Seafarers Rehabilitation and Compensation Act 1992 – how it may impact you

Legal Directions

On 20 May 2013 the Hon Bill Shorten, Minister for Employment and Workplace Relations, released the Review of the Seacare Scheme Report (Report).

The Report sets out 67 recommendations to improve the scheme’s coverage, governance, workers’ compensation costs and legislative inconsistencies.

Included are a number of recommendations that seek to align the Seafarers Rehabilitation and Compensation Act 1992 (Seafarers Act) with changes recently proposed to the Safety, Rehabilitation and Compensation Act 1988 (SRCA) by Mr Peter Hanks QC (Hanks Review).

Some of the Report’s recommendations regarding the Seafarers Act are as follows:

  • The Seafarers Act should provide its own definition of the vessels covered by that Act without referring to definitions in the Navigation Act (R.2.1)
  • The Seafarers Act should have application provisions that as a minimum requirement reflect the existing application provisions, and to clarify coverage, for so long as there are references to Part II of the Navigation Act, they are not to be taken to be limited by Part I of the Navigation Act. Where there are no references to the Navigation Act, any replacement provisions should have at least that wider coverage (R.2.3)
  • Amending the Seafarers Act to be consistent with the SRCA (for example, amending the permanent impairment threshold test from 10% for hearing to 5% binaural hearing) (R.3.1)
  • Requiring that for a seafarer to be entitled to compensation for a disease, the employment contribution be to a significant degree (to be consistent with the SRCA) (R.4.3)
  • Inserting a provision that excludes injury or disease that results from reasonable administrative action (to be consistent with the SRCA) (R.4.4)
  • Giving further consideration to include a system of provisional liability (R.4.7)
  • Amending the cut off age for compensation to be the same as the age of eligibility for the age pension, and if considered suitable, increasing the maximum period for receiving incapacity payments for those approaching retirement age (R.4.12)
  • Amending the Seafarers Act so an injured employee’s entitlement to weekly compensation may be suspended during any period of more than 60 days when an employee is absent from Australia (the Seacare Authority to be satisfied that the suspension was appropriate in the circumstances (R.4.13))
  • Amending the Seafarers Act so that the AAT is able to hear matters not subject to reviewable decision, with consent of the parties (R.6.5)
  • Amending the redemptions provisions to allow for voluntary redemptions which would apply to incapacity payments, medical treatment expenses, and attendant care and household services, with Seacare to approve a voluntary redemption (however any updates to similar redemption sections in the SRCA to be reflected in the Seafarers Act) (R.6.6)
  • The Seacare Authority to be empowered to request information from employers and their insurers on the deductible amounts under their policies, to issue guidelines governing the arrangements and amount of deductibles under employer insurance policies, and to approve proposed deductibles that exceed a prescribed amount (R.6.7)
  • DEEWR should work with the Seacare Authority to develop self-insurance options (R.6.9)
  • Out of 104 Hanks Review recommendations, 73 recommendations (if accepted) should be used as the basis of changes to the Seafarers Act, some of which have been referred to above. Other recommendations include:
    • Heart attacks, strokes, etc, to satisfy ‘significant contributory factor’ eligibility test (R.5.3 Hanks Review)
    • Changes to incapacity step-down provisions (compensation to be paid at 100% NWE during first 13 weeks, at 90% NWE during weeks 14 – 26, and thereafter 80% of NWE) (R.7.13 of Hanks Review)
    • Separate impairments from single injury to be combined (R.8.2 of Hanks Review)
    • The maximum benefit payable for permanent impairment to be the same as the lump sum payment amount for death (R.8.4 of Hanks Review)
    • Introduction of algorithmic method for calculating permanent impairment (from around the 20% degree of permanent impairment mark, employees will receive more than they would under the current linear model) (R.8.5 of Hanks Review).

Seacare Scheme stakeholders will be consulted regarding the Report’s recommendations.

Authored by Rosemary Waldron-Hartfield, Partner, Perth.

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