Superannuation (CSS) (Eligible Employees – Inclusion) Declaration 2003

Eligible employee: The core concept is drawn from subsection 3(1) of the Superannuation Act 1976. The Declaration exercises the power under paragraph (ec) of that definition to specify additional classes of persons who can be eligible employees. Being an eligible employee is the gateway to CSS membership and entitlement to defined benefits including a pension based on final average salary and contributory service. The Declaration does not modify the rest of the Act’s definition; it only adds classes.

Alternative superannuation scheme: This is the central restriction on eligibility. The definition in section 3 of the Declaration is elaborate and carries significant bite. It means a superannuation scheme to which contributions are made in relation to the person’s employment or office. However, it expressly excludes: contributions for other employment or offices; schemes that only preserve or pay productivity related benefits under section 110A of the Act; schemes that only satisfy obligations under the Superannuation Guarantee (Administration) Act 1992; schemes funded only by performance pay; and, for a prescribed person, a scheme of which the person is a member only for top-up purposes. The note given in the Declaration provides an example: if a person makes voluntary contributions to a Retirement Savings Account (RSA) without employer contributions, that RSA is not an alternative scheme; but if the employer contributes above the superannuation guarantee rate, it becomes an alternative scheme. The distinction is critical: a person who becomes a member of an alternative scheme in relation to the relevant employment will cease to be an eligible employee (see the cessation triggers in section 5 and the note referencing the exclusion Declaration). The concept forces a binary choice: retain CSS eligibility by not joining any employer-supported super fund beyond the minimum SG contribution, or lose eligibility by accepting additional employer contributions into another fund.

Top-up arrangement: Defined in subsection 2(3) as an arrangement between a payee and a payer where contributions to a superannuation scheme constitute part of the payee’s overall remuneration (not an addition) and the payer also makes payments under the Act for that person. This allows salary sacrifice into superannuation without triggering alternative scheme status. The concept of “prescribed person” is linked: a person who can choose to take part of their remuneration in non-monetary form (for example, a top-up arrangement). Subsection 2(2) further provides that a person is taken to be a member of a scheme for top-up purposes only in narrow circumstances, including when membership exists solely because of a top-up arrangement, or because of a top-up arrangement combined with performance pay contributions, productivity benefits, or SG-only contributions.

Prescribed person: A person who holds office or is employed under terms and conditions enabling a choice to take part of remuneration in non-monetary form (for example, a top-up arrangement). This definition appears only in the context of excluding certain schemes from the alternative superannuation scheme definition.

Reinstated: Defined to mean re-appointed or re-employed, or deemed to be re-appointed or re-employed as the case requires. This concept is used in classes (m) and (n) of section 4, which cover persons reinstated in circumstances similar to re-appointment under sections 63F, 63G, 66B, 87M or 87Q of the Public Service Act 1922 as in force before its repeal. These provisions protect CSS eligibility for members who were terminated and later reinstated.

The Declaration directly affects employees of a closed list of non-Commonwealth bodies and certain reinstated persons. The bodies are: Northern Land Council (section 4(2)(b)), Northern Territory Legal Aid Commission (section 4(2)(f)), Sydney Harbour Federation Trust (section 4(2)(i)), ASPI Ltd (section 4(2)(k)), Commonwealth Superannuation Corporation (CSC) (section 4(2)(l)), Australian Children’s Education and Care Quality Authority (ACECQA) (section 4(2)(q)), Australian Reinsurance Pool Corporation (ARPC) (section 4(2)(r)), and ASIC in respect of employees who transfer from the Australian Public Service on 1 July 2019 under section 311 of the Australian Securities and Investments Commission Act 2001 (section 4(2)(s)). Section 5 affects Australian Hearing Services employees, but only those for whom contributions were accepted purportedly under the Act on or after 1 July 1997. Additionally, the reinstatement classes (m) and (n) apply to any person who was an eligible employee immediately before termination or cessation and is later reinstated in circumstances analogous to the old Public Service Act provisions, irrespective of employer.

Within each class, the Declaration draws distinctions by employment type. Casual and temporary part-time employees are generally excluded from all classes except where a specific election is permitted (for example, CSC full-time temporary employees may elect to become eligible). This disproportionately affects workers in less secure employment arrangements, who lose the chance to preserve CSS eligibility even if they have prior defined benefit entitlements. The condition that a person must not be a member of an alternative superannuation scheme in relation to the new employment also creates an ongoing constraint: an employee who later accepts employer superannuation contributions into a fund other than the CSS will trigger cessation of eligibility. This limits job mobility and bargaining power, since an employee cannot take a new role that offers additional superannuation benefits without forfeiting the CSS.

