below their classification level within an Agency) and termination (retirement) of non-SES excess employees under the new PS Act. The terms used above in brackets are those used under the old PS Act.

Movement

12 Section 27 of the new PS Act is the only power under which an excess APS employee may be moved to another Agency, without their consent.

13 Under this section, the Public Service Commissioner may, by direction in writing, move an excess employee to another Agency, without anybody's consent. This power is expected to be used only in exceptional circumstances where the Commissioner is satisfied that it is in the interest of the APS to do so and the employee's suitability is demonstrated. As a matter of practice, the Public Service Commissioner will normally only exercise this power after consultation with the heads of the two affected agencies. Where an excess employee is moved by the Commissioner, the Head of the gaining Agency will determine the duties of the employee in the Agency.

14 For the purposes of s. 27, an APS employee is an excess employee only if the Agency Head has notified the Public Service Commissioner in writing that the employee is excess to the requirements of the Agency.

15 Section 26 can be used to move an excess employee (at or below their classification level) from one Agency to another where the receiving Agency Head and the excess APS employee agree.

Assignment of duties

16 Paragraph 23(4)(c) allows an Agency Head to assign duties to an employee under s.25 at a lower classification level, without the employee's consent, if the employee is excess to the requirements of the Agency at the higher classification level. The classification level of an employee is reduced if the Agency Head allocates to the employee a classification that is in a lower classification group than the employee's classification before the reduction Ü see DEWRSB's Advice No 1999/19. Subsection 23(5) provides that, if a relevant Award, Certified Agreement or AWA contains procedures to be followed when reducing the classification level of an employee, then the reduction is of no effect unless those procedures are followed.

Termination

17 Section 29 of the new PS Act provides that an Agency Head may, in writing, terminate the employment of an APS employee. The only grounds, however, upon which an APS employee may be terminated are those set out in s. 29(3). The listed grounds for termination include 'the employee is excess to the requirements of the Agency'.

18 The Public Service Regulations will provide that the termination of an ongoing APS employee must be notified in the Gazette.

19 Agencies need to be aware that the Workplace Relations Act 1996 (the WRA) has rules and entitlements that apply to termination of employment. Where a certified agreement or AWA sets out agreed processes for managing excess employees then the Agency will need to follow those processes when exercising the power to terminate the employment of an excess employee.

20 The only remedy in respect of termination of employment is an application to the Australian Industrial Relations Commission under s. 170CE of the WRA for relief on the ground that the termination was harsh, unjust or unreasonable or on the ground of an alleged contravention of ss. 170CK, 170CL, 170CM or 170CN or any combination of these grounds. An application must be lodged within 21 days after the day on which the termination takes effect, or such longer period as the Commission allows.

Restrictions on re-employment

21 Chapter 4 of the Commissioner's Direction on Merit will require an Agency Head to put in place measures to ensure that a person who receives a redundancy benefit from an APS Agency or a non-APS Commonwealth employer is not engaged as an ongoing APS employee within 12 months of the person ceasing employment.

22 Under the Directions, an Agency Head must not engage a person who received a redundancy benefit from an APS Agency or a non-APS Commonwealth employer in the preceding 12 months for a specified term or the duration of a specified task (except as provided in paragraph 23) unless the Agency Head:

• considers that the engagement of the person is essential for the Agency's operations having regard to the nature of the duties to be performed and the skills, experience and/or qualifications of the person; and
• has consulted the Public Service Commissioner prior to the proposed engagement.

23 An Agency Head must not engage a person who received a redundancy benefit from an APS Agency or a non-APS Commonwealth employer in the preceding 12 months for a specified term of up to 6 months pending the engagement of an ongoing employee or for duties that are irregular or intermittent, unless the Agency Head considers that the engagement of the person is essential for the Agency's operations having regard to the nature of the duties to be performed and the skills, experience and/or qualifications of the person.

Role of APSLMAP

24 The APS Labour Market Adjustment Program (APSLMAP) was originally established to assist excess staff seeking redeployment who were employed in agencies covered by the Continuous Improvement in the APS Enterprise Agreement 1995-97.

25 The APS Enterprise Agreement has ceased to apply as agencies have established their own specific arrangements under agency specific agreements. As an agency agreement cannot be binding on third parties, an Agency Head has no authority to include provisions in an agency agreement about staff access to APSLMAP without first obtaining the agreement of the Public Service Commissioner.

