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Ask RiotACT: To quit or be sacked? A PSS superannuation dilemna

By rigseismic67 - 7 November 2015 15

Ask RiotACT

Here is a modern day minor problem that I need to sort out.

I was aiming to quit my public service job in the near future and contacted the PSS to check my options. The advice was wait until aged 55 to collect my pension/lump sum, however if you are made redundant you can collect a pension straight away.

But… if you are sacked you also get a pension straight away, the same as a redundancy.

In my case, if I get sacked I will get a pension of $47k pa indexed for life.

My department is possibly never going to issue voluntary redundancies so I either stay another 5 years or so and make 55 or I simply let them sack me — what a crazy system.

Has anyone else ever come across this situation? I know the usual issue — sacked from the PS you will never get another job, yeh yeh — but, I am actually a tradesman and worked part time for many years recently in my trade, so another job is not a problem.

Where is the downside to being sacked from the PS in my situation? Another 5 years in the PS could be painful.

What’s Your opinion?


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15 Responses to
Ask RiotACT: To quit or be sacked? A PSS superannuation dilemna
devils_advocate 4:17 pm 13 Sep 16

I was waiting for this to turn into an amusing post about ways to get sacked from the APS, but was sorely disappointing.
Anyway, FWIW, make a post on social media criticising the policies of your department or the gubment. That’ll get you fired asap.

rigseismic67 12:53 pm 13 Sep 16

A few comments say you cannot access your pension pre 55, well those folks are very wrong. Here is the letter from the PSS below;

UNCLASSIFIED
Dear xxxxx
Thank you for your email.
The minimum retiring age to claim your benefit in the form a pension is fifty five, provided you are retired from the workforce, however if you are offered a redundancy from your employer you are able to access to a pension prior to the age of fifty five.
If you require further assistance, please call the Customer Information Centre on 1300 000 377 or reply via return email.
More information about the PSS can be found at http://www.pss.gov.au.
Yours sincerely
XXX
Customer Information Representative
PSS AFS Licence No: 238069

Leon 5:16 pm 11 Nov 15

I discovered a third option. After years of questioning an illegal public service policy that prevented me from complying with the Public Service Code of Conduct, including reporting my agency head for breaching the Code of Conduct by endorsing that policy and as a result being illegally threatened with disciplinary action if I were to raise the issue again, the Department offered me a “voluntary” redundancy.

I’m now much happier and much less stressed. I’m no longer expected to break the law at work. I have much less income, but the payout allowed me to pay off my debts.

Acton 9:39 pm 09 Nov 15

Masquara said :

If he takes Leave Without Pay his PSS contributions will be suspended for the duration …

A person can make full contributions to the PSS on LWOP if the LWOP is approved for 12 weeks or less.
If someone is on unauthorised absence they can continue to make full contributions at their full pay rate.
Pg 9: http://eac.csc.gov.au/storage/COMS%2033324%20tn_PSS_ETN%20PSS01_cont_to_pss.pdf

Masquara 7:22 pm 09 Nov 15

Acton said :

It is not impossible to get sacked from the PS – it just takes perseverance and planning.
Use the PSS Estimator to compare the pension you would get now if terminated, to what it would be if you retired. There will be a difference, but maybe not sufficiently large to justify the extra years of frustration.

Try to contribute to the PSS for as long as you can.
You could take all your Recreational Leave, then all your Long Service Leave and when that runs out apply for Leave Without Pay.

Take RL/LSL on half-pay to stretch out the time away.
You can keep on contributing to PSS while on RL, LSL and LWOP (providing the LWOP is taken in batches of less than 12 weeks) so as to maximise your pension.
Eventually your department will spit the dummy and say no more LWOP.
If you don’t return from leave your department will initiate termination action for unauthorised absence/non-performance of duties.
If you retire or resign from the PS you will get a farewell card from your teary-eyed or much relieved colleagues. But if you are terminated then you should get a full month’s pay in lieu of notice. You have to decide whether you prefer the farewell card or the extra month’s pay.
There is no downside to being sacked from the PS if you have a good indexed pension, an alternative income and no intention of ever reapplying. The worst thing in that case would be to remain in a PS job you detest. Bad for the taxpayer, bad for your colleagues and bad for you. Life is too short.

If he takes Leave Without Pay his PSS contributions will be suspended for the duration …

steveu 5:00 pm 09 Nov 15

johnboy85 said :

Dismissal is treated the same as resignation within the PSS. You would not be able access your PSS benefit early as a result of disimissal. You would need a VR for this. Although there are hardship provisions available too.