The Declaration also indirectly affects CSC, which must administer the eligibility determinations and maintain records of written requests and elections. Employers on the list (for example, ASIC, ACECQA, ARPC) must ensure they do not make superannuation contributions to another fund for eligible employees beyond the SG minimum, or risk causing those employees to lose CSS membership. For the employer, the cost is the loss of flexibility in offering superannuation as part of a remuneration package; the employee receives a valuable defined benefit promise but forgoes the freedom to choose a fund.

The primary right conferred by the Declaration is the right to be an eligible employee under the CSS Act, which triggers the right to contribute to the CSS and receive defined benefits. However, that right is conditional and carries specific duties. For section 4(1) persons (those to whom a provision of the old Eligible Employees Regulations applied immediately before commencement), the duty is to make a written request to be treated as an eligible employee. Without that request, they do not become eligible. For CSC full-time temporary employees under section 4(2)(l), the duty is to make an election in writing to become an eligible employee. Failure to elect means they cannot access CSS membership despite meeting the other conditions.

For all classes, there is an ongoing duty not to become a member of an alternative superannuation scheme in relation to the employment. The Declaration does not require the employee to notify their employer or CSC of any change, but the practical consequence of breaching this condition is the loss of eligibility. The cessation triggers in section 5(2) for Australian Hearing Services employees are explicit: the person ceases to be an eligible employee at the end of the day they cease employment, the day before they become a member of an alternative scheme, the day before they become casual or temporary part-time, or the last day the entity is a corporate Commonwealth entity. No notice period or grace period is provided.

For reinstated employees under classes (m) and (n), the duty is to have been an eligible employee immediately before the termination or cessation, and to be reinstated in circumstances similar to the repealed Public Service Act provisions. The Declaration does not require a written request for these classes, but the similarity requirement imposes a duty on the employer or CSC to determine whether the reinstatement circumstances match the old legislative criteria, which are no longer in force and may be subject to interpretive difficulty.

The right of the person to remain eligible is conditional on the employer’s actions to some extent. For example, if the employer decides to commence making contributions to another superannuation fund for the employee above the SG rate, the employee will lose CSS eligibility through no direct fault of their own. The employee has no right under this Declaration to compel the employer to refrain from such contributions. Similarly, if Australian Hearing Services ceases to be a corporate Commonwealth entity - a decision outside the employee’s control - eligibility ends.

The Declaration itself does not create any criminal offences or pecuniary penalties. Enforcement of the eligibility conditions is achieved through the operation of the CSS Act and the companion exclusion Declaration. If a person is included in a class under section 4 or 5 but later ceases to meet the conditions (for example, by joining an alternative scheme), the legal effect is that they cease to be an eligible employee. CSC will then treat their CSS membership as terminated, contributions will stop, and the person may become a preserved benefit member or, depending on circumstances, may be entitled to a deferred benefit. There is no penalty for non-compliance beyond the loss of the benefit structure.

However, there are indirect enforcement mechanisms. If a person or employer misrepresents eligibility - for example, an employee claims CSS eligibility without having made the required written request, or an employer incorrectly treats contributions as valid when the person was actually a member of an alternative scheme - CSC may seek recovery of wrongly paid benefits or contributions. The general law of misrepresentation, fraud, and unjust enrichment applies. The Superannuation Act 1976 contains provisions for adjustment of overpayments and the recovery of debts due to the Commonwealth. Section 158 of that Act, for instance, allows CSC to recover overpayments of pension as debts. A person who fraudulently obtained CSS membership could also face criminal prosecution under the Criminal Code (Cth) for obtaining a financial advantage by deception. The practical risk for employees is that an error in eligibility could result in years of contributions being voided, with the employee forced into a less valuable accumulation fund with no ability to backdate contributions.

For employers, the risk is primarily reputational and administrative. There is no direct penalty under this Declaration for failing to monitor an employee’s actual scheme membership. However, if an employer negligently causes an employee to lose CSS eligibility by making contributions to an alternative scheme without warning the employee, the employer may face civil liability for breach of contract or negligence. The employee’s loss could be significant: the difference between a defined benefit pension and an accumulation balance. This creates an incentive for employers to obtain written acknowledgments from employees before adding them to any other superannuation fund.

The Superannuation Complaints Tribunal (now the Australian Financial Complaints Authority) may have jurisdiction over complaints about the administration of CSS membership, but the eligibility criteria themselves are determined by legislative instrument and are not subject to merits review in that forum; they would be judicially reviewable under the Administrative Decisions (Judicial Review) Act 1977.

