3.6.6.100 Termination of MOB

Summary

Payment of MOB must cease when a recipient no longer satisfies the qualification criteria. However, the date of cessation depends upon the reason the recipient no longer qualifies. In any case, payment of MOB continues for a period after the disqualifying event. This period is known as the 'period of grace'. The reasons for termination of MOB include:

  • termination of employment,
  • not meeting the 32 hours every 4 weeks rule,
  • cessation of vocational training (1.1.V.60),
  • cessation of voluntary work,
  • cessation of combination of activities,
  • cessation of NSA, YA or Austudy,
  • exemption from the NSA or YA activity test,
  • death of recipient,
  • leaving Australia permanently,
  • receipt of a funded package of support through the NDIS,
  • cessation of job search activities with an employment services provider,
  • cessation of registration with an employment services provider, OR
  • cessation of participation in DES - DMS.

These reasons are explained in more detail in the rest of this topic.

Termination of employment

MOB recipients whose employment is terminated, are considered not employed from the day following the date specified in the formal notification. This provision applies to gainful employment (1.1.G.10), voluntary employment, and recipients employed by outside organisations, but who work from home.

When the period of grace applies

The following table explains when the recipient is regarded as having ceased gainful employment. In ALL these cases, the period of grace commences on the day of the disqualifying event.

If… Then the recipient is regarded as having ceased gainful employment on…
no formal notification is necessary, the day last worked.
a recipient discontinues self-employment, the day self-employment ceases.

a recipient takes paid leave before the termination of their employment,

Example: A recipient takes 2 weeks paid leave before terminating employment on 31 July 1998. They are therefore qualified for MOB until 31 July, and the period of grace starts on the following day.

the termination date.

the employment is terminated:

  • during a period of paid leave, OR
  • following a public holiday period such as the Christmas/New Year break,
the day the employment was terminated.

Not meeting the 32 hours every 4 weeks rule (standard rate)

Recipients cease to be qualified for MOB if they do not meet the 32 hours every 4 weeks rule. Refer to 3.6.6.54. The period of grace commences the day after they are no longer qualified.

Example: A recipient does paid work for 24 hours in a 4 week period. This recipient averages 6 hours a week and does not meet the 32 hours every 4 weeks rule to qualify for MOB. The period of grace starts the day after they are no longer qualified.

Policy reference: SS Guide 3.6.6.40 Assessment of Gainful Employment for Standard Rate MOB, 3.6.6.90 Continuation of MOB during Leave from Employment & Training

Cessation of vocational training

MOB recipients who abandon a course are considered to have ceased vocational training. The following table explains the assessment of the date from which training ceased. In ALL these cases, the period of grace commences on the day they are considered to have ceased training.

If the recipient… Then they are considered to have ceased vocational training on the day…
gives formal notification to the training institution, on which formal notification is given.
does not give, or is not required to give formal notification, of last attendance.
abandons the course during a vacation, that decision is made.

Cessation of voluntary work

MOB recipients who are no longer participating in voluntary work on a continuing basis for a charitable, welfare or community organisation are considered to have ceased voluntary work. The period of grace commences on the day they are considered to have ceased voluntary work.

Cessation of job search activities

For recipients who cease job search activities, the period of grace commences on the day of cessation of the job search part of the EPP.

Period of grace

The following table lists the periods of grace and in what circumstances they would apply:

The period of grace is… If the recipient…
12 weeks,

is receiving MOB at the standard rate and ceases to:

  • be engaged in gainful employment for at least 32 hours every 4 weeks, OR
  • undertake vocational training for at least 32 hours every 4 weeks, OR
  • be engaged in voluntary work (1.1.V.70) for at least 32 hours every 4 weeks, OR
  • undertake any combination of gainful employment, vocational training, and voluntary work for at least 32 hours every 4 weeks
  • receive NSA, YA or Austudy (for reasons other than the failure to satisfy the activity test), OR
  • undertake job search activities under an agreement with a Department of Employment, Skills, Small and Family Business funded employment services provider, OR
  • participate in DES - DMS.
12 weeks,

is receiving MOB at the higher rate and ceases:

  • working 15 hours or more per week above the relevant minimum wage, OR
  • working 15 hours or more per week for wages determined under the Supported Wage Scheme, OR
  • looking for work for 15 hours or more per week under an EPP, or an agreement with a service provider funded by the Department of Employment, Skills, Small and Family Business, AND
  • does not meet the eligibility for MOB at the standard rate.
2 weeks,
  • leaves Australia permanently, OR
  • dies, OR
  • becomes able to use public transport without substantial assistance, OR
  • is provided with a 'gift' car from DVA, OR
  • cease to receive NSA,YA or Austudy due to the failure to satisfy the activity test, OR
  • becomes exempt from the NSA or YA activity test.
stopped immediately,

is receiving a 12 week period of grace payment, and:

  • leaves Australia permanently, OR
  • dies, OR
  • becomes able to use public transport without substantial assistance, OR
  • is provided with a 'gift' car from DVA, OR
  • receives a sales tax exemption on the purchase of a car.

Application of period of grace when moving between rates

A period of grace would apply when moving from the higher to the standard rate of MOB. However, if moving from the standard to the higher rate, no period of grace applies and the person would begin receiving the higher rate from the date of effect.

Example 1: Kylie is receiving the higher rate of MOB because she is receiving NSA and working 15 hours a week. Her hours drop to 10 hours per week. As Kylie meets the 32 hours over a 4 week period, she is eligible to receive MOB at the standard rate. Kylie will continue to receive the higher rate for 12 weeks after which she will receive the standard rate.

Example 2: John is a DSP recipient and is also receiving the standard rate of MOB as he is undertaking voluntary work of 32 hours over a 4 week period. John accepts a permanent paid job of 15 hours per week. He would begin to receive the higher rate from the date he begins his job.

Policy reference: SS Guide 3.6.6.10 Qualification for MOB

People in gaol or psychiatric confinement

People who go to gaol or psychiatric confinement do not get a period of grace because MOB is not payable.

Act reference: SSAct section 1046 Continuation of MOB when person ceases to be qualified, section 1158 Some social security payments not payable…

People assisted under the NDIS

People who start receiving a funded package of support under the NDIS do not get a period of grace because MOB is not payable.

Death of recipient/partner

MOB does not contain any bereavement assistance provisions.

Reviews

MOB recipients are subject to work/training and medical reviews. These reviews are detailed in the linked policy reference.

Act reference: SSAct section 1046 Continuation of MOB when person ceases to be qualified

Policy reference: SS Guide 6.2.5.90 MOB Reviews, 3.1.4.05 Payability During Periods in Gaol or Psychiatric Confinement, 3.1.4.10 Situations that Constitute Being in Gaol or Psychiatric Confinement, 3.6.6.54 Assessment of 32 Hours every 4 Weeks Rule for Standard Rate MOB

Last reviewed: 2 January 2019