Transitional arrangements

26 Division 8C of the old PS Act dealt with the redeployment and retirement of non-SES officers. Regulations made under the PECTA Act will establish the following transitional arrangements:

• where an instrument of retirement had been signed under s. 76W of the old Act but the retirement had not come into effect prior to 5 December 1999, the retirement will proceed under the old Act; and
• where a notice of reduction was issued under s. 76W of the old Act and the period for lodging an appeal under s. 76Z (as specified in old Public Service Regulation 120D) had not expired before 5 December 1999, or where an appeal had been lodged but not heard, the appeal process will be allowed to continue until finalised.

27 The Merit Protection Commissioner will be able to establish a Redeployment and Retirement Appeal Committee which will be able to hear these appeals until all relevant appeals have been lodged, heard and determined.

Attachments

28 Attached are the following advices which were previously issued by the PSMPC in relation to redeployment, redundancy or termination which continue to be relevant:

• Attachment B - Federal Court ruling on the definition of 'locality';
• Attachment C - Amounts to be included in payment instead of notice of termination under section 170CM of the WRA;
• Attachment D - Operation of section 170CL of the WRA in relation to an employer notifying the CES of proposed terminations in certain cases; and
• Attachment E - What ACTPS service is recognised for severance pay purposes in the APS?

Further advice

29 Urgent enquiries from Comnet members and their senior staff should be made by E-mail to psact@apsc.gov.au or the PSMPC's Helpline on 6202 3859.

30 Advice from DEWRSB is accessible through the government employment web sites at www.dewrsb.gov.au or through the PSMPC's web site.

 

Jeff Lamond
Team Leader
Staffing, Structures and Performance Team

26 November 1999

Attachment A

23 Redundancy pay and notice of termination

23.1. Eligible employee: An ongoing APS employee not on probation is an eligible employee for the purposes of this clause.

23.2. Excess employee: An employee is an excess employee if:

• 23.2.1. the employee is included in a class of employees employed in the agency, which class comprises a greater number of employees than is necessary for the efficient and economical working of the agency;
• 23.2.2. the services of the employee cannot be effectively used because of technological or other changes in the work methods of the agency or changes in the nature, extent or organisation of the functions of the agency; or
• 23.2.3. the duties usually performed by the employee are to be performed at a different locality, the employee is not willing to perform duties at the locality and the Agency Head has determined that the provisions of this clause apply to that employee.

23.3. Entitlement: An excess eligible employee whose employment is terminated will be entitled to be paid redundancy pay of a sum equal to 2 weeks salary for each completed year of continuous service, plus a pro rata payment for completed months of service since the last completed year of service.

• 23.3.1. Minimum and maximum payments: The minimum sum payable as redundancy pay on termination will be 4 weeks salary and the maximum will be 48 weeks salary.
• 23.3.2. Pro rata entitlement: Redundancy pay will be calculated on a pro rata basis where the employee has worked part-time hours during the period of service and the employee has less than 24 years full-time service.

23.4. Service for redundancy pay purposes: For the purpose of calculating an entitlement in accordance with 0, "service" means:

