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Tuesday, 27 March 2007
Page: 9

Senator GEORGE CAMPBELL (1:02 PM) —As Senator Wong has outlined in her contribution, Labor are opposed to the Safety, Rehabilitation and Compensation and Other Legislation Amendment Bill 2006, as indeed have we opposed other occupational health and safety bills that the government has put to the Senate. We believe that the best way to have cheaper workplace insurance premiums is through safer workplaces. Further, Labor believes that workers have the right to be fairly compensated for injury and disease related to their work and their workplaces.

The primary issue here, once again, is the government attacking workers’ entitlements. This time the motivation is cost cutting. In order to cut costs of Comcare, the government is cutting back on workers’ rights. The costs will still accrue, but instead of Comcare and employers being responsible it will be the workers, private insurance companies and the public health system that will be forced to meet the costs. Labor argues, as it always has, that the best solution for reducing workplace insurance costs is in fact safer workplaces. The government is—as it is on many issues—hell-bent on making the user pay. In this instance, it is the workforce.

While Comcare is increasingly under financial pressure, some of the claim types eliminated by this bill are falling and in any case impose no great burden on the scheme. As was noted by the Workplace Relations Ministers Council, the Commonwealth jurisdiction has one of the best assets to liabilities ratios; the Commonwealth jurisdiction has the lowest premium rate of any Australian jurisdiction; the scheme does not have escalating claims numbers or costs; the incidence rate and frequency rate of compensated claims in the Commonwealth jurisdiction are decreasing; and an actual analysis of claim costs for the Commonwealth jurisdiction shows little overall change. The urgent need to cut entitlements in this case is not clear, nor indeed, on the facts, is it justified.

The bill changes the definition of ‘disease’, requiring proof that employment has made a ‘significant’ rather than simply ‘material’ contribution to a disease for it to be compensable. The bill also changes the definition of ‘injury’ to exclude injuries arising from reasonable administrative action taken in a reasonable manner. The bill also specifically excludes the availability of compensation for stress arising from performance appraisals and counselling.

This in fact creates a new threshold. It tightens the test and limits the ability of workers to be compensated for injury. The notion of a proportional responsibility is missing. Where proportional responsibility is present, proportional liability should accrue. In this bill, it does not. This may pose, in some instances, some very serious problems. It reduces the onus on employers to ensure a safe workplace and working environment. Proportional responsibility acts as an encouragement to employers to apply safe practices and create a safe working environment. It provides protection for workers to assist recovery from injuries that are at least partly due to failings in their work environment.

In particular, for workers with mental health issues, pre-existing genetic dispositions or any underlying diseases, this may in effect deny them any protection whatsoever. In their submission to the inquiry, the Mental Health Council of Australia argued that the new test might exclude such employees from the statutory protections and prevent them from obtaining help and treatment, that employees might not disclose the nature of an illness for fear of workplace discrimination, and that the exclusions could result in a significant loss of productivity and experienced workers.

How is it fair that someone may be unable to be even partly compensated because there is some other contributing factor? How is it reasonable that the liability is privatised in this way? This may also mean that workers who would otherwise have been compensated to some degree and assisted with return-to-work plans will be denied this assistance in the future. The cost of their health care will pass on to the public health system. They may be forced to leave their employment and, with no help, fall back onto the welfare system. This is totally unacceptable and, further, it is un-Australian. Through unwillingness to help people in the workplace, we are paving their path from work to welfare. Labor is concerned about the exemption from claims where injury was a result of reasonable management action through performance appraisals and counselling. We note concerns by the Australian Manufacturing Workers Union that this might break the link between employers’ behaviour and the consequences of it. It removes incentives to create and follow good and fair processes in the workplace.

When an employee goes to work, they are not making the trip by choice. Over recent decades, it has simply been accepted that when an employee is injured in their journey to or from work, they can claim compensation. That is not unreasonable. It is something that is undeniably a part of the employment relationship. The employee has no choice in the matter; they are going to work and it is part of their working day. That they should not be compensated for an injury arising from their journey is an erosion of a basic right. The argument is made that employers do not exercise control over the worker’s trip to and from work, so it is unreasonable that they be liable. But the employee does not exercise control over this trip either. The time when they travel and the place they travel to are more or less beyond their control. The best solution is that the employee be covered for any injury under the no-fault workers compensation scheme. In this way, the priority is not on apportioning blame; it is on rehabilitation and a swift return to work. But the worker has the security of some cover in the event of an accident.