The Declaration operates within a dense legislative framework. Its primary interaction is with the Superannuation Act 1976, specifically the definition of “eligible employee” in subsection 3(1). Paragraph (ec) grants the power to make this Declaration; the Declaration fills that paragraph. It also interacts with the Superannuation (CSS) (Eligible Employees,Exclusion) Declaration 2003, which is cross-referenced in the note to section 4 and sets out circumstances in which persons may cease to be eligible employees. The two declarations operate in tandem: one includes, the other excludes.

The Act itself is the Superannuation Act 1976. References to “the superseded Act” in section 4(2)(i), (k), (l) refer to an earlier version of the Act that contained sections 64A and 65 (types of pension). The Declaration also relies on section 110A of the Act for the definition of “productivity related benefits” used in carving out certain contributions from the alternative superannuation scheme concept.

The Superannuation Guarantee (Administration) Act 1992 is directly referenced in the alternative superannuation scheme definition: contributions made solely to satisfy SG obligations do not create an alternative scheme. This prevents the SG minimum from triggering loss of CSS eligibility, which is necessary because almost all employees will have SG contributions made on their behalf. The Retirement Savings Account Act 1997 is incorporated by reference, as “superannuation scheme” includes an RSA within the meaning of that Act.

The Governance of Australian Government Superannuation Schemes Act 2011 defines CSC (Commonwealth Superannuation Corporation), which is both a referenced entity in section 4(2)(l) and the body that administers the CSS. The definition of ACECQA comes from the Education and Care Services National Law Act 2010 (Vic), showing the Declaration’s interaction with state-based national law. The definition of ARPC comes from the Terrorism Insurance Act 2003. The definition of ASIC comes from the Australian Securities and Investments Commission Act 2001, and the transfer provision references section 311 of that Act. ASPI Ltd is defined by its ACN and incorporation under the Corporations Act 2001.

The Public Service Act 1922 is referenced in the definitions of reinstatement and in the reinstatement classes (m) and (n), which refer to sections 63F, 63G, 66B, 87M and 87Q as in force immediately before repeal. The Public Service Act 1999 is referenced in the ASIC transfer class (s). The Industrial Relations Act 1988 is referenced in the definition of “performance pay”. This interconnection means that changes to any of these underlying laws can affect the operation of the Declaration without amendment, creating legal uncertainty.

The Declaration was made in 2003, replacing the earlier Superannuation (CSS) Eligible Employees Regulations 1976. Section 4(1) provided a transitional mechanism for persons to whom provisions of the old Eligible Employees Regulations applied immediately before commencement, allowing them to request inclusion. The original version of the Declaration likely contained a smaller set of classes. The inclusion of entities such as ACECQA (established under the Education and Care Services National Law Act 2010 (Vic), which commenced in 2012), ARPC (established by the Terrorism Insurance Act 2003), ASIC (the transfer provision refers to 1 July 2019), and the detailed conditions for CSC full-time temporary employees (CSC itself was established by the Governance of Australian Government Superannuation Schemes Act 2011) indicate that the Declaration has been amended multiple times since 2003. ASPI Ltd was incorporated in 2001 and may have been added later. The Australian Hearing Services provision in section 5 was likely added separately, given its distinct “purported contributions” validation and cessation triggers.

The legislative history is not provided in the source text, but the pattern of inclusions suggests amendments were made as machinery of government changes occurred: outsourcing of functions to prescribed bodies and the creation of new government entities. Each amendment expanded the class of persons eligible to retain CSS membership, preserving defined benefit entitlements for existing members moving to those bodies. No sunset clause or review date is included in the Declaration. The note to section 4 expressly references the companion exclusion Declaration, which may have its own amendment history. Practitioners should seek the current compiled version of the Declaration from the Federal Register of Legislation to confirm the exact list of amendments. The Declaration’s status as a legislative instrument means it is subject to disallowance, but no evidence suggests it has ever been disallowed.

The source text does not name any litigation concerning this Declaration. As a legislative instrument that defines eligibility classes, it is rarely the direct subject of judicial proceedings. Disputes are more likely to arise in the context of benefit claims under the Superannuation Act 1976, where the question of whether a person was an eligible employee at a given time becomes decisive. The Federal Court and the Administrative Appeals Tribunal have considered CSS eligibility issues, but decisions specifically on this Declaration are not referenced. Challenges could arise on grounds of procedural fairness in the making of the Declaration, ultra vires if it exceeded the power under paragraph (ec), or jurisdictional error in administrative decisions about whether a person falls within a class. Because the classes are defined by detailed factual criteria - employment status, membership of alternative schemes, written requests - most disputes would be about factual findings rather than the validity of the Declaration itself. The definition of “alternative superannuation scheme” may be contested, particularly the exclusions for top-up arrangements, performance pay, and SG-only contributions. The interaction with the companion exclusion Declaration could also give rise to disputes about the sequencing of inclusion and exclusion. Class (m) and (n) reinstatement provisions, referencing repealed sections of the Public Service Act 1922, may require courts to interpret provisions that no longer exist, creating legal uncertainty. The absence of reported litigation does not mean the Declaration is immune from challenge; rather, it may reflect the limited number of affected persons and the administrative resolution of most disputes by CSC. Legal practitioners advising clients on CSS eligibility should be aware that the interpretation of these classes is largely untested.