• 23.4.1. service in an agency;
• 23.4.2. Government service as defined in section 10 of the Long Service Leave (Commonwealth Employees) Act 1976;
• 23.4.3. service with the Commonwealth (other than service with a joint Commonwealth-State body or a body corporate in which the Commonwealth does not have a controlling interest) which is recognised for long service leave purposes;
• 23.4.4. service with the Australian Defence Forces;
• 23.4.5. APS service immediately preceding deemed resignation under the then section 49 (as repealed in 1966) of the repealed Public Service Act 1922 if the service has not previously been recognised for redundancy pay purposes; and
• 23.4.6. service in another organisation where:
  • 23.4.6.a. an employee was moved from the APS to give effect to an administrative re-arrangement; or
  • 23.4.6.b. an employee of that organisation is engaged as an APS employee as a result of an administrative re-arrangement and such service is recognised for long service leave purposes.
• 23.4.7. Service not to count as service for redundancy pay purposes: Any period of service which ceased:
  • 23.4.7.a. through termination on the following grounds:
    • the employee lacks, or has lost, an essential qualification for performing his or her duties;
    • non-performance, or unsatisfactory performance, of duties;
    • inability to perform duties because of physical or mental incapacity;
    • failure to satisfactorily complete an entry level training course;
    • failure to meet a condition imposed under subsection 22(6) of the Act;
    • breach of the Code of Conduct; or
    • any other ground prescribed by the Public Service Regulations; or
  • 23.4.7.b. on a ground equivalent to those in 23.3.7.a under the repealed Public Service Act 1922; or
  • 23.4.7.c. through voluntary retirement at or above the minimum retiring age applicable to the employee; or
  • 23.4.7.d. with the payment of a redundancy benefit or similar payment or an employer-financed retirement benefit will not count as service for redundancy pay purposes.
• 23.4.8. Earlier periods of service: For earlier periods of service to count there must be no breaks between the periods except where:
  • 23.4.8.a. the break in service is less than one month and occurs where an offer of employment with the new employer was made and accepted by the employee before ceasing employment with the preceding employer; or
  • 23.4.8.b. the earlier period of service was with the APS and ceased because the employee was deemed to have resigned from the APS on marriage under the then section 49 (as repealed in 1966) of the repealed Public Service Act 1922.
• 23.4.9. Absences during a period of service: Absences from duty which do not count as service for long service leave purposes will not count as service for redundancy pay purposes.

23.5. Rate of payment - redundancy pay: For the purposes of calculating any payment under 23.3 or 23.7, "salary" will include:

• 23.5.1. the employee's full time salary, adjusted on a pro rata basis for periods of part time service; and
• 23.5.2. for an allowance to be included as salary for redundancy pay purposes it will have been paid during periods of annual leave and on a regular basis and not be a reimbursement for expenses incurred or a payment for disabilities associated with the performance of a duty.
• 23.5.3. Additional payments for the performance of duties at a higher classification level are to be included in salary where the employee has been performing duties at the higher classification level for a continuous period of at least 12 months immediately preceding the date on which the employee is given notice of termination.
• 23.5.4. Shift penalties are to be included in salary where the employee has undertaken shift work and is entitled to shift penalties for 50% or more of the pay periods in the 12 months preceding the date on which the employee is given notice of termination. The employee is entitled to have the weekly average of the penalties payable over the 12 months immediately preceding the date on which the employee is given notice of termination included in salary.

23.6. Period of notice - termination: Where an excess eligible employee is terminated, the period of notice will be 4 weeks. In the case of an employee over 45 years of age with at least 5 years continuous service the period of notice will be 5 weeks. Where the Agency Head directs, or the employee requests, a termination date within the notice period, the employee's employment will terminate on that date. The employee will be paid compensation instead of notice for the unexpired portion of the notice period. The payments an employee would have received in respect of the ordinary time the employee would have worked during the period of notice, had the employment not been terminated, will be used in calculating any payment in lieu of notice.

• 23.6.1. Time off during notice period: An employee will be entitled to reasonable time off with full pay to attend necessary employment interviews, from the date the period of notice commences.
• 23.6.2. Expenses: Where expenses to attend interviews are not met by the prospective employer, the employee will be entitled to reasonable travel and incidental expenses incurred.

23.7. Reduction in classification: Where the Agency Head proposes to reduce an excess employee's classification level either:

• 23.7.1. the employee will be given the same period of notice as the employee would have been entitled to receive if the employment had been terminated; or
• 23.7.2. the employer may pay an amount to maintain the level of salary received by the employee at the date of notice of reduction in classification level for the number of weeks of notice still owing. Such payments will be calculated in accordance with subclause 23.5.

23.8. Transitional provisions:

• 23.8.1. Where (at 29 September 1998) an employee had been invited to volunteer for retrenchment or had been advised in writing that the employee was an excess employee in accordance with the provisions of clauses 11 and 12 of the Australian Public Service General Employment Conditions Award 1995:
  • 23.8.1.a. the provisions of clauses 11 and 12 of the Australian Public Service General Employment Conditions Award 1995 continue to apply to the employee while the employee remains an excess employee and the employee is not entitled to the benefits of 23.3 of this Award; and
  • 23.8.1.b. where the employee has declined an offer of voluntary retrenchment and the Agency Head proposes to involuntarily retire the employee, the employee is not entitled to the benefits of subclause 23.3 of this Award.

