Information for employers

Transcription

1 ₁ Issued July ₂₀₁₅ Information for employers AMP Flexible Super Guide Registered trademark of AMP Limited ABN

2 This guide provides information specifically for employers about AMP Flexible Super employer plans. Contents Superannuation for employers Your superannuation guarantee requirements Important information about employees under awards How to transact MySuper solution AMP esuper Default investment option Insurance cover Employee Essential Protection Employee Flexible Protection Employee information Commencing cover automatic acceptance limit in Employee Flexible Protection Insurance premiums in Employee Flexible Protection Insurance premiums in Employee Essential Protection Inactive members Employees leaving their AMP Flexible Super employer Takeover terms for insurance Keeping you informed Additional information Taxation Policy committee Cooling-off Regulated super fund certification from the trustee 10 To understand how AMP Flexible Super works, read this guide with the product disclosure statement (PDS) for employees and fact sheets. This information is of a general nature only and does not take into account your personal objectives, financial situation and needs. Before investing you may want to seek financial advice. The PDS and fact sheets are available at amp.com.au/flexiblesuper or you can call us on and we will send you a free copy. Your employees can contact us for a copy of their member benefit schedule. Information in the fact sheets, the member benefit schedule and the PDS, may change from time to time. We may update information which is not materially adverse to you by issuing a PDS update. These are available at amp.com.au/flexiblesuper or you can call us or your financial adviser for a free copy. AMP Flexible Super is part of the AMP Retirement Trust. AMP Superannuation Limited is the trustee and is referred to as ASL, trustee, we or us in this document. In this document, a reference to you or your is a reference to an employer. The Trustee may enter into financial or other transactions with related bodies corporate in relation to AMP Flexible Super. That related body corporate may be entitled to earn fees, profits, reimbursements or expenses or other benefits in relation to any such appointment or transaction and to retain them for its own account.

3 Superannuation for employers Your superannuation guarantee requirements You are required to make contributions for your employees where applicable. These are known as superannuation guarantee (SG) contributions which is currently 9.50% of an employee s ordinary time earnings. The maximum super contributions base for an employee for a quarter is $50,454 (in 2015/16). SG contributions are not required on ordinary time earnings in excess of the limit. These amounts must be paid at least quarterly by the 28th day following the end of the quarter (ie 28 April, 28 July, 28 October and 28 January). If you don t meet this obligation, you will be liable to pay the Superannuation Guarantee charge. This amount is greater than the minimum super contribution and is also non tax-deductible. Please note: We recommend you speak to a financial adviser to ensure you are meeting all your SG obligations. Important information about employees under awards Most awards specify which superannuation fund an employer can make its SG contributions to, when the employee hasn t made their own choice. This fund is known as the default fund. AMP Flexible Super is currently not a default fund. How to transact We can accept contributions direct from you through direct debit, credit card and software function, an outsourced payroll or service provider, or a clearing house.. You can also make contributions using payroll To make an electronic payment to AMP Flexible Super you will need to use the unique superannuation identifier (USI) AMP1248AU. For details on how members can transact, see the getting to know your Flexible Super fact sheet available from amp.com.au/flexiblesuper/employer. New legislation and payment methods The introduction of the Government s SuperStream Data and Payment Standards legislation will require alterations to existing payment methods and some may no longer be compliant. We encourage you to move to electronic payment methods, as cheque or money order methods will be non-compliant from 1 July 2015 for medium to large employers (those with 20 or more employees) or from 1 July 2016 for employers with 19 or fewer employees. Please refer to the AMP esuper section following for more information about our easy online service. Our current understanding of the legislation is that employers can keep using direct debit, or EFT only channels, at least until 0 June 2015 for medium to large employers (20 or more employees) or 0 June 2016 for small employers (19 or fewer employees). MySuper solution AMP Flexible Super offers a MySuper solution that has been approved by the Australian Prudential Regulation Authority. Refer to the PDS for details. AMP esuper AMP esuper is an online service to help you easily manage your superannuation payments for your employees. It's like a clearing house facility to help manage superannuation payments in a Choice of Fund environment. The service is only available where your AMP fund is the only other employer super plan used by the relevant employees (unless AMP has specifically advised you in writing that you can use this service for other employees). Registered to Pty Ltd ABN

