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Review of the Safety, Rehabilitation and Compensation Act 1988

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Review of the Safety, Rehabilitation and Compensation Act 1988

Australian Human Rights Commission Submission to the Review Comittee, Department of Education, Employment and Workplace Relations

October 2012

Table of contents

1 Introduction

  1. The Australian Human Rights Commission welcomes the opportunity to make a
    submission into the Review of the Safety, Rehabilitation and Compensation Act
    1988     (SRC Act). The Commission commends the Australian Government commitment
    to ensure that the SRC Act provides ‘fair and appropriate workers’
    compensation arrangements for all workers covered by that
    legislation.’[1]
  2. The Review Terms of Reference frame the Government’s intention
    to ensure that the Comcare scheme will be ‘be exemplary in its
    scheme-design as well as in its service
    delivery.’[2] The Government
    also makes explicit that the federal scheme should ‘reflect contemporary
    social models and best
    practice’.[3]
  3. In view of the Australian Government’s intention to provide an
    exemplary workers’ compensation scheme, and in keeping with its policy
    agenda to keep people in the workforce for as long as they are willing and able,
    the Commission recommends that all age limits on the payment of workers’
    compensation provisions be removed from the federal Comcare scheme.
  4. If the Government intends to provide an exemplary scheme, it should look to
    models of practice that do not discriminate on the basis of age, such as the
    workers’ compensation schemes in Western Australia and Queensland.
  5. As it currently stands, the Comcare scheme (s 23(1) of the SRC Act) removes
    the entitlement to weekly incapacity benefits for injured employees once they
    reach the age of 65. For employees who are injured at the age of 63 or over,

    s 23(1A) provides for the payment of weekly incapacity benefits for a
    maximum period of 104 weeks.
  6. The Issues Paper for this Review asks the following questions:
    ‘Should the weekly benefit cut-off age of 65 be increased to 67? If so,
    should that increase mirror the changes in the age pension age?’ [4] The Commission argues that this
    question should be extended to also ask whether the age cap should be removed
    completely. Workers’ compensation schemes that are considered
    ‘contemporary best practice’ in terms of non-discrimination are
    those that have been adopted by Queensland and Western Australia where the age
    limits have been removed completely.

2 Australian
workers’ compensation schemes

  1. Australia has 11 different workers compensation schemes, one operating in
    each State and Territory and three Commonwealth schemes. Most of
    Australia’s workers compensation schemes contain an age limit at which
    workers are no longer covered by the income replacement component of the scheme.
    In most jurisdictions, the age at which income replacement is cut off or limited
    is 65. While workers are covered for medical expenses if they are injured over
    the age of 65, without income replacement provision, workers without independent
    means would be forced to retire.
  2. However, in Queensland and Western Australia, the workers’
    compensation schemes do not impose an age limit on income replacement. Instead
    they impose capped limits on the period of payment or on the amount that the
    schemes will pay to all workers. For example, WorkCover Queensland has a five
    year limit on payments or a capped amount of up to $265,485 regardless of age.
  3. Western Australia imposes a capped limit of $190,701 or a capped weekly
    amount of up to $2,156 for the period until the prescribed limit is reached.
    While there are limits to the Queensland and Western Australia schemes, the
    workers compensation provisions do not discriminate on the basis of age.

2.1 Are older workers
more prone to injury?

  1. It is difficult to know whether the workers compensation age limits are
    predicated on information that older people are more prone to workplace
    accidents or illness. In fact, there is little conclusive evidence to suggest
    older workers are a greater accident or injury risk in the workplace.
  2. The ABS Work Related Injuries report found that people aged 65 years
    and over recorded the lowest rate of work-related injuries and illnesses of all
    age groups with 30 per 1,000 people (28 per 1,000 men and 34 per 1,000
    women).[5] The highest rates of
    work-related injury or illness were experienced in the 45 to 49 year age group
    (74 per 1,000 men and 70 per 1,000
    women).[6]
  3. The Australian Public Service Commission posits some theories as to why
    workers aged 65 years and older have lower rates of injuries and
    illness.

    ... older workers are more likely to be aware of safety in
    the workplace and, therefore, less likely to have an accident

    ... older workers tend to develop their own coping strategies (such as
    pacing, anticipation, planning and organisation) as they age, and these
    strategies may help them to reduce their injury risk

    ... selection factors may be important. That is, older employees may seek to
    move out of occupations or industries where their risk of injury or illness
    would otherwise tend to increase with age and into other forms of employment,
    phased retirement or early retirement. Older workers may also withdraw from the
    workforce prematurely and involuntarily due to ill health or
    disability.[7]

  4. WorkCover SA finds that there are lower injury rates amongst older workers.
    In keeping with the ABS Work Related Injuries report, it finds that in
    South Australia:

    It is not necessarily the person’s
    chronological age that predisposes them to injury at work but their prolonged
    exposure to health and safety risk factors over time...

