Commonwealth of Australia Explanatory Memoranda Commonwealth of Australia Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
2004-2005
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
OHS and SRC LEGISLATION Amendment Bill 2005
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Employment and
Workplace Relations, the Honourable Kevin Andrews MP)
OHS and SRC LEGISLATION Amendment Bill 2005
OUTLINE
The OHS and SRC Legislation Amendment Bill 2005 addresses the following
matters:
1. implementing the Australian Government's response to the Productivity
Commission Inquiry Report No. 27 into National Workers' Compensation and
OHS Frameworks to cover, under the Occupational Health and Safety
(Commonwealth Employment) Act 1991 (OHS(CE) Act), corporations licensed
under the Safety, Rehabilitation and Compensation Act 1988 (SRC Act);
2. ensuring Commonwealth authorities licensed under the SRC Act, but not
covered under the OHS(CE) Act, are covered by the OHS(CE) Act;
3. allowing Comcare to charge all Commonwealth authorities an OHS
contribution for the administration of the OHS(CE) Act; and
4. validating payments purported to have been made under the SRC Act by
some licensees and Commonwealth authorities for OHS contributions in the
2002-2003 financial year.
Response to the National Workers' Compensation and OHS Frameworks Report
Currently corporations licensed under the SRC Act are not subject to the
OHS(CE) Act. OHS obligations for these corporations are provided by the
different State and Territory OHS legislation.
The Productivity Commission recommended that the Australian Government
amend the OHS(CE) Act to enable those corporations that are licensed under
the Australian Government's workers' compensation scheme to elect to be
covered by the Australian Government's OHS legislation. Currently,
corporations may seek coverage under the SRC Act.
The Australian Government workers' compensation and OHS schemes are
effectively integrated. There are significant benefits to both employers
and employees if covered by a single set of workers' compensation and OHS
laws. The Bill, therefore, would provide OHS coverage under the OHS(CE) Act
for all SRC Act licensees.
Coverage of licensed Commonwealth authorities
For consistency, the Bill would also ensure that all Commonwealth
authorities licensed under the SRC Act are covered by the OHS(CE) Act.
Most licensed Commonwealth authorities are already covered by the OHS(CE)
Act because they also meet the definition of Commonwealth authority in the
OHS(CE) Act. However, coverage under both Acts is not automatic. The Bill
provides consistent coverage for all licensees.
Ability to charge a fee to recover administration costs for the schemes
The SRC Act requires Entities (i.e. Commonwealth departments, agencies and
other prescribed bodies), Commonwealth authorities and licensed eligible
corporations to pay one regulatory contribution at the beginning of each
financial year in relation to services and costs of the Safety,
Rehabilitation and Compensation Commission (the Commission) and Comcare in
administering the OHS(CE) Act and the SRC Act.
Prior to 1 July 2002 separate regulatory contributions were paid under the
SRC Act and OHS(CE) Act. The Safety, Rehabilitation and Compensation and
Other Legislation Amendment Act 2001 (the SRCOLA Act) rationalised funding
arrangements under the OHS and workers' compensation schemes and placed
these arrangements in the SRC Act.
While the definitions of Entity in the SRC Act and the OHS(CE) Act are the
same, each Act contains a different definition of Commonwealth authority.
As the requirement to pay a regulatory contribution, which includes costs
in relation to the administration of the OHS scheme, is now contained in
the SRC Act, there is no legal basis to charge a body which is a
Commonwealth authority under the OHS(CE) Act that is not also covered by
the SRC Act. The Bill corrects a drafting oversight in the SRCOLA Act.
The Bill would extend the definition of Commonwealth authority under the
SRC Act, but only for the purposes of charging regulatory contributions
under section 97D, to those Commonwealth authorities that could not
otherwise be charged a regulatory contribution under the SRC Act.
Validation of OHS contributions in 2002-2003
Following the commencement of the SRCOLA Act, a number of Commonwealth
authorities, that were not covered by the SRC Act paid OHS contributions
under section 97D of the SRC Act for the period 1 July 2002 - 30 June 2003.
The payments were retained by Comcare, as agreed with the authorities, for
services to be provided during the 2002-2003 financial year and with the
understanding that an amendment would be made to the legislation to
validate the payments and provide for future payments. The Bill validates
these payments and acts by Comcare in determining the amounts of the
payments.
The SRCOLA Act also streamlined licensing provisions under the SRC Act so
that one generic licence is issued to all licensees. For the 2002-2003
financial year a number of licensees paid licence fees under the new
licensing provisions rather than under the old licensing provisions that
continued to apply for the duration of the licence. The payments were
recalculated by the Commission under the correct provisions. The original
payments were retained by Comcare, as agreed with the licensees, for
services to be provided during the 2002-2003 financial year and with the
understanding that an amendment would be made to the legislation to
validate the payments. The Bill validates these payments and associated
acts by the Commission in determining the amounts of the licence fees.
FINANCIAL IMPACT STATEMENT
Costs borne by Comcare to administer the OHS(CE) Act in relation to private
sector corporations would be covered by an OHS contribution included in the
corporation's self-insurance licence fee. As corporations are self-funded,
OHS contribution costs would not be borne by the Commonwealth from revenue.
