Bills Digest no. 90 2005–06
OHS and SRC Legislation Amendment Bill 2005
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Contact Officer & Copyright Details
OHS and SRC Legislation Amendment
Date introduced: 7 December 2006
House: House of
Portfolio: Employment and Workplace Relations
Commencement: The Bill s formal provisions commence on Royal
Assent. The bulk of the substantive amendments (items 1-45,
Schedule 1) commence on proclamation or, at most, six months after
the Act receives Royal Assent.
The Bill s purposes include:
- amending the Occupational Health and Safety (Commonwealth
Employment) Act 1991 (OHS(CE) Act) to cover new categories of
employers and employees called non-Commonwealth licensees and
employees. The amendments respond to a recommendation made in the
Productivity Commission s report on National Workers
Compensation and Occupational Health and Safety
- ensuring that all Commonwealth authorities licensed under the
Safety, Rehabilitation and Compensation Act 1988 (SRC Act)
are covered by the OHS(CE) Act, and
- correcting drafting errors made in 2001 and validating
regulatory contribution and licence fees that were paid in error by
Commonwealth authorities and licensees.
The SRC Act contains the legislative basis for the Commonwealth
Government s workers compensation scheme. It establishes a fully
funded premium based system and a licensed self-insurance based
system of compensation and rehabilitation for employees injured in
the course of their employment. The self-insurance scheme enables
Commonwealth authorities and eligible corporations to apply for a
licence to self-insure. The Minister then has a discretionary power
to declare eligible for a self-insurance licence a corporation
- is but will cease to be a Commonwealth authority
- is a former Commonwealth authority, or
- is carrying on business in competition with a Commonwealth
authority or with another corporation that was previously a
Once a corporation is declared eligible by the Minister, the
Safety, Rehabilitation and Compensation Commission (the Commission)
can grant a self-licence.(2) The rationale for allowing
coverage to be given to former Commonwealth authorities is to
ensure continuity of workers compensation coverage for their
employees. In relation to private sector corporations, coverage is
designed to promote a level playing field for those corporations in
competition with existing and former Commonwealth
The OHS(CE) Act is designed to protect the health and safety of
Commonwealth employees and employees of Commonwealth statutory
authorities and Government Business Enterprises (GBEs). It sets out
the duties of employers and employees in relation to occupational
health and safety; provides for workplace health and safety
monitoring; contains a notification and reporting scheme for
dangerous accidents and incidents; establishes a scheme allowing
for recovery of costs for administering the Act; and provides civil
and criminal penalties for breaches of the Act. While Commonwealth
authorities in the process of privatisation, former Commonwealth
authorities and eligible private sector corporations can avail
themselves of the self-insurance scheme provided by the SRC Act
they are not covered by the OHS(CE) Act.
Some of the difficulties that arise from the present situation
are set out in the Minister s second reading speech:
At present former Commonwealth authorities and
licensed private sector corporations operate under the Commonwealth
workers compensation regime but are covered by state and territory
occupational health and safety legislation in the jurisdiction in
which they operate. This makes unnecessary difficulties for many
firms to develop a national approach to occupational health and
safety and may result in the requirement that they comply with
eight separate and quite distinct occupational health and safety
Among many recommendations made in its 2004 Report, the
Productivity Commission recommended that:
the Australian Government amend the
Occupational Health and Safety (Commonwealth Employment) Act
1991, to enable those employers who are licensed to
self-insure under the Australian Government s workers compensation
scheme to elect to be covered by the Australian Government
s occupational health and safety legislation. This legislation
would be extended to cover those insuring under any future
alternative national premium-paying insurance
The Government has decided instead to provide mandatory
coverage under the OHS(CE) Act for those non-Commonwealth employers
who obtain a self-insurance licence under the SRC Act. The
Government s preferred course of action is explained in the
The Australian Government considers there is merit
in opening up access to the Government s OHS regime to give those
firms granted a self-insurance licence under the SRC Act scheme a
single set of national OHS rules. The Government s workers
compensation and OHS schemes are effectively integrated and there
are benefits to employers having coverage under both schemes. For
these reasons the Government does not support eligible corporations
having the choice as proposed by the Productivity
The Explanatory Memorandum states that five eligible
corporations (with a total of about 15,000 employees) are licensed
under the SRC Act but not covered by the OHS(CE) Act.(7)
The Productivity Commission reported in 2004 that except for former
Commonwealth authorities no private sector corporation had, at that
time, been declared eligible for a self-insurance licence. It also
reported that a number of private corporations including Sing Tel
Optus, Westpac, Manpower Services (Australia) and Skilled
Engineering had advised it that they had applied or had
investigated the possibility of applying for a self-insurance
In general, Part 1 amends definitions in the OHS(CE) Act so that
the Act extends to non-Commonwealth licensees, their employees and
workplaces. It also ensures that all Commonwealth authorities will
be covered by the OHS(CE) Act.
