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Executive Remuneration and Appointment Procedure

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Section 1 - Purpose

(1) This procedure supports the Executive Remuneration and Appointment Policy by providing details for:

  1. appointments, including renewal or non-renewal of appointments,
  2. probation requirements,
  3. performance management,
  4. determining remuneration packages, including remuneration progression and bonus payments,
  5. superannuation, and
  6. resignation or retirement requirements,
for senior, executive and senior executive leaders.

Scope

(2) This procedure has the same scope as the Executive Remuneration and Appointment Policy.

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Section 2 - Glossary

(3) This procedure uses the same terms as defined in the Executive Remuneration and Appointment Policy.

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Section 3 - Policy

(4) This procedure supports the Executive Remuneration and Appointment Policy.

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Section 4 - Procedure

Part A - Roles and responsibilities

(5) All individuals within the scope of this procedure must ensure that any perceived or actual conflicts of interest are declared and managed in accordance with the Conflict of Interest Procedure.

(6) Employees in leadership positions:

  1. share responsibility with their supervisor for planning and reviewing their performance objectives and professional development, as part of their probation and performance management, and
  2. actively participate in setting performance objectives and professional development activities, consistent with their accountability statement, University strategies, plans and priorities, or other objectives identified and cascaded from the Vice-Chancellor's Leadership Team.

(7) The supervisor is the officer to whom the employee directly reports. In addition to being responsible for initiating and maintaining the remuneration review process, the supervisor:

  1. in conjunction with the employee, sets performance objectives and professional development activities,
  2. reviews and rates the performance of the employee in relation to accountabilities, performance objectives and the University's key objectives, and
  3. makes a recommendation to the Vice-Chancellor's Leadership Team member responsible for the portfolio on remuneration progression or non-progression, payment or non-payment of a performance bonus to the employee, retention or non-retention of a loading, confirmation or termination of a probationary appointment, and/or the renewal or non-renewal of a fixed-term appointment.

(8) Each member of the Vice-Chancellor's Leadership Team (VCLT) has responsibilities with regards to the remuneration and appointment of employees within their portfolio to:

  1. consider advice from their senior or executive leaders on the performance of organisational areas,
  2. consider recommendations from supervisors on remuneration progression and performance bonus payments,
  3. recommend to the Vice-Chancellor an appropriate percentage for remuneration progression and performance bonus payments for eligible senior and executive leaders, and
  4. review decisions regarding remuneration progression as necessary (see Part F in this Procedure).

(9) The Vice-Chancellor is responsible for:

  1. considering recommendations from the supervisor and the Vice-Chancellor's Leadership Team member,
  2. varying performance ratings if considered necessary,
  3. determining the payment and amount of remuneration progression and/or a performance bonus for eligible senior and executive leaders,
  4. determining retention or non-retention of a personal allowance, and
  5. determining the renewal or non-renewal of a fixed-term appointment.

(10) The Vice-Chancellor's decision is final and not subject to internal appeal or review, except with regards to remuneration progression decisions, see Part F of this procedure.

(11) The Nomination and Remuneration Committee:

  1. as set out in the Governance (Nomination and Remuneration Committee) Rule 2015, sets the annual performance targets of the Vice-Chancellor and advises Council on the remuneration of the Vice-Chancellor, 
  2. as set out in the Executive Remuneration and Appointments Policy, recommends to Council the salary progression for other senior-executive leaders, and 
  3. annually reviews the remuneration rates within the model.

(12) The Executive Director, People and Culture is responsible for the overall management of this procedure and the executive remuneration and appointment process including:

  1. providing advice to leaders on the operation of the remuneration model,
  2. oversight of classification of positions within the model,
  3. providing data to assist the University to determine appropriate movement in the model,
  4. providing advice to VCLT members in relation to remuneration for positions within their portfolios,
  5. providing advice to the Vice-Chancellor to inform determinations,
  6. providing advice to the Nomination and Remuneration Committee,
  7. advising outcomes of the Vice-Chancellor's decisions regarding remuneration, and
  8. oversight of equity of the remuneration outcomes.