REGULATION IMPACT STATEMENT
BACKGROUND
The Occupational Health and Safety (Commonwealth Employment) Act 1991 (the
OHS(CE) Act) provides a legal basis for the protection of the health and
safety of Commonwealth employees in Departments, Statutory Authorities, and
Government Business Enterprises (GBEs). The OHS(CE) Act imposes
responsibilities on employers, employees, manufacturers and suppliers of
plant and substances, and persons erecting or installing plant in a
workplace. The OHS(CE) Act also establishes a framework for cooperative
workplace arrangements and a criminal and civil enforcement regime.
The Safety, Rehabilitation and Compensation Act 1988 (the SRC Act)
establishes both a premium based and licensed self-insurance based workers'
compensation scheme to provide coverage for work-related injuries sustained
by employees of the Commonwealth and certain private sector corporations.
Both the OHS(CE) Act and the SRC Act are administered by the Commonwealth's
regulatory body, Comcare.
The SRC Act provides scope for certain corporations to apply for a licence
to self-insure and/or manage their own workers' compensation claims. The
Minister for Employment and Workplace Relations may declare a corporation
eligible to be granted a self-insurance licence under the SRC Act. Eligible
corporations include former Commonwealth authorities, existing Commonwealth
authorities that are about to be privatised, and private sector
corporations operating in competition with an existing or former
Commonwealth authority. The Safety, Rehabilitation and Compensation
Commission has the power to grant a licence under the SRC Act to an
eligible corporation.
The licensing arrangements enable Commonwealth authorities to maintain SRC
Act coverage as licensed corporations following privatisation. This ensures
continuity of workers' compensation arrangements for employees of former
Commonwealth authorities. In order to maintain a 'level playing field',
these provisions also enable private sector corporations in competition
with existing and former Commonwealth authorities to access the SRC Act
licensing arrangements.
The OHS(CE) Act applies to defined Commonwealth authorities. A body
corporate which is not established for a public purpose under a law of the
Commonwealth or a Territory (i.e. a private sector corporation) is only a
"Commonwealth authority" for the purposes of the OHS(CE) Act if:
. the Commonwealth retains a controlling interest in the body and it has
not been declared not to be a "Commonwealth authority" by the
Minister; or
. the Commonwealth retains a substantial interest in the body and the
Minister has declared the body to be a "Commonwealth authority" for
the purposes of the Act.
This Regulatory Impact Statement concerns proposals for amendment of the
OHS(CE) Act to extend coverage under the OHS(CE) Act to private sector
corporations which obtain a self-insurance licence under the SRC Act and
their employees.
OBJECTIVE
To provide for optimum levels of health and safety by facilitating an
integrated approach to workers' compensation and OHS across the
Commonwealth scheme.
THE PROBLEM
Coverage under the OHS(CE) Act
The OHS(CE) Act, in conjunction with the SRC Act, seeks to limit the human
and financial costs of work-related injury. The Commonwealth's approach to
injury prevention and management is to promote continuous improvement in
OHS, rehabilitation and workers' compensation through a systems-based and
integrated approach.
While certain private sector corporations can retain or obtain workers'
compensation coverage under the Commonwealth scheme through a self-
insurance licence, there is no corresponding mechanism for them to obtain
coverage under the Commonwealth OHS scheme.
The current circumstances where corporations could consider applying for
SRC Act coverage but are unable to be covered by the OHS(CE) Act are:
i) Commonwealth authorities in the process of privatisation that wish
to continue their workers' compensation coverage post privatisation
through SRC Act licensing arrangements;
ii) former Commonwealth authorities that have left the Commonwealth
scheme and operate under State/Territory schemes, but are able to
return to SRC Act coverage after Ministerial declaration and SRC
Commission approval of a licence application; and
iii) corporations which operate in competition with existing or former
Commonwealth authorities.
Most Commonwealth authorities are covered by both the SRC Act and OHS(CE)
Act. Former Commonwealth authorities can, if they wish, remain covered by
the provisions of the SRC Act via a self-insurance licence. Alternatively,
they would default to coverage under the relevant State or Territory
workers' compensation legislation.
If the Commonwealth retains at least a substantial interest in a
corporation, that corporation could remain covered by the OHS(CE) Act by
virtue of its meeting the definition of a "Commonwealth authority" under
that Act. However, a former Commonwealth authority cannot be covered by the
OHS(CE) Act. As such, while a privatised former Commonwealth authority may
retain SRC Act coverage, there is no scope for its coverage under the
OHS(CE) Act. This may compromise health and safety because it prevents
former Commonwealth authorities licensed under the SRC Act from having
integrated OHS and workers' compensation arrangements. Their OHS
arrangements which are directed to the prevention of workplace injury are
subject to State and Territory OHS legislation, while their rehabilitation
and workers' compensation arrangements are subject to Commonwealth
legislation.
Corporations carrying on business in competition with an existing or former
Commonwealth authority can be declared by the Minister to be an eligible
corporation to apply for a self-insurance licence under the SRC Act. If
such competitors were to be licensed under the SRC Act for workers'
compensation purposes, they would still remain covered by State and
Territory OHS legislation. This may place them at a competitive
disadvantage where they would be required to comply with up to eight
separate sets of State/Territory OHS legislation, compared to a
Commonwealth authority which is subject to the Commonwealth regulatory
framework. While the principles of the Commonwealth and State/Territory OHS
legislation are the same, there are many differences in the detailed
provisions. Where such differences occur, there may be increased compliance
costs for a competitor operating in multiple jurisdictions. Therefore the
Commonwealth legislation currently provides a barrier to competitive
neutrality for these corporations.