4 AMP esuper is compliant with the Government s SuperStream and Data and Payments Standards legislation. What you can do using AMP esuper You can do the following with AMP esuper: pay superannuation contributions for your employees electronically pay up to three different contribution types (ie employer, salary sacrifice and member) update employee details in your AMP fund (e.g. change of address or salary) add new employees to your AMP fund, and notify AMP when employees leave your AMP fund. Why should you use AMP esuper? AMP esuper enables you to: securely process and manage your employees superannuation information online enquire on past transactions processed for up to two years check transactions status online secure contribution payments which are initiated by you, and choose a payment method eg customer initiated direct debit or. Go to amp.com.au/esuper to register. More about payment methods Customer Initiated Direct Debit You need to contact your financial institution to make a the AMP esuper service). payment each time you send us your payment details (via AMP Bank Limited offers a Customer Initiated Direct Debit (CIDD) clearing house facility via AMP esuper. It allows you to use a single process to submit contributions to a variety of super funds for employees. This facility is only available if your AMP plan is the only other employer super plan you use. Please check the AMP Bank Limited CIDD request product disclosure statement, available online at amp.com.au/forms or call the AMP contact centre on , or speak to your financial adviser. Default investment option Your employees super will be automatically invested in the default investment level Core and the default investment option AMP MySuper Balanced. For more information on the investment options, see the investing and your options fact sheet available from amp.com.au/flexiblesuper/employer. 4

5 Insurance cover AMP Flexible super offers two levels of insurance cover: Employee Essential Protection and Employee Flexible Protection. Both allow you to arrange insurance cover for your employees, provided they are eligible. Your employees can each only have one autocover insurance policy provided by us, unless they have been re-employed. For these employees, the insurance in the former plan must be cancelled effective from the day the new plan commences if autocover insurance is to be provided. Autocover insurance offers employees insurance without them having to provide health information or details of their pastimes. Type of insurance cover Death (including Terminal Illness) Employee Essential Protection members Employee Flexible Protection members (i) Total and Permanent Disablement (TPD) (ii) Temporary Salary Continuance (TSC) (iii) (i) (ii) (iii) Certain types of insurance cover may not be available in certain categories of your employer plan. Only available with Death cover and the amount cannot be greater than the Death cover amount. Available with Death cover, or with Death and TPD cover and only to permanent employees working more than 15 hours a week. Employee Essential Protection Employee Essential Protection is offered where: the plan starts with less than five members, and AMP Flexible Super is either the default fund or the only other employer super plan you use. Employee Essential Protection offers your employees automatic insurance without them having to provide health information or details of their pastimes. Your employees will be provided with Death (including Terminal Illness) and Total and Permanent Disablement cover. If an employee s occupation is classed as hazardous, they will only be offered Death cover. An employer or an employee with more than 20% direct or indirect ownership interest in the business will not be eligible for Employee Essential Protection. You or your employees can apply for individual personal insurance within AMP Flexible Super by contacting your financial adviser. Employee Flexible Protection Employee Flexible Protection is offered where: the plan starts with five or more members, and AMP Flexible Super is either the default fund or if at least 75% of your employees in the employer plan have the default insurance chosen by you or have insurance for higher amounts. Your employees will be provided with Death (including Terminal Illness) and Total and Permanent Disablement cover and, if you select it for your plan, Temporary Salary Continuance cover (also known as income protection). Employee Flexible Protection also allows you to design the default insurance cover for your employees (although some restrictions may apply) and eligible employees will receive the insurance without having to provide health information or details of their pastimes. Please refer to your welcome letter for any non-standard limitations that may apply to your plan. For more information on the insurance cover available to employees, see our insurance for employees fact sheet. Employee information We will need important information about each employee you are nominating for insurance. This includes a list of eligible employees, their age, occupation, salary, employment status and hours worked. You will also be asked to confirm if they were actively employed on the day their insurance starts. If a member is not actively employed when first eligible, they may still be entitled to Limited cover. 5