Attachment B: Federal Court ruling on the definition of 'locality'

This advice was originally contained in PSMPC Circular 1998/7 of 1 May 1998 and deals with a decision of the Federal Court issued on 20 March 1998 concerning the definition of 'locality' in subparagraph 11.1.1.(c) of the APS General Employment Conditions Award 1995 (GECA). GECA has now been displaced by the APS Award 1998, but the term 'locality' is used in both Awards.

Background

The case concerned a declaration sought by the Taxation Officers' Branch of the Australian Municipal, Administrative, Clerical and Services Union (ASU) that an 'excess employee' includes an employee whose job is moved within a city (including from one suburb to an adjoining suburb). The ASU was concerned that its members in the Australian Taxation Office (ATO) affected by the provisions of the ATO - Business 2000 Savings and Investment Strategy, would be required to move to other ATO offices in the same city.

The matter at issue in this case was the definition of an excess employee in clause 11 of GECA, vis:

"an employee is an excess employee if:

... ...

11.1.1.(c) where the duties usually performed by the employee are to be performed at a different locality, the employee is not willing to perform duties at the locality and the Secretary has determined that the provisions of Division 8C of the Act apply to that employee." (Reference to "the Act" is a reference to the Public Service Act 1922)

What was decided

Marshall J found that 'clause 11 of GECA properly interpreted does not contemplate compulsory transfers within the same metropolitan area of a city'. He further found that 'clause 11 of GECA properly interpreted imposes a test of 'different locality' which is only met where the compulsory relocation of the duties performed by the employee is from one capital city to another, or on a similar scale, such as from a country town to a capital city, and it would be necessary and reasonable for the employee to move house in order to maintain employment.'

What you should know about the decision

As a result of the decision you should note that:

• the decision fully upheld the Commonwealth's submissions in the case and confirmed the interpretation consistently expressed by the PSMPC about the application of the excess staffing provisions in situations where a Secretary determines that the duties usually performed by employees are to be performed at a different locality;
• Marshall J did not find for the contention of the Community and Public Sector Union (CPSU), which was also a respondent in the case, that there can be circumstances where both inter-city or intra-city relocations can constitute movement to a different locality depending on the circumstances of the particular relocation;
• the notion that redeployment, retirement and voluntary retrenchment occurs at the initiative of management and is not a right of staff is preserved by this decision - and staff may be expected to perform duties at a different location within a metropolitan area where their duties are relocated; and
• the decision concerns the words used in GECA, but it is also important for agencies developing agreements with staff that there is now confirmation that the excess staffing provisions do not apply where staff are simply moving within the same metropolitan area, and this principle should be maintained by agencies in such agreements.

Summary

A summary of the decision of the Federal Court is as follows:

Decision No. VI 1296 of 1997 - Federal Court - Interpretation of 'Locality' in the Redeployment and Retirement provisions of the APS General Employment Conditions Award 1995 - Decision by Marshall J - 20 March 1998

The applicant sought an interpretation of the words and phrases 'locality' and 'at a different locality' in subparagraph 11.1.1.(c) of the Australian Public Service General Employment Conditions Award 1995 (GECA).

The applicant contended that, where subparagraph 11.1.1.(c) refers to the transfer of duties to 'a different locality' it comprehends not only transfers between metropolitan areas but also within metropolitan areas. Specifically, the applicant contended that the reference to 'a different locality' in subparagraph 11.1.1.(c) of GECA includes a move from one place of work to another provided that such a move is not merely a relocation from one building to another in the immediate vicinity.

The first and second respondents (the Commonwealth) urged the Court to declare that clause 11.1.1.(c) of GECA does not refer to compulsory transfers within the same metropolitan area. The Commonwealth contended that the test of a different 'locality' is only met where the compulsory relocation of the duties performed by the employee is from one capital city to another, or on a similar scale, such as from a country town to a city, and it would generally be necessary and reasonable for the employee to move house in order to maintain employment.

The third respondent (the Community and Public Sector Union) contended that there can be circumstances where both inter-city or intra-city relocations can constitute movement to 'a different locality'. The third respondent contended that this assessment depends on a number of factors including, but not limited to, whether there has been a change of town or city, the distance between the old and the new locality, the availability of services in the new locality including transport and the cost to the employees concerned. The third respondent submitted that the application should be dismissed and that no declaration be made.

