Chapter 2: Remuneration components
The key remuneration components covered by this report are Base Salary, Total Remuneration Package (TRP), Total Reward (TR) and allowances.
Base Salary is an employee’s full time equivalent annualised salary. It includes salary sacrifice amounts such as pre-tax employee superannuation contributions made via salary sacrifice arrangements.
Total Remuneration Package
TRP incorporates Base Salary plus benefits. Benefits include: employer superannuation contribution, motor vehicle cost, executive vehicle scheme, cash in lieu of a motor vehicle, motor vehicle parking, personal benefits and other supplementary payments.
TR represents the full remuneration amount for each employee, less allowances. TR is the sum of TRP (Base Salary plus benefits) plus bonuses. Bonuses include: individual performance, retention, productivity, sign-on and performance by the employee’s group or their whole agency.
Allowances are payments that sit outside of TR as TR plus allowances (TRA). They cover payments for working conditions, qualifications and work-related expenses. The availability of, and eligibility for, allowances depends on specific conditions provided under an employee’s employment instrument and particular circumstances of positions.
Movement in remuneration components
Remuneration movements are affected by a number of factors such as general wage increases, performance advancement through salary scales, promotions, engagements and transfers between agencies.
The population of each classification also affects the impact of overall percentage changes. This can be particularly evident in classifications with small populations such as the APS 1, APS 2, Graduate and SES classifications where a change in headcount can easily shift the median value within a salary scale.
Figure 2.1 shows the annual proportional change in weighted median Base Salaries for non-SES and SES employees over the last five years. This is comprised of the median movements for each classification, weighted to account for employee numbers at each classification. Movement from 2019 to 2020 reflects the impact of the Australian Government’s decision to suspend or defer remuneration increases in response to the COVID‑19 pandemic.
Figure 2.1 Percentage change in weighted median Base Salary by classification group 2016-2020
Figure 2.2 shows the movement in median remuneration components by classification from 2019 to 2020. Remuneration movements generally ranged between -0.5% and 1.0%. The most obvious exceptions were the APS 1 and APS 2 classifications, reflecting the impact of population changes in these classifications.
Figure 2.2 Percentage change in median remuneration components, 2019-2020