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B. Compensation for early termination of non-ongoing APS employees engaged for a specified term

It is suggested that engagement documentation and/or any industrial instruments applying to an employee:

  • specify that where a non-ongoing APS employee who has been engaged for a specified term is terminated before the expiry of the specified term because:
    • the duties in relation to which they were engaged have been completed ahead of time; or
    • a decision has been made that those duties are no longer required to be performed;

    the employee will, in addition to any entitlements arising under section 117 of the FW Act, be entitled to compensation in respect of the period of service foregone (in accordance with a specified formula determined by the agency – see below); and

  • specify that the above amount for compensation for early termination will not be in addition to any entitlement the employee has to redundancy pay under section 119 of the FW Act (National Employment Standards (NES) payment)*; and
  • state that the employee shall not be entitled to other damages or compensation in respect of, or arising out of, the termination (other than any entitlement the employee would have to redundancy pay under section 119 of the FW Act)*.

* Note that if a specified term employee is also entitled to an NES redundancy payment on early termination of the specified term, and the employee’s engagement documentation or the industrial instrument applying to the employee includes early termination provisions which are equivalent or more beneficial to the employee than the NES redundancy amount, it is suggested that it be made clear in the relevant instrument that the employee is not entitled to the benefit of both the NES redundancy entitlement and the compensation amount provided for in the engagement documentation/industrial instrument (i.e. that the compensation amount is to be reduced by any NES redundancy amount payable to the employee).

The following formula may be appropriate in relation to a non-Senior Executive Service (SES) employee engaged for a specified term.

An agency will, however, need to have regard to the particular circumstances of the engagement, e.g. whether remuneration packaging applies or the person relocated from interstate or overseas to take up the engagement, the length of service as a non-ongoing APS employee prior to termination, and other steps taken to mitigate the employee's loss such as assisting in finding alternative employment.

Period of service forgone Compensation
Not more than 6 months Nil
More than 6 months, but not more than 12 months 4 weeks salary
More than 12 months, but not more than 18 months 8 weeks salary