It is preferable to maintain consistency across the scheme through an
integrated approach to workers' compensation and OHS by providing for all
organisations covered by the SRC Act through the licensing arrangements to
be covered concurrently by the OHS(CE) Act. This would also assist in
ensuring that private sector corporations which are licensed under the SRC
Act are able to operate in a competitively neutral environment.
The Productivity Commission recommended in its report on National Workers'
Compensation and Occupational Health and Safety Frameworks that the OHS(CE)
Act be amended "to enable those employers who are licensed to self-insure
under the Australian Government's workers' compensation scheme to elect to
be covered by the Australian Government's occupational health and safety
legislation". The Productivity Commission considered that this would
increase the administrative savings for multi-state corporations and enable
greater coordination and feedback between the workers' compensation and OHS
regimes. It would also enable improved data monitoring, feedback and
reform.
The Australian Government supported the Productivity Commission's
recommendation with the modification that there should be mandatory
coverage under the OHS(CE) Act for non-Commonwealth employers who gain a
self-insurance licence under the SRC Act. The Australian Government
considers there is merit in opening up access to the Government's OHS
regime to give those firms granted a self-insurance licence under the SRC
Act scheme a single set of national OHS rules. The Government's workers'
compensation and OHS schemes are effectively integrated and there are
benefits to employers having coverage under both schemes. For these
reasons the Government does not support eligible corporations having the
choice as proposed by the Productivity Commission.
There are currently 5 eligible corporations which have obtained licences
under the SRC Act but are not covered by the OHS(CE) Act. The figures
provided to Comcare indicate that the number of employees of the 5
licensees is currently approximately 15,000. It is not possible to
identify how many other corporations would apply for, and be successful in
obtaining, a self-insurance licence.
OPTIONS
Options available for regulating OHS in the Commonwealth jurisdiction
include:
A. no change to the current provisions; or
B. providing for coverage under the OHS(CE) Act for employers that obtain
a self-insurance licence under the SRC Act. The Minister's power to
declare corporations as eligible corporations under the SRC Act would
not be affected by this option.
IMPACT ANALYSIS (COSTS AND BENEFITS)
Option A - No change
Costs to private sector licensees
i) Former Commonwealth authorities licensed under the SRC Act are:
- required to leave the Commonwealth OHS scheme and comply with
State/Territory OHS legislation where differences in OHS
requirements may give rise to increased compliance costs,
depending on the number of jurisdictions in which the former
Commonwealth authority operates. There are also costs associated
with the potential increase in their corporate governance
management systems to accommodate up to eight State/Territory OHS
legislative requirements;
- required to pay the equivalent of an OHS contribution to each
State/Territory OHS regulator where the former Commonwealth
authority operates, rather than one contribution to the
Commonwealth regulator;
- unable to maintain a consistent and integrated approach to
workers' compensation and OHS;
- subject to training costs in relation to different State/Territory
OHS requirements without any benefit of increased OHS standards
and protection; and
- subject to different penalties under State/Territory OHS
legislation for similar breaches, giving rise to inequities in OHS
enforcement against employers.
vii) Competitors of existing and former Commonwealth authorities licensed
under the SRC Act are:
- potentially subject to higher compliance costs than Commonwealth
authorities through additional administration associated with
complying with up to eight sets of State/Territory OHS
legislation;
- required to pay the equivalent of an OHS contribution to each
State/Territory OHS regulator where the competitor operates;
- unable to maintain a consistent and integrated approach to
workers' compensation and OHS;
- subject to training costs in relation to different State/Territory
OHS requirements without any benefit of increased OHS standards
and protection.
- potentially placed at a competitive disadvantage when competing
with a Commonwealth authority covered by the OHS(CE) Act as a
Commonwealth authority is mainly covered by the OHS(CE) Act and
only required to pay an OHS contribution to Comcare, whereas
competitors would be required to comply with up to eight sets of
State/Territory OHS legislation and pay the equivalent of an OHS
contribution to up to eight OHS authorities; and
- subject to different penalties under State/Territory OHS
legislation for similar breaches, giving rise to inequities in OHS
enforcement against employers.
Benefits to private sector licensees
xiv) No benefits identified.
Costs to licensee employees
xv) Employees of former Commonwealth authorities may have to undergo new
training or obtain additional qualifications to understand and comply
with the OHS legislation of the State/Territory in which they work;
xvi) Confusion in relation to OHS requirements could arise for employees
working in different jurisdictions. Differential requirements also
restrict an employee's ability to take up, at short notice, duties in
another State/Territory for the employer; and
xvii) Inequities in enforcing OHS obligations against employees for similar
breaches would arise due to differing penalty provisions in
State/Territory OHS legislation.
Benefits to licensee employees
xviii) Employees of corporations operating in competition with existing or
former Commonwealth authorities would remain covered by
State/Territory OHS legislation and would not have to undergo new
training to comply with Commonwealth OHS requirements.
Impact on small businesses and their employees
(i) No adverse impact on small businesses or their employees. Providing
coverage under the OHS(CE) Act for private sector corporations which
self-insure under the SRC Act is likely to have little or no impact on
small business. The States currently fund their OHS prevention and
enforcement activities through special OHS contributions paid by
employers or through their respective budgets. State governments also
receive revenue through fines imposed on organisations that breach OHS
laws.