Part B - Appointment of senior, executive and senior executive leaders

Appointment

(13) Authority to appoint leaders is stated in Delegation Schedule 4 – People and Culture Delegations, following a recruitment process as set out in the Appointments Policy and Appointments Procedure – Recruitment and Selection.

Note: the Appointment Policy is in development; see the Staff Recruitment and Selection Policy

Renewal of an appointment

(14) A fixed-term appointment may be renewed at the discretion of the University for a period of up to five years. The process for the renewal or non-renewal of an appointment prior to the conclusion of the fixed-term appointment is as follows:

  1. Step 1: Normally not less than nine months prior to the expiration of a fixed-term appointment, the Executive Director, People and Culture (or nominee) writes to the employee's supervisor to confirm the ongoing need for the position or any changes.
  2. Step 2: Subject to a positive response from the supervisor, the employee is asked to prepare a written report, outlining their achievements to date and goals for achievement during a further period in the position.
  3. Step 3: The supervisor will consider the report in reviewing the performance of the employee over the period of the current contract and the employee's goals for the future. The supervisor may convene a committee or undertake other suitable processes, such as a 360 feedback process, to inform a recommendation.
  4. Step 4: The supervisor makes a recommendation to the Vice-Chancellor or the delegated officer, in accordance with the Delegations and Authorisations Policy, on the renewal or non-renewal of the employee’s fixed-term appointment. The recommendation takes into account the needs of the University and the employee’s performance.
  5. Step 5: Other than for contracts considered by the Nomination and Remuneration Committee of Council, the Vice-Chancellor or the delegated officer, in accordance with the Delegations and Authorisations Policy, makes the final decision regarding any offer of a further fixed-term appointment.
  6. Step 6: The Executive Director, People and Culture (or nominee) advises the employee of the University's intention to renew or not renew the appointment, normally not less than six months prior to the expiration of the fixed-term appointment.

Part C - Probation

(15) New leaders must complete a probation period unless determined otherwise by the Vice-Chancellor, as stated in the Executive Remuneration and Appointment Policy.

(16) The employee’s supervisor will conduct the probation assessment. 

(17) The employee’s appointment will be confirmed or terminated by the relevant delegated officer, in accordance with the Delegations Authorisations Policy and Delegation Schedule 4 – People and Culture Delegations

(18) An employee on probation is assessed against the accountabilities and performance objectives for the position and any special conditions of probation stated in the contract of employment. A final probation review is conducted prior to the conclusion of the probationary period.

(19) The probationary review is confidential to the supervisor and the employee during the probationary period but is made available to the delegated officer for the purposes of taking action in accordance with clause 20, and to the Division of People and Culture.

(20) At the time of the probation review, the employee's supervisor recommends to the delegated officer, through their supervisor or VCLT member if applicable, that:

  1. the employee's fixed-term appointment be confirmed, or
  2. the employee's appointment be terminated.

(21) The decision of the delegated officer, on a recommendation made in accordance with clause 20 of this procedure, is final and not subject to internal appeal or review.

(22) The probationary review is forwarded to the Division of People and Culture to be retained on the employee's personal file.

Part D - Performance management and performance agreements

Annual performance planning

(23) An employee and their supervisor must prepare annual performance agreements to set performance objectives for the review period, based on the employee's accountability statement, the University's key objectives and relevant initiatives. The annual performance agreement should include a professional development plan, to help meet agreed objectives for the coming year.

Annual performance review

(24) Annual performance reviews must be completed to assess achievements against the performance agreement. The period of review is the year from 1 January to 31 December.

(25) In addition to the annual performance management meeting, regular monitoring of progress and feedback discussions are required.

(26) Leaders should strive to exceed individual performance requirements in an effort to maximise the University's performance, in line with the University's strategic plans.

