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Targeted and Negotiated Voluntary Redundancy (TNVR) is a tool that is available to assist Heads of Agencies to manage their workforce to meet business operational requirements and reduce future employee related expenses.
A TNVR payment may be used to assist “Identified employees” to voluntarily leave their State Service employment provided the specified criteria can be met.
TVNRs may also be used where a major restructure is required. In these cases expressions of interests are called from those employees who will be directly affected, without individual employees having to be specifically identified.
General expressions of interest are not to be generally advertised in an agency, except in cases where a major restructure is required in which case expressions of interest may be called from those affected employees.
TNVRs negotiated or offered to employees under other circumstances require a strong demonstrated business case supported by the Head of Agency.
Heads of Agencies may approve a TNVR payment to an “Identified employee” if a business case has been completed using the provided template that fully justifies, to the Head of Agency’s satisfaction, the reasons for the payment, including:
There is no requirement for:
TNVR payments are to be funded within the agency’s budget allocation, unless alternative arrangements have been agreed by the Secretary, Department of Treasury and Finance.
Agencies are not to call for general expressions of interest from employees in targeted or negotiated voluntary redundancies. However, where an agency, or part of that agency, is undergoing a major restructure, Heads of Agencies may call for expressions of interest from employees who are immediately and directly affected by the restructure.
Prior to calling for expressions of interest, agencies must be clear about the scope and intent of the restructure, identify specific groups of employees who will be directly affected by the restructure and likely to be left without duties to undertake, and have commenced consultation with employees about the proposed restructure.
When calling for expressions of interest agencies must clearly communicate:
In assessing expressions of interest, the Head of Agency is to take into account:
Any restructure must comply with the consultation requirements under the State Service Act 2000and relevant awards.
In special and exceptional circumstances, Heads of Agencies may negotiate a TNVR payment with an employee who is not an “Identified employee” providing:
An employee who is incapacitated due to an injury or illness and it is unlikely that the employee will be able to return to their pre-injury hours or duties, depending on the circumstances of the incapacity, is to be managed in accordance with the provisions of applicable legislation such as Workers Rehabilitation and Compensation Act 1988, State Service Act 2000and/or Retirement Benefits Act 1993.
A Head of Agency must arrange for advice to be obtained from the Office of the Director of Public Prosecutions before offering a TNVR payment to an employee if the employee:
The purpose of obtaining advice from the Office of the Director of Public Prosecutions prior to offering a TNVR payment to the employee is to include seeking advice in relation to:
TNVR payments are based on an employee’s total continuous full-time equivalent employment, “years of service” as defined. The value of the TNVR is:
Employees who are offered a TNVR payment must be provided with both gross and net amounts to assist them in their decision making.
“Years of Service” means continuous full-time equivalent permanent or fixed term employment with the Crown subject to the following:
The Director, SSMO may deem that ineligible service is to be counted towards calculating full-time equivalent service on receipt of documentation from a Head of Agency substantiating that exceptional circumstances exist or that a legal arrangement relevant to that service applied to the transfer of services or staff.
Full-time equivalent years of service means:
The Crown means the Crown in the Right of Tasmania as specified below:
Years of Service commencement date: 20/1/1990
Cessation date: 30/6/2015
Years of Service: 25 years and 162 days (25.44 years)
Full-time Equivalent Award Salary: $62 000
Four week component: 4 weeks + (25.44 x 2 weeks) = 54.88 weeks
Total TNVR payment will be 48 weeks which is the maximum.
$62 000 ÷ 52 weeks x 48 weeks = Total TNVR payment of $57 230.77
Employee was full-time and commenced part-time employment at 0.6 FTE on 1 June 2015
Years of service commencement date: 1/10/2012
Cessation date: 30/10/2015
Years of Service: 2.91
Full-time Equivalent Award Salary: $62 000.
4 week component – As the employee has had a combination of full-time and part-time employment in the 12 month period immediately prior to the cessation date it is necessary to determine the average FTE during this time.
31/10/2014 – 31/5/2015 – FTE 100% - worked 1 109.85 hours
1/6/2015 – 30/10/15 – FTE 60% - worked 485.10
Total hours worked = 1 594.95 = FTE of 83.14% (1 594.95 ÷Full-time hours 1 918.35)
Therefore the employee would be entitled to 4 weeks x 83.14% = 3.33 weeks
As the employee is part-time, the employee is entitled to the greater of the two following calculations.
3.33 weeks + (2.91 x 2 weeks) = 9.15 weeks
$62 000 ÷ 52 x 9.15 = $10 909.62
$62 000 ÷ 52 x 60% (employees current FTE) x 16 weeks (minimum TNVR payment) = $11 446.15
Therefore the employee would be entitled to receive a TNVR payment based on calculation 2 as it is the greater of the two calculations.
