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2019-2020-2021-2022
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
Social Security Legislation Amendment (Streamlined
Participation Requirements and Other Measures) Bill
2021
SUPPLEMENTARY EXPLANATORY MEMORANDUM
Amendments to be Moved on Behalf of the Government
(Circulated by the authority of the Minister for Employment, Workforce, Skills,
Small and Family Business the Hon Stuart Robert MP)
Outline
The amendments to the Social Security Legislation Amendment (Streamlined
Participation Requirements and Other Measures) Bill 2021 (the Bill) will:
• remove Schedule 8 from the Bill, and make technical amendments required
as a consequence of the removal of Schedule 8;
• require the Employment Secretary by legislative instrument to determine
guidelines as to how certain aspects of the participation requirements in the
social security law will be administered in practice;
• remove compliance for job seekers who refuse or voluntarily leave work of
more than 15 hours per week, if they are the principal carer of at least one
child or have a partial capacity to work;
• include a requirement for a comprehensive review of the new employment
services model, Workforce Australia, to be completed within two years of
commencement of Workforce Australia;
• require a legislative instrument containing a digital protections framework for
Commonwealth employment services programs ;
• require the Employment Secretary to make arrangements so that job seekers
are not disadvantaged by the transition to points-based activation under the
new employment services model, Workforce Australia, where the transition
occurs by 30 September 2022.
The amendment to remove Schedule 8 responds to stakeholder concerns with the
schedule, which supports the 2021-22 Budget measure to align payment start day
rules for jobseeker payment and certain youth allowance claimants for those in
digital employment services with those who are referred to an employment services
provider.
The amendment to require determination of guidelines responds to a
recommendation of the Parliamentary Joint Committee on Human Rights in its
Report 9 of 4 August 2021.
The amendment to remove compliance in certain circumstances for job seekers who
are principal carers or have a partial capacity to work strengthens protections for job
seekers in response to concerns raised by stakeholders.
The requirement to complete a comprehensive review of the new employment
services model, Workforce Australia, within two years of the start of the program will
ensure that the effectiveness of the new model is thoroughly and transparently
examined, including views of affected people and relevant stakeholders and experts.
The amendment to require the publication of, and compliance with, a legislated
digital protections framework will provide greater clarity to stakeholders that
employment services are administered ethically.
2
The amendment to require the Employment Secretary to make arrangements so that
job seekers are not disadvantaged by the transition to Workforce Australia will
provide greater assurance to stakeholders that job seekers will not face
inappropriate compliance action as part of their transition to points-based activation.
This Supplementary Explanatory Memorandum also sets out the Minister's
responses to questions raised by the Senate Standing Committee for the Scrutiny of
Bills and the Parliamentary Joint Committee on Human Rights in their reports on the
Bill, as requested by the Committees.
Remove Schedule 8 from the Bill
Under Schedule 8 to the Bill, payment commencement for job seekers referred to
digital services would be aligned with provider-managed job seekers. This would
correct a current inequity whereby these job seekers' payment start dates depend on
whether they are in digital services or are managed by an employment services
provider.
Stakeholders have expressed concerns that the current measure under Schedule 8
will introduce new inequities for job seekers, that job seekers in digital services will
not have time to properly consider Job Plans before agreeing to them, and that
payment commencement delays will disadvantage vulnerable job seekers.
It is important to note that under the new employment services model commencing in
July 2022, job seekers in digital services will not be asked to agree to specific
activities or requirements. They would be merely agreeing to undertake
requirements, choosing the specific tasks to meet their points requirement after
payment commences. And further, protections within Schedule 8 would ensure that
job seekers do not face delays in payment for reasons beyond their control.
However, the Government does not wish the passage of other important
improvements to the social security law to be delayed, including changes to support
the new model. Accordingly, the Government has agreed to remove Schedule 8 from
the Bill.
The amendments made to Schedule 2 to the Administration Act made by Schedule 8
to the Bill also required consequential amendments to be made to other provisions in
the social security law (contained in Schedules 1 and 10 to the Bill) - those
consequential amendments will be removed from the Bill due to these amendments,
meaning that the law will remain as it currently is in relevant respects.
Determine guidelines
Schedule 1 of the Bill will modernise social security law, reduce repetition and
ambiguity and more clearly reflect current policy and practice. Schedule 1 will also
better enable job seekers to self-manage their requirements online.
The proposed amendments will add a provision to Schedule 1 to require the
Employment Secretary by legislative instrument to determine guidelines about:
3
• how job seekers can demonstrate that they are willing to actively seek, accept
and undertake paid work in Australia,
• the kind of information to be provided by the Employment Secretary to a
person who has made a claim for a participation payment about entering into
a Job Plan online or through an employment services provider
• the processes for entering into a Job Plan, including technological
requirements, such as access to a computer or mobile device, internet access
and the capability to use such technology
• the processes for job seekers to report their compliance with the requirements
in a Job Plan
• the types of circumstances in which paid work is considered unsuitable for a
job seeker due to health or safety risks, and how the job seeker can satisfy
the Employment Secretary, or in practice a delegate, of this risk.
This guidance will not change current policy or protections, but will enhance job
seekers' understanding of their rights and responsibilities.
This responds to a recommendation of the Parliamentary Joint Committee on Human
Rights. Other recommendations of the Committee have been responded to through
this Supplementary Explanatory Memorandum.
Additional protections for principal carers and job seekers with a partial capacity to
work
Under Schedule 1 to the Bill, the provisions outlining mutual obligation requirements
and exemptions for participation payments are being streamlined and consolidated
into a single set of provisions. Stakeholders have expressed concern about the Bill
removing protections for vulnerable cohorts. While existing protections for job
seekers will be retained, the Government is introducing additional protections to
assure stakeholders that vulnerable cohorts will not be required to accept work that
is inappropriate for their circumstances.
Currently, principal carers (those with primary care of a child aged under 16) and job
seekers with a disability resulting in an assessed partial capacity to work may 'fully
meet' their requirements, and cannot be given additional requirements, if they are
working for 30 hours per fortnight. Further, principal carers and job seekers with a
partial capacity to work cannot be required to accept work beyond their capacity,
where they have insufficient childcare or where they are not better off financially
accepting the work.
