Wednesday, 14 May 2025

Workplace Injury Rehabilitation and Compensation Amendment Bill 2025

Second reading

Debate resumed on motion of Ben Carroll:

That this bill be now read a second time.

John PESUTTO (Hawthorn) (15:30): I am very pleased to rise this afternoon to speak on the Workplace Injury Rehabilitation and Compensation Amendment Bill 2025. I want to begin with some reflections on why some of these measures have been made necessary. We have to go back to 2020 when the then Andrews government, now the Allan Labor government, commissioned a review by Finity Consulting into the viability of the WorkCover scheme. What Finity found was that the scheme, as it was then being managed, was totally unsustainable, to the point where claims had exploded, the cost of those claims had exploded and recovery times – return-to-work times – had blown out. We were getting to the point where if left unchecked, by 2030 the insurance funding ratio would drop to under 50. To put that in context, you need an insurance funding ratio of between 105 and 120 to be viable. That has been addressed earlier in the debate. It was a serious problem, yet what did the government do in 2020 when it had that report? It sat on it. You have to wonder what was worse: sitting on it or having overseen the mismanagement of the WorkCover scheme, noting that by that time the government had been in office for some six years.

What is more egregious about this is that the government went to the 2022 election not revealing the contents and implications of the Finity report. The government withheld it from workers, the government withheld it from unions and the government withheld it from employers, stakeholder groups and the broader community. It only released details when the jig was up in early 2023, it seems. Then we were told about how serious the predicament of the WorkCover scheme was at that time.

What did the government do? Amongst other things, it imposed on employers premium increases that many of them have struggled to withstand. The government says that it only increased premiums for the 2023 year by 42 per cent, from 1.2 to 1.8 per cent. Let us put that in context. For most employers the average was brought down by the public sector component. Many employers in the private sector were getting increases of upwards of 100 per cent in their premiums. If you were a small to medium-sized business, particularly as many of them were, with a very good claims experience, you had to wonder why all of a sudden you were getting hit with premium increases of 100 per cent or thereabouts. Many of them already struggled under the weight of payroll tax increases and other levies – many of them are paying land tax as well and all the fees and charges that they have to pay – and on top of that there was a doubling of their WorkCover bills.

The government just does not understand how tough it is out there to employ people and to be able to sustain them in their jobs. Most of the employers I have dealt with over the years, and I have dealt with many in previous iterations of my career, have been people who have wanted to look after the most important resource in their business, which is their people. In order to do that they need to be able to make sure their businesses are viable and sustainable, and they need a government that does not continually make life harder for them. We had a situation where the government sat on the Finity report. It finally had to admit to the problems. It wanted to make a virtue out of the fact that the system was broken – broken under them and broken by them. It is hard to believe that the government wants to claim credit for its own mess.

It is something that does need to be called out, but hiding the truth from the public is something this government has form on. You have to marvel at just how similar the concealment over the Finity report was to what happened with the Commonwealth Games. Remember the infamous cabinet meeting on 20 April 2023 when the government increased the funding for the Commonwealth Games in circumstances where even by that stage it was well known that the games were not going to be able to be held because of the costs blowing out.

But they withheld that from the Victorian people, and it was only through the efforts of the opposition that the Victorian Auditor-General was asked, and thankfully the Auditor-General acceded to our request to look into the blowouts on the Commonwealth Games. But it was not because the government finally saw the light –it had to fess up. So that is exhibit A in support of the charge of concealment on the Finity report, but then just this week we had another example of deceit, utter deceit and breach of faith, by the Victorian government over school funding under the Gonski scheme.

Back in 2024, the government was spruiking –

Luba Grigorovitch: On a point of order, Acting Speaker, on relevance, could we please stick to the bill?

The ACTING SPEAKER (Kim O’Keeffe): I ask the member to come back to the bill.

John PESUTTO: Certainly, Acting Speaker, the relevance of references to the breach by the Allan Labor government of its funding commitments to government schools in this state is relevant, because there is a pattern of behaviour which underlies the reason for this bill. The concealment over Finity is not dissimilar to the concealment over the government’s breach of faith by walking back its commitment to school funding for government schools in this state. This is a government that has poor form on these matters. That is why we are here today with a bill, which is one we will not oppose. The measures in the bill itself have been prompted by many of the shortcomings and failures by this government to manage the premium pool and the scheme more generally. Despite those issues we will not stand in the way of these changes, but I do want to offer some reflections on some of the changes in the bill.

The Code of Claimants’ Rights is something that we will certainly not oppose. I wonder how much more it will add to the operation of the scheme, given that there are already, as there should be, strict obligations on authorised agents and authorised insurers and those licensed to manage claims under the WorkCover scheme to actually be very mindful of the rights, interests and welfare of claimants who rely on compensation and also their dependants and their families, who are often dependent on them as well. I am interested to see what the Code of Claimants’ Rights will add to what is already there, but if it does add something positive, then that is a good thing. But again, you have to wonder why, after so many years in office, authorised agents are not being pressured to act well, given the number of Ombudsman’s reports into the management of claims, particularly complex claims.

