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Last updated: 9 September 2003

Circular No 2003/5: Amendment to the Public Service Commissioner's Directions on the engagement of persons who have received a redundancy benefit from Commonwealth employment

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Note: This circular has been updated by Circular 2006/5 in relation to the status of Telstra employees

The purpose of this circular is to advise agencies of changes to the Public Service Commissioner's Directions 1999 (the Directions) dealing with the engagement in the Australian Public Service (APS) of persons who have received a redundancy benefit from the Commonwealth. This circular replaces Circular No. 2002/2 of 21 June 2002.

Scope of the amendments

2. The Public Service Commissioner has now made Public Service Commissioner's Amendment Directions 2003 (No.2) (the Amendment Directions) which replace existing clauses 4.4A and 4.4B of the Directions with a revised clause 4.4A (copy at Attachment A). A consolidated version of the Directions, including this amendment, will be available shortly on the Attorney-General's Department Scaleplus website http://scaleplus.law.gov.au/.

3. The changes come into effect on 15 September 2003 (the date of gazettal of the Amendment Directions), and:

allow an Agency Head to engage a person who has received a redundancy benefit from an APS agency or a non-APS Commonwealth employer in the previous 12 months (a redundancy benefit recipient) as an ongoing APS employee at either a Senior Executive Service (SES) classification level or below, subject to certain criteria being satisfied;
introduce additional discretion for an Agency Head to engage a redundancy benefit recipient as a non-ongoing APS employee at an SES classification level in certain circumstances; and
broaden the circumstances in which a redundancy benefit recipient can be engaged overseas as a locally engaged employee.

4. The new arrangements in relation to the engagement of a redundancy benefit recipient as either an ongoing or non-ongoing APS employee are summarised in Attachment B.

Engagement of a redundancy benefit recipient as an ongoing APS employee

5. Currently there is a total prohibition on the engagement of a redundancy benefit recipient as an ongoing APS employee within 12 months of their separation. Under the arrangements that will apply from 15 September 2003, an Agency Head will be able to engage a redundancy benefit recipient as an ongoing APS employee, at either an SES classification level or below, where the Agency Head:

considers that the engagement of such a person is essential for the agency's operations, having regard to the nature of the duties to be performed and the skills, experience or qualifications of the person; and
has obtained the approval of the Public Service Commissioner prior to engaging a redundancy benefit recipient as an ongoing APS employee.

6. It is expected that approval to engage a redundancy benefit recipient as an ongoing APS employee within 12 months of separation will only be given in exceptional circumstances. In seeking the Commissioner's approval, an agency will need to address the following issues:

the specific skills, experience and/or qualifications required for the performance of the particular duties;
the steps that the agency has taken to fill the employment opportunity (extent of advertising, etc.);
whether there are any other suitable candidates for the vacancy;
the level of benefit received, the organisation it was received from and the time elapsed since it was received;
the Agency Head's personal view of the proposal to engage the person; and
any other factors considered relevant by the agency.

Engagement of a redundancy benefit recipient as a non-ongoing APS employee

7. The arrangements applying to the engagement of a redundancy benefit recipient as a non-ongoing APS employee at a non-SES classification level remain unchanged.

8. Clause 4.4A of the Directions continues to provide that an Agency Head may only engage a redundancy benefit recipient as a non-SES, non-ongoing APS employee within 12 months of their separation where the Agency Head considers that the engagement of such a person is essential for the Agency's operations, having regard to the nature of the duties to be performed and the skills, experience or qualifications of the person.

9. In addition, an Agency Head is required to consult with the Public Service Commissioner before engaging a redundancy benefit recipient as a non-SES, non-ongoing employee except where:

the engagement is for up to 6 months pending the engagement of an ongoing APS employee (i.e. in the circumstances set out in items 6 and 7 of the table contained in sub-regulation 3.5(2) of the Public Service Regulations), or
the engagement is to perform irregular or intermittent duties.

