The Statutory and Other Offices Remuneration Tribunal has made its annual determination in relation to the Chief Executive Service and Senior Executive Service (SES). The Determination was published in the Government Gazette of 12 September 2003 and takes effect from 1 October 2003. It is available on the internet at http://www.remtribunals.nsw.gov.au

In summary, the Tribunal has determined a general increase to SES remuneration packages of 4.7%, representing a 3% economic adjustment and a further 1.7% 'catch up' to maintain relativity with the Senior Officer classification. All increases are subject to satisfactory assessment of performance. As in 2002, the remuneration of executives whose current package falls below the range for their SES level will not be automatically adjusted to the new minimum rate.

The Determination also increases the rates for any new Recruitment Allowances or Retention Allowances.

Administrative guidelines on how the Determination should be implemented are attached.

Enquiries concerning the implementation of the Determination should be made to the Premier's Department contact officers specified in the guidelines.

It should be noted that State Owned Corporations are not covered by this Determination.

Andrew Refshauge
Acting Premier

Supersedes M2002-19, Superseded by M2004-11

___________________________________________________________

Attachment

Implementing the 2003 SOORT Determination for the remuneration of
Chief Executive and Senior Executive Service

Administrative Guidelines

The Statutory and Other Offices Remuneration Tribunal (SOORT) has made its annual determination in relation to the Chief Executive and Senior Executive Service. In these Guidelines the Chief Executive and Senior Executive Service are referred to as the "SES".

These Guidelines describe the administrative and remuneration arrangements that are to apply to the SES on and from 1 October 2003. They should be read in conjunction with the 2003 SOORT Determination for the Chief Executive and Senior Executive Service published at www.remtribunals.nsw.gov.au

Premier's Department Circular 2000-50 should be referred to when implementing the SOORT Determination. The Circular advises that all CES and SES officers are required to have a Performance Agreement in place. The Performance Agreement and annual review form the basis of any remuneration increase in the implementation of any SOORT determination. Performance reviews are to be undertaken at least annually by the officer's employer or some other person nominated by the employer.

1. Applying Remuneration Increases

1.1 General Increase
SOORT has determined a general increase of 4.7% to the remuneration packages of SES officers on and from 1 October 2003. The increase comprises a 3% economic adjustment and a further 'catch up' increase of 1.7%. The 'catch up' component was awarded to maintain relativity with Senior Officers and to ensure that the SES continues to attract and retain high quality staff. In applying the general increase, SOORT has rounded minimum and maximum rates to the nearest $50.

Any decision to grant an increase determined by SOORT must be based on a formal assessment of the officer's performance as being of a satisfactory standard. No executive can be remunerated beyond the maximum for their level.

Table 1. New annual remuneration rates (effective 1 October 2003)
SES Level Minimum Maximum
1 $122,500 $143,450
2 $143,451 $153,900
3 $153,901 $174,850
4 $174,851 $190,550
5 $190,551 $219,850
6 $219,851 $247,100
7 $247,101 $309,900
8 $309,901 $358,050
 
1.2 Conditions for officers remaining below the range
It should be noted that the special conditions of the 2002 Determination, designed to ensure no SES officer received a windfall benefit greater than the general increase as a result of the new rates set in 2002, still apply:

• Officers whose remuneration package following the 2002 Determination remained below the minimum for their SES level will not be adjusted automatically to the new minimum rate. Their remuneration should, subject to satisfactory performance, be increased by 4.7%.
• Where a Minister (in the case of a CEO) or a CEO considers (at any stage) that such an SES officer's performance merits an increase totalling more than the general increase of 4.7%, the approval of the Director-General of Premier's Department must be obtained. Such requests should provide clear justification for the movement, based on a rigorous assessment of the officer's performance, and meet one of the criteria currently applied to movement within the remuneration range (see below).

Note: The above conditions relate only to officers whose existing remuneration is below the range. As SOORT has rounded minimum and maximum rates to the nearest $50, the remuneration of some officers who are being paid at the minimum rate for their level may fall just short of the 2003 minimum when 4.7% is applied. The remuneration of these officers can be moved to the new minimum without Premier's Department approval.

2. Discretion to alter remuneration within the range

Ministers (in the case of CEOs) and the CEOs (in the case of SES) have the authority to determine any progression along the range for SES officers whose existing remuneration package is at or above the minimum for their SES level.

• SES officers can progress along the range within their remuneration level during the term of their appointment.
• The rate of remuneration for officers within the new range may be determined on appointment at the discretion of the Minister or CEO.

Any decision to progress an officer's remuneration along the range should be based on a rigorous assessment of the officer's performance or the general skill and expertise acquired in performing the duties over time. Such a decision may only be made at the time of a performance review. Performance reviews must be undertaken at least annually.

In making these decisions the matters to be considered must include either:

• An officer's performance which over time has significantly contributed to the agency meeting its corporate objectives and outcomes as outlined in the agency's business plan; or
• An officer's increased competence and effectiveness as assessed in the performance review process; or
• Any expanding job requirements (where a position's work value has increased but not sufficiently to result in the position being evaluated at a higher level).

3. Recruitment and Retention Allowances

Two separate allowances are provided to manage issues of attracting and retaining suitably qualified officers within the public sector. These are the Recruitment Allowance and the Retention Allowance.

The payment of a Recruitment Allowance or a Retention Allowance can be made only following approval by the Director-General of Premier's Department based on a recommendation of the Minister (in the case of CEOs) or the CEO (in the case of SES).