It is therefore very unlikely under current compliance arrangements that a principal
carer or job seeker with a partial capacity to work would be penalised for refusing or
voluntarily leaving work of more than 15 hours per week. However, the Government
will amend the Bill to ensure that these job seekers cannot be penalised if they
refuse or voluntarily leave work of more than 15 hours per week.
4
This is not expected to alter the number of penalties that apply in practice. However,
the additional protections will provide further assurance for stakeholders.
Employment Secretary to undertake a comprehensive review of Workforce Australia,
two years after commencement
The requirement to complete a comprehensive review of Workforce Australia within
two years of the commencement of that program will ensure that the effectiveness of
the new model is thoroughly and transparently examined.
The review will include consideration of job seeker experiences as described by job
seekers themselves. It will also include qualitative and quantitative data and input
from employment services providers, key stakeholders such as employers, and
social security experts..
To ensure openness and transparency, the amendment also requires the
Employment Minister to table the review in both Houses of Parliament and the
review to be published on the internet as soon as practicable after tabling.
Employment Secretary to determine and comply with a digital protections framework
for Commonwealth employment services
The Employment Secretary will be required to make a legislative instrument
containing a digital protections framework for employment services programs
administered by the Commonwealth, and the Secretary's use of technological
processes in relation to employment pathway plans must comply with that
framework. This amendment will provide greater assurance to stakeholders that
employment services are administered ethically.
The amendment requires that the legislative instrument must deal with the following:
• natural justice
• human rights protections
• transparency and freedom from bias
• privacy
• accessibility.
Consistently with requirements for consultation regarding legislative instruments, the
Government will consult widely on the contents of the instrument.
The Employment Secretary's use of technological processes in relation to:
• persons entering employment pathway plans
• variation or cancellation of those plans
• monitoring and reporting of compliance with those plans, and
• consequences of non-compliance with those plans,
must comply with the framework.
5
Employment Secretary to make arrangements so that job seekers are not
disadvantaged by the transition to Workforce Australia.
The Government's new employment services model, Workforce Australia, represents
the most significant redevelopment of employment services in two decades.
Informed by an expert panel, its design includes the introduction of a points-based
system, offering job seekers improved flexibility to meet their requirements in any
way they choose.
To ensure that job seekers are not adversely affected by the transition to the new
activation system, the Bill will be amended to ensure that job seekers will not be
disadvantaged for failing to meet certain mutual obligation requirements during the
transition. In practice, this means they will not be subject to compliance action for not
meeting their points requirement within one month of their transition to the new
model.
The amendment builds on existing protections, such as
• the 'light touch' reconnection requirement, where job seekers may avoid or
end a payment suspension or demerit for a first failure by confirming their
understanding of their requirements;
• resolution time - where job seekers may avoid experiencing a payment
suspension if they satisfy their provider they have a valid reason for non-
compliance or re-engage with their requirements within two business days
• arrangements under the targeted compliance framework so that job seekers
do not face lasting financial penalty for failing to meet their requirements until
generally the sixth failure without a good reason, and following two
assessments of the suitability of their requirements.
Financial Impacts
The proposed amendments would reduce savings reflected in the Bill by
$191.6 million (over four years from 2021-22).
6
SUPPLEMENTARY STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny)
Act 2011
Social Security Legislation Amendment (Streamlined Participation Requirements and
Other Measures) Bill 2021
The amendments to the Social Security Legislation Amendment (Streamlined
Participation Requirements and Other Measures) Bill 2021 (the Bill) are compatible
with the human rights and freedoms recognised or declared in the international
instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act
2011.
Overview of the amendments
The amendments to the Social Security Legislation Amendment (Streamlined
Participation Requirements and Other Measures) Bill 2021 (the Bill) will:
• remove Schedule 8 from the Bill (and make technical amendments required
as a consequence of the removal of Schedule 8);
• require the Employment Secretary by legislative instrument to determine
guidelines as to how certain aspects of the participation requirements in the
social security law will be administered in practice; and
• remove compliance for job seekers who refuse or voluntarily leave work of
more than 15 hours per week, if they are the principal carer of at least one
child or have a partial capacity to work.
• include a requirement for a comprehensive review of the new employment
services model, Workforce Australia, to be completed within two years of
commencement of Workforce Australia;
• require a legislative instrument containing a digital protections framework for
employment services programs established by the Commonwealth;
• require the Employment Secretary to make arrangements so that job seekers
are not disadvantaged by the transition to points-based activation under the
new employment services model, Workforce Australia, where the transition
occurs by 30 September 2022.
The amendments to remove Schedule 8 removes the 2021-22 Budget measure to
align payment start day rules for jobseeker payment and certain youth allowance
claimants for those in digital employment services with those who are referred to an
employment services provider.
The amendment to require determination of guidelines responds to a
recommendation of the Parliamentary Joint Committee on Human Rights in its
Report 9 of 4 August 2021.
7
The amendment to remove compliance in certain circumstances for job seekers who
are principal carers or have a partial capacity to work strengthens protections for job
seekers in response to concerns raised by stakeholders.
The requirement to complete a comprehensive review of the new employment
services model, Workforce Australia, within two years of the start of the program will
ensure that the effectiveness of the new model is thoroughly and transparently
examined, including views of affected people and relevant stakeholders and experts.
The amendment to require the publication of, and compliance with, a legislated
digital protections framework will provide greater clarity to stakeholders that
employment services are administered ethically.
The amendment to require the Employment Secretary to make arrangements so that
job seekers are not disadvantaged by the transition to Workforce Australia will
provide greater assurance to stakeholders that job seekers will not face
inappropriate compliance action as part of their transition to points-based activation.
Remove Schedule 8 from the Bill
Schedule 8 is compatible with human rights. Under Schedule 8, payment
commencement for job seekers referred to digital services would be aligned with
provider-managed job seekers. This would correct a current inequity whereby these
job seekers' payment start dates depend on whether they are in digital services or
managed by an employment services provider.
Under Schedule 8 job seekers in digital services would not have been asked to
agree to specific activities or requirements as part of the new model. They would be
merely agreeing to undertake requirements, choosing the specific tasks to meet their
points requirement after payment commences. And further, protections within
Schedule 8 would ensure that job seekers do not face delays in payment for reasons
beyond their control.
