AP784988CRV - Insurance Industry Award 1998
13. TERMINATION OF EMPLOYMENT AND REDUNDANCY
[13 Termination of employment title changed and varied by PR950936 ppc 10Aug04]
13.1 Notice of termination by the employer
13.1.1 In order to terminate the employment of an employee, other than a casual, an employer shall give to the employee the following notice:
Period of continuous service |
Period of Notice |
Less than 3 years |
2 weeks |
Over 3 years and up to the completion of 5 years |
3 weeks |
Over 5 years service |
4 weeks |
13.1.2 In addition to the notice in 13.1.1 of this clause, employees over 45 years of age at the time notice is given with no less than two years continuous service must be given an additional weeks notice.
13.1.3 Payment in lieu of the prescribed notice in 13.1.1 and 13.1.2 must be made if the appropriate notice period is not required to be worked. Provided that employment may be terminated by the employee working part of the required period of notice and by the employer making payment for the remainder of the period of notice.
13.1.4 The required amount of payment in lieu of notice must equal or exceed the total of all amounts that, if the employee’s employment had continued until the end of the required period of notice, the employer would have become liable to pay to the employee because of the employment continuing during that period. That total must be calculated on the basis of:
13.1.4(a) the employee’s ordinary hours of work (even if not standard hours); and
13.1.4(b) the amounts ordinarily payable to the employee in respect of those hours, including (for example) allowances, loading and penalties; and
13.1.4(c) any other amounts payable under the employee’s contract of employment.
13.1.5 The period of notice in this clause does not apply:
13.1.5(a) in the case of dismissal for serious misconduct;
13.1.5(b) to apprentices;
13.1.5(c) to employees engaged for a specific period of time or for a specific task or tasks;
13.1.5(d) to trainees whose employment under a traineeship agreement or an approved traineeship is for a specified period or is, for any other reason, limited to the duration of the agreement; or
13.1.5(e) to casual employees.
13.1.6 Continuous service shall be calculated in the manner prescribed in 25.4.
13.2 Notice of termination by the employee
13.2.1 The notice of termination required to be given by an employee is the same as that required of an employer, save and except that there is no requirement on the employee to give additional notice based on the age of the employee concerned.
13.2.2 If an employee fails to give the notice specified in 13.2.1, the employer has the right to withhold monies due to the employee to a maximum amount equal to the amount the employee would have received under 13.1.4.
13.3 Job search entitlement
Where an employer has given notice of termination to an employee, an employee shall be allowed up to one day's time off without loss of pay for the purpose of seeking other employment. The time off shall be taken at times that are convenient to the employee after consultation with the employer.
13.4 Transmission of business
Where a business is transmitted from one employer to another, as set out in clause 13.5 - Redundancy, the period of continuous service that the employee had with the transmittor or any prior transmittor is deemed to be service with the transmittee and taken into account when calculating notice of termination. However, an employee shall not be entitled to notice of termination or payment in lieu of notice for any period of continuous service in respect of which notice has already been given or paid for.
13.5 Redundancy
13.5.1 Definitions
13.5.1.1 Business includes trade, process, business or occupation and includes part of any such business.
13.5.1.2 Redundancy occurs where an employer has made a definite decision that the employer no longer wishes the job the employee has been doing done by anyone and that decision leads to the termination of employment of the employee, except where this is due to the ordinary and customary turnover of labour.
13.5.1.3 Small employer means an employer who employs fewer than 15 employees.
13.5.1.4 Transmission includes transfer, conveyance, assignment or succession whether by agreement or by operation of law and transmitted has a corresponding meaning.
13.5.1.5 Week’s pay means the ordinary time rate of pay for the employee concerned. Provided that such rate shall exclude:
13.5.2 Transfer to lower paid duties
Where an employee is transferred to lower paid duties by reason of redundancy the same period of notice must be given as the employee would have been entitled to if the employment had been terminated and the employer may at the employer's option, make payment in lieu thereof of an amount equal to the difference between the former ordinary rate of pay and the new ordinary time rate for the number of weeks of notice still owing.
