The Act

1. 1. gives effect to various salaries and wages agreements to provide for enhanced extended leave entitlements;
   2. updates and clarifies provisions relating to the recognition and transfer of service between government agencies, both within NSW and with Commonwealth and interstate agencies;
   3. amends State superannuation legislation; and
   4. repeals the Transferred Officers Extended Leave Act 1961 and its Regulation and amends the Public Sector Employment and Management (General) Regulation 1996 to declare specified service as war service.
       
2. The Act amends Schedule 3 of the Public Sector Employment and Management Act 2002 ("PSEM Act") to provide for the enhanced extended leave entitlements as outlined in Circular 2004-45. The main changes to Schedule 3 of the PSEM Act are:

   (a) Pro-rata access to extended leave provides eligible employees with access to extended leave after 7 years service;
   
   (b) Extended leave at double pay allows employees to take their extended leave entitlement at a faster rate. For example, an employee may use their entitlement to 2 months extended leave by taking one month's leave and receiving two month's pay; and
   
   (c) Crediting public holidays which occur during a period of extended leave. Public holidays will no longer be deducted from an employee's extended leave entitlement.

   Some exemptions to the new provisions apply. Agencies should consult the Act and if in doubt contact the PEO regarding coverage of employees.

3. The Act also repeals the Transferred Officers Extended Leave Act 1961 and its Regulation. A new Schedule 3A to the PSEM Act is created. Schedule 3A updates and clarifies the recognition of service provisions in the Transferred Officers Extended Leave Act 1961 consolidating the provisions into the PSEM Act and the existing cross NSW public sector mobility provisions under that Act. 

   Schedule 3A provides a clear definition of a governmental agency and also provides for the Director-General, Premier's Department to declare interstate and Commonwealth agencies as recognised for extended leave purposes.

   The Director-General has made an order declaring with effect from 1 January 2006, pursuant to Clause 2(1) of Schedule 3A, that the agencies listed in HR eXpert are either a Commonwealth or interstate agency or not for the purposes of recognition of prior service.

   The Act also makes clear that irrespective of whether an employee of a Commonwealth or interstate agency has been paid out the monetary value of any accrued extended (long service) leave, that such leave will be deemed to have been paid to the employee prior to commencement with a NSW public sector agency.

   Only the length of service is recognised for accrual of extended leave in NSW if the requirements for prior service are met. In other words an employee with prior Commonwealth or interstate agency service cannot "transfer" their accrued extended (long service) leave to NSW.

   An explanatory document summarising the main provisions of the new Act is attached to this circular for your information. 

4. Superannuation amendments: The Act amends State superannuation legislation to confirm that extended leave at double pay does not fall within the definition of 'salary' for the closed, defined benefits, superannuation schemes (see Circular 2005-33).
5. As a result of the repeal to the Transferred Officers Extended Leave Act 1961 and the Transferred Officers Extended Leave Regulation 1998 a new clause 100AB has been inserted into the Public Sector Employment and Management (General) Regulation 1996. This deals with the recognition of war service and is identical to the former regulation.

The Personnel Handbook will also be updated to reflect the amended legislation.

Should you have any enquiries please contact Juliet Adriaanse on 9228 3593 or Cathy McInnes on 9228 3598.

A.S. Smith
Acting Director-General

Issued: Employee Relations And Workforce Planning Services (Public Employment Office)
File no: PSM/05708 Part 2
Date: 23 December 2005
This circular has not superseded any other Memorandum/Circular.
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SCHEDULE 3A - PUBLIC SECTOR EMPLOYMENT AND MANAGEMENT ACT 2002 - EXTENDED LEAVE - RECOGNITION OF PREVIOUS SERVICE - COMMENTARY ON MAIN PROVISIONS

1. COMMENCEMENT OF NEW PROVISIONS

Changes to recognition of service provisions will only apply to employees who commenced with a NSW public sector agencies on or after 1 January 2006. Agencies with employees who commenced in a NSW public sector agency prior to this date and who are seeking recognition of service will need to apply the provisions of the Transferred Officers Extended Leave Act 1961.

2. RECOGNISED SERVICE IN OTHER JURISDICTIONS

Only "service" recognised

The amendments make no change to what is recognised, that is, there is no provision to transfer any crystalised accrued leave or other entitlements from a recognised Commonwealth or interstate agency to NSW. Only previous "service" is recognised for future accruals of extended leave in NSW if the previous service satisfies requirements.

The changes to current practice in this regard are that:

• the Act articulates that any crystalised extended leave entitlement from the former jurisdiction is deemed to have been taken or paid out by the former employer (clause 9); and 
• for staff who enter NSW with 10 or more years of service from a jurisdiction with a different rate of accrual, adjustments will no longer be made to take account of the amount paid out or taken. For example, notwithstanding that a former Commonwealth employee would on 20 years service be paid out or have taken only 6 months entitlement (NSW it is 7 months), on transferring to NSW they will begin with a zero leave balance. That is, the years of service in the Commonwealth or interstate agency will be recognised, year for year, in NSW (clause 9 (2)).

