Draft Regulations for the Victorian Portable Long Service Benefits Scheme Released

Thursday 23 May 2019 @ 1.45 p.m. | Industrial Law | Legal Research

On 18 September 2018, the Long Service Benefits Portability Act 2019 (VIC) (‘the Act’) received Royal Assent. The Act established the Portable Long Service Benefits Authority (‘the Authority’) and its Governing Board on 1 November 2018. The remainder of the Act is due to commence on 1 July 2019. This Act was discussed in a previous TimeBase article.

The Portable Benefits Scheme

Under the Act, Victorian workers in contract cleaning, security and community services will be able to access long service entitlements, despite employer changes, as long as they stay within their industry. Under this scheme, workers will accrue one week of long service leave for every 60 weeks of continuous employment, if the worker has had a minimum of 7 years of continuous employment. Workers in the community service sector will receive a payment instead of leave, based on the same calculation and requirement.

Businesses that employ eligible workers will be required to register and submit quarterly reports to the Authority. Employees will also have to be registered for the scheme, which will be funded by a levy paid by the employers.

The Draft Regulations

The Long Service Benefits Portability Regulations (VIC) (‘the Regulations’) will be introduced to support the operation of the portable benefits scheme. In order to gain feedback from interested parties, the Government released draft regulations and questions for consultation on 3 May 2019.

The draft Regulation focuses on the following key issues:

  • The quarterly returns (reports to the Authority)
  • Disclosure of information
  • Operation of the scheme in the community services sector
  • Double-dipping

Under section 27 of the Act, employers of eligible workers are required to report back to the Authority every quarter. Under the draft Regulations, the proposed information to be provided includes:

  • Any long service leave accrued or taken by the worker
  • Payments made in lieu to the worker
  • The time which the benefits were given
  • The service period to which the benefits relate

The aim of this report is to allow the Authority to better manage these entitlements and to provide the Authority a better view of the worker’s entitlements without needing to contact multiple past employers.

In regards to disclosure of information, the draft Regulations proposes that the Australian Tax Office (‘the ATO’) and the Labour Hire Licensing Authority (‘the Licensing Authority’) be added as two additional prescribed bodies that the Authority should be allowed to share information with. Under section 51 of the Act, the Authority is allowed to disclose information to certain Victorian and Commonwealth bodies. The addition of the ATO is proposed to ensure that the correct tax is deducted from workers and the addition of the Licensing Authority is to assist with enforcement of both the labour hire licensing scheme and the long service portable benefits scheme.

The draft Regulations also assist the Act in defining what the community services sector would be under the meaning of this scheme. The aim of these provisions is to provide clarity as to the scope of this sector, in terms of what community service work is and who is an employer or employee.

The draft Regulations also addresses the issue of double-dipping. Workers eligible for long service leave under a fair work instrument are not entitled to claim on long service leave under this scheme for work in the same period. Furthermore, employers of that worker are not required to pay the levy for same period where leave is already accrued under a fair work instrument.

Some of the questions posed for consultation include:

“Will employers be in a position to provide this additional information [in regards to quarterly returns]?

Are there any specific matters about privacy of information that you wish to raise as part of this proposed regulation?

Do the exposure draft Regulations provide clarity as to the scope of the community services sector, what is community service work, and who is an employer, and an employee for the sector?

Does the proposed Regulation adequately address any risk of double-dipping?”

Consultation on the draft Regulations is open until 5 pm on May 30.

TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products. Nothing on this website should be construed as legal advice and does not substitute for the advice of competent legal counsel.

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