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Division 5: Payment instead of long service leave

5.5.24 Member this Division applies to

This Division applies to a member who ceases continuous full time service, and who meets one of these conditions.

  1. They are entitled to a long service leave credit.

  2. They qualify under section 5.5.28. This section applies to members who have at least one year of effective service and who leave the ADF in a way listed in section 5.5.28.

    See: Section 5.5.28, Pro rata entitlement

5.5.25 Members this Division does not apply to

  1. If a member leaves the ADF because they die, this Division does not apply. See Chapter 11 Part 3 instead.

  2. This Division does not apply to members who are discharged from one Service in order to start an appointment in another Service without a break. These members are not entitled to payment instead of long service leave.

5.5.26 Payment instead of long service leave

  1. The member is entitled to a payment instead of their long service leave credit.

    See:
    Subsections 2 and 3 for how to calculate the final credit.
    Subsection 4 for what salary to use.
    Subsection 5 for how to calculate the payment.

  2. The member's credit is calculated in accordance with this table.

    Credit calculation
    Step Action See
    1. Work out the member's total period of accrued service, in years and months.
    This includes the member's current service, prior full days of Reserve service and other prior service.
    Division 3 sections 5.5.13 to 5.5.17
    2. Work out their total long service leave credit for the years of service. The credit should be expressed in months and part months (ie taken from the 'months' column of the table in section 5.5.8.) Division 2 section 5.5.8
    3. Work out their total long service leave credit for the remaining months of service. Subsection 5.5.26.3
    4. Add the credits from Steps 2 and 3 together.
    5. Subtract any leave that they have already taken as leave or been paid for instead of leave.

    Example:
    A member has 12 years, 3 months total service.
    Credit for 12 years of service is 3.6 months.
    Credit for 3 months of service is 0.075 months
    Total is 3.675 months.
    If the member has never taken any long service leave, this is the member's credit to be paid out.

  3. This table shows how to work out the credit for completed months of accrued service.

    Long Service Leave credit
    Months of service Long service leave as part of a month
    1
    0.025
    2
    0.050
    3
    0.075
    4
    0.100
    5
    0.125
    6
    0.150
    7
    0.175
    8
    0.200
    9
    0.225
    10
    0.250
    11
    0.275
  4. Unless section 5.5.22 applies, salary for a period of long service leave for a member who is to be paid instead of long service leave is the sum of these amounts.

    1. Salary at the applicable rate for their substantive rank and (if applicable) their pay grade.

    2. The amount of any allowance that the member may be paid during long service leave.

      See: Division 4 section 5.5.23, Allowances while on long service leave

      Exceptions:Antarctic allowance, Port Wakefield allowance, ADF district allowance, uniform allowance, hardship allowance, rent allowance and executive vehicle allowance are not payable.

    Related Information: Division 4 section 5.5.22, Salary – member on temporary or acting rank

  5. This table shows how to calculate the final payment instead of long service leave.

    Final payment calculation
    Step Action
    1. Divide the salary for long service leave by 12, to give the monthly rate.
    Note: This rule applies no matter how many days there are in the month.
    2. Multiply by the member's credit. This figure is the amount to be paid.
    See: Subsection 2

5.5.27 Member on higher duties, temporary or acting rank

  1. This section applies to a member who held temporary or acting rank, or was entitled to higher duties allowance, for either of these periods.

    1. The year before the start date.

    2. The start date plus three of the five years immediately before and including the start date. The three years may be in a single period, or broken periods.

    Example: A member performs higher duties and then holds acting rank. These periods can be added together to confirm whether they have met the time requirements in subsection 1.

  2. If a member only held one rank during the period, the rate of salary is the sum of these amounts.

    1. The rate of salary for the higher duties or temporary or acting rank and (if applicable) their pay grade, held immediately before the start date.

    2. The amount of any allowance that the member may be paid during long service leave. These are paid at the same rank as salary under paragraph a.

      See: Division 4 section 5.5.23, Allowances while on long service leave

  3. If a member held more than one level of higher duties or temporary or acting rank during the period, the rate of salary is the sum of these amounts.

    1. The rate of salary for the lowest level of higher duties or temporary or acting rank.

      Example: For the year before the member's resignation, a Captain had higher duties as a Major for six months, and as a Lieutenant Colonel for six months. Payment instead of long service leave will be at the Major salary rate.

    2. The amount of any allowance that the member may be paid during long service leave. These are paid at the same rank as salary under paragraph a.

      See: Division 4 section 5.5.23, Allowances while on long service leave

  4. A member's rate of salary for the higher duties, temporary or acting rank may increase after the start date and before the day before the member ceases continuous full-time service. In this case, their salary is taken to increase by the same amount.

5.5.28 Pro rata entitlement

  1. A member who has more than one year but less than 10 years of accrued service may be entitled to a pro rata payment instead of long service leave. Their service must end for one of these reasons.

    1. Redundancy.

    2. Retrenchment.

    3. Illness.

    4. Death.

    5. They have reached their compulsory retirement age.

    6. Management-initiated early retirement.

    7. Related Information: Part 3 of Chapter 8 of the Defence (Personnel) Regulations 2002.

    Example: A member starts work as a specialist officer with the ADF at age 49. When they reach age 55 they do not continue working on a fixed tenure appointment. They are entitled to a pro rata long service leave credit for the six years of service.

    Non-example: A member who is on a fixed tenure appointment that is not renewed has not been made redundant or retrenched, and has not reached their compulsory retirement age. They would not be entitled to a pro rata credit of long service leave.

  2. A member (other than a member mentioned in subsection 1) who has less than 10 years of accrued service and who voluntarily ceases continuous full-time service before reaching compulsory retirement age, is not entitled to a pro rata payment instead of long service leave.

  3. The payment is worked out using the process described in section 5.5.26.

See: Section 5.5.26, Payment instead of long service leave

5.5.29 Option not to be paid

  1. A member who is entitled to payment instead of long service leave may elect to retain and seek to transfer their leave credit instead. The election must be submitted in writing at least 30 days before the member ceases continuous full-time service.

    Note: If the member has not made an election 30 days before ceasing continuous full-time service their long service leave credits are paid to them.

    Example: The member leaves the ADF to become an APS employee in the Department of Defence. As an APS employee, their ADF service will be recognised for APS long service leave purposes. They choose in writing not to receive payment instead of ADF long service leave.

    Notes:

    1. Transfer of long service leave credits can only be made to Public Governance, Performance and Accountability Act 2013 entities.

    2. Members must discuss the issue of leave transfer with their prospective employer before making an election to transfer their long service leave credit.

    3. Commonwealth entities are under no obligation to accept transfers of credit.

    See: Section 10 of the Public Governance, Performance and Accountability Act 2013, for the definition of Commonwealth entity.

  2. In some cases, the member's new agency may decide not to accept the full amount of the member's long service leave credit. In these cases, the credit that is not transferred to the new Commonwealth entity must be paid to the member under the relevant provisions for payment instead of long service leave.

    See: Section 5.5.26, Payment instead of long service leave

Application to Reservists: Yes, on continuous full-time service.



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