Recognised service

For service to be recognised it must satisfy two requirements:

i. Previous service must be with a body that satisfies the definitions in the Act OR is declared by the Director-General, Premier's Department; and

Changes in this regard are that:

• the Act now provides a definition of "Commonwealth or interstate agency" that is a body established under an Act, is under the control of a Minister , is part of the public service and where the employment conditions are substantially similar to the conditions of officers employed under the Public Sector Employment and Management Act 2002 (clause 1); and
• in line with changes introduced by the Public Sector Employment and Management Act 2002 the Director-General, Premier's Department (rather than the Governor) may make an order declaring that a specified body is, or is not, a Commonwealth or interstate agency (clause 2 (1)).

Per clause 2 (3) a full list of recognised Commonwealth or interstate agency agencies is available through the HR Expert Agency Inquiry Option available from the Premier's Department website.

ii. Previous service must also satisfy the definitions of "continuous" and "immediately follows" as set out in the Act.

The singular concept of "continuity" of service previously used has been replaced by a two limb requirement:

• "Continuous" (clause 3); and

To be recognised the previous eligible service must be continuous. This relates to the requirement to remain continuously employed by the eligible employer for the whole of the relevant period.

Continuity is maintained if the employee is retrenched or there is a reduction of work but is re-employed by the employer within the next 12 months.

• "Immediately follows" (clause 4)

This requirement has been modified and simplified to allow a person's service to be recognised as long as the new service commences within 2 months of leaving the previous recognised employer. An employee no longer is required to have accepted employment with a NSW public sector employer prior to leaving their former employer.

3. RECOGNITION OF SERVICE IN THE NSW PUBLIC SERVICE AND PUBLIC SECTOR

In respect of extended leave, Part 3.2 Division 2 Cross-public sector leave arrangement of the Public Sector Employment and Management Act 2002 has been amended to read:

94 Recognition of prior government service for purpose of calculating extended leave

Schedule 3A has effect in relation to employees.

The relevant provisions in Schedule 3A with respect to recognition of service in the NSW Public Service and Public Sector are summarised as follows:

Previous service in the NSW Public Service (as defined in the Public Sector Employment and Management Act 2002 or equivalent preceding Acts)

Recognition for employees in the NSW Public Service with previous NSW Public Service remains unchanged as outlined in the Personnel Handbook 6-7.3.

Previous NSW Public Sector service (as defined in the Public Sector Employment and Management Act 2002)

Recognition of public sector service (other than the Public Service as defined) is subject to the same rules for service in a "Commonwealth or interstate agency". That is:-

i. Previous service must be with an organisation that satisfies the definitions in the Act or is declared by the Director-General, Premier's Department; and 

ii. It must also satisfy the definitions of "continuous" and "immediately follows" as set out in the Act.

The above applies when an employee moves from:-

• a recognised NSW public sector agency to a NSW Public Service agency or vice versa; or
• between two recognised NSW public sector agencies
  (i.e. no change in current practice).

State Owned Corporations
The definition of public sector agency has the same definition has public sector service, that is State Owned Corporations are excluded unless prescribed. As at December 2005 only one State Owned Corporation, RailCorp, has been prescribed, that is listed in the Regulation, to be covered by the definition of public sector service for Division 2 of Part 3.2 of the Act - that is Cross-public sector leave arrangements, and the recognition of prior service.

Therefore where the provisions relating to recognition of prior service refer to public sector service or to public sector agency the only State Owned Corporation it applies to is RailCorp.

4. EVIDENCE

All previous service accepted by the immediately previous recognised employer for extended leave purposes will continue to be taken into account to the same extent (clause 6 (1)).

The employee must provide evidence of their previous employment with the immediately previous recognised employer, when it was terminated, reason for termination and when.

If previous service is not recognised upon commencement and some time elapses before the employee applies for recognition, the onus of proof regarding previous service rests with the employee to follow up with the previous employer. However, the employing agency may choose to contact the former employer on behalf of the employee to ascertain their status, dates of employment, conditions, etc.

5. MISCELLANOUS AMENDMENTS

Previous restrictions placed upon the recognition of service where a person was aged sixty years or more have been removed as it contravenes the Anti-Discrimination Act 1977.

Reference to the Commonwealth Reconstruction Training Scheme has been removed as it no longer exists.

Where a full time member of a specified administrative tribunal has previously been a NSW public sector employee their time as a full time member of the tribunal is to be recognised as public sector service where the member later returns to employment as a NSW public service of public sector (clause 11).

Although no change, clause 8 clarifies that employees who transfer between Departments of the Public Service are not able to elect to receive payment instead of accrued extended leave. However, employees who transfer between employers within the NSW Public Sector other than Public Service Departments may elect to be paid all of their accrued extended leave or elect to have their leave (and corresponding funds) transferred to the new employer.