Marshall J considered the factual background to the case which involved the proposed reorganisation of the Australian Taxation Office (ATO) and the relocation of employees from certain ATO offices to other ATO offices within a region. His Honour examined the provisions of GECA and predecessor instruments, the most materially relevant of which was the Australian Public Service Redeployment and Retirement (Redundancy) Award 1987 (RRR Award). His Honour commented that

"...the notion of 'at a different locality' in the RRR Award was intended to encompass a move the magnitude of which was inter-city, or of a similar scale, such that the employee would be required to move house in order to maintain her or his employment." He also noted that other material including the Excess Staff Circular and the Personnel Management Manuals constitute part of the context in which clause 5(e)(iii) of the RRR Award should be considered. His Honour's interpretation of cl 11.1.1(c) of GECA therefore had regard to the transplantation of clause 5(e)(iii) of the RRR Award to GECA and so to the context in which the RRR Award was considered.

His Honour concluded that GECA does not refer to compulsory transfers within the same metropolitan area and that the test of different 'locality' is only met where the compulsory relocation of the duties performed by the employee is from one capital city to another, or on a similar scale, such as from a country town to a capital city, and it would be necessary and reasonable for the employee to move house in order to maintain employment.

Attachment C: Workplace Relations Act 1996 - Impact on APS termination of employment requirements

This advice was originally contained in PSMPC Circular 1998/1 dated 10 February 1998.

Purpose

The purpose of this advice is to inform agencies of new advice from the Attorney-General's Department on amounts to be included in payment instead of notice of termination under section 170CM of the Workplace Relations Act 1996 (the WR Act).

2. Following two decisions by judicial registrars of the Industrial Relations Court of Australia, the Attorney-General's Department has reviewed advice given in 1994 on the operation of subsection 170DB(4) of the Industrial Relations Act 1988. Subsection 170CM(4) of the WR Act is in identical terms to those used in subsection 170DB(4) of the Industrial Relations Act 1988.

Payment instead of notice of termination

3. In October 1994 the Attorney-General's Department advised that agencies are required to include in the amount of compensation payable under subsection 170DB(4):

• ordinary wages;
• anticipated overtime or shift allowances;
• other allowances, such as senior officer allowance, clothing and site allowances;
• payments on account of accrued annual leave;
• payments on account of pro rata annual leave;
• payments on account of long service leave; and
• the amount of the employer's superannuation contributions.

4. Agencies were advised of this in Circular No. 1995/12 of 31 May 1995 titled "Industrial Relations Act 1988 - Impact on APS Termination of Employment Procedures".

5. The Attorney-General's Department has advised that the October 1994 advice is now not correct given the following decisions:

• Kenney v Loveland (Ritter JR, decision #960026)
  In Kenney v Loveland, Judicial Registrar Ritter ruled that annual leave, long service leave and superannuation contributions are not contemplated by subsection 170DB(4) of the Industrial Relations Act 1988 and that amounts on account of these matters would not form part of the amount to be paid under that provision.
• Hammond v Moore Business Systems Australia Ltd (Murphy JR, decision #950451)
  In Hammond v Moore Business Systems Australia Ltd Judicial Registrar Murphy ruled that subsection 170DB(4) requires "payment of amounts which would have been paid and only those amounts over the notice period". He went on to say that "annual leave, long service leave and superannuation contributions are not contemplated by these provisions".

6. The Attorney-General's Department has now advised that payments instead of notice should only include payments that are typically in an employee's weekly, fortnightly or monthly pay packet. Essentially, this means wages or salary, overtime and shift allowances, and other allowances. It would not include accrual entitlements such as payments on account of pro rata annual leave, long service leave or employer's superannuation contributions that would have accrued had the person remained as an employee during the relevant notice period.

7. Based on the latest advise from the Attorney-General's Department agencies are required to include in the amount of compensation payable under subsection 170CM(4) of the WR Act:

• ordinary wages;
• anticipated overtime or shift allowances; and
• other allowances, such as senior officer allowance, clothing and site allowances.

