EXPLANATORY STATEMENT
Issued by the authority of the Minister for Employment
Safety, Rehabilitation and Compensation Act 1988
Subsection 100(1)
Safety, Rehabilitation and Compensation (Licence Eligibility – Medibank Private Limited) Declaration 2014 (No. 1)
The Safety, Rehabilitation and Compensation Act 1988 (‘the Act’) establishes the Commonwealth workers’ compensation and rehabilitation scheme (the Comcare scheme).
Under Part VIII of the Act, an ‘eligible corporation’ may apply to the Safety, Rehabilitation and Compensation Commission (‘the Commission’) for a licence to:
(a) accept liability to pay workers’ compensation in respect of its employees in accordance with the Act; and
(b) manage the claims of its employees in accordance with the Act.
An ‘eligible corporation’ is a corporation that has been declared to be such by the Minister for Employment under subsection 100(1) of the Act. Subsection 100(1) of the Act provides that if the Minister is satisfied that it would be desirable for the Act to apply to employees of a corporation that:
(a) is, but is about to cease to be, a Commonwealth authority; or
(b) was previously a Commonwealth authority; or
(c) is carrying on business in competition with a Commonwealth authority or with another corporation that was previously a Commonwealth authority;
the Minister may, by legislative instrument, declare the corporation to be eligible to be granted a licence under Part VIII of the Act.
Medibank Private Limited (ACN 080 890 259) is, but is about to cease to be, a Commonwealth authority. Medibank Private Limited operates within the Medibank Private Group and is currently covered by the Comcare scheme.
Once Medibank Private Limited ceases to be a Commonwealth authority, the Comcare scheme will cease to apply and its employees would then be covered under the schemes established by relevant state and territory laws, unless a licence to self-insure is granted by the Commission.
Medibank Private Limited has requested that the Minister make a declaration that it is an eligible corporation under subsection 100(1) of the Act.
As Medibank Private Limited is already covered by the Comcare scheme, the entitlements of employees of Medibank Private Limited will not change, as their entitlements will continue to be governed by the Act.
The declaration provides that Medibank Private Limited is eligible to be granted a licence under Part VIII of the Act.
The Office of Best Practice Regulation was consulted regarding this declaration and indicated that a Regulation Impact Statement was not required for this declaration (OBPR ID Number 17018).
Wider consultation was not undertaken as this declaration was made at the request of Medibank Private Limited itself and it is not likely to have a direct or substantial indirect effect on business, or restrict competition.
This declaration is a legislative instrument for the purposes of the Legislative Instruments Act 2003. This declaration takes effect on the day after it is registered on the Federal Register of Legislative Instruments.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Safety, Rehabilitation and Compensation (Licence Eligibility – Medibank Private Limited) Declaration 2014 (No. 1)
This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Legislative Instrument
The Safety, Rehabilitation and Compensation (Licence Eligibility – Medibank Private Limited) Declaration 2014 (No. 1) is made in accordance with section 100 of the Safety, Rehabilitation and Compensation Act 1988 (‘the Act’), which establishes the Commonwealth workers’ compensation and rehabilitation scheme (the Comcare scheme).
Under Part VIII of the Act, an ‘eligible corporation’ may apply to the Safety, Rehabilitation and Compensation Commission (‘the Commission’) for a licence to:
(a) accept liability to pay workers’ compensation in respect of its employees in accordance with the Act; and
(b) manage the claims of its employees in accordance with the Act.
An ‘eligible corporation’ is a corporation that has been declared to be such by the Minister for Employment (‘the Minister’) under subsection 100(1) of the Act.
If the Minister makes a declaration that a corporation is an eligible corporation under subsection 100(1) and the corporation subsequently makes an application to the Commission, then the Commission must decide whether to grant the eligible corporation a licence under Part VIII of the Act. If a licence is granted, the Comcare scheme will continue to apply to the eligible corporation from the date the licence comes into force. If a licence is not granted, the Comcare scheme would no longer apply to Medibank Private Limited or its employees should Medibank Private Limited cease to be a Commonwealth authority. Instead, relevant state or territory workers’ compensation schemes would apply.
Declaration of Medibank Private Limited as an ‘eligible corporation’
The declaration has the result that Medibank Private Limited is eligible to be granted a licence under Part VIII of the Act. A licence will only be granted if the Commission is satisfied that it is appropriate to do so.
Human rights implications
Article 9 of the International Covenant on Economic, Social and Cultural Rights provides for the right of everyone to social security, including social insurance. General Comment 19 by the Committee on Economic, Social and Cultural Rights elaborates on Article 9, stating that the ‘States parties should … ensure the protection of workers who are injured in the course of employment or other productive work’.[1]
Workers’ compensation is analogous to social insurance in that it provides payment of wages and medical costs to employees for injuries occurring as a result of their employment. Workers’ compensation is generally available instead of the right of employees to sue their employer for these costs.
The effect of this declaration is that Medibank Private Limited is eligible to make an application to the Commission to be granted a licence.
As Medibank Private Limited is already covered by the Comcare scheme, the entitlements of employees of Medibank Private Limited would not change as their entitlements would continue to be governed by the Act.
This declaration engages but does not limit human rights. Its effect is that it allows Medibank Private Limited to make an application for the grant of a licence, to be considered by the Commission. As a result, making the declaration does not affect the workers’ compensation rights of Medibank Private Limited’s employees and so does not limit the right to social security.
Conclusion
The Legislative Instrument is compatible with human rights because it does not negatively impact on human rights.
Senator the Hon. Eric Abetz
Minister for Employment
[1] Committee on Economic, Social and Cultural Rights, General Comment 19: The Right to Social Security (art. 9), U.N. Doc E/C.12/GC/19 (2008), [17].