However, stakeholders expressed concerns that the current measure under
Schedule 8 will introduce new inequities for job seekers, that job seekers in digital
services will not have time to properly consider Job Plans before agreeing to them,
and that payment commencement delays will disadvantage vulnerable job seekers.
The Government does not wish the passage of other important improvements to the
social security law to be delayed, including changes to support of the new
employment services model commencing on 1 July 2022. Accordingly, the
Government has agreed to remove Schedule 8 from the Bill.
The amendments made to Schedule 2 to the Administration Act made by Schedule 8
to the Bill also required consequential amendments to be made to other provisions in
the social security law (contained in Schedules 1 and 10 to the Bill) - those
consequential amendments will be removed from the Bill due to these amendments,
meaning that the law will remain as it currently is in relevant respects.
8
Written guidelines
Schedule 1 of the Bill will modernise social security law, reduce repetition and
ambiguity and more clearly reflect current policy and practice. Schedule 1 will also
better enable job seekers to self-manage their requirements online.
The proposed amendments will add a provision to Schedule 1 to require the
Employment Secretary by legislative instrument to determine guidelines on the
internet about:
• how job seekers can demonstrate that they are willing to actively seek, accept
and undertake paid work in Australia,
• the kind of information to be provided by the Employment Secretary to a
person who has made a claim for a participation payment about entering into
a Job Plan online or through an employment services provider
• the processes for entering into a Job Plan, including technological
requirements, such as access to a computer or mobile device, internet access
and the capability to use such technology
• the processes for job seekers to report their compliance with the requirements
in a Job Plan
• the types of circumstances in which paid work is considered unsuitable for a
job seeker due to health or safety risks, and how the job seeker can satisfy
the Employment Secretary, or in practice a delegate, of this risk.
This guidance will not change current policy or protections, but will enhance job
seekers' understanding of their rights and responsibilities.
This responds to a recommendation of the Parliamentary Joint Committee on Human
Rights. Other recommendations of the Committee have been responded to through
this Supplementary Explanatory Memorandum.
Additional protections for principal carers and job seekers with a partial capacity to
work
Schedule 1 to the Bill is compatible with human rights.
Under Schedule 1 to the Bill, the provisions outlining mutual obligation requirements
and exemptions for participation payments are being streamlined and consolidated
into a single set of provisions. Stakeholders have expressed concern about the Bill
removing protections for vulnerable cohorts. While existing protections for job
seekers will be retained, the Government is introducing additional protections to
assure stakeholders that vulnerable cohorts will not be required to accept work that
is inappropriate for their circumstances.
Currently, principal carers (those with primary care of a child aged under 16) and job
seekers with a disability resulting in an assessed partial capacity to work may 'fully
meet' their requirements, and cannot be given additional requirements, if they are
working for 30 hours per fortnight. Further, principal carers and job seekers with a
9
partial capacity to work cannot be required to accept work beyond their capacity,
where they have insufficient childcare or where they are not better off financially
accepting the work.
It is therefore very unlikely under current compliance arrangements that a principal
carer or job seeker with a partial capacity to work would be penalised for refusing or
voluntarily leaving work of more than 15 hours per week. However, the Government
will amend the Bill to ensure that these job seekers cannot be penalised if they
refuse or voluntarily leave work of more than 15 hours per week.
This is not expected to alter the number of penalties that apply in practice. However,
the additional protections will provide further assurance for stakeholders.
Employment Secretary to undertake a comprehensive review of Workforce Australia,
two years after commencement
The requirement to complete a comprehensive review of Workforce Australia within
two years of the commencement of that program will ensure that the effectiveness of
the new model is thoroughly and transparently examined.
The review will include consideration of job seeker experiences as described by job
seekers themselves. It will also include qualitative and quantitative data and input
from employment services providers, key stakeholders such as employers, and
social security experts..
To ensure openness and transparency, the amendment also requires the
Employment Minister to table the review in both Houses of Parliament and the
review to be published on the internet as soon as practicable after tabling.
Employment Secretary to determine and comply with a digital protections framework
for Commonwealth employment services
The Employment Secretary will be required to make a legislative instrument
containing a digital protections framework for employment services programs
administered by the Commonwealth, and the Secretary's use of technological
processes in relation to employment pathway plans must comply with that
framework. This amendment will provide greater assurance to stakeholders that
employment services are administered ethically.
The amendment requires that the legislative instrument must deal with the following:
• natural justice
• human rights protections
• transparency and freedom from bias
• privacy
• accessibility.
Consistently with requirements for consultation regarding legislative instruments, the
Government will consult widely on the contents of the instrument.
10
The Employment Secretary's use of technological processes in relation to:
• persons entering employment pathway plans
• variation or cancellation of those plans
• monitoring and reporting of compliance with those plans, and
• consequences of non-compliance with those plans,
must all comply with the framework.
Employment Secretary to make arrangements so that job seekers are not
disadvantaged by the transition to Workforce Australia.
The Government's new employment services model, Workforce Australia, represents
the most significant redevelopment of employment services in two decades.
Informed by an expert panel, its design includes the introduction of a points-based
system, offering job seekers improved flexibility to meet their requirements in any
way they choose.
To ensure that job seekers are not adversely affected by the transition to the new
activation system, the Bill will be amended to ensure that job seekers will not be
disadvantaged for failing to meet certain mutual obligation requirements during the
transition. In practice, this means they will not be subject to compliance action for not
meeting their points requirement within one month of their transition to the new
model.
The amendment builds on existing protections, such as
• the 'light touch' reconnection requirement, where job seekers may avoid or
end a payment suspension or demerit for a first failure by confirming their
understanding of their requirements;
• resolution time - where job seekers may avoid experiencing a payment
suspension if they satisfy their provider they have a valid reason for non-
compliance or re-engage with their requirements within two business days
• arrangements under the targeted compliance framework so that job seekers
do not face lasting financial penalty for failing to meet their requirements until
generally the sixth failure without a good reason, and following two
assessments of the suitability of their requirements.
Human rights implications
The amendments engage the following rights:
• the right to social security - Article 9 of the International Covenant on
Economic, Social and Cultural Rights (ICESCR)
• the right to an adequate standard of living - Article 11 of ICESCR
• the right to work - Articles 2 and 6 of ICESCR.
