Defined Benefit and Retirement Scheme Superannuation Dispute
The LGEA and the other Industry Parties (USU, depa, and LGNSW) have been before the NSW Industrial Relations Commission (NSWIRC) twice now concerning a Dispute notified by depa in relation to potential issues arising out of the Local Government Super (LGS) Defined Benefit (DB) and Retirement Scheme (RS) superannuation funds.
Summary of Issues
The Trust Deed for the relevant funds subject to the Dispute requires that the employer ascribe a value to the Private Use Component of any Council Leaseback Vehicle and report that value so ascribed as being part of an employee’s superable salary if the employee is a member of either the DB or RS funds. The question at the heart of this Dispute is whether or not some Councils across the state may have erroneously failed to ascribe a value to this Private Use Component and/or failed to properly report that value to LGS annually as being part of the superable salary of relevant employees.
As such this is a Dispute that has the capacity to directly impact upon LGEA members who are members of either the DB or RS funds, and who have (or have had) a Council Leaseback Vehicle to which they have a Private Use entitlement. To be clear it will only impact those fund members where an error has been made with respect to the calculation and reporting of superable salary, and this will most likely not have occurred in all (or even a majority) of cases.
Progress in the Commission & Current Status
During the first appearance of this Dispute before the NSWIRC on 18 October 2017 the Industry Parties discussed the matter and the relevant issues in Private Conference before Chief Commissioner Kite, and as a result of these discussions Chief Commissioner Kite Directed depa to invite the Proper Officers of LGS to attend the Commission on the next date of listing, so that those representatives may assist the Commission and the Industry Parties in the resolution of the Dispute.
The second listing of the matter before Chief Commissioner Kite occurred at 2:00pm last Friday, 3 November 2017, and in addition to the Industry Parties the Proper Officers of LGS, including CEO David Smith, were also in attendance. The acceptance of the invitation to attend by Mr Smith and the other Proper Officers of LGS was welcomed by both the Industry Parties and the Chief Commissioner as being a positive step towards resolution of the matters in Dispute.
In addition to his attendance in person, Mr Smith had provided a letter to the Chief Commissioner and the Industry Parties prior to the listing which clearly set out that LGS, on the instructions of its Board, had begun taking steps to deal with all potential issues arising out of the calculation of superable salary for employees in the DB and RS funds.
Mr Smith’s letter advised that as a first step, LGS will be writing to all Councils in NSW to remind them of their obligations as to the calculation of superable salary for members of the DB and RS funds. This is so as to avoid the continued perpetuation of any anomalies or errors when it comes to the ongoing calculation and reporting of superable salary for relevant employees.
Mr Smith’s letter also advised that the next step will be a thorough investigation commissioned by LGS that will seek to assemble the relevant facts required to determine the nature and scope of any issues that exist with respect to the calculation and reporting of superable salaries to LGS for DB and RS fund members.
Next Steps Toward Resolution
On the basis of this plan for next steps, the parties have agreed to have the Dispute listed again before Chief Commissioner Kite on 30 January 2018, where it is anticipated the preliminary results of the LGS investigation will be available for discussion. In addition to this, the parties have also agreed to meet together informally on a date in mid-December 2017 to keep one another appraised of progress in the matter and to discuss any potential complicating factors.
The LGEA is hopeful that once LGS has completed its investigation the nature and scope of any issues in this space within the industry will become much clearer. We will look to discuss the findings of this investigation with our members as soon as practicable once they become clear, with a view to then assisting any directly affected members resolve any anomalies that may apply to their situation.
In the meantime however we will continue to keep members appraised of progress towards the resolution of the Dispute by way of further LGEA Updates in due course.
Annual General Meeting Notice
We are pleased to advise members that this year’s AGM will be held in Sydney on Thursday 16 November.
Aside from the official business of the meeting, we will also be announcing the winner of the 2017 LGEA Employer of Choice Award during the AGM.
This Award is designed to promote and encourage the adoption of employment practices by councils that provide respect, recognition and reward to LGEA members working in local government.
This year’s winner will follow Holroyd City Council and Ryde City Council who were the LGEA employers of choice for 2015 and 2016.
All LGEA members are welcome to attend the meeting and join us for refreshments afterwards in the beautiful atrium of the historic Trades Hall building following the meeting.
Special offer membership drive – 50% off!
There literally is no better time for your colleagues to join the LGEA.
Any new member who joins the LGEA during November will enjoy 50% off our normal membership fees for their first year of membership.
All new members will have access to all the LGEA’s member only benefits and services, including access to advice and representation, our journey insurance, careers services, RPEng registration programme, remuneration information, mortality benefit, wills services and more for half the normal fee for the first 12 months of their membership.
Our special offer application form can be downloaded at LGEA Special Membership form
PLUS if your colleague writes your name on the application form when joining you will receive $100 as a referral bounty.