What is an Employment Separation Certificate, and When Do I Need to Provide One?

In Short

• An employee separation certificate is required when an employee leaves and applies for government benefits.
• Employers must issue the certificate within 14 days of a request.
• It provides details about the employee’s employment, including the reason for separation and final pay.

Tips for Businesses

Ensure you issue employee separation certificates promptly when requested by former employees. This helps them access government benefits without delays and keeps your business compliant with legal obligations. If unsure how to complete the certificate, consult a legal expert to ensure accuracy and compliance.

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Table of Contents

• What is an Employment Separation Certificate?
• Do Employers Have to Provide a Certificate?
• Tips for Accurately Completing the Form
• Key Takeaways
• Frequently Asked Questions

As an employer, you have legal obligations when terminating employees. For instance, upon request, you must complete an employment separation certificate. It is essential to take these obligations seriously to avoid potential legal claims against you by former employees. This article will explain employment separation certificates, helping you understand and fulfil this obligation.

What is an Employment Separation Certificate?

An employment separation certificate (‘a certificate’) is a form that Services Australia issues. This certificate provides relevant employment information for terminated employees. Moreover, a properly completed certificate enables Centrelink to accurately assess and provide income support payments to individuals who qualify for assistance.

A certificate must include:

• the terminated employee and employer details;
• employment details;
• the date the employment ended;
• the gross weekly wage;
• any pending amount owed by the former employer;
• the reason for separation from the company;
• the terminated employee’s final gross payment;
• any unused leave payments; and
• redundancy payments.

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Do Employers Have to Provide a Certificate?

Employers do not need to provide a certificate for every employee termination. However, if Services Australia, Centrelink or a terminated employee requests one, you must provide it.

An employment separation certificate may also be required in circumstances that do not result in termination of employment. Services Australia may ask for this form if your employee decreases their work hours or changes their employment status from full-time to casual. The same process will apply; however, when completing the certificate, you would provide more information on the change in employment status within the ‘reason for separation’.

Tips for Accurately Completing the Form

To ensure the form is completed accurately:

1. Verify Information: Ensure you review and cross-check all details provided on the form, including specific dates, payment amounts, and the stated reasons for termination. This step is crucial to maintain data integrity and avoid potential errors or discrepancies.
2. Timely Submission: Submit the form within the required 14-day period.
3. Use the Online Portal: Utilise the Services Australia Business Hub for efficient submission and record-keeping.

Key Takeaways

Centrelink will use employment separation certificates to assess the eligibility of income support payment claims. If Centrelink requests it, an employer must provide an employment separation certificate. It is best practice to have the employee’s records and relevant information readily available if you are required to submit an employment separation certificate. You are not required to issue a separation certificate to all terminated employees; however, you may be required to complete one at the request of the former employee, Services Australia, or Centrelink. Additionally, you should be mindful that the deadline to submit the separation certificate is within 14 days from the date of the request.

If you need help completing an employment separation certificate, our experienced employment lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.

Frequently Asked Questions