Legislative Assembly for the ACT: 2009 Week 15 Hansard (10 December) . . Page.. 5724..
MS GALLAGHER (continuing):
incumbent on the chief executive to have regard to all evidence and information that is relevant to the exercise of this discretion. It ensures that the government is not forced to make a decision in error of the law by reason of being unable to consider new information or evidence that amounts to a relevant consideration because it is not reflected in the express list of criteria set.
This avoided premium penalty is consistent with those operating in other jurisdictions, such as New South Wales and Victoria, and will have the effect of scaling the penalty to be commensurate with the size of the employer. This disproves the perception that non-compliance is a cheaper alternative to the cost of complying with the workers compensation laws. The protection of workers in the workplace is not optional.
The bill also introduces personal liability for executive officers where there is a debt associated with the new civil penalties for non-insurance or under-insurance. Consistent with most other workers compensation jurisdictions, the bill also prohibits injured working directors of uninsured entities from claiming compensation from the default insurance fund. The person responsible for avoiding their responsibilities should not be eligible to compensation from the default insurance fund.
Every claim made against the fund by a working director of an uninsured entity represents an increased cost to those compliant employers and undermines the compliance objectives inherent in the Workers Compensation Act. Critically, these amendments also close the loop on employers who fail to discharge their statutory obligations.
There are an increasing number of individual labourers and tradespeople who operate as contractors with an Australian business number, an ABN. The sole trader with an ABN has become a vehicle for contractors further up the contracting chain to avoid paying workers compensation insurance, portable long service leave and payroll tax. The prevalence of this contracting structure severely penalises those employers who employ their workers on an appropriate basis and comply with their legal responsibilities. The commercial advantage these contracting arrangements brings is so significant that the viability of businesses doing the right thing is under threat.
This bill clarifies the broad definition of worker, thereby limiting the opportunity for premium avoiding and sham contracting. If an individual on a worksite, in a cafe, at a retail shop or in a commercial cleaning company supplies labour only, then without a doubt they are a worker, regardless of whether they have an ABN. These workers must be protected by their employers.
The new provisions will not capture those legitimate contractors who are paid to achieve an outcome; supply the necessary plant, equipment or tools of trade; and are or would be liable for the cost of rectifying any defective work.
The new provisions work together to assist employers and workers alike to understand who is considered a worker. In practice, whether an individual is a worker under the act will depend on the specific facts of the matter and the application of the broad definition as well as the more detailed provisions already contained in the Workers Compensation Act.