Article 9 of the ICESCR recognises the right of everyone to social security. The right
to social security requires States to establish a social security system and, to the
maximum of their available resources, ensure access to a social security scheme
11
that provides a minimum essential level of benefits to all individuals and families that
will enable them to acquire at least essential health care, basic shelter and housing,
water and sanitation, foodstuffs, and the most basic forms of education.
Article 11 of the ICESCR recognises the right of everyone to an adequate standard
of living including adequate food, water and housing, and to the continuous
improvement of living conditions.
Article 2 of ICESCR requires that each State Party undertakes to take steps to the
maximum of its available resources, especially economic and technical, to realise the
rights recognised in the Covenant, particularly through legislative measures. Article 6
of ICESCR recognises the right of every person to the opportunity to gain a living by
work which they freely choose or accept.
While for some job seekers, Schedule 8 meant that the start date of their payment
would have been later than under current law, any limitations on rights which
Schedule 8 would have involved were reasonable and proportionate and for
legitimate reasons, including to encourage job seekers to engage with their right to
work by connecting quickly with employment services and entering a Job Plan, which
means they would be more likely to quickly gain paid work.
These amendments will mean that current law is maintained in relevant respects, i.e.
there will be no change to payment start dates. To that extent, these amendments
promote human rights. While the amendments mean that the above benefits of
Schedule 8 will not now result, the Bill contains other important improvements to the
social security law, which will benefit job seekers by enabling them to participate in
digital services if they choose, in accordance with simpler and clearer legislation due
to the Bill.
Requiring, by legislative instrument, determination of guidelines will assist job
seekers to better understand their rights and responsibilities and support them to
meet their mutual obligation requirements.
This amendment therefore promotes the right to social security and an adequate
standard of living by helping to ensure that job seekers meet the conditions to
commence receiving and continue to receive their income support payment.
This amendment also promote the right to work by assisting job seekers to identify
when paid work may not be suitable for them, ensuring they are applying for or
undertaking safe and sustainable work.
Schedule 1 to the Bill will retain existing protections for job seekers, including that
requirements must be suitable, having regard to individual circumstances.
Principal carers and job seekers with a partial capacity to work will still be able to
fully meet their requirements, and cannot be given additional requirements, if they
are working for 30 hours per fortnight. Further, principal carers and job seekers with
a partial capacity to work cannot be required to accept work beyond their capacity,
where they have insufficient childcare or where they are not better off financially
accepting the work.
12
The amendments will ensure that principal carers or job seekers with a partial
capacity to work cannot be penalised for refusing or voluntarily leaving work of more
than 15 hours per week. Further, the amendments ensure that job seekers
transitioning to Workforce Australia will not face compliance action for not meeting a
points requirement within the first month of their transition to the new model, where
the transition occurs by 30 September 2022.
The amendments therefore promote the right to social security and an adequate
standard of living.
The amendments introducing a requirement to make a legislative instrument
containing a digital protections framework and requiring a review of Workforce
Australia also promote human rights because they will help ensure that employment
services programs established by the Commonwealth are administered fairly and
without any undue limitation to human rights.
Conclusion
The amendments are compatible with human rights and promote the right to social
security, the right to an adequate standard of living and the right to work.
13
Issues raised by the Senate Standing Committee for the Scrutiny of Bills
In its Scrutiny Digest 8 of 2021 and Scrutiny Digest 10 of 2021 the Senate Standing
Committee for the Scrutiny of Bills sought the Minister's advice about proposed
provisions in the Administration Act. In particular, the Committee sought the
Minister's advice about why determinations under the new section 40T of the
Administration Act will not be legislative instruments.
In its Scrutiny Digest 11 of 2021, the Committee requested the key information
provided by the Minister to the Committee in response to its request for advice about
determinations under section 40T be included in an addendum to the Explanatory
Memorandum to the Bill. That information is as follows.
Schedule 1, item 123
Item 123 of the Bill inserts section 40T to the Administration Act. Section 40T is a
new exemption provision for which there is no current equivalent and relates to
exceptional circumstances in which classes of people will not be required to satisfy
the employment pathway plan requirements if a determination to that effect is made.
It is appropriate that the Bill provides that determinations under section 40T are not
legislative instruments. This is not merely a matter of administrative flexibility - job
seekers need timely information in advance so they do not expose themselves to
danger, for example due to bushfires, due to uncertainty about whether they need to
meet requirements. The usual tabling and disallowance processes are inconsistent
with this, due to the potential for emergency situations to evolve rapidly and
unpredictably in many areas simultaneously, as noted in the explanatory
memorandum.
While not all exceptional circumstances which might fall within the scope of section
40T will constitute health or safety emergencies, they may nonetheless evolve
rapidly. Classes of job seekers who are affected by the exceptional circumstances
need timely information in advance about their obligations so they are not exposed to
unnecessary stress or anxiety in connection with whether they need to meet
requirements.
An example of a situation where the power in proposed section 40T may be needed
is if a bushfire is spreading on a Sunday night. If the instrument is legislative, it would
need to be drafted, signed and registered, with an accompanying explanatory
statement. This would not physically be possible in time to provide job seekers in the
bushfire affected areas the certainty they need that they would not risk their
payments being affected by not complying with their requirements the next morning.
This is not an uncommon scenario. During the 2019-20 bushfires, for example, there
were 22 instances where requirements needed to be urgently paused for some job
seekers.
It is also important to note that it would not be possible for an instrument under
proposed section 40T to encroach on personal rights and liberties because the only
purpose of such an instrument would be to exempt persons from needing to comply
with mutual obligation requirements under the social security law in order to receive
14
their social security payment. Accordingly, it is appropriate that the Bill provides that
determinations under section 40T are not legislative instruments.
Issues raised by the Parliamentary Joint Committee on Human Rights
In Report 7 of 2021 the Parliamentary Joint Committee on Human Rights sought the
Minister's advice about proposed provisions in the Social Security Act 1991 (the Act)
and the Administration Act. In particular, the Committee sought the Minister's advice
about:
• the requirement for a job seeker to be willing to actively seek, accept and
undertake paid work in Australia;
• the objective behind compulsory engagement in an employment pathway
plan;
• the Employment Secretary's discretion to suspend, reduce or cancel a
person's payment because of a mutual obligation failure;
• the use of technological processes in relation to employment pathway plans;
• determining what work is 'unsuitable';
• exemptions for those living in rural areas; and
• treatment and exemptions for misuse of drugs and alcohol.
