EXPLANATORY STATEMENT

Defence Determination, Conditions of Service Amendment (Leave) Determination 2018 (No. 22)

This Determination amends Defence Determination 2016/19, Conditions of service (the Principal Determination), made under section 58B of the Defence Act 1903 (the Defence Act) and in accordance with subsection 33(3) of the Acts Interpretation Act 1901 (AIA Act). Determinations made under section 58B of the Defence Act are disallowable legislative instruments subject to the Legislation Act 2003. These instruments are also subject to the interpretation principles in the AIA Act, as modified by section 58B of the Defence Act.

Chapter 5 of the Principal Determination sets out provisions dealing with leave for members of the Australian Defence Force (ADF).

The purpose of this Determination is to preserve the value of a senior officer's accrued recreation leave and long service leave credits upon finishing their appointment.

Background

Prior to the repeal of Defence (Personnel) Regulations 2002 on 1 October 2016, members appointed to Chief of Defence Force (CDF), Vice Chief of Defence Force (VCDF) or Service Chief were generally transferred to the Reserves at the end of their appointment. Defence Regulation 2016 replaced the Defence (Personnel) Regulations 2002 which does not require transfer to the Reserves.

On 20 September 2017 the Defence Force Remuneration Tribunal (DFRT) determined a consistent set of rules for the remuneration and treatment of senior officers at the rank of Lieutenant General (equivalent) and above during their periods of transition out of the Permanent Forces on cessation of their appointments as CDF, VCDF, a Service Chief or Chief of Joint Operations (CJOPS).

A paid transition period for these senior officers allows them time to complete the career transition activities they were unable to undertake while in the demanding appointed position and perform or complete other operational tasks as required or directed.

All appointments (other than CJOPS) are remunerated under determinations made by the Remuneration Tribunal. CJOPS is not a statutory appointment and as such is remunerated under determinations made by the DFRT both during their appointment and also during the transition period.

During transition, these senior officers are paid the same annualised rate of salary for which superannuation contributions were payable as applied on their last day of appointment.

Up until the commencement of this Determination, payment or transfer of a member's leave credits after the member has ceased continuous full-time service were paid at the rate of salary and allowances payable on their last day in the Permanent Forces.

For those senior officers who are ceasing continuous full time service after a DFRT determined transition period, this could result in a significantly reduced final leave credit transfer or payment as their leave credits would be paid at a rate that might be less than their rate of salary during their appointments prior to transition.

This Determination ensures that any recreation or long service leave credits accrued up to the last day of the senior officers' appointment, are paid to these senior officers at the rate they would have been paid if they had taken the leave during their appointment or had ceased continuous full time service on the last day of that appointment.

Section 1 of this Determination sets out the manner in which this Determination may be cited.

Section 2 provides that this instrument commences on 31 May 2018.

Section 3 provides that this instrument has authority under section 58B of the Defence Act 1903.

Section 4 provides that each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this instrument has effect according to its terms.

Schedule 1 amends the Defence Determination 2016/19, Conditions of service

Section 1 inserts 5.1.1A into the Principal Determination, which provides a table of definitions for terms used in the Chapter. The following definitions are provided.

• Senior officer who transitioned; this term is used in the recreation leave and long service leave Parts of the Principal Determination, consequential upon this Determination. The term means a senior officer who has left the Permanent Forces, held appointment as either CDF, VCDF, a Service Chief or CJOPS and undertook required activities to support their resignation, retirement or transfer to the Reserves.
• Transition period; this is the period following the day a senior officer who transitioned ceased their appointment up to their last day in the Permanent Forces.

Section 2 amends the definition of 'salary' under section 5.4.42 of the Principal Determination, which provides what salary means for members in various circumstances in the Division. Section 2 inserts an exception for a 'senior officer who transitioned'. When the term 'salary' is used with regard to these members, the rates are provided under section 5.4.44A.

Section 3 amends subsection 5.4.44.1 of the Principal Determination, which provides how to calculate payment to a member for their unused accrued recreation leave when they leave the Permanent Forces. The change provides that the section does not apply to a 'senior officer who transitioned'. Provisions for payment of credits to these members are provided under section 5.4.44A of the Principal Determination, consequential upon section 4 of this Determination.