For the purposes of calculating TNVR payments salary is defined as:
If further information is required in respect to the definition of salary and the inclusion of specific allowances the matter is to be referred to the Director, SSMO by emailing firstname.lastname@example.org
For the purposes of calculating TNVR payments the employee’s salary as defined is to be divided by 52.
Although a TNVR is a voluntary payment to assist “Identified employees” in specific circumstances, to leave their State Service employment it is important that employees are provided with an appropriate period of time to consider the offer, seek superannuation, taxation and financial advice and separate from their employment. Unless otherwise agreed between the employee and the Agency, employees are to be provided with a minimum of 21 calendar days to enable them to consider the offer and seek appropriate advice.
At a minimum the written notification to the employee must specify:
Agencies must not provide employees with superannuation, taxation and financial advice or provide information or comment on the suitability or effectiveness of any arrangement, scheme or provider.
An employee who accepts a TNVR payment is entitled to receive payment for any accrued and unused recreation leave, purchased leave and long service to which the employee may be entitled under the provisions of the relevant award and long service leave legislation. Subject to award provisions, employees may also be entitled to leave loading. The payment of these leave entitlements do not form part of the TNVR payment.
Employees who accept a TNVR payment must agree to not seek or accept any employment in any capacity or seek or accept to directly provide consultancy services to the Crown, as defined, from the date of their cessation of employment for the period equivalent to the number of weeks applicable to their TNVR payment rounded up to the nearest whole number of weeks.
An employee receives 22.98 weeks TNVR payment. The employment exclusion period is rounded up to 23 weeks.
An employee receives 34.25 weeks total TNVR payment. The employment exclusion period is rounded up to 35 weeks.
“Employment Exclusion period” means that the employee agrees not to seek or accept:
The Crown means the Crown in the Right of Tasmania and includes for the purposes of a TNVR Deed of Release to include employment or appointment as outlined above for:
In respect to undertaking consultancy services the following information is provided:
In exceptional circumstances the Director, SSMO may provide approval to waive, reduce or vary the exclusion period where special or extraordinary circumstances exist. The Head of Agency in which the re-employment, consultancy or contract work is to be undertaken is to submit a request in writing to the Director, SSMO outlining:
A former employee who, without approval from the Director, SSMO, undertakes employment or consultancy work for the Crown prior to the expiry of the exclusion period is to be terminated and incur a penalty in accordance with the provisions of the Deed of Release. The penalty may only be waived or varied by the Director, SSMO.
The offer and acceptance of a TNVR payment is not deemed to be binding until a Deed of Release (Deed) which is a legal document is signed by the employee and the Head of Agency (on behalf of the Crown) and the signatures are witnessed. The Deed of Release template is maintained and issued to agencies by the Director, SSMO. The Deed of Release must not be varied unless approved by the Director, SSMO.
In summary the Deed specifies that the employee’s employment is terminated by reason of redundancy and sets out the terms and conditions of the agreement including the:
The Deed of Release does not include:
Heads of Agency must:
The recurrent savings are calculated by multiplying the employee’s full-time award salary by their FTE percentage.
If a full-time employee’s award salary is $70 555 per annum, this is the recurrent savings for the 12 months commencing from the employee’s cessation date ie ($70 555 x 100%)
If a part-time employee is working 0.6 FTE, and the full-time award salary is $70 555 per annum, the recurrent savings for 12 months will be $42 333 ie ($70 555 x 60%).
The payback period is calculated by dividing the total amount of the TNVR by the recurrent savings.
If the employee’s total TNVR payment is $65 127.69 and the recurrent saving is $70 555 the payback period will be 0.92 of a year ie ($65 127.69 ÷$70 555).
Heads of Agencies are to have processes in place for positions to be abolished from the agencies Pay/Personnel systems and establishment at the time the employee’s TNVR payment is processed or no later than fourteen calendar days from that date.
Heads of Agencies must also ensure that a position at the same or similar classification level is not created or an existing vacant position is not re-profiled for the purpose of assigning the duties of an abolished position to that position.
Heads of Agencies are to have in place arrangements for employees to be paid their TNVR payment and relevant leave payments on the next available normal pay day following their cessation of employment. This provision is specified in the Deed of Release.
The payment of superannuation benefits is a matter for the employee’s superannuation fund. Any superannuation benefits to which the employee may be entitled will be provided to the employee in accordance with applicable superannuation legislation and the requirements of their superannuation provider.
Heads of Agencies are to ensure that documentation is retained in accordance with legislative requirements and their agency’s approved records management system. Documentation is to be made available to the Director, SSMO for examination or review if requested.
Crown employees must not release any information to a third party in relation to employees who have accepted a TNVR payment without the employee’s written consent unless the information: