Return To Work Act

Adjourned debate on motion of Hon. T.A. Franks:

1. That a select committee of the Legislative Council be established to inquire into—

(a) The potential impacts on injured workers and their families as a result of changes to the Return to Work Act including tightening of the eligibility criteria for entry into the Return to Work Scheme;

(b) Alternatives to the overly restrictive 30 per cent WPI threshold for ongoing entitlements to weekly payments;

(c) The current restrictions on medical entitlements for injured workers;

(d) Potentially adverse impacts of the current two year entitlements to weekly payments;

(e) The restriction on accessing common law remedies for injured workers with a less than 30 per cent WPI;

(f) Matters relating to and the impacts of assessing accumulative injuries;

(g) The obligations on employers to provide suitable alternative employment for injured workers;

(h) The impact of transitional provisions under the Return to Work Act 2014;

(i) Workers compensation in other Australian jurisdictions which may be relevant to the inquiry, including examination of the thresholds imposed in other states;

(j) The adverse impacts of the injury scale value; and

(k) Any other relevant matters.

2. That standing order 389 be so far suspended as to enable the chairperson of the committee to have a deliberative vote only.

3. That this council permits the select committee to authorise the disclosure or publication, as it sees fit, of any evidence or documents presented to the committee prior to such evidence being presented to the council.

4. That standing order 396 be suspended to enable strangers to be admitted when the select committee is examining witnesses unless the committee otherwise resolves, but they shall be excluded when the committee is deliberating.

(Continued from 25 May 2016.)

The Hon. M.C. PARNELL (17:06): My purpose in speaking to this motion now is to move an amendment to it. I move to amend the motion, as follows:

Paragraph 1—Leave out the words 'That a select committee of the Legislative Council be established to inquire into—' and insert the words 'That the Occupational Safety, Rehabilitation and Compensation Committee inquire into and report on—'

Paragraphs 2 to 4—Leave out these paragraphs.

I understand the amendment has been circulated, but it is quite straightforward. Basically, it leaves out the words, 'That a select committee of the Legislative Council be established to inquire into' and it inserts the words 'That the Occupational Safety, Rehabilitation and Compensation Committee inquire into and report on'. I will now just briefly say that it simply moves this motion from the one being the creation of a select committee to the reference of these matters to a standing committee. I understand that the amendment has the general support of the opposition and crossbench members and I commend the amendment and the amended motion to the house.

The Hon. T.T. NGO (17:08): I rise to support the Hon. Tammy Franks' motion to refer her proposal to inquire into various aspects of the Return to Work Scheme to the Occupational Safety, Rehabilitation and Compensation Committee. As honourable members would be aware, parliament passed the Return to Work Act 2014 in October 2014, with the new scheme coming into effect on 1 July 2015. To support those legislative changes, the methods of service delivery and case management were transformed. These reforms have been the most substantial changes to work injury insurance in nearly 30 years and were vital for the benefit of workers, employers and the state.

Although the new scheme is only in its infancy, there are very promising signs of improvement. For example, there are now over 100 mobile case managers providing face-to-face service to people with injuries, their employers and service providers across the state, including Adelaide, Mount Gambier, the Iron Triangle and the Riverland. It is my understanding that the level of disputes lodged with the scheme have dropped drastically with the introduction of the new Return to Work Scheme. I am told the reduction is about 22 per cent.

The cost of the Return to Work Scheme is also significantly less with it charging employers an average premium rate of 1.95 per cent of remuneration in 2015-16, compared with 2.75 per cent the previous year. The scheme's unfunded liability, which before these reforms was the largest in Australia, has now been completely wiped out. The scheme is now running at a surplus. I am extremely supportive of these developments as they ensure the scheme's long-term viability for all affected workers. While the Return to Work Scheme is not yet a year old, it appears that the intent of government and the parliament in establishing a scheme that supports workers who suffer injuries at work through early intervention is likely to be realised.

Given the importance of this social and economic statutory scheme, it is appropriate that the parliament and its members continue to monitor the administration and operation of the Return to Work Scheme. This is why the Return to Work Act 2014 contains a provision for a review of the act. This legislatively required review must consider the effectiveness of the dispute resolution processes, whether the jurisdiction of the South Australian Employment Tribunal be transferred to the South Australian Civil and Administrative Tribunal, any improvements in determining or resolving medical questions and any other matter that the minister considers to be relevant. The review will conclude with a written report that must be tabled in both houses of parliament.

Members will be able to analyse and question the findings or outcomes of the review. This legislatively required review is due to begin three years after the commencement of the act, that is, on 4 December 2017. It is the government's view that a review of the Return to Work Act 2014 now would be premature. While the motion by the Hon. Tammy Franks is supported, the government's view is that the legislation already contains a provision for a review of the Return to Work Act 2014 and the proposal for an inquiry is premature and unnecessary.

The Hon. R.I. LUCAS (17:12): I rise on behalf of Liberal members to speak to the motion and the amendment to the motion. As has just been outlined by the government, the government is supporting the motion and, as I understand it, other minor party and Independent members are supporting the motion as well. So, the position and vote ultimately of the Liberal Party members, we acknowledge, will not be of great significance in terms of whether or not it gets referred for review.

As the Hon. Mr Ngo has just outlined, there are certainly some who have argued very strongly to the Liberal Party that there should not be a review. As the Hon. Mr Ngo has pointed out, there is already a three-year review provision in the legislation, which I think was supported by all parties at the time, which means that there will be a review, irrespective of the fate of this particular motion.

The Liberal Party has been contacted by a number of interested groups, in particular employer organisations that have strongly opposed the notion of an early review, as they would refer to this particular motion. We have been lobbied by two or three employer groups that have opposed the notion of an early review, as they would deem it. As I said, the government has indicated that it is supporting it and all other members are supporting it, so the Liberal Party will not stand in the way of the motion. Even if the Liberal Party did, it would not have the numbers to prevent this review of the legislation that the government is now supporting.

The only other point I would make in my brief contribution is that an argument that my colleagues on the standing committee have indicated to me which would support the notion of the committee undertaking a review is that the committee has, over its years, monitored the workers compensation scheme in South Australia, even without a reference from either house of parliament.

In my brief period on the committee, we resolved as a committee to look at the workers compensation scheme. I know it had been done prior to me joining the committee, and my understanding is it is one of those sorts of issues that clearly and sensibly comes within the purview of the work of the committee. Therefore, the argument can be rationally made that it is an ongoing part of the work of this particular committee and therefore, if there was to be a reference to any committee, this is the appropriate committee for it to be referred to.

There is obviously a body of expertise on that committee already. Some members have had many years of experience and expertise in workers compensation issues—the member for Ashford and other members. I know the member for Schubert from another place from an employer perspective has had an ongoing and active interest in workers compensation issues and I am sure is looking forward to participating in this review of the scheme.

My final point is that, given, as I said, the government has supported this, hopefully the committee will be able to apply its expertise to the issues at hand to throw further evidence and light on some of the concerns that have been expressed so that, clearly when the formal review is done in three years' time, the parliament can be forewarned perhaps in relation to the concerns of some individual stakeholders. Clearly, it will give the opportunity for ReturnToWorkSA and its management and those who support it to respond to the concerns that some stakeholders have raised and will raise to the committee.

From that viewpoint, I think it is good that some of these issues will be aired, discussed and considered by the committee with the opportunity for people to express their differing views on the concerns. Then when the formal review is conducted and concluded, and that will be after the next state election, whichever government happens to be in power after March 2018 will be charged with the responsibility of oversight of what, if anything, is done as a result of the review of the legislation that is included in section 203 of the act.

The Hon. K.L. VINCENT (17:17): Dignity for Disability certainly welcomes the opportunity to support this motion and investigate this legislation, brought forward by the Hon. Tammy Franks in conjunction with the Hon. John Darley, to inquire into the current workers compensation scheme and the impact that these new laws are having or will have on injured workers. Being injured at work is certainly not something we will hope happens to us or to our family, friends or people we know and care about, but it unfortunately remains a fact of life.

It does happen, and we need a system which recognises the impact workplace injuries can have on a person's whole life. It is an impact that can last a lifetime and in fact many aspects, if not every aspect, of daily living. It is beholden on all of us to examine the consequences of this legislation on the quality of life of injured workers and how we can work to improve that quality of life. Particular concerns have been expressed, as I am sure members would be aware, in the community about the 30 per cent whole-person impairment (WPI) threshold to have medical costs and wages supplement payments carried on.

Constituents have raised with me the situation of older, particularly partially incapacitated workers, who were on the previous WorkCover scheme. With South Australia's ageing population being combined with workers staying longer in the workforce, we need to be alert to specific situations of older workers. Under section 56 of this legislation, if you are injured under the old WorkCover scheme, you are not entitled to economic loss, even though, under the new Return to Work Scheme, after two years you will lose the weekly wage build-up component, which is up to 80 per cent of your wage pre-injury.

