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Employment and Workplace Relations Amendment Bill 2009

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2008-2009

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

 

 

 

 

SENATE

 

 

 

 

 

 

 

 

EMPLOYMENT AND WORKPLACE RELATIONS AMENDMENT BILL 2008

 

 

 

 

 

 

 

 

 SUPPLEMENTARY EXPLANATORY MEMORANDUM

 

 

Amendments and Requests for Amendments to be Moved on Behalf of the Government

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Employment and Workplace Relations, the Honourable Julia Gillard MP)



Employment and Workplace Relations Amendment bill 2008

 

 

OUTLINE

 

The proposed Government amendments and requests for amednments will amend the Employment and Workplace Relations Amendment Bill 2008 (the Bill) as introduced.

 

 

Safety, Rehabilitation and Compensation Act 1988 (SRC Act)

 

In the 2008-09 Budget, the Government announced an increase to the death benefits payable under the SRC Act.

 

The amendments to the SRC Act provide for the increases in the death benefits to commence on and from 13 May 2008, the date the increases were announced.

 

 

Seafarers Rehabilitation and Compensation Act 1992 (Seafarers Act)

 

The amendments to the Seafarers Act will be to increase the lump sum death benefit to $412,000 (from $225,594.33), as well as increase the weekly death benefits to dependent children to $113.30 (from $75.17). The amendments to the Seafarers Act will commence on the day after Royal Assent.

 

 

FINANCIAL IMPACT

 

Safety, Rehabilitation and Compensation Act 1988

 

Nil.

 

Note: In relation to the measure to increase death benefits under the SRC Act, the additional cost of premiums will be $6.1 million over 4 years.  There is no identifiable resourcing, fiscal or underlying cash impact on the Budget because the additional cost will be met through the premiums paid by Commonwealth agencies under the Comcare scheme. However, amendments 2,5 and 7 may result in an appropriation of revenue or monies for the purposes of section 56 of the Constitution and therefore these amendments will need to be moved as requests for amendments.  

 

 

Seafarers Rehabilitation and Compensation Act 1992

 

Nil, this scheme is privately funded.

 

 



NOTES ON AMENDMENTS

 

Amendment 1

 

Inserts item 1A into the commencement information Table in clause 2.  Item 1A provides that items 1 and 2 of Schedule 1 will commence on 1 July 2009.  This amendment will ensure that amounts of compensation paid for injuries resulting in death will be indexed from 1 July 2009.

 

 

Amendment 2

 

Omits and substitutes item 2 of the commencement information Table in clause 2.  Item 2 will now provide that items 3, 4 and 5 of Schedule 1 will be deemed to have commenced on 13 May 2008.  The amendments contained in items 3,4 and 5 prescribe an increase in the amount of compensation for the benefit of dependants to $400,00 and an increase in compensation for the benefit of children to $110 per week.  Items 3,4 and 5 of Schedule 1 will have a beneficial effect.

 

 

Amendment 3

 

Inserts items 2A and 2B into the commencement information Table in clause 2.  Item 2A provides that items 6 and 7 of Schedule 1 commence on the day on which the Act receives Royal Assent.

 

Item 2B provides that items 8,9,10, 11, 12, 13, 14 and 15, which amend the Seafarers Rehabilitation and Compensation Act 1992 , commence the day after the Act receives Royal Assent.

 

 

Amendment 4

 

Amends subitem 6(1) of Schedule 1 to replace ‘at or after commencement of this item’ with ‘on or after 1 July 2009.’  This amendment will ensure that compensation for the benefit of dependents paid under subsections 17(3) and (4) of the Safety, Rehabilitation and Compensation Act 1988 will be indexed from 1 July 2009.

 

 

Amendment 5

 

Amends subitem 6(2) to replace ‘at or after commencement of this item’ with ‘on or after 1 July 2009.’  This amendment will have the effect of providing that the increase of the lump sum death benefit for dependants to $400,000 provided for in items 3 and 4 will be applied retrospectively from 13 May 2008.

 

 



Amendment 6 

 

Amends subitem 7(1) of Schedule 1 to replace the phrase ‘at or after commencement of this item’ with ‘on or after 1 July 2009.’ This amendment will ensure that compensation for the benefit of children paid under subsection 17(5) of the Safety, Rehabilitation and Compensation Act 1988 will be indexed from 1 July 2009.

 

 

Amendment 7

 

Amends subitem 7(2) to replace ‘at or after commencement of this item’ with ‘on or after 1 July 2009.’  This amendment will have the effect of providing that the increase in payments for the benefit of children to $110 per week provided for by item 5 will be applied retrospectively from13 May 2008.

 

 

Amendment 8 - Schedule 1, page 6 (after line 28), at the end of the Schedule

 

Inserts new items 8 to 13 relating to the Seafarers Rehabilitation and Compensation Act 1992

 

Item 8 amends the definition of ‘relevant amount’ in subsection 23(1) to remove all references to the death benefit provisions of the Seafarers Act to reflect that compensation for injuries resulting in death is to be indexed by the Wage Price Index in accordance with proposed section 23A inserted by item 9.

 

The heading to section 23 is altered to reflect this change.

 

Item 9 inserts a new section 23A to provide for the automatic indexation of death benefits set out in subsections 29(3), (4) and (5) by the Wage Price Index rather than by the Consumer Price Index under section 23. The new section is similarly structured to the current section 23 except that paragraph 23A(1)(b) provides some additional flexibility by allowing for a new index number to be prescribed by regulation, if the Wage Price Index ceases to be published by the Australian Statistician, or in some other way is no longer appropriate to use.

 

Subsection 23A(1) provides for the definitions of ‘index number’, ‘relevant amount’ and ‘relevant year’ for section 23A. ‘Index number’ means the Wage Price Index number, or another prescribed index number, published by the Australian Statistician.

 

The ‘relevant amount’ means the amounts referred to in the death benefit provisions (subsections 29(3), (4) and (5)) and the ‘relevant year’ means the financial year starting on 1 July 2009 or a later financial year.

 

Subsection 23A(2) provides for the increasing of the relevant amount, by multiplying it by the indexation factor for a relevant year, where the indexation factor for that year is greater than one.  In circumstances where this section has already been used to substitute another amount for the relevant amount, the substituted amount will be used.

 

Subsections 23A(3)-(6) set out the method for calculating the indexation factor, including dealing with decimal places and specifying the index number to be used.

 

Prescribing the Index

The Australian Statistician on occasion may vary an indexation series, including by renaming it. For example, the Wage Price Index was previously the Wage Cost Index. In order to allow some flexibility, paragraph 23A(1)(b) allows for the index number to be prescribed by regulation. This will still allow for Parliamentary scrutiny of the index, as the regulation would be subject to disallowance by Parliament under the Legislative Instruments Act 2003 .

 

It would be expected that if at some future time an index was prescribed, it would be the one that most closely reflected the Wage Price Index.

 

Items 10 and 11 increase the amounts payable as death benefits to dependants of an employee. The lump-sum benefit increases to $412,000 and the weekly benefit for dependent children increases to $113.30. Both these amounts will be subject to annual indexation increases under the provisions of new section 23A.

 

Items 12 and 13 are application provisions.

 

Item 12 has the effect of providing that the increased lump-sum payments are payable in relation to the death of an employee that occurs at or after commencement (which will be the day after the Act receives the Royal Assent).

 

Item 13 has the effect of providing that the increase in the weekly payment for a dependent child is payable from the start of the relevant week that begins at or after commencement (which will be the day after the Act receives the Royal Assent). This item applies also to dependent children, where the employee has died before the commencement of this item, and those children are in receipt of weekly payments.