Costs to Government
xix) No cost is borne by the Commonwealth as corporations are self-funded
and the cost to the SRC Commission in monitoring the OHS components of
the licensing conditions is fully covered by the licensing fees.
Benefits to Government
xx) No benefits identified.
Option B - Providing for coverage under the OHS(CE) Act for private sector
corporations that obtain a self-insurance licence under the SRC Act
Costs to private sector licensees
xxi) Former Commonwealth authorities and competitors of existing and former
Commonwealth authorities licensed under the SRC Act would be required
to pay an OHS contribution towards the costs of administering the
OHS(CE) Act by the Comcare. Currently, these corporations are not
required to pay an OHS contribution under the OHS(CE) Act as they are
only required to comply with State/Territory OHS legislation.
xxii) For competitors of existing and former Commonwealth authorities,
there may be initial costs in acquiring knowledge and implementing
changes to ensure compliance with Commonwealth OHS requirements.
xxiii) Potentially, two separate systems of OHS regulation could apply to a
single site if a self-insurer engaged contractors who are covered by
State/Territory OHS laws. However this situation already exists for
all employers covered by the OHS(CE) Act and does not create any
significant problems.
Benefits to private sector licensees
xxiv) Former Commonwealth authorities licensed under the SRC Act would:
- no longer be required to leave the Commonwealth OHS scheme;
- no longer be potentially subject to increased compliance costs
associated with State/Territory OHS legislation implementation;
- no longer be required to pay the equivalent of an OHS contribution
to each State/Territory OHS regulator where the corporation
operates;
- retain the benefits of a single integrated prevention, compensation
and rehabilitation scheme; and
- potentially be placed in a competitively neutral environment vis-a-
vis Commonwealth authorities.
xxx) Competitors of existing and former Commonwealth authorities would:
- obtain nationally consistent OHS arrangements where the
corporation operates in multiple jurisdictions;
- no longer be subject to multiple costs associated with
State/Territory OHS legislation compliance;
- no longer be required to pay the equivalent of an OHS contribution
to each State/Territory OHS regulator where the corporation
operates;
- have the benefits of a single integrated prevention, compensation
and rehabilitation scheme; and
- be placed in a competitively neutral environment vis-a-vis
Commonwealth authorities.
Costs to licensee employees
i) Employees of corporations operating in competition with an existing or
former Commonwealth authority may need to undergo new training to
undertake certain work to comply with Commonwealth OHS requirements.
ii) Employees of self-insurers which operate in multiple jurisdictions may
at times be performing work otherwise than at their employer's
workplace and at a site subject to State/Territory laws. However this
situation already occurs in relation to Commonwealth employees under
the OHS(CE) Act and does not create any significant problems.
Benefits to licensee employees
i) Greater certainty for employees who work in more than one jurisdiction
in relation to their OHS rights and obligations.
ii) Equity in the enforcement of OHS obligations for employees of
corporation across Australia.
Impact on small businesses and their employees
(i) Providing coverage under the OHS(CE) Act for private sector
corporations which self-insure under the SRC Act is expected to have
little or no impact on small business. The States currently fund
their OHS prevention and enforcement activities through special OHS
contributions paid by employers or through the budget. State
governments also receive revenue through fines imposed on
organisations that breach OHS laws.
Costs to Government
i) Costs borne by Comcare to administer the OHS(CE) Act in relation to
private sector corporations would be covered by an OHS contribution
included in the corporation's self-insurance licence fee. As
corporations are self-funded, OHS contribution costs would not be
borne by the Commonwealth from revenue.
Benefits to Government
i) No cost is borne by the Commonwealth as corporations are self-funded
and the cost to the SRC Commission in monitoring the OHS components of
the licensing conditions is fully covered by the licensing fees.
Administration of the OHS(CE) Act by the regulator is cost neutral.
ii) Workers' compensation data could be used by Comcare to assist licensed
corporations to develop improved prevention strategies, which would
assist them in lowering their workers' compensation costs.
CONSULTATION
Consultations have been undertaken with all Commonwealth authorities and
private sector corporations which have obtained a licence under the SRC
Act. All licensees support the proposed amendment of the OHS(CE) Act to
provide coverage under that Act for corporations which are licensed under
the SRC Act. They see significant advantages in operating under one OHS
regime rather than having to operate under a multiplicity of jurisdictions.
For example, one licensee said it currently found it almost impossible to
develop a demonstrable national approach which is essential to achieving
successful outcomes. Another licensee indicated that the work involved in
complying with multiple jurisdictions is an inefficient and inappropriate
use of resources as it does nothing to improve workplace health and safety
because the costs of establishing a separate OHS management system for a
number of jurisdictions do not lead to any increased health and safety
protection for their employees. The primary benefit of the proposed
amendment is therefore better safety outcomes for employees.
Licensees also noted that the amendment would provide a number of
administrative and commercial benefits, including considerable cost savings
in relation to training.
CONCLUSION AND RECOMMENDED OPTION
In summary:
. Option A would maintain the current level of coverage of the OHS(CE)
Act which does not provide for coverage for all corporations covered
by the SRC Act.