Added to this is the very real possibility of being made redundant or dismissed after the said 104 weeks, with no financial compensation for your work-related injury. The phrase 'thrown on the scrapheap' comes to mind, and that is no way to treat anybody. We need to review the large financial incentives for the employer to reduce a longstanding employee's salary to the lowest level possible after the 52-week mark if they are unable to return to their pre-injury role or pay level.

Employers, by placing the older worker in particular in a much lower position or base rate, will in turn have an impact on employee time-related entitlements, for example, annual leave, quarterly and yearly bonuses, superannuation and long service leave and, of course, there is the risk that, when we arrive at the 104-week mark, the older worker is dismissed or made redundant or is being paid at a vastly lower rate, effectively saving the employer many thousands of dollars by having, of course as I have said, a severe impact on that particular worker's quality of life.

Furthermore, under section 39 of the legislation, which covers income maintenance, for the first two years under the return-to-work legislation injured workers are entitled to income maintenance for the first year at 100 per cent of their average weekly earnings, and for the second year at 80 per cent of their average earnings. If they are deemed to be under their 30 per cent whole-person impairment threshold, all income maintenance is stopped at the end of the second year.

To be incapacitated at or over 30 per cent whole-person injury, a worker would have to be very severely injured, but if they have secondary injuries to their main injury they can combine their injuries for a higher whole-person impairment percentage rate. It is important to note here that psychiatric and psychological injury, resulting from a physical work-related injury, cannot be added to the physical injury whole-person impairment percentage rate, as they are measured as stand-alone mental injury.

Older workers who were injured during the time of the old WorkCover scheme cannot now claim secondary injuries to increase their whole-person impairment percentage rate due to the change in legislation and date of their injury. There was no reason under the old WorkCover scheme to pursue secondary injuries, bar for the small section 43 payment, as income was guaranteed until retirement age and not removed at the 104-week period. Injured older workers who were on WorkCover require access to claim economic/non-economic loss and the ability to secure secondary injuries to the primary injury under the current return-to-work legislation.

The withdrawal of income maintenance at the 104-week mark needs to be totally removed from the Return to Work Act to stop placing financial incentive for employers to lower injured workers wages, as this will cause the harsh flow-on effect to employees' long-term entitlements. As it stands, the future outcome for injured workers, particularly older workers, will be age and injury-related unemployment and reliance on government assistance. We cannot afford adding insult to injury, quite literally, through the potential flow-on effects of the loss of self-esteem, family breakdown and even potential suicide attempts resulting from such harsh economic constraints, brought about through no fault of their own. These working people of South Australia deserve better from government and better from parliament. With those few words, Dignity for Disability welcomes the opportunity to examine this legislation, particularly the ramifications of it, and offer our support for the motion.

The Hon. T.A. FRANKS (17:24): I rise to very briefly thank members for their contributions—both today and previously: the Hon. Tung Ngo, the Hon. Mark Parnell, the Hon. Rob Lucas and the Hon. Kelly Vincent today for their indications of support. I want to particularly thank the Hon. John Darley for moving this motion with me. We did it as a team because we were similarly receiving reports and hearing about cases of injured workers with, for example, disc herniation surgery, total hip replacement, compression fracture of spine and even a leg amputation below the knee, and all of these life-altering injuries not being defined as serious under the current laws.

What has changed in recent months has been the success of the Protect Our Cops campaign, where the police officers of this state showed to the public and then to the Weatherill Labor government that these new changes were unfair, they were too harsh and they had gone too far. The Police Association ran a successful campaign and the voices of those injured workers were heard loud and clear by Labor. I hope that the voices of the workers will be heard loud and clear by Labor through the processes of this committee, and supporting those injured workers to tell those stories through the parliamentary processes sooner rather than later. We need to protect our cops but, do you know what, we need to protect our ambos, our nurses, our teachers, our tradies, any workers. A worker who is injured on the job should be treated in the same way as any other worker who is injured on the job, regardless of whether they are a cop or a construction worker.

I thank those members for their contributions and the conversation that happened outside this chamber, and I am certainly very supportive of the select committee being replaced with a standing committee. I thank members who were instrumental in facilitating that pathway. These people who we want to hear from are the most vulnerable in our community and they need our support, and they need a strong and supportive workers compensation scheme. I am hopeful that we can look at what is happening sooner rather than later and not wait for that review that comes after the next state election, but hear from these workers who have similar stories to tell as the police officers of this state told to the community. I think, when the community hears these stories, they will be shocked and surprised and perhaps we will see further legislation in this place to correct the errors that have been made. With those few words, I commend the motion.

Amendment carried; motion as amended carried.