IP Pack - Factors affecting eligibility and entitlements
It is important that the integrity and transparency of GEERS is maintained at all times. To assist the CM to make informed and consistent decisions, it is important that you provide the Department will all relevant information regarding the insolvency that could affect the eligibility of employees or the recovery rights of the Commonwealth.
Transmission of Business (ToB)
GEERS is not intended to provide entitlements where employers seek to restructure the business, or where a contract for sale of the business removes the employer's responsibility from meeting employee entitlements. To prevent this from occurring, and in order to accurately process claims, it is important that you notify the Department if a ToB, sale, transfer, or assignment to a new employer has taken place, or if there are reasons to suggest any of these events will occur. You should do this even if you have terminated the employees' employment.
Deed of Company Arrangement (DoCA) or Personal Insolvency Agreement (PIA)
If a DoCA or PIA has preceded the liquidation or bankruptcy, then:
- Where an employer was subject to a DoCA in the 12 months preceding the insolvency event, employees will only be eligible for GEERS assistance if the DoCA applied Sub-Division D, Division 6, Part 5.6 of the Corporations Act 2001 to any distribution made under the Deed, and if the DoCA provided for the distribution of all available funds or assets; or
- Where an employer was subject to a PIA, this agreement must include the same priorities as section 109 of the Bankruptcy Act 1966.
- The Commonwealth’s recovery rights must be protected. Please note that if the DoCA or PIA does not meet the provisions stated in the OA’s, claims for GEERS assistance may be rejected, or advances may be withheld until such time as appropriate changes to the DoCA are made.