Subject to approval of an allowance, Ministers and CEOs may determine the quantum of the allowance up to the maximum for the level of the position (shown in Table 2 below). Once the quantum has been determined it cannot be altered during the term of the officer's current appointment unless the Director-General, Premier's Department gives approval. Where approval is given to increase the Allowance during the term of the appointment, the increased portion of the Allowance accrues or is payable from the date of approval to increase.

Table 2. Annual rates for Recruitment and Retention Allowances
(effective 1 October 2003)
SES Level Maximum Allowance
1 and 2 Up to $15,000
3 and 4 Up to $19,000
5 and 6 Up to $27,000
7 and 8 Up to $35,000

The Recruitment and Retention allowances have been increased with the 2003 Determination. The new maximum rates apply only to new allowances approved by the Director-General of Premier's Department and they are not to be applied to an existing allowance.

SES officers in receipt of a combined Recruitment and Retention Allowance, available before the two categories were separated in the 2000 Determination, continue to receive their existing allowances for the remainder of their current appointment.

It is important to note that Recruitment and/or Retention Allowances lapse on the completion of a term of appointment. A fresh approval may be sought for a Recruitment Allowance, if a case exists, on renewal of the appointment.

Determining the remuneration increases for officers currently in receipt of a Recruitment Allowance or Retention Allowance

The total remuneration package of these officers consists of two components - the base remuneration and an Allowance. Increases granted as a result of the annual determination (increases up to 4.7% from 1 October 2003 or progression along the range) apply to the base remuneration only).

Financial advice
Where approval is given to pay a Recruitment Allowance or a Retention Allowance the SES officer is advised to seek independent financial advice regarding their financial arrangements including superannuation arrangements and future taxation obligations.

Payment of allowances to Chief Executive Officers
Requests for the payment of allowances to Chief Executive Officers should continue to be made to the Director-General of the Premier's Department.

3.1 Recruitment Allowance (from the commencement of a term of appointment)
A Recruitment Allowance may apply for newly appointed SES officers and for current SES officers if they are re-appointed at the expiration of their current term. It will apply where it has been certified that specific capabilities are necessary for recruitment purposes and the performance of the duties of the position.

The changing working environment and labour market continues to see the need for new capabilities additional to those previously identified. The changing labour market also may make it difficult to attract suitably qualified candidates to a position. Accordingly Ministers (in the case of CEOs) and CEOs (in the case of SES) may seek approval to offer a Recruitment Allowance.

Table 2 provides the annual rates of the Recruitment Allowance at different SES levels.

Issues to be addressed when seeking approval from the Premier's Department:

• Current difficulties in recruiting and retaining SES officers
  • Patterns of responses to advertising/recruitment for particular positions
  • Limitations in the number of potentially qualified applicants
  • Impact on project/programs (eg. turnover costs, delays) through non selection
• Recruitment practices
  • Variety of recruitment options that have been canvassed
•  Current state of labour market
  • Current state of labour market and the need to increase the agency's competitiveness through offering market related remuneration
  • Current market remuneration for comparable skills and experience
•  Requirement to achieve results
  • Specific specialist, professional qualifications and/or experience in the nominated area that is considered an essential requirement for achievement of the position's objectives.

The criteria outlined above should not be varied. However, where exceptional circumstances warrant special consideration, it is appropriate to liaise with the Director-General, Premier's Department with a view to resolving particular difficulties.

3.2 Retention Allowance (during the term of the appointment)
A Retention Allowance may be approved to officers during the term of their current appointment.

The Retention Allowance accrues on an annual basis (and prorata for incomplete years) and is not payable until the completion of the officer's appointment.

 In this context the "completion of the officer's appointment" is defined as: 

• an officer's term of appointment expires; or
• the officer retires from office; or
  
• the officer is removed and unattached from the position pursuant to s.77 of the Public Sector Employment and Management Act 2002 (PSEMA) and subsequently appointed to another position; or
• an officer's unattachment is revoked pursuant to s.77 of the PSEMA; or
• the officer is appointed to another SES position within the NSW public sector. This includes appointments at a higher level and transfers; or
• an officer dies.

The Allowance will not be available where an officer resigns or is removed from office pursuant to s.51 of the PSEMA. An Allowance should also not be paid if the officer's performance has been less than satisfactory.

Table 2 provides the annual rates of the Retention Allowance at different SES levels.

Issues to be addressed when seeking approval from the Premier's Department:

• Current difficulties in retaining SES officers
  • Impact on project/programs if the officer leaves the position (eg. delays in achieving outcomes, loss of unique or specific capabilities and experience, turnover costs)
  • Evidence of turnover that has adversely affected the agency's programs, if applicable.
• Current state of labour market
  • Current state of labour market and the need to increase the agency's ability to make a competitive counter offer.
  • Current market remuneration for comparable skills and experience.
• Requirement to achieve results
  • The officer's specific specialist, professional qualifications and/or experience in the nominated area that is considered an essential requirement for achievement of the position's objectives.

The criteria outlined above should not be varied. However, where exceptional circumstances warrant special consideration, it is appropriate to liaise with the Director-General, Premier's Department with a view to resolving particular difficulties.

Further Enquiries
SES officers should contact their agency SES Administrator if they have any enquiries. SES Administrators may direct their enquiries to:

Robert Horrocks, 9228 4263
Francine Cutler, 9228 3586 (Mon-Thurs)
Megan Irwin-Moyle, 9228 3023
Gary McGrath, 9228 4381
Angela Megale, 9228 4137