Section 4 inserts section 5.4.44A into the Principal Determination. The section provides how to calculate the payment for unused accrued leave credits for a 'senior officer who transitioned'. The new section makes the following provisions.

• Credits held on the final day of the member's appointment are payable at the rate of salary and allowances payable to the senior officer on their final day of their appointment.
• Credits accrued during the senior officer's transition period are payable at the rate of salary and allowances payable to the senior officer on their final day in the Permanent Forces.
• If recreation leave is taken during the transition period, the payment amount is reduced at the rate of pay and allowances payable to the senior officer during the transition period for each day of leave taken.

Section 5 amends subsection 5.5.26.4 of the Principal Determination, which provides how to calculate payment instead of long service leave for a member who leaves the Permanent Forces. The change provides that the subsection does not apply to a 'senior officer who transitioned'. Calculation of payment for these senior officers is provided under subsection 5.5.26.4A of the Principal Determination, consequential upon section 7 of this Determination.

Section 6 amends subsection 5.5.26.5 of the Principal Determination, which provides how to calculate the final payment to a member who leaves the Permanent Forces for their unused long service leave credits. The change provides that the subsection does not apply to a 'senior officer who transitioned'. Provisions for payment of credits to these members are provided under subsection 5.5.26.6 of the Principal Determination, consequential upon section 7 of this Determination.

Section 7 inserts subsection 5.5.26.4A into the Principal Determination. The subsection provides how to calculate the payment to a 'senior officer who transitioned' for their unused long service leave credits. The new subsection provides the following.

• Credits held on the final day of the member's appointment are payable at the rate of salary and allowances payable to the senior officer on their final day of their appointment.
• Credits accrued during the senior officer's transition period are payable at the rate of salary and allowances payable to the senior officer on their final day in the Permanent Forces.
• If long service leave is taken during the transition period, the payment amount is reduced at the rate of pay and allowances payable to the senior officer during the transition period for each day of leave taken.
• ADF district allowance and rent allowance are not included in the calculations.

This Determination fairly preserves a member’s leave credit or transfer payment for leave balance accruals up until the final day of these senior officer’s appointments. It also ensures that leave accrued and used during periods of transition following their appointments as Chief of the Defence Force, Vice Chief of the Defence Force, a Service Chief or Chief of Joint Operations is paid at a rate that is fair and reasonable for that period of service.

This Determination preserves the value of accrued recreation leave and long service leave credits held at the end of a senior officer's appointment.

Consultation

The Directorate of Senior Officer Management-ADF was consulted in the development of this Determination. The rulemaker was satisfied that further external consultation was not required.

Authority:  Section 58B of the
Defence Act 1903

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Defence Determination Conditions of Service Amendment (Leave) Determination 2018 (No. 22)

This Determination is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Determination

The purpose of this Determination is to preserve the value of a senior officer's accrued recreation leave and long service leave credits upon finishing their appointment.

Human rights implications

Right to the enjoyment of just and favourable conditions of work

The protection of a person's right to remuneration engages Article 7 of the International Covenant on Economic, Social and Cultural Rights. Article 7 guarantees just and favourable conditions of work, including remuneration, safe and healthy conditions, equal opportunity and reasonable limitations.

This Determination preserves the value of accrued recreation leave and long service leave credits held at the end of a senior officer's appointment. This ensures they receive just and favourable remuneration in accordance with Article 7. This Determination ensures that any recreation or long service leave credits accrued up to the last day of the senior officer's appointment, are paid to the senior officer at the rate they would have been paid if they took the leave during their appointment as Chief of the Defence Force, Vice Chief of the Defence Force, a Service Chief or Chief of Joint Operations or had ceased continuous full time service on the last day of that appointment.

Conclusion

This Determination is compatible with human rights because it advances the protection of human rights.

Elizabeth Anne Sisley, Acting Assistant Secretary People Policy and Employment Conditions