Aside from the above, the pension divisor used in the PSS pension calculation reduces at each birthday. This means a pension taken earlier (as a result of redundancy) would be smaller from the outset than one taken a few years later now based on a smaller divisor. Add to that, the fact that your benefit multiple should now be increasing at 0.31 per year (assuming you’ve been in the PSS for over 10 years and have increased your Member Contributions to 10%), the PSS benefit will be increasing at a relatively rapid pace with each additional year you stay in the APS.

I wouldn’t be leaving if I had made it that far, with the pension benefits just starting to escalate rapidly. I certainly wouldn’t be trying to get sacked – what kind of a person does that? where is your pride.

Birthdays are everything. Always leave at least a day or two after your birthday to get the higher super salary used to call the average. Stick it out for 5 years or spend the 5 years trying to get a VR. Make sure you are putting 10% in. Don’t try to get sacked.

Put in for jobs elsewhere, you might like it.

rosscoact 4:08 pm 09 Nov 15

Pee in the bosses pot plants. That should get you on special projects and to the front of the line for redundancy

johnboy85 3:01 pm 09 Nov 15

Dismissal is treated the same as resignation within the PSS. You would not be able access your PSS benefit early as a result of disimissal. You would need a VR for this. Although there are hardship provisions available too.

Aside from the above, the pension divisor used in the PSS pension calculation reduces at each birthday. This means a pension taken earlier (as a result of redundancy) would be smaller from the outset than one taken a few years later now based on a smaller divisor. Add to that, the fact that your benefit multiple should now be increasing at 0.31 per year (assuming you’ve been in the PSS for over 10 years and have increased your Member Contributions to 10%), the PSS benefit will be increasing at a relatively rapid pace with each additional year you stay in the APS.

I wouldn’t be leaving if I had made it that far, with the pension benefits just starting to escalate rapidly. I certainly wouldn’t be trying to get sacked – what kind of a person does that? where is your pride.

Acton 2:13 pm 09 Nov 15

It is not impossible to get sacked from the PS – it just takes perseverance and planning.
Use the PSS Estimator to compare the pension you would get now if terminated, to what it would be if you retired. There will be a difference, but maybe not sufficiently large to justify the extra years of frustration. Try to contribute to the PSS for as long as you can.
You could take all your Recreational Leave, then all your Long Service Leave and when that runs out apply for Leave Without Pay. Take RL/LSL on half-pay to stretch out the time away.
You can keep on contributing to PSS while on RL, LSL and LWOP (providing the LWOP is taken in batches of less than 12 weeks) so as to maximise your pension.
Eventually your department will spit the dummy and say no more LWOP.
If you don’t return from leave your department will initiate termination action for unauthorised absence/non-performance of duties.
If you retire or resign from the PS you will get a farewell card from your teary-eyed or much relieved colleagues. But if you are terminated then you should get a full month’s pay in lieu of notice. You have to decide whether you prefer the farewell card or the extra month’s pay.
There is no downside to being sacked from the PS if you have a good indexed pension, an alternative income and no intention of ever reapplying. The worst thing in that case would be to remain in a PS job you detest. Bad for the taxpayer, bad for your colleagues and bad for you. Life is too short.

artuoui 1:30 pm 09 Nov 15

Your post suggests you’re about 50 which is not a great time to be looking for a new job with an employment record so bad that you managed to get sacked from the public service.

Wily_Bear 11:44 pm 08 Nov 15

If your only dilemma is money, then without doubt stay. If you are unhappy with the job, take the lanyard (bridle) off, and free yourself. Five years of happiness is worth infinitely more than whatever you might lose in a financial sense.

Masquara 8:04 pm 08 Nov 15

It’s only CPI-indexed, so you’ll find that the $47000 (a reasonable retirement salary for a modest lifestyle) is whittled away and by the time you’re 70 it will be more like the “breadline” $33000 in today’s money. Better to keep working for as long as you can, and shunt extra money into super.

fabforty 4:10 pm 08 Nov 15

It would probably take managers longer than five years to get around to sacking you anyway.

hsr776 8:27 pm 07 Nov 15

As taninaus said, getting sacked from the APS is probably worse than working for another 5 years. Alternatively, there’s no reason why you couldn’t resign and do a job you prefer as you will not lose your existing superannuation entitlements. Anyway, you’re lucky, you’ve only got 5 years left, I’m stuck for another 10!

taninaus 10:54 am 07 Nov 15

the problem is – from what I have seen it is really, really hard to get sacked. they will usually performance manage you into a blob on the floor before they give you the pink slip. you face disciplinary actions like penalties, reduction in level, close supervision of your work etc. unless you do something so bad it warrants summary dismissal. and that all depends on how effective your HR area is. really you have to figure out how much suffering you want to face if you choose that route.

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