Items 1 and 2 of
Schedule 1 amend the long and short titles of the
OHS(CE) Act to reflect the new coverage proposed by the Bill. The
new short title of the Act will be the Occupational Health and
Safety Act 1991.
Section 3 of the OHS(CE) Act states that the objects of the
legislation include securing the health, safety and welfare at work
of employees of the Commonwealth and Commonwealth authorities.
Item 3 adds employees of non-Commonwealth
licensees to this list. Non-Commonwealth licensees are eligible
corporations that are licensed under the SRC Act (item
Item 4 amends the definition of chief executive
officer in the OHS(CE) Act to include chief executive officers of
non-Commonwealth licensees. They are defined as people primarily
and directly responsible to the directors of the licensee for the
general and overall management of the licensee.
At present, not all Commonwealth authorities covered by the SRC
Act are covered by the OHS(CE) Act. Item 5 extends
the definition of Commonwealth authority so that all Commonwealth
authorities licensed under the SRC Act are covered by the OHS(CE)
Act. Item 13 effects a consequential
The term contractor is redefined to include the new category of
non-Commonwealth licensee contractor as well as Commonwealth
contractor and Commonwealth authority contractor and the
definitions are restructured (see items 6, 8, 10,
15 and 25).
The OHS(CE) Act currently defines employer as meaning the
Commonwealth or a Commonwealth authority.(9) The term
employer is extended to cover non-Commonwealth licensees
The term employee is currently defined in the OHS(CE) Act as a
person employed by the Commonwealth or a Commonwealth
authority.(10) There will now be three categories of
employee a non-Commonwealth licensee employee , an expression
defined as a person employed by a non-Commonwealth licensee under a
Commonwealth, State or Territory law or under a contract of service
or apprenticeship (items 16 and
24). The other categories of employee are
Commonwealth employees and Commonwealth authority employees but the
meaning of those terms is unchanged (items 7, 9,
20 and 22).
The existing definition of workplace in the OHS(CE) Act is
Commonwealth premises in which employees or contractors work, other
than parts of premises used as private dwellings.(11)
The existing definition is repealed and replaced by a restructured
definition including Commonwealth premises and Commonwealth
authority premises and adding non-Commonwealth licensee premises .
Once again, workplaces do not include parts of premises used as
private dwellings (item 18). Non-Commonwealth
licensee premises are premises owned and occupied by a
non-Commonwealth licensee (item 17). Definitions
relating to Commonwealth premises and Commonwealth authority
premises remain unchanged.
The effect of section 11 of the OHS(CE) Act is that while the
Commonwealth and Commonwealth authorities are not subject to
criminal prosecution or liable to pay fines and penalties, their
employees, GBEs and their employees can be prosecuted and may be
liable to pay fines and penalties. Item 27 makes
consequential changes to terminology in paragraphs 11(4)(a) and
(b). Instead of the current terminology,(12) section 11
will refer to Commonwealth employees and Commonwealth authority
employees. Its meaning remains unchanged.
Item 28 amends paragraph 12(1)(c) of the
OHS(CE) Act to empower the Commission to collect, interpret and
report occupational health and safety information in relation to
non-Commonwealth licensee employees. Paragraph 12(1)(c) allows this
information to be collected in relation to all employees currently
covered by the Act.
Section 41 of the OHS(CE) Act enables Comcare to conduct
investigations to determine whether the Act is being complied with
or has been breached. Comcare can also investigate the occupational
health and safety policies and practices of Entities
(13) and Commonwealth authorities. Items
33-35 extend investigative powers under
the OHS(CE) Act to non-Commonwealth licensees.
Division 3 of Part 4 of the OHS(CE) Act deals with inquiries and
reports. It does not, in general, apply to GBEs. It enables the
Commission to hold inquiries, including public inquiries. It also
empowers the Commission to summon witnesses, require them to answer
questions and report its findings to the Minister. Item
36 in general exempts non-Commonwealth licensees from
Division 3 of Part 4.(14) The Explanatory Memorandum
Division 3 has limited effect on Government business enterprises
and is not necessary for non-Commonwealth licensees because they
are subject to the full range of sanctions and penalties under the
Civil penalties, criminal penalties and other sanctions for
breaches of the Act are set out in Schedule 2 of the Act. The
Schedule 2 regime applies to GBEs and will apply to
non-Commonwealth licensees. In contrast, as stated above, neither
the Commonwealth nor Commonwealth authorities are subject to
criminal prosecution or liable to pay fines and
At present, the SRC Act only allows a licensee to be charged a
licence fee on commencement of a licence or on 1 July each year.