(27) Items to be discussed in an annual performance review meeting between an employee and their supervisor typically include the following:

  1. the employee's specific performance achievements in the past twelve months,
  2. the University’s and the employee’s priorities for the coming twelve month period and the objectives by which the achievement of these priorities will be measured,
  3. the employee's plans for the future (e.g. long service leave, a further appointment, new role, aspirations for their further/increased leadership role at the University, retirement),
  4. discussion and identification of any professional development priorities for the employee, in line with the above expectations, and
  5. succession planning for the employee's position.

(28) Performance agreements are to be finalised and the employee’s supervisor may recommend one or more of the following:

  1. remuneration progression of up to 5% towards the maximum step of their classification and remuneration level, in accordance with clauses 35-36 of this procedure,
  2. a one-off performance bonus of up to 5% of their current annual salary for outstanding performance, in accordance with clauses 41-47 of this procedure,
  3. retention of a personal allowance (if applicable), or
  4. a performance improvement plan, if the employee does not meet requirements.

(29) The Vice-Chancellor's Leadership Team member normally meets with the Vice-Chancellor and the Executive Director, People and Culture in June each year to consider remuneration progression and performance bonus recommendations for employees within their portfolio, taking into account:

  1. the executive or senior leader’s achievements in the preceding 12 month review period,
  2. University achievements in the preceding 12 months, and
  3. parity across all senior and executive leadership positions.

Performance improvement plan

(30) Where an employee’s performance does not meet requirements, then the supervisor and employee will develop a performance improvement plan. The duration of this plan and timing of progress reviews will be determined by the supervisor, taking into account the nature of the performance improvement required.

(31) If the specified elements of performance improve sufficiently at the progress meeting, then remuneration progression will recommence from the date of the progress meeting.

(32) If significant progress has not been made in relation to the performance improvement plan by the end of the performance improvement plan, then the employment contract may be terminated.

Part E - Remuneration

(33) The remuneration model is described in the Executive Remuneration and Appointment Policy.

Remuneration on appointment

(34) The commencing remuneration package for a new leader is approved in accordance with the Delegation Schedule 04 - People and Culture Delegations, taking into account factors such as skills, knowledge, experience, internal relativities and/or attraction/retention/market considerations.

Remuneration progression

(35) Each year, an employee who meets or exceeds their performance requirements will be eligible to progress upwards towards the maximum step of their remuneration level, subject to achievement of their accountabilities and performance objectives, and their contribution towards the University's key objectives over the past twelve months.

(36) Following the annual performance review meeting, the supervisor will recommend remuneration progression of up to 5% towards the maximum step of the remuneration level, based on the employee meeting or exceeding performance requirements.

(37) The Vice-Chancellor considers the supervisor's recommendation in consultation with the VCLT member responsible for the portfolio.

(38) The Executive Director, People and Culture (or nominee) notifies the employee of the Vice-Chancellor's decision in writing.

(39) Any adjustment to remuneration normally takes effect annually from 1 July in the year that the decision on remuneration progression is made.

(40) Where an employee disagrees with a decision about their remuneration progression, they may seek a review of the decision as set out in Part F of this Procedure.

Bonus payments for outstanding performance

(41) To be eligible for a performance bonus, an employee must have worked in the position for at least nine months. Recommendations for a bonus inside this timeframe are only approved in exceptional circumstances. All periods of approved paid leave are defined as time worked in the position.

(42) A performance bonus must be approved by:

  1. for all leaders other than the Vice-Chancellor, the Vice-Chancellor, or
  2. for the Vice-Chancellor, the Nomination and Remuneration Committee.

(43) Approval of a bonus payment is based on:

  1. the employee's individual performance as outlined in the performance agreement for the previous twelve month review period,
  2. the relevant organisational area's performance over the same period. For example, a Head of School's individual performance is assessed in conjunction with the performance of the school and/or faculty.