. Option B would provide coverage under the OHS(CE) Act for employers
that obtain a self-insurance licence under the SRC Act. This would
allow competitors of existing and former Commonwealth authorities to
compete with such organisations in a neutral environment in regard to
OHS compliance requirements, and provide them with the benefits of an
integrated workers' compensation and OHS scheme, as well as cost
savings. Employees would have the benefits of certainty in relation to
their OHS rights and obligations and equity in the enforcement of
their duty of care, regardless of their work location. This option is
strongly supported by licensees.
Option B is the preferred option.
IMPLEMENTATION AND REVIEW
Implementation of the proposed changes would involve four stages:
i) legislative amendment to the OHS(CE) Act;
ii) preparation of guidance material by Comcare to advise Commonwealth
authorities, applicants for licences which are former Commonwealth
authorities and competitors of existing and former Commonwealth
authorities of the legislative amendment;
iii) preparation of advice by Comcare to the OHS authorities in each of the
States and Territories advising of the legislative amendment; and
iv) while no formal review is planned, a review of the effectiveness of
the proposed legislative amendment would be undertaken by Comcare on a
continuing basis and reported to the Safety, Rehabilitation and
Compensation Commission which would advise the Minister if a change to
the arrangements were necessary.
NOTES ON CLAUSES
Clause 1 - Short title
The enacted Bill will be known as the OHS and SRC Legislation Amendment Act
2005.
Clause 2 - Commencement
Clause 2 specifies when the various provisions of the Act commence.
Sections 1 to 3 and anything in the Act not elsewhere covered by the table
in this clause will commence on the day on which the Act receives the Royal
Assent. The main amendments to the OHS(CE) Act and any consequential
amendments (Schedule 1) will commence on a day or days fixed by
Proclamation. The amendments to the SRC Act relating to regulatory
contributions and licence fees (Part 1 of Schedule 2) commence on the first
1 July following Royal Assent to coincide with the beginning of a financial
year. The validation provisions (Part 2 of Schedule 2) commence on the day
on which the Act receives the Royal Assent. The technical amendments
relating to legislative instruments (Schedule 3) commence on Royal Assent.
Clause 3 - Schedule(s)
This clause provides that an Act that is specified in a Schedule is amended
or repealed as set out in that Schedule. Other items (eg transitional
provisions) have effect according to their terms.
SCHEDULE 1 - EXTENDING THE COVERAGE OF THE OCCUPATIONAL HEALTH AND SAFETY
(COMMONWEALTH EMPLOYMENT) ACT 1991
PART 1 - MAIN AMENDMENTS
Item 1 - Long Title
Currently the Occupational Health and Safety (Commonwealth Employment) Act
1991 (the Act) covers employers and employees of the Commonwealth and
Commonwealth authorities only. This item amends the long title of the Act
to insert a reference to "certain licensed corporations" to reflect a new
category of employer and employees to be covered by the Act - non-
Commonwealth licensees and non-Commonwealth licensee employees (see items
14 and 16).
Item 2 - Section 1 Short Title
This item amends the short title of the Act to reflect extended coverage of
the Act to non-Commonwealth licensees. The note following section 1
explains that if another act refers to the short title of this Act, section
10 of the Acts Interpretation Act 1901 allows the new title to be read in
place of the old title.
Item 3 - Section 3(a) Objects
Currently the objects of the Act are to secure the health, safety and
welfare at work of employees of the Commonwealth and Commonwealth
authorities. This item extends those objects to apply to employees of non-
Commonwealth licensees.
Item 4 - Subsection 5(1) Definition of chief executive officer
This item amends the definition of chief executive officer to include the
chief executive officer, or equivalent person, of a non-Commonwealth
licensee. This item identifies the person responsible for carrying out the
employer's role under the Act.
Item 5 - Subsection 5(1) Definition of Commonwealth authority
Section 103 of the SRC Act allows the Commission to grant a licence to a
Commonwealth authority to accept liability for workers' compensation claims
and/or manage such claims in relation to its employees. The OHS(CE) Act
and the SRC Act contain similar but different definitions of Commonwealth
authority. Not all Commonwealth authorities covered by the SRC Act are
also covered by the OHS(CE) Act. Item 5 addresses this issue by extending
the definition of 'Commonwealth authority' under the OHS(CE) Act to ensure
all Commonwealth authorities licensed under the SRC Act are also covered by
the OHS(CE) Act. Commonwealth authorities covered under existing
paragraphs (a)-(c) will not have their status altered if they also fall
into paragraph (d).
Item 6 Subsection 5(1) Definition of Commonwealth authority contractor
The existing definition of contractor includes a contractor to the
Commonwealth or a Commonwealth authority. Item 10 amends the definition of
contractor to reflect the three categories of contractor under the Act - a
Commonwealth contractor, a Commonwealth authority contractor and a non-
Commonwealth licensee contractor. A contractor to a Commonwealth authority
is called a Commonwealth authority contractor. This item provides that a
Commonwealth authority contractor is defined in new section 9A (see item
25).
Item 7 Subsection 5(1) Definition of Commonwealth authority employee
The existing definition of employee includes an employee of the
Commonwealth or a Commonwealth authority. Item 20 amends the definition of
employee to reflect the three categories of employee under the Act - an
employee of the Commonwealth, a Commonwealth authority or a non-
Commonwealth licensee. This item clarifies that an employee of a
Commonwealth authority is called a Commonwealth authority employee. A
Commonwealth authority employee is defined in amended section 9 (see item
20).
