It’s pretty normal for salaries to go up and down from time to time and there are a number of reasons a salary could change. There could be a new enterprise bargaining agreement or an incremental increase, the employee could be working more hours, or at a higher level, or they may have proportionate or purchased leave.

The way you report these changes in salary to us will depend on the type of account the employee's standard member contributions are paid into.

Employees working higher duties, or seconded from one department to another, need to work for a continuous period of 12 months before the higher salary is recognised and used as the basis for super payments.

When an employee returns to their substantive position, the payments will change to the current substantive position salary. In all other cases (including secondment to another participating QSuper employer), the new salary should be reported and your payments increased or decreased immediately.

For Defined Benefit account members, you should report the superannuation salary (defined as base salary plus approved allowances), at the most recent 1 July. This applies regardless of whether your employee has an increase or decrease in salary throughout the year.

For an employee that’s receiving a higher salary because they’re in a higher paid role, the higher salary is only reported as the employee's 1 July salary if they’ve been acting in the higher role continuously for at least the 12 months preceding that 1 July. This also applies when an employee is seconded from one Government department to another to act in a higher paid role.

When an employee changes their hours of work, the 1 July salary remains unchanged. However, the contributions and working hours are adjusted according to what the employee is actually working.

How will ‘purchased leave' impact employees with Defined Benefit accounts?

Depending on how your payments are reported to QSuper, purchased leave will impact Defined Benefit accounts in the following ways:

Issue Reported as part-time Reported as leave without pay
Resignation and retirement benefits
  • Reduction of resignation and retirement benefits in proportion to the ratio of leave over full membership
  • Reduction of payments over the period concerned
  • Reduction of resignation and retirement benefits in proportion to the ratio of leave over full membership
  • Reduction of payments over the period concerned
Super payments
  • Must make standard member contributions
  • Can make voluntary member contributions
  • After age 65, work test applies
  • Cannot make standard member contributions.
  • Can make voluntary member contributions
  • After age 65, work test applies
Death and TPD cover
  • Standard Death/TPD cover continues, amount will reduce to reflect the reduction in future multiple
  • Standard cover (without reduction) for first two years of leave without pay
  • If leave extends beyond two years, cover ceases. After two years, benefit is equal to resignation benefit until return to work
Additional death and TPD cover
  • Extra cover continues to age 65, with death only cover to 70, providing there is sufficient money in the account to pay premiums
  • Extra cover continues to age 65, with death only cover to 70, providing there is sufficient money in the account to pay premiums
Income protection
  • Standard cover remains on proportionate salary
  • Not available, unless leave is changed to sick leave without pay

How will ‘purchased leave' impact employees with Accumulation accounts?

There are several similarities and differences in the way purchased leave impacts Accumulation accounts, depending on how the payments are reported to QSuper.

Issue Reported as part-time Reported as leave without pay
Resignation and retirement benefits
  • Reduction of resignation and retirement benefits caused by the reduction of payments over the period concerned
  • Reduction of resignation and retirement benefits caused by the reduction of payments over the period concerned
Super payments
  • Must make standard member contributions
  • Can make voluntary member contributions
  • After age 65, work test applies
  • Cannot make standard member contributions
  • Can make voluntary member contributions up to two years after commencing leave without pay
  • After age 65, work test applies
Death and TPD cover
  • Standard cover continues without reduction
  • Standard cover continues without reduction
Additional death and TPD cover
  • Extra cover can continue to age 65 with death only cover to 70, providing there is sufficient money in the account to pay premiums
  • Extra cover can continue to age 65, with death-only cover to 70, providing there is sufficient money in the account to pay premiums
Income protection
  • Standard cover remains on proportionate salary
  • Not available, unless leave is changed to sick leave without pay

Your employee will need to think carefully about the continuity of their insurance cover, because it can have a significant impact on them and their family in the event of an accident or illness. So make sure your employees are aware of this information before starting a purchased leave contract.