In Report 9 of 2021, at paragraph 2.9.2, the Committee recommended that the Bill
be amended to require that guidelines be published to:
"(a) outline the circumstances in which a person may satisfy their employment pathway
plan requirements, including as to how a person must demonstrate that they are
willing to actively seek and to accept and undertake paid work in Australia (including
where they are subject to an exemption);
(b) set out the kind of information which must be provided to a person applying for a
social welfare payment regarding their ability to enter into an employment pathway
plan either through a job services provider or via technological processes, and what
using technological requirements will necessitate (e.g. regular access to a phone
with credit, regular access to a computer with internet, self-reporting each week);
and
(c) set out the types of circumstances in which a workplace may be unsafe for a
person, and what a person would need to demonstrate that they consider a
workplace may be unsafe".
The amendment on Sheet TK310 addresses this recommendation, as outlined above.
The Committee also requested the extensive information provided by the Minister to
the Committee in response to its request for advice be included in an addendum to the
Explanatory Memorandum to the Bill. That information is as follows.
Schedule 1, Items 19 (proposed subsections 500(2A) and (2B) of the Act),
28 (proposed subsection 540(2) of the Act), 70 (proposed subsection 593(1AC) of
the Act) and 85 (proposed subsection 729(2B) of the Act)
15
Requirement for payment recipients to be willing to actively seek, accept and
undertake paid work
The requirement for a participation payment recipient to satisfy the Employment
Secretary (in practice, a delegate) they are willing to actively seek and to accept and
undertake paid work in Australia, except unsuitable paid work, is equivalent to the
current and longstanding "activity test" requirement that a person must satisfy the
Secretary that they are actively seeking and willing to undertake paid work in
Australia, except unsuitable work. Usually a person could satisfy the Employment
Secretary of this by entering an employment pathway plan and meeting their
employment pathway plan requirements or only failing to do so for good reason, or
simply making a statement as to their willingness if a delegate asked them, in the
absence of any contrary evidence.
In practice, a person would only fail to comply with the requirement in egregious
cases where the person actively states that they would be unwilling to accept
suitable work if it were offered, or in other rare cases where the person has such a
major focus on volunteer work, unprofitable self-employment or some other project
that it is incompatible with being willing to actively seek or to accept or undertake
paid work.
An exemption also does not remove this requirement, although the provisions in
Schedule 1 are clear that a person would only be required to be willing to look for
and accept work if it were not for the exemption from requirements.
Schedule 1, item 123
Compulsory engagement in an employment pathway plan
Currently under social security law, entry into employment pathway plans is
compulsory where a person is required by the Secretary or delegate to enter a plan,
and this would not change following passage of the Bill.
The legitimate objective behind compulsory employment pathway plans is to ensure
that those receiving unemployment payments do all that they are able to support
themselves through paid work. The employment pathway plan sets out job seekers'
mutual obligation requirements. There is strong evidence that these requirements
increase the chances of and speed the rate at which job seekers find work.
For example, the OECD has highlighted the effectiveness of job seeker participation
in targeted programs that include job search monitoring and participation in activities
that promote motivation and employability1 (referred to internationally as active
labour market programs). One meta-analysis of 207 studies looking at 857 active
labour market programs found participation in these programs effective in the short
and long term.2
1
OECD (2015). Employment Outlook 2015 - Activation policies for more inclusive labour markets, OECD Publishing.
2
Card, D., Kluve, J.,Weber, A., (2018). What Works? A Meta Analysis of Recent Active Labour Market Program Evaluations.
Journal of the European Economic Association, 16(3).
16
There is also strong evidence that making these requirements compulsory, with
consequences applying for not complying with requirements, increases employment3
and engagement with requirements.4
In addition, while mutual obligation requirements have existed for many years,
requirements have more recently been introduced for some groups of parents. In
2006 and 2007, activity requirements for parents receiving payment were introduced
for those with a youngest child aged 6 or over. Administrative data was analysed for
the sub-group of parents with a youngest child aged 6 and 7, as this group was given
activity requirements but experienced no change in payment rates or other settings.
The analysis shows the introduction of mutual obligation requirements led to an
increase in the average proportion of parents reporting earnings in the years
following the changes:
• from 30 per cent to 37 per cent for parents of youngest children aged 6;
• from 32 per cent to 45 per cent for parents of youngest children aged 7.
A 2013 study also found that parent job seekers were more likely to exit income
support after the introduction of mutual obligation requirements. Parents of youngest
children aged seven were 48 per cent more likely to exit payment in the year after
introduction5.
The employment pathway plan is the method of setting out job seekers' mutual
obligation requirements.
Protections within the current employment pathway plan provisions, and those
proposed in the Bill, ensure that job seekers' circumstances and capacity to comply
with their requirements need to be taken into consideration when a person enters
into an employment pathway plan with the Secretary, or if a person seeks review of a
plan that they have chosen to enter into.
The Bill makes it very clear that a delegate cannot require a person to comply with
an employment pathway plan requirement which is not suitable for them - see
proposed subsection 40D(5): "The Employment Secretary must not approve
requirements which are not suitable for a person" and that in determining what is
suitable the person's circumstances must be considered by the delegate - see
proposed subsection 40D(5) and 40F. The Bill also makes clear that plans cannot
3 See for example:
• Arni, P., Lalive, R. and Van Ours, J. (2013) 'How Effective Are Unemployment Benefit Sanctions? Looking Beyond Unemployment
Exit', Journal of Applied Econometrics, 28, 1153-1178.
• Abbring, J., Van den Berg, G. and Van Ours, J. (2005) 'The Effect of Unemployment Insurance Sanctions on the Transition Rate from
Unemployment to Employment', The Economic Journal, 115, 505, 602-630.
• Van den Berg, G., Van der Klaauw, B. and Van Ours, J. (2004) 'Punitive Sanctions and the Transition Rate from Welfare to Work'
Journal of Labor Economics, 22, 1, 211-241.
• Van der Klaauw, B. and Van Ours, J. (2013) 'Carrot and stick: How re-employment bonuses and benefit sanctions affect exit rates
from welfare' Journal of Applied Econometrics, 28, 2, 275-296.
