Community sector strengthening
Portable long service leave for the community services sector
UPDATE AS OF 28 May 2010.
Since the decision to delay the legislation of a Victorian portable long service leave scheme in October 2009, Price Water House Coopers was engaged as a consultant to undertake further assessment of the business impact of the scheme.
VCOSS provided input from Peaks and Statewide Networks Forum members to the terms of reference for the consultancy in December 2009.
PriceWaterHouseCoopers ran focus groups with community sector representatives in January this year and was due to provide a final report in mid-February. This report was delayed due to some further scoping work on the scheme, which now excludes Aged Care services.
The full report with recommendations from PriceWaterHouseCoopers was provided to members of the Department of Human Services portable long service reference group on Thursday 20 May. A presentation was also provided.
VCOSS lodged a submission to the final report on Friday 28 May, informed by feedback from the VCOSS portable long service leave working group on Wednesday 26 May.
The VCOSS submission made the following recommendations:
COSTS
- Government subsidy of the scheme administration, including implementation assistance.
- Additional Government subsidy of the fund levy.
- Government to guarantee a fund levy of 1% for a 10 year period.
FUND MODEL
- Strong support for flexibility to pay out long service leave on a pro rata basis - after 5 or 7 years employment in the sector regardless of the number of employers.
- Strong support for use of pro rata pay out as part of flexible work initiatives at enterprise level, such as additional annual leave, flexible working arrangements, time off for training and paid maternity leave.
SCOPE
- Greater clarity around which services are included in the scope of the scheme is required.
GOVERNANCE
- Support for an independent governance structure such as a statutory body with a Government Chair, providing adequate representation for employers and unions while retaining Government involvement.
TIMING AND START DATE
- Proposal to start scheme at 1 July 2012, if portable long service leave legislation is passed in 2010.
VCOSS is awaiting the response of Government and will pass on further updates as they are announced.
UPDATE AS OF 1 October 2009.
VCOSS and representatives of the VCOSS Portable Long Service Leave (PLSL) Working Group met with Minister Neville this afternoon for a briefing on the progress of the PLSL scheme.
The Minister advised us that the Government has decided to delay the introduction of the PLSL legislation (originally scheduled for the spring session of parliament) to the autumn session in 2010. This delay will enable the Government to work closely with the community services sector and unions over the next three to four months to develop a more viable scheme.
An independent consultant will be engaged to provide an assessment of the business impact of the scheme. The sector will have input into the terms of reference for the consultant and a reference group will be established.
As you may be aware, VCOSS, along with many other peaks and CSOs, have been advocating for a delay to the legislation to allow more time to consider the key issues – administrative complexity, cost impact and scope. VCOSS welcomes the new approach offered today, as this gives the sector, unions and government more time to work together to develop a sustainable PLSL scheme.
Thank you to everyone who has taken the time to contact Ministers and local members of parliament to raise issues of concern from your perspective.
Your work has contributed to today’s outcome. VCOSS looks forward to working with the Government to develop a sustainable and viable PLSL model for the community sector.
For further information please contact:
Cath Smith
Chief Executive Officer
T: 9654 5050 E: cath.smith@vcoss.org.au
Paula Grogan
Community Sector Sustainability Policy Coordinator, VCOSS
T: 9654 5050 E: paula.grogan@vcoss.org.au
UPDATE AS OF 9 September, 2009
Given the lack of progress in negotiating a sustainable portable long service leave model with government, VCOSS is calling on Victorian community sector organisations (CSOs) to actively and publicly voice concerns about the model and the proposed legislative timelines over the next two to three weeks.
We forwarded the Peaks and Statewide Networks portable long service leave (PLSL) position paper (linked below) to the Victorian Government on 12 August and to date have received no formal response to this paper and no official briefing on the status of the PLSL project.
We are aware that the Victorian Government is waiting to clarify whether the PLSL legislation can be deferred until after the implementation of the Federal Government Fair Work Act on 1 January 2010. We understand that the Government will continue with its commitment to introduce legislation in the Spring Session of Parliament if the Federal Government does not provide this assurance shortly.
VCOSS have informed Minister Neville’s Office that the sector will be communicating its concerns more publicly during September given it is still the Government’s intention to introduce legislation in the Spring Session of Parliament.
