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Thursday, 7 December 2000
Page: 23592

Mr REITH (Minister for Employment, Workplace Relations and Small Business) (9:44 AM) —I move:

That the bill be now read a second time.

This bill mainly proposes amendments to two acts, the Safety, Rehabilitation and Compensation Act 1988 (SRC Act), which is the legislative basis for the Commonwealth public sector workers compensation scheme, and the Industrial Chemicals (Notification and Assessment) Act 1989 (ICNA Act), which establishes a scheme to assess industrial chemicals imported and manufactured in Australia for their health and environment effects.

The amendments to the SRC Act proposed in this bill will improve the operation of the Commonwealth workers compensation scheme while at the same time ensuring that the act reflects the government's commitment to balancing the costs of work related injury with access to fair compensation and effective rehabilitation for injured workers.

The amendments are, however, largely of a housekeeping nature, reflecting that the act has not been amended for some time. They include amendments based on advice from the Safety, Rehabilitation and Compensation Commission, and amendments which rectify unintended legislative anomalies. They also include amendments to implement what was parliament's original intent as to the effect of the legislation at the time it commenced operation during the previous Labor administration.

The bill proposes to streamline the act's currently complex and prescriptive licensing arrangements, while closely paralleling existing arrangements.

The five categories of licence now available will be replaced with a single generic licence which will provide scope for both self-insurance and claims management. Applications for licences will still be determined by the commission but within a less prescriptive framework. Ministerial directions will give guidance by disallowable instruments on such matters as the criteria for granting a licence and licence conditions. The bill also contains some minor amendments to improve the general operation of the licensing scheme.

Amendments are also proposed to streamline the funding arrangements for regulation of workers compensation and occupational health and safety in the Commonwealth jurisdiction by providing for one regulatory contribution.

The bill also contains amendments to ensure that Comcare's financial arrangements are consistent with the requirements of the Commonwealth Authorities and Companies Act 1997.

The Commonwealth scheme recognises the importance to both the employee and the employer of arranging a safe return to work as quickly as possible and has processes and incentives in place to achieve this. These include a system of rehabilitation which relies on the services of approved rehabilitation providers.

The act currently gives Comcare the responsibility of ensuring that rehabilitation providers have the qualifications, proven effectiveness, availability and cost efficiencies to deliver quality services to employers and employees.

The approval provisions protect injured employees by ensuring that persons providing treatment and services meet acceptable standards. The bill proposes to improve the current processes for approving new rehabilitation providers, provide a statutory basis for existing guidelines, enable a fee to be charged to cover the costs of the application process and ensure that the approval can be revoked if a rehabilitation provider is no longer able to meet the standards required.

The bill also contains amendments to improve some scheme benefits, clarify the circumstances in which compensation is payable under the act and clarify the appropriate amount of compensation payable.

The improvements to scheme benefits will provide greater access to compensation for employees who suffer a hearing loss, ensure that all employees covered by the act can receive compensation beyond age 65 if they are injured over the age of 63 years and enable claimants to have the costs of treatment from a wider range of health practitioners than at present reimbursed, without having to seek a referral from a medical practitioner.

Other amendments will standardise the basis by which compensation is calculated for the first 45 weeks of a claim and clarify that dependants of deceased employees have access to common law.

The bill also addresses deficiencies in compensation for former employees by ensuring that compensation payments for former employees are maintained at 70 per cent of indexed normal weekly earnings and that normal weekly earnings of former employees are updated by reference to a prescribed index.

As mentioned previously, the bill also includes amendments to clarify the circumstances in which compensation is payable under the SRC Act. Amendments are therefore proposed to the definitions of `disease' and `injury' in the act.

The act requires a material contribution by employment to a disease before compensation is payable. However, case law indicates that the act has not achieved parliament's original intention. The bill therefore includes an amendment to restore this intention by making it clear that an employee's employment is not to be taken to have contributed in a material degree to his or her disease unless there is a close connection between the employee's employment and the disease.

In terms of the definition of `injury', the current legislation seeks to prevent compensation claims being used to obstruct legitimate management action and accordingly contains what is known as an exclusionary provision. It provides that compensation is not payable in respect of an injury which arises from reasonable disciplinary action taken against an employee, or a failure by the employee to obtain a promotion, transfer or benefit in connection with employment. This provision needs to be updated to include other activities which are regarded as normal management responsibilities.

The bill therefore includes an amendment which provides that, in addition to the current exclusions, an employee will also not be entitled to compensation for an injury resulting from a reasonable appraisal of the employee's performance, any reasonable counselling action (whether formal or informal), any reasonable suspension action, or a failure by the employee to obtain a reclassification in connection with his or her employment.

A further amendment relates to the interaction between `disease' and `injury'. The SRC Act sets out separate tests for establishing entitlements to compensation for diseases and injuries. The bill includes an amendment to ensure that where an injury occurs at work which is the natural progression of a disease, the injury will be deemed not to be an injury for the purposes of the act, but an employee will not be prevented from seeking to establish that his or her employment contributed in a material degree to the contraction of the disease itself and that the disease is therefore compensable.

The bill also proposes an amendment to extend to all claimants the requirement that any earnings by a claimant may be taken into account in the calculation of that claimant's weekly incapacity payments. Another amendment will clarify that there is no automatic entitlement to payment for non-economic loss for employees who suffered a permanent impairment before the SRC Act commenced.

The bill also contains a number of other amendments to the SRC Act which are mainly of a minor policy or technical nature, including some amendments which address regulatory matters. These include amendments to enable Comcare to collect premiums to cover common law liability for Commonwealth agencies in relation to proceedings which are permitted under the SRC Act and to allow Comcare to manage the defence of such proceedings, a change to the composition of the Safety, Rehabilitation and Compensation Commission to provide for the Australian Capital Territory to be represented (as an employer). There are also a number of amendments to streamline administrative arrangements.

This bill also amends the Industrial Chemicals (Notification and Assessment) Act 1989. The majority of the amendments are minor or technical in nature and will streamline and improve the operation of the National Industrial Chemicals Notification and Assessment Scheme.

One amendment will extend the definition of synthetic polymers of low concern to include polyesters of low molecular weight and risk. This will reduce fees for firms applying for assessment of this type of chemical. Other amendments will assist in streamlining the reassessment procedures and reducing the burden on industry. For example, the provision for joint application for reassessment will enable the sharing of fees (where applicable) and the provision of information by several companies.

This bill also includes minor or technical amendments to four other acts. The Equal Opportunity for Women in the Workplace Act 1999 is amended to correct a technical anomaly arising from the Equal Opportunity for Women in the Workplace Amendment Act 1999. The Income Tax Assessment Act 1936 is amended to enable taxation information to be provided to Comcare as well as to the Safety, Rehabilitation and Compensation Commission. The National Occupational Health and Safety Commission Act 1985 is amended to reflect the change of name of the Australian Chamber of Commerce and Industry. The Occupational Health and Safety (Commonwealth Employment) Act 1991 is amended, consequential upon the amendments relating to collection of premiums under the Safety, Rehabilitation and Compensation Act 1988 which are proposed elsewhere in the bill.

Full details of all amendments are contained in the explanatory memorandum.

Debate (on motion by Mr Stephen Smith) adjourned.