4 See for example:
• Wright, A., Dollery, B, Kortt, M., Leu, S., (forthcoming) "The Effect of Varying Sanction Values on Future Compliance with
Unemployment Benefit Requirements: An Empirical Analysis Using Australian Administrative Data". Public Administration Quarterly
• Wright, A. and Dollery, B. (2020) 'The impact of sanctions on compliance with unemployment payment requirements: An analysis
using 2015/16 Australian national data'. Australian Journal of Labour Economics, 23, 1-20.
5 Fok and McVicar (2013). Did the 2007 welfare reforms for low income parents in Australia increase welfare exits?, IZA Journal of Labor
Policy.
17
contain a requirement to seek, accept or undertake unsuitable paid work - see
proposed section 40H.
In addition, administrative arrangements under the Targeted Compliance Framework
ensure that job seekers will not face a financial penalty for not complying with a term
of their employment pathway plan until the appropriateness of their employment
pathway plans has been assessed twice - once by their provider (or the Digital
Services Contact Centre) and once by Services Australia. In addition, job seekers
also will not face financial penalties if they have a reasonable excuse for not meeting
a requirement.
The compulsory nature of employment pathway plans therefore promotes the right to
work, and to the extent that there is any restriction on the right to social security and
adequate standard of living, this is minimised, reasonable and proportionate to
achieve a legitimate objective.
Requiring a person to engage in an employment pathway plan is also rationally
connected to the legitimate objective of job seekers finding employment and
reducing their reliance on income support.
Schedule 1, item 123 (proposed section 40A of the Administration Act)
Protections for those using digital employment services
Assessment of digital literacy and access is part of the process of determining
whether somebody is able to enter into an employment pathway plan through
technological processes. Proposed paragraph 40A(3)(b) states that a person may be
given the option to enter a plan through technological processes, taking account of
their circumstances. Whether or not a person has digital literacy and access is part
of their circumstances.
Before a job seeker is offered the opportunity to enter into an employment pathway
plan using technological processes, they will have their circumstances assessed.
Job seekers who are assessed as job-ready and able to use and access Digital
Services will be able to choose to manage their requirements online. These job-
ready job seekers can also choose to be referred to a provider. Job seekers who are
not assessed as job-ready will be referred to a provider to manage their
requirements.
Again, the Bill also ensures that a person must be given the option of entering into
an employment pathway plan with a human delegate when being given the
requirement to enter into an employment pathway plan - see proposed subsection
40A(3).
Safeguards built into the Digital Employment Services Platform will ensure people do
not get left behind, including a Digital Services Contact Centre to provide advice and
extra support via phone or email. In addition, existing safeguards built into
compliance arrangements will ensure that before anybody faces any financial
penalty for not meeting their requirements they will have the appropriateness of their
18
requirements for their individual circumstances assessed twice, at a Capability
Interview and a Capability Assessment with human delegates. Further, job seekers
are able to move to a provider of their choice at any time if they feel the online
service is not meeting their needs.
Schedule 1, item 123 (proposed section 40B of the Administration Act)
The use of technological processes
Schedule 1 of the Bill will allow job seekers accessing online employment services to
use technology to choose and vary their own Job Plan requirements online, without
assistance from the Digital Services Contact Centre, unless they want or need
assistance.
The provisions in the Bill deliberately do not specify the types of technological
processes that may be used to enter or vary an employment pathway plan so as to
allow flexibility to develop the best service for job seekers as technology and service
offerings develop. Currently, it is envisaged that job seekers will use online
processes to enter or vary their employment pathway plans.
No job seeker will be required to enter an employment pathway plan through
technological processes if they do not have access to, or cannot use, or do not wish
to use, relevant technology.
Some technological processes would require access to services or devices such as
a computer or smart phone and a viable internet and/or mobile telephone signal. For
this reason, before a job seeker is offered the opportunity of entering a plan via
technological processes, they will have their circumstances assessed. Job seekers
who are assessed as job-ready and able to use and access digital services will be
able to choose to manage their requirements online.
However, human oversight and assistance also remain an integral part of all
employment services and will continue to do so. At any time, job seekers will be able
to contact a person in the Digital Services Contact Centre who is trained to answer
their questions and assist them with any difficulties.
The amendments also require that all job seekers will have the option of entering an
employment pathway plan with a human delegate - see proposed subsection
40A(3).
Schedule 1, item 123 (proposed sections 40D, 40F and 40H of the Administration
Act)
Assessment of unsuitable work
There are a range of legislative criteria in the Bill that prevent job seekers being
compelled to apply for unsuitable work. An employment pathway cannot contain a
requirement to look for, accept, or undertake unsuitable paid work - see proposed
section 40H which applies in relation to both traditional plans and plans entered
through technological processes. Further, due to proposed subsection 40D(5) and
19
40F, when a job seeker enters an employment pathway plan with the Employment
Secretary (in practice a delegate), the delegate must consider a range of matters in
determining requirements, including requirements about the number of job searches.
The matters which must be considered include:
• the person's capacity to comply;
• the state of the local labour market;
• the participation and transport options available to the person; and
• the length of travel time to comply with those requirements.
These legal protections are supplemented by administrative protections. For
example, if a person considers that their requirements are unsuitable, they may
contact their provider or the Digital Services Contact Centre in order to reduce their
requirements. Further, if for some reason, a person's employment pathway plan
does contain requirements above their capacity, two assessments of the
appropriateness of their employment pathway plan will be undertaken before they
face financial penalties for not meeting those requirements.
The Parliamentary Joint Committee on Human Rights asked what the evidentiary
requirements were for a job seeker to avoid a penalty for refusing work where they
believed a potential workplace may be unsafe, for example, due to sexism, racism,
homophobia or other bullying or harassment. There are no specified evidence
requirements needed to satisfy providers or delegates in Services Australia that work
was unsuitable. However, it would also be open to a delegate to accept evidence
from a job seeker, if it were available, and to conclude on that basis that particular
work is unsuitable for the job seeker.
Schedule 1, item 123 (proposed sections 40D, 40F, 40H and 40X of the
Administration Act)
Employment pathway plan requirements for those in rural areas
Job seekers' requirements are adjusted to ensure their requirements are appropriate
and achievable - including if they live in a rural area or live in a depressed labour
market. However, job seekers are not usually completely exempted from
requirements merely due to living in a rural area. The Bill will not change this
situation.
