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Thursday, 24 May 2001
Page: 24277

Senator IAN CAMPBELL (Parliamentary Secretary to the Minister for Communications, Information Technology and the Arts) (10:01 AM) —I move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows—


The amendments which I am introducing today in this Bill will bring significant improvements for Commonwealth employees through safer Commonwealth workplaces.

This Bill contains amendments to the Occupational Health and Safety (Commonwealth Employment) Act 1991 (the OH&S Act) which provides a legislative basis for the protection of the health and safety at work of Commonwealth employees in Departments, Statutory Authorities and Government Business Enterprises. It complements the compensation and rehabilitation arrangements established under the Safety, Rehabilitation and Compensation Act 1988.

The OH&S Act requires amendment to modernise and streamline outdated provisions which are currently inhibiting its effectiveness. Consistent with the principles of the Workplace Relations Act 1996, the focus of occupational health and safety regulation has to shift away from imposing solutions towards enabling those in the workplace to work together and make informed decisions about how best to reduce risks to health and safety at their particular workplace. Any additional flexibility in meeting obligations, however, must be backed by a strong and effective enforcement regime.

The amendments in the Bill reflect the Government's commitment to achieving safer workplaces and take account of advice from the Safety, Rehabilitation and Compensation Commission (comprising representatives of Commonwealth employers and employees and other persons with relevant qualifications and experience) which has recommended changes in some areas.

The key amendments proposed to the OH&S Act by this Bill relate to the employer's duty of care, workplace arrangements and penalties.

In relation to the employer's duty of care, amendments are proposed to s.16 of the Act to replace the current prescriptive elements of the section requiring an employer to develop an occupational health and safety policy and agreement in consultation with involved unions. Instead, employers will be required to develop, in consultation with their employees, safety management arrangements that will apply at the workplace. The term “safety management arrangements” is being used to describe collectively a range of matters which could be covered and the specific needs of individual workplaces will therefore be able to be accommodated in a more flexible and efficient way. Employers and employees will be able to make informed decisions about how best to reduce any risks to workplace health and safety at their own workplace. This will ensure that there is a more integrated and focussed approach at the workplace level. To assist organisations to develop their safety management arrangements, the Safety, Rehabilitation and Compensation Commission is being given the power to advise on the matters to be included, and employers must have regard to such advice in developing their safety management arrangements.

Safe and healthy workplaces can only be achieved if there is maximum commitment from both employers and employees and each must play an active part in developing appropriate arrangements at the workplace level. Consistent with this, consultation between employers and employees to improve occupational health and safety outcomes is being enhanced by facilitating a more direct relationship between employers and employees and removing the current mandated role of unions.

Employees will have the right to be represented in consultations with their employer by an employee association that has a principal purpose of protecting and promoting the industrial interests of its members in the workplace.

The proposed amendments to the workplace arrangements provisions retain the current features of the Act concerning designated workgroups, health and safety representatives and health and safety committees.

A health and safety representative may be selected for each designated workgroup as is currently the case. However, the current restrictions on the ability of all employees to become health and safety representatives, are being removed.

A health and safety committee will be required to be established where an employer's workforce comprises not fewer than 50 employees The current prescriptive requirements concerning the composition and operation of health and safety committees are being removed from the Act and these matters will be dealt with under the safety management arrangements at the workplace.

Improved outcomes can also be achieved by encouraging employers and employees and others with responsibilities under occupational health and safety laws to voluntarily comply with their statutory obligations. Other amendments in this Bill therefore provide greater encouragement for voluntary compliance.

There must however be a strong enforcement regime to ensure compliance with the requirements of the Act. The less prescriptive approach being proposed to the employer's duty of care is therefore being balanced by very important amendments to the penalties provisions to ensure an effective compliance regime. A wide range of remedies and sanctions is being introduced, along with significant increases in penalty levels.

Currently all offences under the Act are criminal offences. Even though there have been over 28,000 incidents reported under the Act since its commencement in 1992, with 1248 investigations, there have only been 9 prosecutions, of which 8 have been successful. All prosecutions have involved significant delays (up to 4 years in one particular case).

The Bill proposes to amend this enforcement regime to one based on both civil and criminal penalties for contravention of the Act. As far as possible, the Act will provide for civil penalties rather than criminal penalties. This is expected to make proceedings under the Act more readily available and reduce delays.

Criminal penalties will be retained for contraventions of the Act which result in death or serious bodily harm (or if the contravention is intentional or reckless) and for offences which are more appropriately dealt with in the criminal justice system. Courts will also be given the powers to grant injunctions to prevent the occurrence or re-occurrence of a breach of the Act and make remedial orders.

A very important initiative in this Bill is the power being given to Comcare to accept enforceable undertakings from persons considered to have contravened the Act. Enforceable undertakings will be available as an alternative to prosecution and will assist in obtaining voluntary compliance with the Act.

Where a court finds that an employer has breached sections 64 or 76 of the Act, by dismissing, or taking other prejudicial action against, an employee, the court will be able to make orders modelled on s.298U of the Workplace Relations Act 1996, such as requiring reinstatement of the employee or the payment of compensation

The new range of available remedies will provide maximum flexibility to ensure that effective action can be taken to address breaches or potential breaches of the Act.

Currently, the penalties under the Act apply only to Government Business Enterprises and their employees . The Bill includes an amendment to extend civil and criminal penalties to Commonwealth employees and employees of Commonwealth authorities. This will ensure that a Commonwealth employee will be accountable where he or she has acted wrongfully. Commonwealth officers or employees however will have the protection of the Commonwealth's policy on indemnification where they have acted reasonably and responsibly in the course of their duties.

Commonwealth employers will, however, be subject to the new provisions providing for injunctions and remedial orders.

Finally and importantly in relation to penalties, the Bill proposes substantial increases to the level of penalties in the Act. Currently the maximum penalty under the Act for a breach of the employer's duty of care is $100,000. The new maximum penalty will be 2,200 penalty units (currently $242,000) for a breach attracting a civil penalty and 4,500 penalty units (currently $495,000) for a breach attracting a criminal penalty. These amendments will make the level of penalties under the Act more consistent with the levels of penalties in State and Territory occupational health and safety legislation.

The Bill also contains amendments to revise the annual reporting requirements of Commonwealth agencies under the Act so that there will be a greater focus on outcomes rather than process and some minor or technical amendments to improve the current arrangements concerning investigations of alleged contraventions and notices issued by inspectors.

Full details of all amendments are contained in the Explanatory Memorandum for the Bill.



This Bill mainly proposes amendments to two Acts, the Safety, Rehabilitation and Compensation Act 1988 (the SRC Act), which is the legislative basis for the Commonwealth public sector workers' compensation scheme, and the Industrial Chemicals (Notification and Assessment) Act 1989 (the 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% 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 Senator Ludwig) adjourned.

Ordered that the bills be listed on the Notice Paper as separate orders of the day.