Item 8 Subsection 5(1) Definition of Commonwealth contractor
This item clarifies that a contractor to the Commonwealth is called a
Commonwealth contractor. A Commonwealth contractor is defined in new
section 9A (see item 25).
Item 9 Subsection 5(1) Definition of Commonwealth employee
This item provides that an employee of the Commonwealth is called a
Commonwealth employee. A Commonwealth employee is defined in amended
section 9 (see item 20).
Item 10 Subsection 5(1) Definition of contractor
This item moves the definition of contractor from subsection 5(1) to new
section 9A (see item 25). The note following this definition alerts
readers that the definition of contractor under section 14 is extended by
new subsection 14(3) (see item 31).
Item 11 Subsection 5(1) Definition of employer
This item repeals the existing definition of employer and specifies three
separate categories of employer to which the Act applies - the
Commonwealth, a Commonwealth authority or a non-Commonwealth licensee.
Item 12 Subsection 5(1) Definition of employing authority
The Act places obligations on an employer in relation to its employees.
Because the Commonwealth is an indivisible entity, the Act uses employing
authority to identify the Department or Agency within the Commonwealth that
is responsible for discharging the Commonwealth's obligations as an
employer to its employees. This item amends the definition of employing
authority as a consequence of the amendments made by items 7 and 11. The
amendment makes it clear that the duty of an employing authority is to a
Commonwealth employee or a Commonwealth contractor.
Item 13 Subsection 5(1) Definition of Government business enterprise
A number of Commonwealth authorities under the Act are also Government
business enterprises (GBEs). GBEs are bodies corporate that are removed
from the Commonwealth and do not attract the shield of the Crown. GBEs and
their employees are, therefore, subject to both the criminal sanctions and
civil remedies under the Act. This item provides a mechanism by which the
new category of Commonwealth authority, as defined under new paragraph (d)
of that definition, may also be scheduled or declared as a GBE under the
Act.
Item 14 Subsection 5(1) Definition of non-Commonwealth licensee
This item inserts a new category of employer to be covered by the Act - a
non-Commonwealth licensee. A non-Commonwealth licensee is an eligible
corporation that holds a licence under Part VIII of the SRC Act. A non-
Commonwealth licensee does not include a licensee that is a Commonwealth
authority.
This item also provides that if the licence of a non-Commonwealth licensee
is suspended, the OHS(CE) Act would still apply to the non-Commonwealth
licensee. A non-Commonwealth licensee is subject to all criminal penalties
and civil remedies available under the OHS(CE) Act.
Item 15 Subsection 5(1) Definition of non-Commonwealth licensee contractor
This item inserts a reference to a new category of contractor - a non-
Commonwealth licensee contractor. A non Commonwealth licensee contractor
is defined in new section 9A (see item 31).
Item 16 Subsection 5(1) Definition of non-Commonwealth licensee employee
This item inserts a reference to a new category of employee - a non-
Commonwealth licensee employee. A non-Commonwealth licensee employee is
defined in section 9 (see item 20).
Item 17 Subsection 5(1) Definition of non-Commonwealth licensee premises
The Act currently defines Commonwealth premises in relation to a workplace
owned or occupied by the Commonwealth or a Commonwealth authority. Item 17
inserts a reference to a new type of premises to which the Act applies -
the premises of a non-Commonwealth licensee. Non-Commonwealth licensee
premises include premises owned or occupied by a non-Commonwealth licensee.
Item 18 Subsection 5(1) Definition of workplace
Currently the Act covers workplaces that are Commonwealth premises in which
employees or contractors work, other than a private dwelling. Item 18
amends and extends the definition of workplace to reflect the three
categories of employee that work on the premises of their respective
employers. The definition of workplace continues to exclude premises used
primarily as a private dwelling.
Item 19 Subsection 5(2) Responsible Minister
Entities and some Commonwealth authorities report to a Minister who is
responsible for it to the Parliament. For example, where a report of an
investigation is undertaken it is provided to the responsible Minister.
Some Commonwealth authorities, that are removed from the Commonwealth and
have their own accountability mechanisms separate from the Parliamentary
process, do not report to a responsible Minister. The SRC Act licence
provisions provide alternative accountability mechanisms for a licensee's
workers' compensation and OHS performance. This item maintains the status
quo in relation to existing Commonwealth authorities and amends subsection
5(2) to clarify that there is no responsible Minister allocated to a new
paragraph (d) Commonwealth authority which is licensed under the SRC Act.
Items 20 - 24 Section 9 Meaning of employee
Currently the Act covers employees of the Commonwealth and Commonwealth
authorities. These items expand the application of the Act to cover
employees of a non-Commonwealth licensee.
These items restructure section 9 by separating employees into three
categories - a Commonwealth employee, a Commonwealth authority employee and
a non-Commonwealth licensee employee.
A licence under Part VIII of the SRC Act may cover some or all of the
employees of a licensed eligible corporation. A reference in the Act to a
non-Commonwealth licensee employee includes only those employees of the
licensed eligible corporation that are covered by the SRC Act licence. An
employee of a non-Commonwealth licensee is subject to all criminal
penalties and civil remedies available under the Act.
