Summary of mandatory requirements and responsibilities
- The following mandatory terms from the PEER Policy apply to all public sector executive employment in relation to termination of contracts:
- The employer may terminate a contract by providing the executive with four months’ notice in writing
- There is no compensation for termination of a contract beyond payment in lieu of notice and accrued leave
- An unexpired portion of a contract may only be paid out in exceptional circumstances, with the written consent of the relevant department Secretary.
10.1 Circumstances ending employment
An executive’s employment can end in a number of different circumstances. Some of these circumstances and the responsibilities of each party are discussed below.
- An employer may terminate a contract without notice for reasons of serious misconduct.
- The Standard Contract provides that an executive must give four weeks’ notice to end their contract.
- An executive’s employment may end due to the expiry of the contract, voluntary resignation, termination of contract, retirement or death.
- Executives must be paid out any accrued entitlements (i.e. annual leave and long service leave) at the end of their employment, as appropriate. Any payments in lieu of accumulated annual leave and long service leave entitlements are not considered to be ordinary time earnings so the Employer is not required to pay a superannuation contribution on them. Payments in lieu of these leave entitlements are calculated in accordance with the source of the entitlement (for example, the ‘base rate of pay’ as defined in the Fair Work Act 2009 (Cth) or the ‘ordinary time rate of pay’ as defined in the Long Service Leave Act 2018 (Vic).
- Pay in lieu of notice is based on 100 per cent of the TRP.
- Information or products developed by the executive during their employment remains the property of their employer.
- Executives are not eligible for redundancy payments.
10.2 Re-employment
The Standard Contract provides that the employer:
- Consult the executive at least six months prior to the expiry of the contract regarding whether a further contract will be offered. In the case of a short-term contract (one year or less), the consultation should be undertaken at least three months prior to the expiry of the contract.
- Advise the executive on the decision about contract renewal no later than four months before contract. In the case of a short-term contract, no later than two months before contract expiry.
If a new contract is offered, the employer should ensure that the administrative processes (i.e. payroll processes, new contract ready for signing, delegations continue, etc.) are in place to execute the contract before the current contract expires.
If a contract is not renewed, the executive must be paid any outstanding accrued but untaken annual and/or long service leave entitlements as indicated above, if applicable.
10.3 Termination of contract
A contract may be terminated by the employer or employee under the terms set out in their contract. See Appendix 3 for more detail on summary dismissal.
If the employer chooses not to continue employment through to the end of the notice period, payment in lieu of notice may be offered.
10.4 Retirement
It is unlawful to discriminate against an employee on the basis of age or for the employer to compulsorily retire an employee due to age (refer to the Equal Opportunity Act 2010 (Vic)). An exemption from the Attorney-General can be sought for compulsory age retirement in certain circumstances.
10.5 Death
It is important that employers have in place processes to deal with an executive’s family, friends and colleagues, should an executive die in their employment. Many public entities have access to an Employee Assistance Program.
Payment of entitlements
The deceased executive’s family (dependents or non-dependents) or representative (trustee) is to be paid any outstanding:
- remuneration
- annual leave and long service leave payment provided that all legal requirements are satisfied.
Note:
Termination of contract is covered in the Standard Contract. A generic step-by-step guide for ending employment is in Appendix 4.
10.6 Redeployment
Redeployment to a vacancy at a similar level may be available for an executive who is identified as surplus, if provided in the employer’s HR policies. Further advice can be sought from Industrial Relations Victoria on redeployment. Executives are generally not entitled to redundancy packages.
10.7 Outplacement support
An employer may offer reasonable outplacement support to an executive who is leaving the public entity involuntarily save as a result of termination on notice due to failure to fulfil duties or due to summary termination. The outplacement assistance provides the executive with support and enables them to search for a new job for up to four months.
10.8 Confidential information
When an executive leaves a public entity, any work produced by the executive remains the property of the employer, unless otherwise agreed in writing between the employer and executive. Confidential information obtained by an executive during his or her employment must not be used for:
- personal gain
- to advantage a prospective employer or business
- disadvantage the Victorian Government.