10. Under the arrangements that will apply from 15 September 2003, an Agency Head will also have the capacity to engage a redundancy benefit recipient as a non-ongoing APS employee at an SES level within 12 months of separation, where the Agency Head:

considers that the engagement of such a person is essential for the agency's operations, having regard to the nature of the duties to be performed and the skills, experience or qualifications of the person; and
has obtained the approval of the Public Service Commissioner prior to engaging a redundancy benefit recipient as a non-ongoing SES employee.

11. Agencies should address the issues identified in paragraph 6 above when either consulting with, or seeking the approval of, the Public Service Commissioner prior to engaging a redundancy benefit recipient as a non-ongoing SES or non-SES APS employee.

Engagement of a redundancy benefit recipient as a locally engaged employee

12. Under the arrangements that will apply from 15 September 2003, an Agency Head will be able to engage a redundancy benefit recipient as a locally engaged employee under section 74 of the Public Service Act 1999 in any capacity, in circumstances where the Agency Head:

considers that the engagement of such a person is essential for the agency's operations, having regard to the nature of the duties to be performed and the skills, experience or qualifications of the person; and
has consulted with the Public Service Commissioner prior to engaging a redundancy benefit recipient as a locally engaged employee.

13. This arrangement replaces the current provisions whereby such engagements can only be for a specified term.

14. The new arrangements apply to the engagement of a redundancy benefit recipient who is:

a former APS employee, or other Commonwealth employee, who is seeking to be engaged as a locally engaged employee; and
a former locally engaged employee who is seeking to be engaged again as a locally engaged employee.

15. A former locally engaged employee who is a redundancy benefit recipient and who seeks employment in the APS as either an ongoing or non-ongoing APS employee is covered by the arrangements set out in paragraphs 5 to 11 above as the case may be.

Definition of redundancy benefit and non-APS Commonwealth employer

16. The terms redundancy benefit and non-APS Commonwealth employer continue to be defined in the Directions (see Attachment C). There have been no changes to these definitions.

17. A redundancy benefit as defined in clause 4.4 of the Directions means a severance payment, or similar payment, made to an employee on cessation of the employee's employment with the Commonwealth, and includes a payment made to an employee as a result of the shortening of a retention period as well as payments made to SES employees under section 37 of the PS Act.

18. Clause 4.4 of the Directions includes specific examples of what does not constitute a redundancy benefit, including compensation paid to an employee for early termination of a period of non-ongoing employment and certain payments made to overseas employees on cessation of employment.

19. A non-APS Commonwealth employer as defined in the Dictionary to the Directions includes employment:

with non-APS Commonwealth employers such as the Australian Defence Force, the Parliamentary Departments or under the Members of Parliament (Staff) Act 1984 or the Governor-General Act 1974;
in non-APS Commonwealth authorities (for example, Airservices Australia, Australian Federal Police, Australian National University, Australian Sports Commission, Civil Aviation Safety Authority, Commonwealth Scientific and Industrial Research Organisation, Health Insurance Commission, High Court of Australia, National Gallery of Australia);
in Government Business Enterprises (GBEs) (for example, Australian Government Solicitor, Australian Postal Corporation, Employment National, Health Services Australia, Medibank Private, Telstra Corporation (while it remains in majority Commonwealth ownership)); and
in companies which are 100% owned by GBEs (e.g. Pacific Access, Telstra Enterprise Services which are owned by Telstra).

Pre-engagement procedures

20. Agencies should ensure that their pre-engagement procedures are designed to obtain accurate information from prospective employees about their prior employment history.

21. Applicants for employment in the APS need to be made aware that receipt of a redundancy benefit from an APS agency or a non-APS Commonwealth employer in the previous 12 months means that they are covered by the arrangements set out in clause 4.4A of the Directions. Good practice will ensure that prospective employees declare whether or not they have received a redundancy benefit from an APS agency or a non-APS Commonwealth employer in the previous 12 months.

Engagement of redundancy benefit recipients as independent contractors

22. The measures set out in clause 4.4A of the Directions apply only to the engagement of a redundancy benefit recipient as an APS employee. The Directions do not apply to the engagement of a redundancy benefit recipient as an independent contractor (including as a consultant).