Item 24 also inserts new headings for subsections 9(4) and 9(5).
Existing subsections 9(4), (5) and (6) are retained unamended.
Item 25 New section 9A Meaning of contractor
This item inserts a new section 9A that defines the term contractor. New
section 9A separates contractors into 3 categories - a Commonwealth
contractor, a Commonwealth authority contractor, and a non-Commonwealth
licensee contractor.
The note following this subsection (1) notes that the definition of
contractor under section 14 is extended by new subsection 14(3) (see item
31).
The new definitions of a Commonwealth contractor, a Commonwealth authority
contractor, and a non-Commonwealth licensee contractor are used to explain
who is a contractor in relation to each type of employer under the Act.
Item 26 Paragraph 10(1)(a) Acting through an employing authority
This item is a consequential amendment to item 25 which clarifies that the
reference to contractor in paragraph 10(1)(a) is a reference to a
Commonwealth contractor and not one of the other categories of contractors.
Item 27 Paragraph 11(4)(a) & (b) Extent to which the Act binds the Crown
This item makes consequential amendments resulting from items 20 and 22.
This item updates references to employees in paragraph 11(4) to references
to a Commonwealth employee and Commonwealth authority employee.
Item 28 Paragraph 12(1)(c) Extended functions of Commission to non-
Commonwealth licensee employees
Item 28 provides that the Commission's function under paragraph 12(1)(c) of
the Act includes the ability to collect, interpret and report information
relating to the occupational health and safety of all employees (including
non-Commonwealth licensee employees) covered by the Act.
Item 29 Subsection 14(1) note
This item amends the note following subsection 14(1).
Item 30 Subsection 14(2) Application of Act to workplaces controlled by
contractors
A workplace continues to be controlled by a contractor for construction and
maintenance purposes, despite the presence at the workplace of an employee
of the employer, if that employee has no right to control the workplace.
Item 30 updates the reference to "a Commonwealth employee" in subsection
14(2) to reflect the expanded coverage of the Act to include non-
Commonwealth employees.
Item 31 Extended meaning of contractor under section 14
Section 14 excludes the application of the Act, except section 20, to a
workplace that is controlled by a contractor for the purpose of maintenance
or construction. OHS legislation from the jurisdiction in which that
contractor operates applies to that workplace, contractors and employees in
that case.
This item inserts new paragraph 14(3) which extends the definition of
contractor under section 14 to include bodies corporate as well as natural
persons.
Item 32 Section 15 Application of Act to workplaces
Section 15 provides that where a person ordinarily performs work at
premises other than the employer's premises certain parts of the Act only
apply if prescribed by regulation. This arrangement recognises that where
the employer does not have direct control over the workplace and employees
the responsibility for OHS is shared with the person who has control over
the premises and employee. This item extends the operation of section 15
to apply to non-Commonwealth licensee employees.
Item 33 Subsection 41(3) Updated references to non-Commonwealth licensees
Item 34 Subsection 41(4)
Item 35 Paragraph 43(1)(a)
Each of these items inserts a reference to "non-Commonwealth licensee"
after a reference to a "Commonwealth authority" to ensure that the
investigation powers under sections 41 and 43 apply to a non-Commonwealth
licensee in the same way it currently applies to a Commonwealth authority.
Item 36 Section 52 Application of Division to non-Commonwealth
licensees
Division 3 of Part 4 of the Act provides procedures for OHS investigations
to be carried out at Commonwealth and Commonwealth authority workplaces.
Employers are held accountable for their OHS performance via public
hearings and inquiries. Division 3 has limited effect on Government
business enterprises and is not necessary for non-Commonwealth licensees
because they are subject to the full range of sanctions and penalties under
the Act.
Item 37 Paragraph 53(3)(b) Reports of Investigations
Paragraph 53(3)(b) provides that, where it considers it appropriate, the
Commission must give an investigation report to the responsible Minister in
relation the employer. This item clarifies that a reference to an employer
in paragraph 53(3)(b) is a reference only to the Commonwealth or a
Commonwealth authority.
Item 38 Paragraph 70(2)(a) Updated reference to Commonwealth employment
This item updates a reference in section 70 to "Commonwealth employment",
as amended by the National Occupational Health and Safety Commission
(Repeal, Consequential and Transitional Provisions) Act 2005, to reflect
the extended coverage of the Act to non-Commonwealth licensees.
Item 39 Paragraph 2(3)(f) of Schedule 2 Updated reference to non-
Commonwealth licensees
This item updates a reference to "Commonwealth Entity or Commonwealth
authority" to reflect the extended coverage of the Act to non-Commonwealth
licensees in relation to sanctions.
Item 40 Special provision about licence fees
Currently the SRC Act only allows for a licensee to be charged a fee on
commencement of a licence or on 1 July each year. Non-Commonwealth
licensees may have already paid a fee for the current period in relation to
workers' compensation under section 104A of the SRC Act. This item
provides that if the Act commences on a day other than a 1 July, Comcare
and the Commission can use section 104A of the SRC Act to charge a non-
Commonwealth licensee an additional regulatory contribution for the
administration of OHS(CE) Act for the period until the next 1 July.
The Commission must notify the non-Commonwealth licensee of the amount it
must pay in relation to OHS before the non-Commonwealth licensee is liable
to pay the fee.