It is clear that now is the time for a more public approach as there is insufficient time left in 2009 for proper consideration of the proposed legislation, including negotiating changes to the Government’s proposed model to ensure that it is a sustainable model.
WHAT YOU CAN DO
We encourage peaks and sector agencies to write to key Ministers including the Premier, Deputy Premier, Treasurer, Minister Neville and Minister Holding and your local MP over the next two to three weeks to highlight sector concerns about the proposed model, to promote the attributes of a sustainable model, and to call for a delay to the legislation to allow adequate time for consultation.
VCOSS has forwarded a letter to all MPs, a copy of which is linked below. CSOs are welcome to use this letter to assist in writing their communications. This letter is a condensed version of the Peaks and Statewide Networks PLSL position paper, which raises issues of general concern across the sector. It is important to personalise issues from the perspective of your agency, your programs and your workforce. It is important for organisations to explain the specific impact that an unsustainable PLSL model would have on their organisations and their services to disadvantaged Victorians.
Contact details for all MPs can be found on the Victorian Parliament website:
http://www.parliament.vic.gov.au/handbook/menupage.cfm?menuId=1
Click here to read the brief sent to MPs
For further information, contact:
Paula Grogan, Community Sector Sustainability Policy Coordinator, VCOSS
T: 9654 5050, E: paula.grogan@vcoss.org.au
Cath Smith, CEO, VCOSS
T: 9654 5050, E: cath.smith@vcoss.org.au
The Victorian Government has committed to introducing a legislated long service leave portability scheme which will cover the vast majority of community sector organisations (CSOs) in Victoria. VCOSS broadly supports the principle of portable long service leave (PLSL) in the community sector and seeks the implementation of a scheme that is viable and sustainable for the community sector.
The Department of Human Services (DHS) is leading the government process and has been consulting with the sector about an appropriate PLSL scheme model. The Government has indicated that the Central Fund Model is the preferred model. The key elements of the Central Fund Model are:
- Management of Portable Long Service Leave would be centralised;
- Employers would register their employees and pay a quarterly levy payment to an Authority/Fund Manager that would manage employees’ LSL funds and entitlements;
- Administration fees would be factored into the quarterly levy;
- Monitoring and enforcement would be the responsibility of the Authority; and
- LSL entitlements more generous than the LSL Act 1992 would be managed by employers.
- The model will cover the majority of non-profit, non-government, employees, including those not funded by government.
The Government has also indicated that:
- Legislation for a PLSL scheme is to be introduced in the spring session of parliament; and
- A ‘non-urgent’ timeframe for implementation of the Scheme is preferred, but decisions about commencement of the Scheme are dependent on the outcomes of discussions with the Commonwealth Government in relation to the Fair Work Act 2009.
The following document provides more information about the proposed model.
DHS PLSL Scoping paper, 9 May 2009
Scoping paper
VCOSS hosted a sector forum on 31 July and the Peaks and Statewide Networks Forum met in August and discussed concerns about the proposed model. It is clear that there is significant sector opposition to the proposed Central Fund model and the combined Victorian Peaks and Statewide Networks Forum does not support the model as it is currently proposed.
Key issues of concern are:
- Cost
The overall cost of PLSL will rise as a result of administrative complexity and the transfer of funds from organisations’ balance sheets to the central fund. These costs are compounded by financial pressures as a result of the global economic downturn.
- Administrative complexity
The majority of community sector employees are on awards and workplace agreements where LSL entitlements are superior to the LSL Act 1992. The proposed model deems that entitlements above the Act will be managed by employers. This will mean duplicate record keeping for employers and the fund.
- Timelines
The community sector does not support the legislation timelines proposed by the Victorian Government given that there has been no formal consultation period where the sector has had access to the business impact assessment of various models.
Members of the combined Victorian Peaks and Statewide Networks Forum have expressed in-principle support for a sustainable PLSL scheme to be developed and a desire to continue working with the Victorian Government to do this. The following paper was developed to highlight the attributes of a sustainable portable long service model.
Victorian Peaks and Statewide Networks Forum Position Paper
For further information, contact:
Paula Grogan, Community Sector Sustainability Policy Coordinator, VCOSS
T: 9654 5050 E:paula.grogan@vcoss.org.au