Similarly, with the advisory committees for the occupational health and safety and WorkCover committees, offering lived experience on that – yes, obviously it is something that is to be welcomed, but again, I wonder: isn’t that something that is already done? If it is not, and this adds to that, then that will be a good thing, and let me place that on record.

The return-to-work measures here – I do have to wonder whether the government gets it on return to work. I can understand the imposition of obligations on employers to designate an officer to provide mandatory training, and one of the members from the opposite side talked about it being only one day. Well, all well and good, you will train these people, but it is more about the resources and supports that come from the insurer side and the government side of claims management that is going to matter more here for return to work. As I said, I have had some experience in this field, where I practised in the area of occupational health and safety and WorkCover for a number of years, and I can tell you, most employers – in fact all of the employers I ever dealt with – wanted their workers to get back to work. They did that for a number of reasons: one, because they got how important their staff was to the success of their business. But equally, there is also a very clear and conspicuous financial benefit in getting your people back to work, because it is good for them and it is good for the business as well, so everybody wins by having that. But the government seems to be mute when it comes to what it is actually going to do on the claims management side to promote return to work, and that was the whole idea of the set of negotiations we had last year over the legislation that came in at that time to address the financial crisis confronting WorkCover due to the government’s mismanagement.

Finally, when it comes to the enhanced entitlements, particularly for families and loved ones who have lost people in terrible circumstances where workers have lost their lives, obviously that is to be welcomed, and again, we will not be standing in opposition to those measures. So we will not oppose the measures in this bill, but I do hope the government takes on board the comments I have made, because you are not going to avoid the need to come back to these issues and revisit them unless you address those matters I have spoken about in my remarks.

Luba GRIGOROVITCH (Kororoit) (15:40): It gives me great pleasure to rise to speak about the Workplace Injury Rehabilitation and Compensation Amendment Bill 2025. From the outset can I say that no-one goes to work to be in harm’s way. As a former union secretary and official I have seen too many members dealing with workplace injury, and it is not something that any of us wants. No-one wants their loved ones or people they care about to be in harm’s way, and that is what goes to the heart of this bill. I also want to thank the members of the Workplace Incidents Consultative Committee who were in the gallery this morning. They did a ton of work and from what I have been told by the various people involved in the committee there were a lot of robust discussions, so to those who were here in the gallery this morning, thank you. To Brett Struhs, David Brownlee and Ralph Snider, all the work that you did towards this bill was very much appreciated, as was the fact that you came along today to listen to the debate.

The bill before us this afternoon delivers on the Victorian Labor government’s commitment to implementing the recommendations provided in two separate reports: the independent review of complex workers compensation claims management provided to the government in April 2021 – the Rozen report – and the review of the adequacy of compensation and supports for family members of workers whose deaths are work related. Today’s bill acquits the recommendations requiring legislative change that were accepted by the Victorian government following those reports. This bill makes amendments to the Workplace Injury Rehabilitation and Compensation Act 2013, the Accident Compensation Act 1985 and the Occupational Health and Safety Act 2004 to improve the experience of injured workers who access the WorkCover scheme; to improve the support that the scheme provides to family members and dependants of workers whose deaths are work related; to refine the operation of the Workplace Injury Commission and of administrative arrangements for members of WorkSafe’s boards, WorkSafe’s chief executive officer and hearing loss assessors; and to correct technical oversights in other relevant legislation.

Recommendations 19 and 20 of the 2021 Rozen report recommended that the objectives of the Workplace Injury Rehabilitation and Compensation Act, otherwise known as the WIRC act, and of WorkSafe be amended to expressly provide for the fair, respectful and dignified treatment of injured workers and their dependants by WorkSafe and the provision of high-quality services. Adding new objectives to the WIRC act and the Accident Compensation Act will ensure that users of the WorkCover scheme receive high-quality services and are treated fairly, respectfully and with dignity.

Recommendation 14 of the Rozen report recommended that WorkSafe develop a code of injured workers’ rights that should (1) identify the rights of workers and the corresponding responsibilities of WorkSafe and (2) identify the process by which rights may be enforced and developed in consideration of codes in other jurisdictions, such as the New Zealand Code of ACC Claimants’ Rights. The bill delivers on this through the creation of a Code of Claimants’ Rights, which will be developed in consultation with stakeholders if the bill is passed. The bill requires that the code include specific rights of claimants under the code; obligations to ensure services provided by WorkSafe, its agents and self-insurers are provided in a manner that promotes and upholds those rights; a procedure for lodging and dealing with complaints about noncompliance with the code by WorkSafe, its agents and self-insurers; and remedies that apply if any complaints are substantiated. The code will have the ability to provide rights to all persons who have entitlements under the WIRC act and the Accident Compensation Act, such as injured workers, dependants, deceased workers and family members of deceased or injured workers.