• The “alternative superannuation scheme” trap: Exclusions from the definition are narrow. A person who accepts even one dollar of employer superannuation contributions above the superannuation guarantee minimum into a fund other than the CSS will become a member of an alternative scheme. The note in the Declaration makes this clear: voluntary RSA contributions without employer money are safe, but employer contributions at any level above SG trigger alternative scheme status. This means an employee cannot salary sacrifice into a different fund if the employer also makes the SG contribution into that fund.
• Written request requirement for section 4(1): Persons who were eligible under the old Regulations must make a written request. There is no prescribed form, but the request must be made. Failure to do so means the person is not an eligible employee, even if they meet all other conditions. This is easy to miss in a transition.
• Casual and temporary part-time exclusion: With limited exceptions, all classes exclude persons employed on a casual or temporary part-time basis. The exception for CSC full-time temporary employees requires an election in writing. For other classes, any change from full-time permanent to casual will trigger cessation under section 5(2) for Australian Hearing Services employees; for other classes, the Declaration is silent but the person would no longer meet the class description.
• Reinstatement classes rely on repealed laws: Classes (m) and (n) require circumstances similar to those in specific sections of the Public Service Act 1922, which are repealed. Determining “similar circumstances” is inherently uncertain and may be litigated.
• Cessation for Australian Hearing Services employees under section 5(2): The triggers include the day the entity ceases to be a corporate Commonwealth entity. This is an event beyond the employee’s control that can end CSS eligibility immediately with no accrued right.
• The definition of “top-up arrangement” requires a dual payment test: The payer must make contributions under the Act (the Superannuation Act 1976) in relation to the payee and the employment. This is a condition that may be difficult to satisfy if the payer is not a Commonwealth entity.
• No grace period for changes in circumstances: The moment a person becomes a member of an alternative scheme, their eligibility ends (see the cessation provisions). There is no opportunity to correct the situation.
• Interaction with the exclusion Declaration: The note warns that a person may cease to be an eligible employee under the exclusion Declaration. Practitioners must check both instruments in tandem.
• Performance pay definition is historical: It refers to industrial instruments under the Industrial Relations Act 1988 as in force before specific dates. Modern performance pay arrangements may not qualify, meaning contributions labelled as performance pay could count as alternative scheme membership.

For employers listed in the Declaration or employing persons who may fall within a class, compliance requires a systematic process at the point of engagement and ongoing monitoring. First, determine whether the new employee was an eligible employee under the CSS immediately before the new role. This requires checking with CSC or obtaining evidence of previous CSS membership, deferred benefits, or invalidity pension. Second, confirm the employment type is not casual or temporary part-time, unless an express exception applies (such as CSC full-time temporary). Third, obtain a signed declaration from the employee that they are not currently a member of an alternative superannuation scheme in relation to the new employment, and that they will not join one without first leaving the CSS. Fourth, for section 4(1) transitional persons, ensure the employee provides a written request to be treated as eligible. For CSC full-time temporary employees, ensure a written election is made. Fifth, for Australian Hearing Services employees, verify that contributions were accepted purportedly under the Act on or after 1 July 1997. Sixth, monitor any changes in the employee’s superannuation arrangements. The employer should not make contributions to a fund other than the CSS for that employee unless the employee first ceases to be eligible and the CSS membership is formally terminated. Any additional employer superannuation contributions, even if salary sacrificed, will create an alternative scheme and cause the employee to lose eligibility.

For employees, compliance involves maintaining awareness of their CSS eligibility status and the restrictive conditions. They should never accept employer superannuation contributions into any fund other than the CSS without first understanding the consequences. If they wish to change superannuation arrangements, they should seek advice from CSC and obtain a prospective ruling. Employees in the reinstatement classes should keep records of the termination and reinstatement circumstances to demonstrate similarity to the repealed Public Service Act provisions. Employees should also retain copies of any written requests or elections made under the Declaration.

For CSC, compliance means maintaining a register of eligible employees under each class, processing written requests and elections, and ensuring timely cessation of membership when triggers occur. CSC should also issue guidance to employers on the list to prevent inadvertent breaches. Because the Declaration is a legislative instrument, CSC’s interpretation and application of its terms may be challenged; therefore, maintain records of decisions and the basis for determining whether a person meets the class criteria. Regular review of the Declaration for amendments is essential, as new classes are added periodically.