6 You will need to make an initial superannuation guarantee (SG) contribution to your employee s account within 120 days of joining. This information needs to be accurate and it is important you are familiar with the following definitions. Any incorrect disclosure may result in the insurance being modified or cancelled and you may also be liable for the amount of insurance claim. Employment status Permanent employee Contract employee Casual employee Non-executive director Hours worked Salary Actively employed Limited cover Definition An employee who is entitled to annual leave and sick leave and whose employment does not have a fixed end date. An employee who works regular hours and who has a contract guaranteeing employment until a specified date. An employee who has no entitlement to annual leave or sick leave and no guarantee of continued employment. A director (but not an employee) of the AMP Flexible Super employer. For new employees you will need to estimate the hours worked based on expected working hours per week. For existing employees adding insurance cover you will need to use the average hours per week worked over the preceding three months. The total package from employment including commission, regular bonuses, fringe benefits (which is determined by the average taxable salary earned for the previous three years) and any other items relating to their own efforts. We do not include superannuation contributions made by you or investment income. AMP Life does include superannuation contributions made by you that are part of salary sacrifice arrangements between you and your employee. AMP Life does not include investment income as salary. Your employees are employed (including being on paid leave except for leave caused by an illness or injury) to carry out identifiable duties, on a full-time, part-time or casual basis, and your employee is capable of performing (without restriction by accident, injury or illness) their full and normal duties on a full-time basis (for at least 0 hours per week) even though actual employment may be on a full-time, part-time or casual basis. You should refer to the insurance for employees fact sheet for more detail on this definition. This means your employee member will only be covered for claims that arise from a sickness or injury that first became apparent, occurred or was diagnosed, on or after the date their Employee Flexible Protection cover started. You should refer to the insurance for employees fact sheet for more detail on this definition. More details about definitions are available in our insurance for employees fact sheet. Commencing cover automatic acceptance limit in Employee Flexible Protection We can generally provide automatic acceptance cover up to an automatic acceptance limit (AAL) for employees. This means even if your employees can t get cover under a personal insurance policy because of their health or leisure activities, they may still be able to get cover under Employee Flexible Protection, without having to provide health information. To qualify for an AAL the following conditions must be met by your employer plan: there are clearly defined eligibility rules for each category of membership (based on age, service or employment status) there is a clearly defined and fixed benefit formula for determining the level of benefit amounts for each category of insured persons which precludes individual selection. there must be at least five insured employees. we are the only insurer of benefits under the plan and you have no other AMP superannuation plan where we provide auto cover insurance to your employees, and no more than 10% of insured persons are resident overseas. Family members do not receive automatic cover. They may apply for insurance cover under AMP Flexible Super Essential Protection or Super Protection. 6

7 Insurance premiums in Employee Flexible Protection Every year on 1 July we recalculate employee member premiums. Premiums are deducted at the start of the month. They are based on employee age and generally increase each year as they get older. Other factors will also impact their premium, like occupation and other loadings applicable to them or their category, or the number and cost of claims paid over the previous five years (this is referred to as experience adjustment factor). Plan size discounts A plan size discount will apply to your plan if you have chosen Employee Flexible Protection insurance and it depends on the number of employee members who join when the plan commences. This discount is recalculated every 1 July. When an employee member leaves your plan, this discount will be removed which means their premiums will generally increase. The following table shows the plan size discounts applying at the date this guide was prepared. Number of people in the plan 1 to 4 5 to 9 10 to to and above Plan size discount (%) N/A Please note: We may change these discounts at any time without prior notice to you. Insurance premiums in Employee Essential Protection The insurance premium is for a fixed amount which is based on the following: the type of cover your employee members receive (Death and TPD cover or Death only), and your gender. The following fixed premium amount applies: Weekly premiums White collar ($) Light blue ($) Heavy blue ($) Hazardous ($) Death and TPD cover male n/a Death and TPD cover female n/a Death cover male Death cover female Inactive members If we do not receive a contribution for an employee member for 12 months, they and any linked family members will no longer be part of your plan or have access to your plan discounts. Please advise us immediately when an employee member stops working for you. Employees leaving their AMP Flexible Super employer When an employee stops working for you, their account and any linked family members can remain in AMP Flexible Super, as long as the member continues to make contributions. Insurance will continue without the need for them to provide evidence of their health. They will no longer have access to your employer plan discount so it is important you tell us as soon as possible when an employee has left. 7