There are existing safeguards relating to the extent to which a person can be
expected to seek, accept or undertake jobs some distance from their home. The Bill
will not change this - see for example proposed paragraphs 40X(1)(f) and (h)
regarding unreasonably difficult commutes and work which requires a person to
move from home.
Recognising the unique social and labour market conditions in remote Australia, a
different employment service exists in remote Australia. The Community
Development Program (CDP) is the Government's remote employment and
community development service. CDP supports job seekers in remote Australia to
build skills, address barriers to employment and contribute to their communities
through a range of flexible activities.
20
Schedule 1, item 123 (proposed section 40L of the Administration Act)
Employment pathway plan requirements relating to misuse of drugs and alcohol
The provisions in subsection 40L(4), specifying that the exemptions in section 40L
cannot be granted for reasons wholly or predominantly due to misuse of drugs or
alcohol, replicate existing provisions in social security law, and arrangements would
not alter following passage of the Bill.
A fundamental principle of mutual obligation requirements is that job seekers must
do all that they are able to in order to support themselves through paid work -
including addressing drug or alcohol misuse. Participation in drug and alcohol
treatment may count towards mutual obligation requirements, and if job seekers
cannot meet a requirement due to a circumstance wholly or predominantly due to
drug or alcohol misuse, this may be a reasonable excuse (however, there are
restrictions on repeatedly using drug and alcohol as a reasonable excuse if a person
has refused appropriate and available treatment).
Further explanation of the objective, legitimate and proportionate nature of the
provisions which subsection 40L(4) replicate is contained in the Statement of
Compatibility with Human Rights for Schedule 13 of the Social Services Legislation
Amendment (Welfare Reform) Act 2018 at
www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Re
sult?bId=r5927.
Permanent conditions relating to misuse of drugs and alcohol
Exemptions from mutual obligations are intended for circumstances where a person
is temporarily unable to meet their requirements. For this reason, a person would
generally not be eligible for an exemption solely due to the impact of a permanent
condition. In these cases, a person would be assessed for a partial capacity to work,
or potentially have their eligibility assessed for other payments such as Disability
Support Pension.
Where a person has a disability or illness, regardless of the cause, this must be
considered in setting the person's mutual obligation requirements.
A job seeker may also be eligible for a temporary medical incapacity exemption if
they experience a temporary exacerbation of a permanent condition, which would be
considered a result of the medical condition - not the circumstances which caused
the medical condition.
Schedule 3, Items 1 to 14
Decisions to suspend, reduce or cancel a person's payment under the Targeted
Compliance Framework
Current provisions in the Social Security (Administration) Act 1999 specify that
failures to comply with mutual obligation requirements 'must' result in a payment
21
suspension, regardless of whether the person has a good reason for missing their
requirement. In practice, this means that in cases where a person has a valid reason
for missing a requirement, their payment suspension is ended at the same time it
begins - with no practical effect on the payment.
The amendments proposed by the Bill would mean the requirement for this
suspension would cease, and instead provide flexibility on whether or not a payment
suspension should apply. For example, the amendments better support the current
practice of appropriate compliance response to mutual obligation failures, by making
clear that sanctions need not be imposed where doing so would not further the
objectives of the Targeted Compliance Framework.
The purpose of payment suspension is to motivate a person to reconnect with their
employment services provider after a mutual obligation failure. However, the
Secretary is currently obliged to suspend a person's participation payment even if
the person has a reasonable excuse for the mutual obligation failure, and even if the
person has already reconnected with their provider by the time the mutual obligation
failure comes to the Secretary's attention or before the Secretary has had time to
issue a reconnection requirement.
For example, a job seeker might miss an appointment with their provider scheduled
for 10am on a day, with or without a reasonable excuse, but of their own volition
attend their provider soon after on the same day, before being issued with a
reconnection requirement.
In these cases, currently the Secretary suspends the person's participation payment,
but the period of suspension immediately ends, with no practical consequence.
Suspension therefore serves no material purpose, so it is appropriate to amend the
law as is being done by this Schedule.
The proposed amendments would more clearly support, not alter, existing practice
by not requiring a participant's payment to be suspended if the participant has a
good reason for missing a requirement or if they have already re-engaged with their
provider.
Further detail on the operation of the Targeted Compliance Framework is available
at:
• guides.dss.gov.au/guide-social-security-law/3/11/13; and
• www.dese.gov.au/jobactive/resources/targeted-compliance-framework.
The provisions in the Bill will not result in any changes to the processes contained in
these documents.
As is currently the case, delegations regarding suspensions will be made to
employment services providers and delegations regarding application of penalties
will be made to Services Australia. The only changes in delegations will be updated
references to powers in social security law as a result of changes in the Bill. No
change will be made to the current processes that these delegates are required to
follow.
22
Protections for those who have committed a mutual obligation failure
When a person's payment is suspended they must be notified of how to re-engage
with their requirements and end their payment suspension (a reconnection
requirement). In practice, reconnection requirements are to meet the requirement
that was missed, or supply a valid reason for not being able to. As outlined above,
requirements need to be achievable and take into account job seekers'
circumstances and capacity to comply.
In December 2020, the Government introduced "resolution time" which allows job
seekers two business days to re-engage with their requirements before their
payments are suspended. If job seekers are unable to re-engage with their
requirements within two business days, their payment suspension is ended.
These arrangements mean that job seekers' suspensions are within their control and
can be ended either through re-engaging with requirements, providing a valid reason
for their initial failure to meet their requirement or explaining why they cannot re-
engage within two business days.
Current processes and safeguards will remain in place, including two separate and
rigorous job seeker capability assessments before a person faces financial penalties
for not meeting their requirements.
The first assessment, a Capability Interview, is undertaken by the job seeker's
employment services provider (or the Digital Services Contact Centre for those in
online employment services) generally following a third failure without a valid reason.
At this assessment, the appropriateness of job seekers' requirements is examined,
and the assessment is designed to prompt job seekers to disclose any
circumstances that may affecting their ability to meet their requirements. This may
result in job seekers being referred to further assessment or referred to Services
Australia for consideration of whether an exemption from requirements is
appropriate.
A second similar assessment is undertaken by Services Australia (generally
following a fifth failure without a valid reason).
In addition, following a missed requirement, employment services providers are
required to try to contact the job seeker.
This Bill makes no changes to processes regarding demerits or to the operation of
the Targeted Compliance Framework more generally. The Bill would better support,
not alter, existing practice.
