L2: 19. Superannuation

19.1. Overview

^{(Updated: March 2007)}

The University provides generous superannuation arrangements for its staff.

There are different superannuation plans available to staff depending on the type of employment, the funding sources (eg. the University's recurrent funding or external funding) and the actual contract of employment conditions. Membership of the appropriate plan is an employment condition.

The University provides access to the following UniSuper Plans:

The Defined Benefit Division and Accumulation Super (2) plans are only available to staff who are in receipt of 17% employer contributions. Please refer to Section 19.2.1 for eligibility.

Defined Benefit Division - formerly known as the Defined Benefit Plan. benefits are calculated using a formula based on the member's salary, years of membership and age. Defined benefits are typically not determined by investment performance.
Accumulated Super (2) - formerly known as Investment Choice Plan. All contributions are paid into this account and invested in your chosen investment option(s). The member's super balance accumulates over time with investment returns (which may be positive or negative). The final benefit is the total of the UniSuper account (minus fees and taxes) and is dependent on investment performance.

The Accumulation Super (1) Plan is mainly for staff who are eligible for 9% Superannuation Guarantee only. Please refer to Section 19.2.4 for eligibility.

Accumulation Super (1) - formerly known as Award Plus Plan. Benefits are based on the balance in the account, which is made up of contributions (less expenses and tax) and investment earnings.

These Plans are administered by UniSuper Management Pty Ltd.

19.1.1. References

Superannuation Industry (Supervision) Act 1993;
Superannuation Guarantee (Administration) Act 1992;
Annual Report to Members;
The University of Melbourne Enterprise Bargaining Agreement 2006;
Statute 16.3 - Superannuation Scheme for Australian Universities http://www.unimelb.edu.au/Statutes/s163.pdf.

19.2. Policy

19.2.1. Eligibility for the Defined Benefit Division/Accumulation Super (2)

Generally, full-time, fractional, and contract staff whose appointments are:

on time fractions of at least 50%;
for at least 2 years or more;
funded from the University's recurrent funding,

are required to join the Defined Benefit Division or Accumulation Super (2) as a condition of employment.

Where there are funding arrangements making full and adequate provision for the full contribution of the University to be met from other than University Recurrent Funding, the Head of Budget Division may approve a request for membership of Defined Benefit Division or Accumulation Super (2) from a staff member who does not meet the criteria.

Initially staff members will join the Defined Benefit Division as the default plan. Staff will then have a period of 12 months from the date of joining to decide whether they wish to remain in the Defined Benefit Division or transfer to the Accumulation Super (2).

It should be noted that once a member has transferred to the Accumulation Super (2), it is not possible to transfer back to the Defined Benefit Division.

19.2.2. Contributions by staff members

For Defined Benefit Division or Accumulation Super (2) members:

Contributions are automatically deducted from fortnightly salary payments. Staff members contribute:

At the standard rate of 7% of their salaries, or
Under Contribution Flexibility arrangements, members can reduce their contributions to 4.45%, 4%, 3%, 2%, 1% or 0%.

Staff employed at or below salary classifications HEW Level 4 may elect to apply for half membership and contribute at 3.5% of salary for a corresponding reduction in employer contributions and benefits. Please refer to Section 19.2.3.

19.2.3. Contributions by the University

The University contributes at the rate of:

17% of members' salaries.
10% of members' salaries (half membership).

Note: Members have the option of paying their superannuation contributions from before-tax pay (ie. salary sacrifice). Professional financial advice should be sought before requesting this option.

19.2.4. Eligibility for Accumulation Super (1)

Staff who do not meet the eligibility criteria for the Defined Benefit Division or Accumulation Super (2) will join as Accumulation Super (1) only members.

The University will contribute 9% employer contributions into Accumulations Super (1) as required under the Superannuation Guarantee legislation. Staff members are not obliged to make any contributions to this plan.

