Okay, we don’t mind a challenge, but …

When we happened to be the only people in the world who thought to ask a very simple question late last year about why employees with cars at the former Kogarah were receiving a value for those cars in the calculation of “superable” salary for superannuation purposes, and their colleagues in the Georges River merger from the former Hurstville were not, we had no idea what we were getting into.

But what the heck, we were off and running. LGS after an initial period of hostility and trying to blame everyone else is now doing everything to pursue compliance with the Fund’s own requirements for those in the Retirement Scheme and the Defined Benefits Scheme. The IRC is supportive with timetabling and encouragement and LGNSW is pressing its members to provide the information we need to work out just how big this problem is.

When the dispute was listed last in 2017 before Chief Commissioner Kite, LGS undertook to use the annual survey on superable salary to provide more information and obtain as much as they could about the extent of the problem.  LGS kept the parties advised of the documents as they were going out and the dispute was relisted for 30 January - the day after the deadline imposed by LGS for the information to be provided.

Only 38% of councils had responded in time.  January is not a good time and LGS said this is pretty consistent with their expectations.  While this is a disappointing response, it’s not a bad sample and it showed:

  • 1506 of 4544 employees were covered by those responses - 33% of all members affected,
  • 311 of those 1560 employees had access to a private use car but LGS claimed only 137 “required a value to be reported”. 

We can assume that those employees who didn’t require a value to be reported would be senior staff and senior staff contracts where the Council would have reported a TRP.

The IRC has an extremely valuable role to play here because it can direct the attendance of councils not cooperating and the Chief Commissioner provided an encouraging paragraph to be included in LGS follow-up correspondence.  The dispute was relisted for a further report on 21 February with the understanding that the words of encouragement would be included in correspondence from LGS the following day or so to the outstanding 62% of councils, there would be telephone follow-up and LGNSW would be actively chasing up those councils as well.
On 21 February when the dispute resumed, all councils had responded - the last slacker Council (which LGS would not name) responding only the day before.
We will meet with LGS on 8 March after they’ve had time to check, analyse and validate the responses and present some exact figures.  The information provided, before analysis and validation, shows 4402 employees in the funds affected, 328 employees where the Council claimed a value had been reported but of course it’s those councils that didn’t report a value but where employees have private use of a Council car, which need to be identified as well.

But there is a limit to the value of this information.  It will show which councils are providing a value for the private use of the Council car in superable salary but only prospectively for 2018.  It will then require a forensic examination of individual records to determine which councils had been doing so in 2017, 2016 and so on all the way back to when this became a clear and unequivocal obligation in 2003.
Clearly this is going to be a long haul.
We have 145 members who’ve given written consent for depa to have access to information held by both the employer/s and LGS which might ordinarily be regarded by either as confidential to the extent necessary to settle this dispute.  It may well be we can use those members and their consent to audit those councils.  If you are a member affected by this dispute but you have not provided your written consent, it would be a good idea to do so now.
While we will have some information on the current position (and we know of one Council in particular that has confessed to employees that “for the first time”, they will be doing it right) it’s going to take a long, long time to go back and research this sufficiently to work out how to deal with it.  At the very worst, it could involve a forensic examination of salary histories and the employer advice on every single person with a Council car, at each or every of their councils, going back over the last 15 years...

And then we’ll have to start looking at people who retired since 2003 and see how they were treated.  LGS has accepted that after we have reached a settlement for those currently employed, they will write to members of the relevant funds who have retired since 2003 to see if they want to make a claim.  We’ve had a few members contact us from that category and we are committed to assisting mopping up for the retired members as well.

But this is a big deal.  It is also a very, very, very big job.  It won’t be finished this year but we will have a better idea of the figures after our next meeting on 8 March.

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