23
Notes on clauses
Removal of Schedule 8 from the Bill
Amendment (22) will have the effect of removing Schedule 8 from the Bill in its
entirety.
Schedule 8 of the Bill would have inserted a new clause 4B into Schedule 2 to the
Administration Act, setting out how to work out the start day of a job seeker in receipt
of Jobseeker Payment or Youth Allowance who has entered into an employment
pathway plan under new section 40E of the Administration Act (that is, a self-
serviced job seeker able to enter their job plan online). Schedule 8 would also have
made some consequential amendments to clause 4A of Schedule 2 to the
Administration Act, which clause sets out how to work out the start day of job
seekers who are required to attend job services providers.
The changed arrangements for the start day for self-serviced job seekers required
other consequential amendments to the social security law, so these consequential
amendments also need to be removed or amended by the amendments in
Sheet TK310.
Amendment (1) will remove the items in the commencement table of the Bill that
provide for the commencement of Schedules 8 and 10 to the Bill (Schedule 10 to the
Bill is removed by amendment (23)).
Provisions of the Social Security Act that were being repealed because of the
introduction of new start day rules for certain job seekers are being reinstituted.
These include sections 547AA and 615. Amendments (3) and (5) amend items 61
and 80 of Schedule 1 to the Bill such that section 547AA and 615 of the Act are not
repealed, but amended to refer to employment pathway plans.
Amendments (2), (4), (6), (15), (16) and (23) are consequential to the amendments
made by amendments (3) and (5):
• amendment (2) will prevent item 30 in the table in subsection 93(1) of the
Farm Household Support Act 2014 being repealed;
• amendment (4) will prevent subsection 550(4) of the Social Security Act
being repealed;
• amendment (6) will prevent subparagraphs 37(2)(b)(v) and (6)(b)(v) of the
Administration Act being repealed;
• amendment (8) will prevent subsection 80(4) of the Administration Act being
repealed;
• amendment (16) will prevent the repeal of subclause 4A(5) and paragraph
(e) of the definition of exclusion period in subclause 5(2) of Schedule 2 to
the Administration Act; and
• amendment (23) will prevent paragraph 38B(6)(c) of the Social Security Act
being repealed.
24
Those provisions no longer need to be repealed, as they refer to sections 547AA and
615 of the Social Security Act, which are not being repealed.
Similarly, subparagraphs 42E(4)(b)(ii) and (c)(ii) of the Administration Act refer to
sections 547AA and 615 of the Social Security Act, and no longer need to be
repealed. However, subparagraphs 42E(4)(b)(i) and (c)(i) of the Administration Act
refer to provisions of the Social Security Act that are being repealed and replaced.
Consequently, item 133 of Schedule 1 to the Bill, which repeals
paragraphs 42E(4)(b) and (c) in their entirety, needs to be amended to instead
amend the subparagraphs of those paragraphs differently. This is done by
amendment (12), which replaces the existing item 133 of Schedule 1 with
items 133, 133A, 133B and 133C.
Amendment (17) will repeal the transitional provision relating to the amendments
made by items 150 and 151 of Schedule 1 to the Bill. The amendments are no
longer being made (see amendment (16)), so the transitional provision is no longer
required.
Employment Secretary to make guidelines on employment pathway plan
requirements etc.
Amendment (7) will insert a new section 40Y into the Administration Act, at the end
of the new provisions relating to employment pathway plans.
The new section 40Y will require the Employment Secretary to make a legislative
instrument determining guidelines about:
(a) how a person satisfies the Employment Secretary that the person is willing to
actively seek and to accept and undertake paid work in Australia, except
particular paid work that is unsuitable to be done by the person; and
(b) the following:
(i) the kind of information to be provided by the Employment Secretary to
a person who has made a claim for a participation payment about the
person entering into an employment pathway plan under section 40D or
40E;
(ii) the processes (including any technological requirements) for entering
into such a plan;
(iii) the processes for reporting compliance with the requirements in such a
plan; and
(c) the circumstances in which performing paid work in Australia may constitute
a risk to health or safety and how a person satisfies the Employment
Secretary that particular paid work constitutes such a risk.
Compliance protections for principal carer parents and persons with partial capacity
to work
Amendments (8), (10), (11), (13) and (14) will have the effect of inserting new
subsections into sections 42AC, 42AD, 42AE, 42N and 42S of the Administration
Act, respectively, that will prevent a person who is a principal carer parent or who
25
has a partial capacity to work from committing one of the compliance failures that are
set out in those sections in relation to work of more than 15 hours per week.
Amendment (9) is an amendment to the numbering of subsections in section 42AD
consequent to amendment (10).
Amendments (18), (19) and (20) insert application provisions that will provide that
the amendments made by amendments (8), (11) and (14) apply in relation to failures
that occur on or after the commencement of the amendments.
Review of operation of Workforce Australia, digital protections framework for
employment services programs and safeguards for transition to Workforce Australia
Amendment (21) inserts a new item 159A into Schedule 1 to the Bill.
Subitems (1) to (6) require the Employment Secretary to undertake a
comprehensive review of the Workforce Australia program, to be completed within
two years of the start of the program. The review needs to specifically examine the
effects of activity requirements, compliance and penalties, digital services, and
enhanced services on recipients of participation payments and on employment
outcomes. The report of the review must be tabled by the Employment Minister in
each House of Parliament, and published on the internet as soon as practicable
afterwards.
Subitems (7) to (9) require the Employment Secretary to determine, by legislative
instrument, a digital protections framework for Commonwealth employment
programs that addresses natural justice, human rights protections, transparency and
freedom from bias, privacy, and accessibility of technological processes. The
Secretary's use of technological processes in relation to employment pathway plans
must comply with the framework.
Subitem (10) requires the Employment Secretary to make arrangements to ensure
that a person is not disadvantaged because of mutual obligation failures relating to
paragraph 42AC(1)(e) (inadequate job search efforts) or (f) (other requirements of
the person's employment pathway plan) of the Administration Act. These
arrangements apply to mutual obligation failures committed by a person who
transitions to Workforce Australia on or before 30 September 2022, and which are
committed by the person within one month of their transition to Workforce Australia.
Subitem (11) sets out definitions of Employment Minister and Employment
Secretary for the purposes of item 159A.
26
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