19.2.5. Casual Staff Employer Contributions

Staff who are defined by the University as casual employees are eligible for 3% employer contributions provided that:

in respect of Academic Staff, the staff member earns at least $2,202 (indexed annually), in each half year; or
in respect of Professional Staff, the staff member works at least 100 hours in each year.

If a casual staff member earns more than $450 in any month the contribution rate is, in most cases, increased to 9% to meet Superannuation Guarantee requirements.

Casual staff members will have their contributions credited to their UniSuper Accumulation Super (1) accounts.

19.2.6. Procedures

An eligible staff member is required to sign a membership application. This is normally provided by Human Resources.

Questions concerning details of benefits, contributions, or any other features of the Award Plus Plan should be directed to the Human Resources team that deals with the enquiring staff member's department.

19.3. Additional voluntary contributions

To build a bigger superannuation benefit, staff members may make regular additional voluntary contributions to their superannuation.

Fortnightly staff members can commence, vary or cease their additional voluntary contributions to their UniSuper accounts on a fortnightly basis. Contributions can be made on a before-tax (salary sacrifice) or after-tax basis.

Staff are required to complete the UniSuper Regular Voluntary Contribution Election Form and the University's HR32A Form. The completed forms should be forwarded to the Superannuation Team in Human Resources for processing.

19.4. Benefits

Different benefits are payable depending on the circumstances. Human Resources Officers or the Superannuation Officer can provide details of:

retirement benefits;
resignation benefits;
death benefits;
disablement benefits;
temporary incapacity benefits; and
disabled child pension.

19.5. Secondment or Internal Fixed Term Transfer

A staff member's superannuation membership, including the contribution level, will remain unchanged during the period of a secondment or internal fixed term transfer if the staff member is already contributing to the Defined Benefit Division or Accumulation (2) Plans.

Defined Benefit Division or Accumulation Super (2) members will maintain full superannuation contributions at 17% throughout their employment at the University, ie. if a Defined Benefit Division or Accumulation Super (2) member transfers from one department to another within the University and there is no gap in service, the member must also receive full superannuation contributions in the new position - the employer contributions can not be reverted from 17% to 9% of the salary.

19.6. Part-Time Appointments

A period of part-time employment will reduce a member's Average Service Fraction. For Defined Benefit Division members, the Average Service Fraction is one of the factors used in calculating the member's final benefits.

A member can maintain full benefits while on a part-time appointment, provided the full contributions are paid by the member and the member's department.

19.7. Loadings and Bonuses

Performance bonus and temporary loadings, such as the General Faculty Loading, may be salary sacrificed into the member's UniSuper plan.

Performance bonuses can only be directed into a member's superannuation account when the University has been advised of the member's intention to salary sacrifice the bonus before the member has an entitlement to the payment, ie. before the period of employment to which the performance bonus relates, commences. This advice must be documented.

Temporary allowances and temporary higher classifications for less than 5 years are treated as an increase in service fraction for the purposes of the Defined Benefit calculations.

19.8. Superannuation contributions while on leave

Superannuation contributions will continue during any period of paid leave.

All superannuation contributions will cease for staff members on Leave Without Salary.

For members of the Defined Benefit Division, the period of Leave Without Salary is treated as membership with a service fraction of zero. Death and disablement benefits will continue, but reduce over the period of leave.

19.9. Rollover of Benefits

On joining UniSuper, a member can rollover the superannuation benefits in another superannuation fund (eg. in a previous employer's fund) into UniSuper. To facilitate this benefit transfer, the member has to complete a Rollover Form from the UniSuper website at http://www.unisuper.com.au/resources/forms.cfm.

19.10. Leaving the University

There are several options available to members when they cease their employment with the University.

These options are available for UniSuper members:

leaving the benefits in UniSuper and continuing to make contributions into the UniSuper account;
rolling over the UniSuper benefit to another fund;
deferring the deferred benefit component of the account and retaining the entitlement to a formula-based benefit in the Plan;
taking some of all of the unrestricted non-preserved superannuation as a cash payment;
purchasing UniSuper pension products.