13.5.3 Severance pay
13.5.3.1 Severance pay - other than employees of a small employer
An employee, other than an employee of a small employer as defined in 13.5.1.3, whose employment is terminated by reason of redundancy is entitled to the following amount of severance pay in respect of a period of continuous service:
Period of continuous service |
Severance pay |
Less than 1 year |
Nil |
1 year and less than 2 years |
4 weeks’ pay* |
2 years and less than 3 years |
6 weeks’ pay |
3 years and less than 4 years |
7 weeks’ pay |
4 years and less than 5 years |
8 weeks’ pay |
5 years and less than 6 years |
10 weeks’ pay |
6 years and less than 7 years |
11 weeks’ pay |
7 years and less than 8 years |
13 weeks’ pay |
8 years and less than 9 years |
14 weeks’ pay |
9 years and less than 10 years |
16 weeks’ pay |
10 years and over |
12 weeks’ pay |
* Week’s pay is defined in 13.5.1.5
13.5.3.2 Severance pay - employees of a small employer
An employee of a small employer as defined in 13.5.1.3 whose employment is terminated by reason of redundancy is entitled to the following amount of severance pay in respect of a period of continuous service:
Period of continuous service |
Severance pay |
Less than 1 year |
Nil |
1 year and less than 2 years |
4 weeks’ pay* |
2 years and less than 3 years |
6 weeks’ pay |
3 years and less than 4 years |
7 weeks’ pay |
4 years and over |
8 weeks’ pay |
* Week’s pay is defined in 13.5.1.5
13.5.3.3 Provided that the severance payments shall not exceed the amount which the employee would have earned if employment with the employer had proceeded to the employee's normal retirement date.
13.5.3.4 Continuity of service shall be calculated in the manner prescribed by clause 25.4. Provided that service prior to 10 August 2004 shall not be taken into account in calculating an entitlement to severance pay for an employee of a small employer pursuant to 13.5.3.2.
13.5.3.5 Application may be made for variation of the severance pay provided for in this clause in a particular redundancy situation in accordance with the Redundancy Case Decision [PR032004, 26 March 2004] and the Redundancy Case Supplementary Decision [PR062004, 8 June 2004].
13.5.4 Employee leaving during notice period
An employee given notice of termination in circumstances of redundancy may terminate his/her employment during the period of notice set out in clause 13.1 - Notice of Termination. In this circumstance the employee will be entitled to receive the benefits and payments they would have received under this clause had they remained with the employer until the expiry of the notice, but will not be entitled to payment in lieu of notice.
13.5.5 Alternative employment
13.5.5.1 An employer, in a particular redundancy case, may make application to the Commission to have the general severance pay prescription varied if the employer obtains acceptable alternative employment for an employee.
13.5.5.2 This provision does not apply in circumstances involving transmission of business as set in 13.5.7.
13.5.6 Job search entitlement
13.5.6.1 During the period of notice of termination given by the employer in accordance with 13.1, an employee shall be allowed up to one day's time off without loss of pay during each week of notice for the purpose of seeking other employment.
13.5.6.2 If the employee has been allowed paid leave for more than one day during the notice period for the purpose of seeking other employment, the employee shall, at the request of the employer, be required to produce proof of attendance at an interview or he or she shall not receive payment for the time absent. For this purpose a statutory declaration will be sufficient.
13.5.6.3 The job search entitlements under this subclause apply in lieu of the provisions of 13.3.
13.5.7 Transmission of business
13.5.7.1 The provisions of this clause are not applicable where a business is before or after the date of this award, transmitted from an employer (in this subclause called the transmittor) to another employer (in this subclause called the transmittee), in any of the following circumstances:
13.5.7.1(a) Where the employee accepts employment with the transmittee which recognises the period of continuous service which the employee had with the transmittor and any prior transmittor to be continuous service of the employee with the transmittee; or
13.5.7.1(b) Where the employee rejects an offer of employment with the transmittee:
13.5.7.2 The Commission may vary 13.5.7.1(b) if it is satisfied that this provision would operate unfairly in a particular case.
13.5.8 Employees exempted
13.5.8.1 This clause does not apply to:
13.5.9 Incapacity to pay
The Commission may vary the severance pay prescription on the basis of an employer's incapacity to pay. An application for variation may be made by an employer or a group of employers.