As the CEPU told the inquiry, employers’ arguments that they should not be liable because they are not at fault undermine the entire no-fault workers compensation system. Furthermore, for some workers, it is not clear what is a journey claim and what is not. People whose vehicles are essentially mobile workplaces have a special set of circumstances. For example, Telstra technicians are not in an office or another easily-defined workplace very often. For all intents and purposes, their vehicle is their workplace. They travel from job to job, and all the while they have no control over their whereabouts. For many, their workplace is garaged at their home. This narrowing of the definitions is troublesome. This bill gives no clarity or certainty to workers in so-called mobile workplaces like this.

Workers will also take time off for lunch and other breaks as mandated by enterprise agreements and so on. They will have a break, but they may not necessarily have a lunchroom. They may not have a canteen. If an employee goes off site—an example given in the inquiry was going over the road to eat a sandwich in a park—and is injured, they will not be covered. This is one of the more outrageous consequences of this bill.

The physical activity restrictions mean that such things as cycling to work or going to the workplace gym will no longer be covered. For example, imagine if a staffer hurts themselves in the Parliament House gym and is off work for some time with no compensation available. Or perhaps a worker is hurt in the course of a social game of squash over a lunch break. Woe betide the worker who rolls an ankle in the office lunchtime touch footy competition, because that person will not be covered. The employee may decide that the risk is not worth it and simply forgo the exercise. How much more of an impact will that have on the health of employees? When so many workplaces across the country are doing admirable work in encouraging a healthy and active workforce, this bill removes some of the necessary protections and will act to discourage this activity.

The basic thrust of this legislation is clear: either workers are restricted in their actions to those under the direct control and supervision of their employers, or they are not covered. They are not permitted to get a bite to eat, to go to the gym or even to drive to work with the security of knowing that, if something goes wrong, they will not bear the liability. Never mind that they do not choose the entirety of circumstances of their travel. Never mind that these things are, and have been, recognised as an essential part of the employment relationship. Instead, the potential liability is shrunk down as small as possible, and the risk for the worker increased.

The calculation of retirees’ incapacity benefits will change to take account of changes in interest rates and superannuation fund contributions. The Superannuated Commonwealth Officers Association argues that, for a small saving, the changes to calculations of retirees’ incapacity benefits will cost a small group a lot. Former Commonwealth employees will simply be subsidising the government’s liability from their own superannuation. A deeming rate is applied to pre-tax lump sum payments to calculate the appropriate sum to be paid in compensation payments. This is the rate of assumed earnings from superannuation and is intended to give an estimate of the amount a retiree will receive. At present, this rate is 10 per cent, which is significantly higher than actual interest rates and therefore artificially reduces compensation payments. This will reduce as a result of this bill, as I understand it, to the 10-year bond rate. But there is still an argument as to whether or not even that is the appropriate level at which it should be set. As has already been indicated, my colleague Senator Marshall will be moving an amendment to try to deal with this issue.

The CEPU argued that deemed interest rates used to calculate changes to benefits should reflect either actual interest rate expectations or deeming rates used by other legislative payments. The age pension or veterans service pension rates are preferable. The Superannuated Commonwealth Officers Association also argued that this deeming rate should be applied to the post-tax lump sum amount. It seems unreasonable in the extreme to make calculations on a pre-tax figure, as this overestimates the amount actually received. The calculations will therefore underestimate the appropriate compensation sum. It seems to me that this is just a mean act by a miserly government. The reduction of incapacity payments impacts on the ability of incapacitated employees to fund their retirement.

In conclusion, this bill further demonstrates the difference in approach of the Labor Party and the coalition. Where Labor seeks solutions that promote safer workplaces, the government seek to cut the rights and entitlements of workers. Where Labor pushes for commonsense arrangements, the government simply want to control. Either workers will be under the control of their employers or they will not be covered. This is both unreasonable and unfair. Workers should be appropriately compensated when their work contributes to an injury or disease. When workers are retired, they deserve to see the fruits of their savings rather than to see their superannuation subsidise government payments.

Like many of the bills we have seen since the government took control of this place, it demonstrates the difference between us and them. We believe in fairness; they do not. We believe in due process and just workplaces; they do not. We want to make work safe and give people the security of knowing that, if they are hurt at work, they are covered. The government do not.