(44) The performance of the organisational area is determined as follows:

  1. The University's performance is determined by the Council on the advice of the Vice-Chancellor.
  2. The performance of all other organisational areas is determined by the Vice-Chancellor on the advice of the appropriate executive leaders and with the assistance of the Vice-Chancellor's Leadership Team member responsible for the portfolio.

(45) Where the supervisor determines that the performance of the employee during this period is outstanding, then the supervisor:

  1. makes a recommendation regarding the percentage of bonus payment to be awarded to the employee (up to 5% of the employee’s current base salary), and
  2. forwards the recommendation to the Vice-Chancellor's Leadership Team member, along with the signed, finalised performance agreement as evidence of the employee's achievements.

(46) The Vice-Chancellor's Leadership Team member considers the recommendation and holds further discussions with the supervisor and/or employee if required. The Vice-Chancellor's Leadership Team member then forwards the final recommendation to the Vice-Chancellor for consideration.

(47) Performance bonus payments may be awarded each year. They are taxable and non-superable (subject to clause 54) but are able to be salary packaged. There should be no expectation of regular bonus payments.

Attraction/retention allowances

(48) Refer to the Personal Allowances Policy.

Part F - Review of remuneration progressions decisions

(49) Where an employee, other than a member of the Vice-Chancellor's Leadership Team (VCLT), has concerns regarding the process undertaken by the supervisor to assess their performance and/or perceives bias in the decision on remuneration progression, then the following process applies:

  1. The employee notifies the supervisor of their concerns and they attempt to resolve the matter. If an attempt to resolve the matter at the supervisory level has already been made and a resolution has not been achieved, then the matter is referred to the supervisor's manager for resolution.
  2. If the concerns of the employee remain unresolved, then the matter is referred to the VCLT member for consideration and recommendation to the Vice-Chancellor. The employee is required to provide written details of their concerns to the VCLT member.
  3. After finalising their review, the VCLT member advises all parties involved in writing, including the Vice-Chancellor, of their recommendation(s).
  4. Where a member of the VCLT has been involved in the resolution process at clause 49a, then they are not permitted to participate in the review process or the formulation of the recommendation and the Vice-Chancellor will complete the review.

(50) The Vice-Chancellor's decision on the review is final and not subject to any further internal appeal or review.

Part G - Superannuation

(51) For the purpose of this part, the 'nominated' salary is the salary rate determined by subtracting the leader’s employer cost to superannuation from the remuneration package’s total value.

(52) The employer cost to superannuation is determined as follows:

  1. For members of UniSuper, this figure is currently 17%.
  2. For members of SSS and SASS, the employer contribution rate (up to 25%) is determined by the fund actuary. The rate is subject to change and the University will request an employer liability cost upon commencement. This rate should be reviewed annually.
  3. For members of other funds, this figure will be the current super guarantee contribution rate.

(53) The nominated salary is used for notifying the relevant superannuation fund. This is the maximum amount of remuneration that an employee can elect to receive as salary (where salary means remuneration by way of regular periodical payments subject to PAYG taxation).

(54) For the purposes of clause 53, the following items do not count as nominated salary:

  1. employer contributions to superannuation,
  2. other payments that do not form part of ordinary time earnings, such as, but not limited to entertainment and reimbursement of travel costs, and
  3. performance bonuses, subject to the maximum superannuation contribution base (MSCB).

(55) Temporary loadings and allowances that are paid in addition to the remuneration package are not included as nominated salary for the purposes of the salary package unless provided for under the rules of the relevant superannuation fund. Examples of temporary loadings and allowances include:

  1. performance loadings or personal allowances which are reviewable, and
  2. higher duties allowances, including secondments.

Part H - Resignation or retirement

(56) Upon resignation or retirement, a leader’s accrued and related leave entitlements are paid at the base salary rate.

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Section 5 - Guidelines

(57) Refer to Motor Vehicles Guidelines - Executive Managers.