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Employee Protection (Employee Entitlements Guarantee) Bill 2001

Part 3—Employee Entitlements Protection Insurance

Division 1—Policy of employee entitlements protection insurance

8   Nature of policy of employee entitlements protection insurance

                   A policy of employee entitlements protection insurance is a policy of insurance under which an approved insurer insures an employer's  workforce against loss resulting from the employer's insolvency.

9   Extent of employee's protection

                   An employee is entitled to be indemnified under a policy of employee entitlements protection insurance for liabilities of the following kinds owed by an insolvent employer to the employee:

                     (a)  a liability for unpaid wages;

                     (b)  a liability resulting from termination of employment without notice or with insufficient notice;

                     (c)  a liability for annual leave or long service leave;

                     (d)  a liability for repayment of a premium or other amount paid by the employee to the employer for training in a particular trade or profession;

                     (e)  a liability for payment relating to redundancy or termination payments as provided for under the relevant employment’s instrument; and

                      (f)  a liability of the employer outstanding in respect of the employer’s superannuation obligations under legislation or under the relevant employment instrument.



Division 2—Obligation to hold insurance

10   Obligation to hold employee entitlements protection insurance

                   An employer (other than an exempt employer) must take out, and maintain, a policy of employee entitlements protection insurance with an approved insurer for the employer's workforce.

Penalty:  150 penalty units.

11   Exempt employers , partial exemptions etc

             (1)  An employer is exempt from the requirement to hold a policy of employee entitlements protection insurance if: the employer's employees are not employed for the purposes of a trade or business carried on by the employer.

             (2)  An employer is exempt from the requirement to hold a policy of employee entitlements protection insurance if the employer employs fewer than 20 employees.

             (3)  The Commissioner, if satisfied that other satisfactory arrangements have been made by the employer, may issue a certificate in writing exempting an employer from the obligation to hold employee entitlements protection insurance in respect of all or any of the matters set out in section 9.

             (4) Where, because of the provisions of subsection (3), the Commissioner issues a certificate exempting an employer from the obligation to hold employee entitlements protection insurance in respect of some of the matters set out in section 9, the Commissioner may approve an arrangement under which the employer pays a premium calculated in respect of protection for those matters set out in section 9 and not covered in the certificate.

             (5)  The calculation and determination of any exemption or liability under this section is to be on the basis of principles and requirements fixed by regulation.



Division 3—Information about insurance

12   Employer to give information to employees about employee entitlements protection insurance

                   An employer must provide each employee with an information booklet in a form approved by the Commissioner:

                     (a)  explaining the employee's rights under the policy of employee entitlements protection insurance maintained by the employer; and

                     (b)  stating the name of the employer's insurer under the policy of employee entitlements protection insurance.

Penalty:  50 penalty units.

13   Requests for information

                   An employer must, at the request of the employee, notify the employee of the name and address of the insurer under the employer's policy of employee entitlements protection insurance.

Penalty:  50 penalty units.

14   Insurer to notify policy of employee entitlements protection insurance

                   An insurer must, on issuing a policy of employee entitlements protection insurance for an employer's workforce, give the Commissioner written notice:

                     (a)  stating the name and address of the employer; and

                     (b)  containing the information required by the regulations.

Penalty:  50 penalty units.

15   Commissioner to give information on request to employee

             ( 1 )  The Commissioner must, at the request of an employee, notify the employee of the name and address of the insurer under the employer's policy of employee entitlements protection insurance, as shown in the Commissioner's records.

             ( 2 )  If it appears from the Commissioner's records that the employer does not have a current policy of employee entitlements protection insurance, the Commissioner must notify the employee of that fact.