For State Superannuation Scheme members, please refer to the GSO website at http://www.gsoconnect.com.au.

Human Resources will notify the relevant superannuation fund within 10 working days after the member's final pay date. Please note that it is the responsibility of the relevant superannuation fund to forward a Benefit Entitlement Statement to the member and this process could take up to 4 weeks. If a staff member wishes to transfer the UniSuper membership to another tertiary institution, the member should indicate it on the HR12 Cessation Form (http://www.hr.unimelb.edu.au/forms).

19.11. Death and Disablement Insurance

Insurance cover is an inbuilt feature of the Defined Benefit Division/Accumulation Super (2) membership. It provides a benefit for the member and dependants if the member has to stop work temporarily or permanently due to injury or illness or death.

Accumulation Super (1) members have the option of purchasing optional Death and Disablement insurance and Income Protection insurance.

Disablement is defined as a member being absent from employment through non-work related injury or illness for three months within a period of twelve consecutive months, and being in a state of health that renders the member permanently incapable of performing duties or engaging in employment for which the member is or was, by reason of training or experience, reasonably qualified.

Members must exhaust their sick leave entitlements before payment of a disablement or temporary incapacity benefit can commence.

A monthly benefit is paid based on 60% of benefit salary.

19.12. Temporary Incapacity Benefit

The temporary incapacity benefit is paid for a period defined by the Trustees for a period of up to 24 months. The need for the incapacity benefit is reviewed every six months.

The University will keep a suitable position available for a member of staff on a temporary incapacity benefit for a period of up to 24 months or for the period of the unexpired term of the member's contract of employment (whichever id the shorter period).

19.13. Special Disability Scheme

It is possible that there will be cases where a disabled member of staff has insufficient paid sick leave credits to cover the UniSuper qualifying period without financial hardship. In such cases the staff member can apply for consideration under the University's Special Disability Scheme.

The University will make payments under this scheme to a disabled Plan member to cover the period of absence from the expiry of paid sick leave until the three months qualifying criteria for a disablement pension is met. Payment is made at the rate applicable to the member had the member been eligible under the Plan rules. Please contact your Human Resources Consultant for further details.

Acceptance under the Special Disability Scheme is subject to the following conditions:

the member must make an application for consideration under the Scheme which is supported by medical evidence from a medical practitioner to the effect that the member is disabled according to Plan definitions, and is likely to remain so until the expiration of the three months qualifying period;
the member must agree to submit to such medical examination as may be required by the University;
the application will be submitted to the Vice-Principal (Human Resources) for consideration;
the member must acknowledge that the granting of any payments under the Scheme is an internal University arrangement applicable only to the period between the expiry of the member's sick leave and the completion of the three months absence requirement under rules and in no way commits the University or UniSuper to further payments or disability pension after the end of the qualifying period.

Should a member be granted payments under the Special Disability Scheme and subsequently be refused a disability pension by UniSuper, or return to work, payments made will not be repayable.

Unless otherwise agreed by Council no member shall be eligible to receive payments under the Scheme in respect of more than one disability application.

19.14. Procedures

All eligible staff members are required to sign up a membership application form. Most applicants are new employees of the University, but a change of appointment could also mean that an existing staff member may become eligible to join another plan.

Human Resources Officers will advise new staff, and staff with contract extensions of their eligibility and applicable superannuation schemes and provide the appropriate forms to the employee.

Questions concerning details of benefits, contributions, or any other features of the different plans should be directed to the Superannuation Officer, Human Resources.

For further information about UniSuper, please visit the UniSuper website at http://www.unisuper.com.au or ring the UniSuper Member Services Hotline on 1800 331 685.

Staff who are members of other superannuation schemes, such as State Superannuation Revised or New Schemes, SERB (State Employees Retirement Benefits Scheme) can obtain more information from the GSO Connect website at http://www.gsoconnect.com.au or call the GSO Member Service Line on 1300 655 476