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7 Mar 2022

As I understand that if an employee wishes to salary sacrifice unused leave credits upon termination they had to have entered into an arrangement prior to accruing that leave. I want to offer such an arrangement to new starters so they at least have the option to sacrifice amounts on termination if they want to. By offering the arrangement at the start of employment there won't be any dispute about the eligibility of unused credits to be sacrificed if that is a choice the employee wishes to exercise.


My question is really about existing employees. Is it OK for someone who has already been employed for a while to enter into a sacrificing arrangement - mid-employment as it were - on the understanding that only leave accrued from the time they commence that arrangement can be considered for sacrificing when they leave??

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EthanATO(Community Support)Community Support
7 Mar 2022

Hi @StephFrancis,


Yep! This arrangement would be acceptable as long as only leave accrued after the agreement was entered is included. Just make sure all other requirements of a salary sacrifice are met and there shouldn't be an issue.

13 Mar 2022

One more clarification please. If employees enter into such an arrangement they aren't obliged to put unused leave into super when they cease employment - having this arrangement in place simply gives them the option to do so if they wish??

Thanks...

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Can a salary sacrifice arrangement for unused leave credits be made at any time? | ATO Community