8 Takeover terms for insurance Takeover terms for insurance may apply when your plan commences in AMP Flexible Super and we agree to take over the insurance cover previously provided by another insurer. The acceptance of takeover terms will be subject to the receipt and acceptance of all required takeover information by AMP Life. For transferring members, Death cover will commence on the date AMP Flexible Super commences. The TPD or TSC cover ( TSC can only come across if the Flexible Super plan offers TSC) in the account will also commence on the date AMP Flexible Super account commences if your employees were: at work actively performing all the duties of their usual occupation on their last normal working day immediately before the date AMP Flexible Super commenced, or on approved leave for reasons other than illness or injury on their last normal working day immediately before the date AMP Flexible Super commenced, and they were at work actively performing all the duties of their usual occupation on the day before their first day of leave and not disabled due to an event (eg illness or injury) occurring on a date before the date AMP Flexible Super commenced while on leave. Otherwise, the TPD or TSC insurance cover will commence on the same date as AMP Flexible Super does but will only be New Events cover. New Events cover means TPD or TSC insurance cover does not cover disability arising from illness or injury which caused an employee to not be at work actively performing all the duties of their usual occupation: on their last normal working day immediately before the date their AMP Flexible Super account commenced, or on the date their AMP Flexible Super account commenced, with an event occurring in the period after your last normal working day immediately before the date your AMP Flexible Super account commenced. Full TPD or TSC cover will commence once an employee is at work actively performing all the duties of their usual occupation on or after the date their AMP Flexible Super starts. If the above takeover terms are provided for a group of family members that already have cover within a corporate superannuation fund, it will be agreed between you and AMP Life. These terms are in accordance with the industry standard, referred to as the Financial Services Council Guidance Note No Group Insurance Takeover Terms. A full copy of this document is available from us. Please note: Takeover terms only apply when a plan is commencing with AMP Flexible Super and does not apply to individual employee members requests. Keeping you informed You will receive a list of the employees who have insurance cover in your welcome letter and annual statement. 8

9 Additional information Taxation Tax concessions on employer contributions You can claim tax deductions on all contributions to a complying super fund on behalf of your employees, subject to eligibility rules. Tax file numbers It is important to give your employee s tax file number (TFN) to us. Penalties may apply if you don t and it is in your employee s interest. Without a TFN: we are not permitted to accept member contributions, and we are required to apply an additional 4% tax on employer contributions if we do not hold the member's TFN on 0 June of the financial year in which the contributions were made. Policy committee Your plan may have a policy committee. Its role is to help a member or employer enquire about the investment strategy, performance and operation of the plan. The policy committee may also assist the Trustee to obtain the views of members on various issues. We are required to help you set up a policy committee where your plan has: 50 or more employee members, or between five and 50 employee members and the Trustee has received a written request from at least five employee members. There must be equal numbers of employer and member representatives on the policy committee. You will select your representatives, whilst member representatives are generally elected by members. Details are shown on your annual statement and your employee s member statement. For more details, see our how to set up a policy committee guide. For your copy, please contact us or visit amp.com.au/forms. Cooling-off If you no longer want this plan, contact us on There is a limited time to do this, being 14 days starting on the earlier of: the date you received the letter from us welcoming you to the plan, or five business days after the date of the letter welcoming you to the plan. Your plan cannot be closed if you have exercised rights or powers under the terms of the plan. The amount we refund will be the original amount invested less any tax and reasonable administration costs incurred by the trustee relating to the establishment of and termination of the plan. We will also adjust the amount to allow for the unit price and earnings (whether positive or negative) of the market linked investments. We will also deduct and/or charge any tax payable on the amounts invested plus any no-tfn tax that may arise. The amount we refund can be more or less than the original amount invested in the plan. We can only return rollovers in cash if they are unrestricted non-preserved. All other money must be paid to another complying super fund. We can only pay any employer payments made (including salary sacrifice and super guarantee contributions) to another complying super fund. You must give us the details of this fund within one month from when you informed us you wanted to leave this plan. Similarly, if an employee member has transacted on their account, we will also transfer this money to another complying super fund. The employee member must give us the fund details. Note: No cooling-off rights apply to employee members of AMP Flexible Super. 9

10 Regulated super fund certification from the trustee The trustee has been granted a Registrable Superannuation Entity (RSE) Licence by the Australian Prudential Regulation Authority (APRA). The trustee registered the fund as an RSE with APRA. The fund: is a resident regulated superannuation fund within the meaning of the Superannuation Industry (Supervision) Act 199 (SIS) is not subject to a direction under section 6 of SIS, and has never previously been subject to a direction under section 6 of SIS. The trustee confirms that the fund is a complying superannuation fund under Part -0 of the Income Tax Assessment Act Contact us phone web mail am 6pm (Sydney time) Monday Friday amp.com.au/flexiblesuper [email protected] Customer Service AMP Life Limited PO Box 00 PARRAMATTA NSW /15 10