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EMPLOYMENT AND WORKPLACE RELATIONS AMENDMENT BILL 2009

                                  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.