Implementation

8. Implementation of the revised arrangements should occur without delay. Agencies may wish to:

• carefully consider the application of the changes in cases where a person has accepted an offer of voluntary redundancy on the basis of specific financial information from the agency that pro rata payments for annual leave, long service leave and employer's superannuation contributions would be included in the amount of compensation; or
• seek specific legal advice on their obligations.

Attachment D: Termination of employment in APS agencies - Operation of Section 170CL of the Workplace Relations Act 1996

This advice was originally contained in PSMPC Circular 1998/8 dated 1 May 1998.

Background

The purpose of this circular is to clarify the operation of section 170CL of the Workplace Relations Act 1996 (WR Act) - Employer to notify CES of proposed terminations in certain cases - where an agency decides to terminate the employment of 15 or more employees for reasons of an economic, technological, structural or similar nature. Section 170CL requires an employer to give written notice of an intention to terminate 15 or more employees to the Commonwealth Employment Service (CES) where the employment is to be terminated for such reasons. A number of agencies have sought advice about when and in what circumstances they are obliged to give written notice under section 170CL and to whom such notification should be provided.

Set out below are answers to commonly asked questions about the operation of section 170CL which are based on information obtained from the Legislation, Policy and Services Branch of the Department of Workplace Relations and Small Business.

Commonly asked questions about the operation of section 170CL

Does the requirement to notify the CES arise where separate decisions have been made within an agency and for different reasons to terminate the employment of 15 or more employees?

The WR Act contemplates situations where an employer has formulated its decision to terminate the employment of 15 or more employees for more than one reason so long as those reasons are of an economic, technological, structural or similar nature. The requirement to notify the CES would not arise in a case where clearly separate decisions are made within different parts of an organisation to terminate the employment of employees, and their total number happens to equal 15 or more. In this regard, section 170CL contemplates a single corporate decision to terminate the employment of 15 or more employees.

The obligation, however, to notify the CES may arise in a case where the proposed terminations were based on different reasons (of an economic, technological, structural or similar nature), but are demonstrably a result of separate decisions made as part of an overall management strategy. There may be circumstances demonstrating that a series of separate decisions form one composite decision.

Does the requirement under section 170CL arise where the 15 or more employees are geographically separated but their employment is to be terminated for the same reason?

Yes. The question of geographical separation of the employees concerned is irrelevant in relation to the question of whether the obligation under section 170CL arises. Section 170CL merely refers to the decision of an employer to terminate the employment of 15 or more employees and does not distinguish between centralised and disparate workplaces in terms of the obligation to notify the CES.

Which entity is to be notified in place of the CES?

Any notifications pursuant to section 170CL can be provided to any Commonwealth Services Delivery Agency (Centrelink) office. The Service Arrangement in place between the Secretary of the Department of Employment, Workplace Relations and Samll Business (DEWRSB) and the Chief Executive Officer of Centrelink provides that Centrelink will act as the agent for the CES in receiving notifications under subsection 170CL(2) of the WR Act. (The statute which established the CES has not been repealed and accordingly the CES still exists although it is not operational. The CES currently consists of the Secretary of DEWRSB only.)

Attachment E: What ACTPS service is recognised for severance pay purposes in the APS?

This advice was originally contained in PSMPC Circular 1999/5 dated 25 May 1999.

Background

The purpose of this advice is to clarify the arrangements in place concerning the recognition of service with the ACT Public Service (ACTPS) as service for severance pay purposes in the Australian Public Service (APS).

2. The ACTPS was established as a separate entity on 1 July 1994. On that date persons working in the APS on ACT functions ceased, by operation of Commonwealth legislation, to be officers or employees of the APS. The people concerned were immediately appointed to, or employed in, the ACTPS by operation of ACT legislation.

3. At the time of the creation of the ACTPS, legislation was enacted which established reciprocal mobility arrangements between the two Services. The key elements of those arrangements are:

• a right for officers of each Service to apply and compete on merit for non-Senior Executive Service vacancies in the other Service which are advertised for permanent filling; and
• portability of certain benefits or recognition of service for certain purposes on movement between the two Services under the reciprocal mobility arrangements.

Recognition of service for severance pay - Commonwealth arrangements

In 1994 it was agreed between the Commonwealth and the unions that the Commonwealth would recognise:

• APS service prior to 1 July 1994; and
• ACTPS service between 1 July 1994 and the person's subsequent appointment to the APS

as service for severance pay purposes for all staff who transferred to the ACTPS on 1 July 1994, regardless of whether they joined the ACTPS from the APS or from a Territory-owned authority, if their APS, ACTPS and APS periods of service were continuous.