Schedule 1 - CONSEQUENTIAL AMENDMENTS OF OTHER ACTS
PART 2 - CONSEQUENTIAL AMENDMENTS
Items 41 - 50 Updated references to the short title in the Safety,
Rehabilitation and Compensation Act 1988
These items make consequential amendments to the Safety, Rehabilitation and
Compensation Act 1988 to reflect the change of short title at item 2 to the
Occupational Health and Safety Act 1991.
Items 51 - 57 Updated references to the short title in the Social Security
Act 1991
These items make consequential amendments to the Social Security Act 1991
to reflect the change of short title at item 2 to the Occupational Health
and Safety Act 1991. However, items 51-54 are also being amended by the
Employment and Workplace Relations Legislation Amendment (Welfare to Work
and Other Measures) Bill 2005. The items will also make amendments to
that Bill following its commencement.
Schedule 2 - REGULATORY CONTRIBUTIONS AND LICENCE FEES UNDER THE SAFETY,
REHABILITATION AND COMPENSATION ACT 1988
PART 1 - AMENDMENTS
Item 1 - Subsection 4(1) Definition of Commonwealth authority
This item inserts a note following the definition of 'Commonwealth
authority' under the Safety, Rehabilitation and Compensation Act 1988 (SRC
Act) alerting readers to an extended meaning of 'Commonwealth authority'
for the purposes of Division 4A of Part VII (see item 2).
Item 2 - Before section 97 Extended meaning of Commonwealth authority
This item extends the meaning of Commonwealth authority under the SRC Act
for the purposes of charging regulatory contributions.
Entities (Commonwealth departments, agencies and other prescribed bodies)
and Commonwealth authorities are required to pay a regulatory contribution
under section 97D of the SRC Act at the beginning of each financial year in
relation to services and costs to the Commission and Comcare in
administering the OHS(CE) and SRC Acts.
Prior to the Safety, Rehabilitation and Compensation and Other Legislation
Amendment Act 2001 (the SRCOLA Act) contributions for the administration of
the SRC Act were paid under the SRC Act and contributions for the
administration of the OHS(CE) Act were paid under the OHS(CE) Act. The
SRCOLA Act rationalised funding arrangements so that regulatory
contributions in relation to both Acts were payable only under the SRC Act.
While the definition of Entity under each Act is the same, the Acts contain
a similar, but slightly different, definition of Commonwealth authority.
This results in a number of bodies being Commonwealth authorities for the
purposes of the OHS(CE) Act but not the SRC Act. Commonwealth authorities
that are not covered by the SRC Act cannot be charged a contribution in
relation to the administration of the OHS(CE) Act.
Item 2 inserts new section 96 which extends the meaning of Commonwealth
authority to include all Commonwealth authorities covered by the OHS(CE)
Act. This allows Comcare to charge a regulatory contribution for the
administration of the OHS(CE) Act to all Commonwealth authorities covered
by that Act. This item also applies to all other provisions in Division 4A
of Part VII the SRC Act that relate to regulatory contributions.
Item 3 - Application of amendments
This item aligns the application, and therefore the commencement, of item 2
with the beginning of the next financial year. This streamlines the
application of the provisions with other contributions charged by Comcare
and the Commission under the SRC Act.
PART 2 - VALIDATION PROVISIONS
Item 4 - Definitions for Part 2
This item inserts a number of definitions into Part 2 of this Schedule for
reference when reading the provisions.
Item 5 - Validation of regulatory contributions purportedly determined for
certain bodies
As noted at item 2 of this Schedule, an unintended consequence of the
SRCOLA Act amendments in 2001 was that Comcare can no longer charge
Commonwealth authorities covered by the OHS(CE) Act a regulatory
contribution toward the administration of the Act unless they are also
covered by the SRC Act.
A number of Commonwealth authorities, however, paid a contribution under
section 97D of the SRC Act in relation to the administration of the OHS(CE)
Act for the 2002-2003 financial year. The payments were retained by
Comcare, as agreed with the authorities, for services to be provided during
the 2002-2003 financial year with the understanding that an amendment would
be made to the legislation to validate the payments and provide for future
payments. Three Commonwealth authorities are known to have paid such
contributions.
Item 5 validates determinations purported to be made under section 97D of
the SRC Act and payments received by Comcare for the 2002-2003 financial
year in relation to the above bodies.
Item 6 - Validation of licence fees purportedly notified to certain bodies
Also following the SRCOLA Act amendments a number of bodies which held
licences under the pre-SRCOLA Act licence provisions paid licence fees in
accordance with new section 104A rather than the pre-SRCOLA provisions.
The pre-SRCOLA fee provisions continued in operation for the duration of
the licence. The original payments were retained by Comcare and put toward
the amount determined to be owed under the pre-SRCOLA provisions, as agreed
with each licensee, and with the understanding that an amendment would be
made to the legislation to validate the payments. There are three
licensees known to have paid fees under section 104A of the SRC Act for the
2002-2003 financial year.
Item 6 validates determinations purported to be made by the Commission and
payments received by Comcare under section 104A of the SRC Act for the 2002-
2003 financial year in relation to the above bodies.
This item also makes it plain that no additional notification is necessary
under paragraph 104A(1)(b) as notification was provided when the initial
determination was made and each body agreed to and paid the contribution at
the time the contribution was determined.