Item 40 takes account of the fact non-Commonwealth
licensees may have already paid a licence fee for the current
period and that the Bill may commence on a day other than a 1 July.
It allows an additional regulatory contribution to be levied for
the period to the next 1 July.(17)
Items 41-50 change references in the SRC Act to
reflect the new short title of the OHS(CE) Act.
Items 51-57 make similar changes to references
proposed for or contained in the Social Security Act
Comcare is a Commonwealth statutory authority responsible for
workplace safety, rehabilitation and compensation. It administers
the OHS(CE) Act and the SRC Act. It also provides support to the
Safety, Rehabilitation and Compensation Commission, the body
responsible for regulating workplace, safety, rehabilitation and
compensation requirements under the OHS(CE) and SRC Acts.
The passage of the Safety, Rehabilitation and Compensation
and Other Legislation Amendment Act 2001 (SRCOLA) and
different definitions of Commonwealth authority in the OHS(CE) Act
and SRC Act had an unintended consequence Commonwealth authorities
covered by the OHS(CE) Act cannot be charged a regulatory
contribution unless they are also covered by the SRC Act.
Regulatory contributions are determined by Comcare under section
97D of the SRC Act and are intended to cover the estimated costs of
the Commission and Comcare in carrying out their functions under
the SRC Act and the OHS(CE) Act.
Item 2 of Schedule 2 enables Comcare to levy a
regulatory contribution on all Commonwealth authorities covered by
the OHS(CE) Act and thus remedies the situation that has
The effect of item 3 of Schedule
2 and clause 3 of the Bill is that
regulatory contribution amendments will commence in a new financial
The Explanatory Memorandum explains that at least three
Commonwealth authorities not covered by the SRC Act paid regulatory
contributions to Comcare for the 2002-03 financial year. It goes on
to say that:
The payments were retained by Comcare, as agreed with the
authorities, for services to be provided during the 2002-2003
financial year with the understanding that an amendment would be
made to the legislation to validate the payments and provide for
Item 5 validates relevant determinations and
SRCOLA also inserted new section 104A into the SRC Act. Section
104A deals with licence fees payable to the Commission. The
Explanatory Memorandum states that three licensees paid licence
fees under section 104A instead of under the pre-SRCOLA provisions.
Once again, the payment were retained by Comcare as agreed with the
licensees on the understanding that a statutory amendment would
validate the payments.(19) Item 6
validates relevant determinations and payments.
- Productivity Commission, National Workers Compensation and
Occupational Health and Safety Frameworks, Inquiry Report No.
27, 16 March 2004. At:
- For a discussion see ibid, pp. 109 110.
- Explanatory Memorandum, p. ii.
- Kevin Andrews MP, Second reading speech, OHS and SRC
Legislation Amendment Bill 2005, House of Representatives,
Hansard, 7 December 2005, p. 7.
- Productivity Commission, op. cit., p. XL. Emphasis added.
- Explanatory Memorandum, p. iv.
- ibid., p. iv.
- Productivity Commission, op. cit., p. 110.
- Section 5, OHS(CE) Act.
- Sections 5 and 9, OHS(CE) Act.
- Section 5, OHS(CE) Act.
- Paragraphs 11(4)(a) and (b) currently refer to a person who is
employed by the Commonwealth and a person who is employed by a
Commonwealth authority (including a Government business enterprise)
- Section 5 of the OHS(CE) Act defines an Entity as a Public
Service Act agency, a parliamentary department or a prescribed
person or body.
- The only exception is in relation to section 53 of the OHS(CE)
Act. This section requires investigators to give reports of their
investigations to the Commission. After receiving the report the
Commission must notify the employer of the findings of the report
and may ask the employer to report on what action is proposed in
response to the report. While the Commission may also report to the
Minister, the relevant paragraph in section 53 does not apply to
GBEs and will not apply to non-Commonwealth licensees (item
- Explanatory Memorandum, p. 7.
- See section 11, OHS(CE) Act.
- See Explanatory Memorandum, p, 7.
- Explanatory Memorandum, p. 9.
- ibid., p. 10.
3 February 2006
Bills Digest Service
Information and Research Services
This paper has been prepared to support the work of the
Australian Parliament using information available at the time of
production. The views expressed do not reflect an official position
of the Information and Research Service, nor do they constitute
professional legal opinion.
IRS staff are available to discuss the paper's
contents with Senators and Members and their staff but not with
members of the public.
© Commonwealth of Australia 2005
Except to the extent of the uses permitted under the
Copyright Act 1968, no part of this publication may be
reproduced or transmitted in any form or by any means, including
information storage and retrieval systems, without the prior
written consent of the Parliamentary Library, other than by members
of the Australian Parliament in the course of their official
Published by the Parliamentary Library, 2005.
Back to top