Page 5718 - Week 15 - Thursday, 10 December 2009

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The bill also broadens the definition of “worker” to ensure that sole trader occupations—contractors operating with an ABN who supply labour only or substantially labour only services—are caught in the definition. The provisions relating to the definition of “worker”, the wage statements and the rehabilitation arrangements commence on 1 July 2010 and everything else commences on the day after notification.

I note from the minister’s presentation speech that the amendments will save the business sector $4 million in costs and will cut red tape. This is a good outcome for business as any reduction in government red tape is an enhancement to business operation. Certainly, there will be a range of direct cost savings to businesses. These relate to the abolition of the need for audited wages statements, as well as the new rules relating to the engagement of rehabilitation service providers. Any saving in cost due to government regulation is an added bonus for business. So, on behalf of Canberra’s business community, I commend the government on its initiatives.

Some might consider the penalty provisions in the bill to be steep or even somewhat draconian. Nonetheless, they are designed, as most penalties are, to deter non-compliance. The benefit that has been introduced in this bill is that the penalties, apart from the default notice penalty, being the recovery amount, are structured such that they are commensurate with the size of the business. This too is a good outcome for business, notwithstanding the ideal that they should not have to be levied in the first place, but also understanding that not all businesses comply with the law in this area. That said, workers compensation is an important and compulsory cost of doing business. Non-compliance adds costs unnecessarily to the businesses who do comply. A higher level of compliance will lower costs for insurers, which in turn translates to lower workers compensation premiums.

In considering this bill, I invited comments from a range of employer representatives and other stakeholders. All the responses I received were supportive. However, the Law Society, whilst also supportive, did note that ordinary householders—that is, non-business employers—who engaged the services of contractors, for example cleaners, gardeners and even babysitters, may now be subjected to workers compensation liability and penalties. This is because an exemption that currently exists was not preserved in this bill. I will be proposing amendments to preserve this exemption and will address this issue in more detail in the detail stage of the debate. However, I flag now that further down the track I would like to begin a conversation about the role of non-business employers, particularly householders, and their exposure to workers compensation.

It is a complex issue. There are many cases where, for example, a householder might engage a full-time cleaner—I only wish I could—or a nanny, in which case there may be a clear need for the householder to carry workers compensation insurance. But what about the mum and dad who get the 15-year-old from next door to babysit the kids while they go to the movies, or the householder who gets a contract cleaner in for a couple of hours every week? Should they carry workers compensation insurance? Or does their public liability insurance cover them for any injury that might occur while these people are on their property? What about the 15-year-old girl next door that takes the kids to the local park for a couple of hours to get them out of the

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