5. These arrangements are not covered by legislation but were given effect by an Administrative Instruction made by the Public Service Commissioner under section 76X of the Public Service Act 1922. These arrangements also reflect the principle that the APS only recognises service with non-APS Commonwealth organisations for severance pay purposes where staff move as a result of the compulsory transfer of a function - see subclause 11.4.8 of the former APS General Employment Conditions Award 1995 and clause 23.4.6 of the Australian Public Service Award 1998.

6. Under the arrangements agreed with the ACTPS, the Commonwealth does not recognise either combined APS and ACTPS service, or ACTPS only service, for severance pay purposes for persons who join the ACTPS after 1 July 1994 and later join (or rejoin) the APS, even though such periods of service may be continuous. This includes APS staff who exercise rights to deemed promotion or transfer to the ACTPS after 1 July 1994.

7. Persons who leave the APS to join the ACTPS in this manner, and subsequently rejoin the APS, are treated in the same way as employees of other State Governments who obtain employment in the APS, i.e. the only service that is recognised for severance pay purposes is the current period of APS employment.

Recognition of service for severance pay purposes - ACTPS arrangements

8. In 1994 the ACTPS agreed that, for APS employees compulsorily transferred on 1 July 1994 and for APS employees moving to the ACTPS under the reciprocal mobility arrangements after that date, it would recognise any continuous prior APS service for severance pay purposes where those employees were made redundant by the ACTPS.

9. For persons who:

• joined the ACTPS on or after 1 July 1994; and
• are subsequently appointed to the APS and retrenched;

the ACTPS has now advised that it will pay a severance benefit in respect of ACTPS service where this is not recognised as service for severance pay purposes by the APS, but it will not include payment for any previous periods of APS service that are not recognised as service for severance pay purposes by the APS. The ACTPS has also advised that the amount payable by the ACTPS to any retrenched APS employee under this commitment will not exceed an amount of two weeks' pay for each completed year of ACTPS service (plus a pro rata amount for completed months of service) up to a maximum of 48 weeks' salary.

Provisions in agency agreements

10. When these arrangements were agreed in 1994 each Service had its own Service-wide redeployment and redundancy arrangements. Since that time, however, both the APS and the ACTPS have moved to an environment where comprehensive terms and conditions of employment (including redeployment and retirement arrangements) are determined more and more at the agency level under agency specific agreements. In the APS this means that:

• while severance pay (and therefore the definition of service for severance pay purposes) continues to be an allowable award matter and is prescribed in the Australian Public Service Award 1998 (which has replaced GECA), those provisions only operate in agencies which do not have an agency specific agreement; and
• APS agencies and their staff are able to agree to vary the former Service-wide arrangements through Certified Agreements or Australian Workplace Agreements.

11. It should be noted, however, that agency level agreements cannot override or displace the reciprocal mobility arrangements which are contained in the Australian Capital Territory Government Service (Consequential Provisions) Act 1994.

12. In the light of these changed circumstances, individuals moving from the ACTPS to the APS and vice versa need to know whether the Service-wide arrangements for the recognition of prior APS or ACTPS service apply or whether the agency they are proposing to join recognises, or is prepared to recognise, their prior APS or ACTPS service for severance pay purposes. Individuals will need to resolve these issues on their own behalf.

Advice to staff

13. It is important that staff who are intending to move from the APS to the ACTPS, or have moved from the APS to the ACTPS and then back to the APS under the reciprocal mobility arrangements, are made aware of the information in this circular. It is suggested that APS agencies advise persons contemplating a move either to or from the ACTPS that they need to clarify the extent to which service with either jurisdiction will be recognised for severance pay purposes should they be retrenched. It is also suggested that agencies:

• provide clear advice on the arrangements in place concerning the recognition of prior ACTPS service for severance pay purposes to APS employees who have such service and who are being offered voluntary retrenchment; and
• encourage APS staff with prior ACTPS service who are offered voluntary retrenchment to contact the ACTPS for details of the severance payment (if any) they will receive in respect of the periods of service not recognised for severance pay purposes by the APS.

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