    International research findings indicate that older workers may take longer
    to recover from their injuries but WorkCover SA claims data do not show any
    increased duration times for older injured
    workers.[8]

2.2 Workers’
compensation coverage beyond pension age

  1. The Review Term of Reference 1.5 requires that ‘any legislative
    anomalies and updates that need to be addressed’ ... [do] ‘not
    disadvantage workers over the age of 65 and there is no gap between the
    workers’ compensation age limit and the foreshadowed increase to the age
    pension eligibility age to 67 by
    2023.’[9]
  2. In order to not disadvantage any worker over the age of 65, the SRC
    Act must be amended to accommodate the increase in the eligibility for the Age
    Pension to 67 and extended beyond age 67 to people who remain in the workforce.
    While the gap between the new pension age and the Comcare workers’
    compensation scheme must be rectified, there is a broader requirement for
    coverage of workers aged 67 and older.
  3. Any worker over 67 who is undertaking paid work in the same way as younger
    workers should have the right to fair and equitable treatment. It is
    discriminatory in action to provide differential treatment in coverage and
    entitlements to workers simply because they have reached a certain age.
  4. The Commission would like to see a nationally consistent workers’
    compensation framework that provides coherence and fairness in the income
    insurance provisions for people who work beyond pension age for as long as they
    remain in the workforce.
  5. While the Australian Government has an intention to harmonise some aspects
    of Australia’s workers compensation schemes under its National Workers
    Compensation Action Plan    , the terms of reference are limited to:

    • the assessment of permanent impairment, and
    • definitions of retirement age and the definition of a
      worker.[10
  6. The Commission would now like to see all jurisdictions review the age limits
    on their workers compensation schemes with the view to removing them.
  7. In this Review of the Safety, Rehabilitation and Compensation Act
    1988     (SRC Act) the Australian Government should consider the recent
    amendments to workers’ compensation in Western Australia.
  8. The WA Minister for Finance, Commerce and Small Business announced that the
    changes in 2011 were to have ‘a positive economic and social impact’
    for Western Australia where there is ‘record low unemployment and a need
    to maintain experienced and skilled
    people’.[11]
  9. The Australian Government is making significant investments to keep people
    in the workforce for as long as they are fit and
    able.[12] The current limits to the
    Comcare workers’ compensation provisions are at cross purposes with many
    Australian Government policies and initiatives aimed at retaining an experienced
    mature-age workforce.

3 Recommendation

  1. The Australian Human Rights Commission recommends
    the following amendments to s 23(1) of the SRC Act:

    • The removal of all age limits on weekly incapacity payments for workers
      covered by the Comcare scheme; and
    • The inclusion of non-discriminatory weekly incapacity payment provisions,
      similar to those adopted for the Western Australia’s workers’
      compensation scheme.

[1] Department of Education,
Employment and Workplace Relations. Terms of Reference for Safety,
Rehabilitation and Compensation Act 1988 (SRC Act) 2012. At http://www.deewr.gov.au/WorkplaceRelations/Policies/Pages/SRCActReview.aspx (viewed 15 October 2012.

[2] Department of Education, Employment and Workplace Relations. Terms of Reference
for Safety, Rehabilitation and Compensation Act 1988 (SRC Act) 2012. At http://www.deewr.gov.au/WorkplaceRelations/Policies/Pages/SRCActReview.aspx (viewed 15 October 2012.

[3] Department of Education, Employment and Workplace Relations. Terms of Reference
for Safety, Rehabilitation and Compensation Act 1988 (SRC Act) 2012. At http://www.deewr.gov.au/WorkplaceRelations/Policies/Pages/SRCActReview.aspx (viewed 15 October 2012.

[4] Peter
Hanks QC, Review of the Safety, Rehabilitation and Compensation Act 1988 – Issues Paper, September 2012. At http://www.deewr.gov.au/WorkplaceRelations/Policies/Pages/SRCActReview.aspx (viewed 15 October 2012.

[5] Australian Bureau of Statistics, 6324.0 - Work-Related Injuries, Australia,
2009-10, 2010. At http://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/6324.0Main
per
cent20Features32009-10?opendocument&tabname=Summary&prodno=6324.0&issue=2009-10&num=&view=
(viewed 1 November 2010).

[6] Australian Bureau of Statistics, Work-related injury or illness down, men
still at most risk, 6324.0 - Work-Related Injuries, Australia, 2009-10.
(Media Release, 13 December 2010). At http://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/6324.0Media
per
cent20Release12009-10?opendocument&tabname=Summary&prodno=6324.0&issue=2009-10&num=&view=
(viewed 1 November 2011).

[7] Australian Public Service Commission, Productive and safe workplaces for an
ageing workforce, 2003. At http://www.apsc.gov.au/publications03/maturecomcare3.htm (viewed 1 November 2011).

[8]K.
Barnett, J. Spoehr, E. Parnis, Exploring the Impact of an Ageing Workforce on
the South Australian Workers’ Compensation Scheme, Key findings, The
Australian Institute for Social Research, 2008. p.4.

[9] Department of Education,
Employment and Workplace Relations. Terms of Reference for Safety,
Rehabilitation and Compensation Act 1988 (SRC Act) 2012. At http://www.deewr.gov.au/WorkplaceRelations/Policies/Pages/SRCActReview.aspx (viewed 15 October 2012.

[10] Safe Work Australia, National Workers’ Compensation Action Plan
2010–2013, Commonwealth Government Australia, pp. 4-5. At http://safeworkaustralia.gov.au/AboutSafeWorkAustralia/WhatWeDo/Publications/Pages/WCPlan2010-2013.aspx (viewed 18 October 2011).

[11] Western Australian Minister for Finance, Commerce and Small Business, Better
Workers’ compensation for over 65s, (Media Release 18 August 2011). At http://www.mediastatements.wa.gov.au/Pages/default.aspx?ItemId=143293 (viewed 19 October 2011).

[12] Australian Government department of Employment, Education and Workplace
Relations, Experience+ New incentives and support for mature age job
seekers. At http://www.deewr.gov.au/Employment/Programs/ExpPlus/Pages/supportformatureagejobseekers.aspx (viewed 18 October 2012).