23. Agencies should, however, ensure that their policies and procedures on the engagement of independent contractors are consistent with the spirit of the Government's policy as expressed in clause 4.4A of the Directions.

24. Such policies should also be consistent with relevant government guidelines (e.g. Commonwealth Procurement Guidelines issued by the Department of Finance and Administration, individual agency Chief Executive Instructions).

Parliamentary scrutiny

25. The Amendment Directions are subject to Parliamentary scrutiny, which means that a notice of disallowance may be given in either House of Parliament within 15 sitting days of tabling. Should such a notice be given, the Amendment Directions may be disallowed by resolution of either House. In the event of disallowance, the Directions, as they existed before 15 September 2003 would be revived from the date of disallowance. Further advice will be issued should disallowance occur.

Further advice

26. General enquiries in relation to these matters can be directed to the APS Commission's Helpline on (02) 6202 3859.

Peter Miller
Acting Group Manager
Policy and Employment Group
8 September 2003

Attachment A

available here

Attachment B: Engagement of redundancy benefit recipients as ongoing or non-ongoing APS employees

	Engagement at non-SES level	Engagement at SES level
Ongoing APS employment	Agency Head able to engage a redundancy benefit recipient within 12 months of separation only where the Agency Head considers that the engagement of such a person is essential for the agency's operations, having regard to the nature of the duties to be performed and the skills, experience or qualifications of the person and obtains prior approval of Public Service Commissioner.	Agency Head able to engage a redundancy benefit recipient within 12 months of separation only where the Agency Head considers that the engagement of such a person is essential for the agency's operations, having regard to the nature of the duties to be performed and the skills, experience or qualifications of the person and obtains prior approval of Public Service Commissioner.
Non-ongoing APS employment	Agency Head able to engage a redundancy benefit recipient within 12 months of separation only where the Agency Head considers that the engagement of such a person is essential for the agency's operations, having regard to the nature of the duties to be performed and the skills, experience or qualifications of the person.Agency Head is required to consult with the Public Service Commissioner prior to engaging a redundancy benefit recipient as a non-SES non-ongoing employee except where: the engagement is for up to 6 months pending the engagement of an ongoing APS employee (i.e. in the circumstances set out in items 6 and 7 of the table contained in sub-regulation 3.5(2) of the Public Service Regulations), or the engagement is to perform irregular or intermittent duties.	Agency Head able to engage a redundancy benefit recipient within 12 months of separation only where the Agency Head considers that the engagement of such a person is essential for the agency's operations, having regard to the nature of the duties to be performed and the skills, experience or qualifications of the person and obtains prior approval of Public Service Commissioner.

Note: A redundancy benefit recipient means a person who has received a redundancy benefit (as defined in clause 4.4 of the Commissioner's Directions) from an APS Agency, or a non-APS Commonwealth employer (as defined in the Dictionary to the Commissioner's Directions) and less than 12 months has passed since the person's employment ceased.

Attachment C: Extract from Public Service Commissioner's Directions

4.4 Redundancy benefit

Subject to subclause (2), each of the following payments is a redundancy benefit:
1. a severance payment, or similar payment, made to an employee on cessation of the employee's employment in an Agency or with a non?APS Commonwealth employer;
2. a payment made to an employee as a result of the shortening of a retention period;
3. a payment made to an SES employee under section 37 of the Act.
Each of the following payments is not a redundancy benefit:
1. a payment made:
  1. to a person who was engaged as an APS employee for a specified term or for the duration of a specified task; and
  2. as compensation for the early cessation of the person's employment;
2. a payment made:
  1. to a person who was engaged by a non-APS Commonwealth authority, under a contract of employment, for a specified term or for the duration of a specified task; and
  2. as compensation for the early cessation of the person's employment;
3. a payment made to a person if:
  1. the person was engaged overseas to perform duties overseas as an employee under section 74 of the Act; and
  2. the person's employment ceased otherwise than at the initiative of the employer.

Dictionary

non-APS Commonwealth employer includes:

the Australian Defence Force; and
any other non-APS Commonwealth employer, whether or not the employer is established under an Act; and
any other employer (including a company) in which the Commonwealth has a controlling interest.