SA Introduces Substantial WorkCover and Workers Compensation Legislation Changes

Monday 11 August 2014 @ 11.08 a.m. | Industrial Law | Trade & Commerce

Two important Bills were recently introduced into the South Australian House of Assembly by the Deputy Premier the Honourable J.R. RAU who is also the Attorney General and Minister for Industrial Relations (6 August 2014). The two Bills are the Return to Work Bill 2014 (Bill No 29 of 2014) and the South Australian Employment Tribunal Bill 2014 (Bill No 30 of 2014).

The Return to Work Bill proposes legislation for a new scheme to support workers and employers where there is a work injury. The scheme is to be known as the Return to Work Scheme, and proposes to repeal the existing scheme established under the Workers Rehabilitation and Compensation Act 1986 (SA).

The second Bill, the South Australian Employment Tribunal Bill, is related to the Return to Work Bill because it proposes to establish the South Australian Employment Tribunal (the Tribunal), which is to be a Tribunal with the jurisdiction to review certain decisions arising from the Return to Work Scheme which the South Australian Government has indicated is planned to commence operation  on 1 July 2015.

Governments Rationale for New Laws

In his second reading speech, the Deputy Premier gave indications that the overhaul of the current system of workers compensation proposed by the Return to Work legislation was needed because:

" . . . the current Workers Rehabilitation and Compensation scheme does not best serve workers, employers or the state."

Going on to indicate that South Australian workers experience worse return to work outcomes than workers in other jurisdictions and that:

". . . for many, the services provided to them [did] not support early and effective recovery and return to work. However, it should be noted that, currently, there are approximately 15,500 new claimants per year, of which about 70 percent receive either no income maintenance or less than two weeks' income maintenance". 

Referring to the 2012-13 National Return to Work Survey (published in August 2013), the Deputy Premier said that the survey reported that South Australia's return-to-work result of 82 percent was the highest it had been since 2008-09, but that, despite relative improvement, the return to work rate remained well below that of all other Australian states and had been consistently below the national average for many years, a key reason for the changes and overhaul proposed.

In his second reading speech introducing the South Australian Employment Tribunal legislation, the proposed law is described by the Deputy Premier as establishing a tribunal with the jurisdiction to review certain decisions relating to the rights or circumstances arising out of or in the course of the employment of workers and the conferring of power on the tribunal.

The Tribunal is described as having similar ". . . functions, powers and operating approach" as the recently established South Australian Civil and Administrative Tribunal, notably it will be intended to "act with as little formality and technicality as possible and be flexible in the way in which it conducts its business". The tribunal will be headed by a president who will hold concurrent office as a judge of the Industrial Relations Court.

The Deputy Premier is reported in the press as saying the changes planned by the Return to Work legislation will ". . . target workers who suffer minor injuries but remain on compensation for more than two years".

The Deputy Premier is further quoted as saying that ". . . the current unfunded liability of WorkCover needed to be reduced so that injured workers would become ineligible for cover after two years". The Deputy Premier is reported as indicating changes to the current compensation scheme, which currently covers 430,000 South Australian employees, employed in 50,000 businesses, were expected to save business about $180 million annually by lowering their insurance premiums while 94 percent of workers would get increased benefits or at least be no worse off.

Reaction and Comment

The ABC reports the SA opposition's industrial relations spokesman Mr Rob Lucas as commenting that the SA Government's previous record on the issue of WorkCover reform ". . . left him unexcited about its latest reform plan", indicating past plans by the SA Government in his view had failed to achieve the required level of change and that he did not expect the current scheme to ". . . prove to any more successful than claims that have been made in the past."

Union reaction to the proposed laws is reported as being that, ". . . a focus on getting injured people back into work that did not involve penalising them," was needed. SA Unions secretary Mr Joe Szakacs is reported as saying he supported efforts to make workers' compensation more financially sustainable and that getting rid of medical review panels would save money and assist in reducing the stress on injured workers.

Current Status

The two new items of proposed legislation are at second reading stage and to be further debated when the South Australian Parliament next sits in September 2014.

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