For an employer that is listed in the regulations (e.g. AIDC Ltd, Medibank, Snowy Hydro Limited, the CSS/PSS Board), the key compliance obligation is to make payments under section 159 of the Act as extended by Schedule 1. This means the employer must pay to the Commonwealth the amount of contributions and other payments that the Commonwealth is liable for in respect of the eligible employee. The employer must also pay for medical examinations under section 160 as modified. To comply, the employer should have arrangements in place with CSS/PSS Board to remit contributions and other costs. The employer must ensure that it continues to make these payments as long as the person is a relevant person under the regulations.
For the employer, it is also critical to monitor the cessation triggers. If the employer ceases to be under Commonwealth control (e.g. through privatisation), the employer should notify affected employees that section 14A will cease to apply at the end of the last day of Commonwealth control. The employer should also keep records of employees’ scheme membership to know if an employee has joined another superannuation scheme, which would also trigger cessation.
For an employee who is a relevant person, compliance means continuing to make contributions under the Act as required (typically basic member contributions at the applicable rate). The employee must also refrain from joining another superannuation scheme (except for the limited exceptions of performance-pay-only schemes, top-up arrangements, productivity benefits, and SG-only schemes). Joining a new employer’s standard superannuation fund would likely terminate CSS continuation. The employee should review the new employer’s superannuation arrangements and seek confirmation that membership is limited to the permitted exceptions.
The employee who is eligible for a mobility allowance and wishes to take advantage of the election under Schedule 2 must do so in writing within three months of becoming eligible (or would-be eligible). The election should be sent to the Commissioner (now the CSS/PSS Board). Once made, the employee’s salary for contribution purposes becomes the maximum mobility allowance amount, which may lower contributions. The employee should also be aware that the election removes them from the operation of section 47 (decreases in salary) and section 51 (leave without pay) - they will not have to worry about contribution increases if their salary reduces, but they also lose the protection of section 51 for unpaid leave.
Persons who are in a class that allows transfer to PSS (regulation 4A - classes 3A(1)(e), (l), and regulation 3B) had a window of 1 March to 31 August 1996, with extensions for leave without pay or preclusion. That window has long closed, so no current compliance action is possible, but those who made the election validly should have transferred to PSS.
For employers and employees alike, record-keeping is essential. The definitions of ‘relevant person’ and the class conditions involve precise facts: was the person an eligible employee immediately before the employment change? Did they ever become a member of another scheme? The employer should keep copies of the employee’s CSS membership history and any elections made.
Because many provisions turn on the meaning of ‘superannuation scheme’ and ‘top-up arrangement’, employers should seek legal advice before implementing salary sacrifice arrangements for CSS continuation employees. The arrangement must meet the definition in regulation 2(3) and (4) to avoid jeopardising CSS membership.
Finally, the Minister’s certificate power under regulation 3B(2) means that repatriation staff coverage can be blocked if the Minister is not satisfied with arrangements. The relevant State or authority should proactively negotiate satisfactory payment arrangements with the Commonwealth to ensure coverage for transferred staff. If no certificate is signed, the regulation does not apply, and those staff lose CSS continuation.## What it does
These regulations, made under the Superannuation Act 1976 (the Act), define the classes of persons to whom section 14A of the Act applies and the classes to whom it does not apply. Section 14A is a provision that allows certain individuals who cease to be eligible employees under the Act (i.e. who leave employment that ordinarily attracts Commonwealth Superannuation Scheme (CSS) membership) to nevertheless continue making contributions to the CSS and remain within the scheme. The regulations also fix the times at which section 14A ceases to apply for each class, and modify the operation of the Act for those persons by inserting deemed leave periods and altering contribution calculations.
The regulations achieve this by listing, in regulation 3 and 3A, dozens of specific employer entities and employment circumstances. Persons in classes listed in regulation 3 are excluded from the benefit of section 14A - they cannot continue CSS contributions after moving. Persons in classes listed in regulation 3A are included - they may remain in the CSS despite moving to employment with a listed body such as AIDC Ltd, Australian Postal Corporation, Qantas, Medibank, Snowy Hydro Limited, or the CSS/PSS Board itself. Each class is defined by a combination of: the person’s employment history (e.g. was an eligible employee immediately before transfer), the nature of the new employment (full-time, non-casual), and the requirement not to have joined another superannuation scheme (with limited exceptions for top-up arrangements or performance-pay-only membership).
Further, regulation 4 provides detailed cessation triggers for each class - for example, when the person ceases employment with the listed entity, becomes a casual or temporary part-time employee, joins a different superannuation scheme, or when Commonwealth control of the entity ceases. Regulation 4A creates a special window (1 March to 31 August 1996, with extensions) during which certain persons could elect to transfer out of the CSS into the Public Sector Superannuation Scheme (PSS). Schedule 1 inserts a new Part VIIIA into the Act for persons who have been reinstated after dismissal or deemed retirement, deeming the gap period as leave without pay and overriding benefit payments. Schedule 2 modifies the Act for persons receiving a mobility allowance, allowing them to elect a notional salary equal to the maximum mobility allowance rate, and excluding them from certain leave and salary decrease provisions. Schedule 3 extends special fixed-term employee provisions to persons who are eligible employees by virtue of being in Division 3 of Part IV of the Public Service Act or being a section 14A(1)(b) or (e) person.
In essence, the regulations are a detailed machinery that preserves CSS membership for a defined set of employees who move from the Australian Public Service or approved authorities into corporatised or privatised entities, while preventing double coverage and ensuring that only those who meet strict criteria can continue. They also manage the eventual termination of that preserved membership.