We know that the longer a person is away from work the less likely they are to ever return to work. Being on workers compensation indefinitely is not the answer. Recommendation 17 of the Rozen report recommended the effectiveness of return-to-work coordinators, who should be enhanced by requiring employers to ensure return-to-work coordinators have training and the assistance and facilities reasonably necessary to perform their functions under the WIRC act. The bill will implement this recommendation by introducing a requirement for employers to ensure that their appointed return-to-work coordinator completes approved training within the required timeframe unless the employer has a reasonable excuse for not doing so.

This amendment aims to build the capability of workplaces to more effectively support their injured workers to recover and return to work, which is better for workers, businesses, families and the scheme. The minister for WorkSafe may determine the training required to be completed, including initial or refresher training, any qualifications to be held by the return-to-work coordinator and the time period within which a return-to-work coordinator must complete the approved training. WorkSafe will approve the training providers that are able to deliver the approved training. In making its recommendation to the minister, WorkSafe will consult with key stakeholders to ensure that the training requirements are practical, accessible, flexible and aligned with policy intent. WorkSafe will explore and develop a range of training approaches, including a shorter online module that could be suitable for different employee contexts.

Oversight of the scheme will also be strengthened by requiring that a statutory review of the scheme is undertaken at least every five years. The first review must be completed by 31 December 2030. If the minister for WorkSafe forms the view that a review is required earlier than the five-year period, then they can call for a review at any time. The amendments require a review at least once in each period of five years after 31 December 2030. This amendment recognises that regular, proactive reviews of the Victorian workers compensation scheme will enable trends and issues to be identified as they emerge rather than when they are already significant issues. A statutory requirement for regular reviews also aligns the Victorian workers compensation scheme with the schemes in most other Australian states.

We know that the longer a person is away from work, the less likely they are to ever return to work. That is why we have established Return to Work Victoria, to provide tailored support to injured workers to help them get back to work. WorkSafe supported more than 26,000 injured workers to return to safe workplaces in 2023–24. WorkSafe, through Return to Work Victoria and its agents, is committed to ensuring that any worker no longer eligible to receive weekly payments has the best support to be able to transition to suitable employment where possible.

WorkSafe has a range of tailored supports in place for workers with long-term injuries or complex needs, including those no longer eligible for weekly payments. This can include ongoing medical treatment and occupational rehabilitation and access to transition support programs that connect workers with appropriate services, such as psychological supports, community support services, training programs and suitable employment opportunities. Return to Work Victoria will deliver the government’s commitment to creating and trialling new programs and initiatives to improve return-to-work outcomes, with an initial program budget of $50 million for its first three years. An annual review will evaluate pilot programs to ensure they are delivering outcomes for workers and value for money. The pilot programs include a worker support hotline where workers can access mental health support for work-related stress and burnout and an initiative that will provide small and medium-sized businesses with tailored support to build mentally healthy workplaces.

The Victorian Labor government also proudly established the Workplace Incidents Consultative Committee in June 2021 to strengthen the voice of Victorians who have been affected by a serious workplace incident. It was my honour to recognise them earlier in my speech. The WICC currently comprises 13 members with direct lived experiences. All members are appointed by the minister for WorkSafe.

The Allan Labor government has made vital changes to the WorkCover scheme to ensure that it remains financially sustainable and can continue to support injured workers into the future. The government’s priority is to ensure the scheme continues to be contemporary and fit for purpose and supports workers. While the current financial results are improving, more work is needed to stabilise Victoria’s WorkCover scheme given the considerable pressure it will continue to face in coming years from an increase in claims – far beyond what was ever envisaged when this scheme was first established.

Labor built our state’s WorkCover scheme to support workers, unlike those opposite, who abolished common-law rights for seriously injured workers. Only Labor stands with our workers to support them when they most need it. We will always prioritise the safety and wellbeing of all workers. No-one plans to get injured at work, any more than they plan to die at work. The Allan Labor government is standing with injured workers and their families, ensuring they are treated with the respect, the care and the dignity that they deserve in their toughest times. Our main focus is and always will be to ensure that injured workers have the support to return to work safely with dignity and as soon as possible. That is why I am pleased to commend this bill to the house.

Annabelle CLEELAND (Euroa) (15:50): I rise today to speak on the Workplace Injury Rehabilitation and Compensation Amendment Bill 2025, a bill that brings forward a range of amendments aimed at reforming WorkCover. As we have heard throughout the day, this is a scheme that we can all agree is fundamentally broken. This is primarily done by amending existing legislation such as the Workplace Injury Rehabilitation and Compensation Act 2013 and the Accident Compensation Act 1985. These amendments propose several changes that are designed to improve the claims process for injured workers, enhance compensation for families of deceased workers and create better systems for workplace rehabilitation. Despite there being merit to many of these amendments, there are still some concerns that have not been addressed throughout the legislation. My concern is about the broad implications of these changes, particularly the impact they will have on small businesses and those operating in regional Victoria.

One of the most striking proposals is the introduction of a Code of Claimants’ Rights, which is set to define the service standards that must be met by WorkSafe and self-insurers when assessing workers claims. While this sounds well intentioned, there is still a lot of uncertainty around how this will impact businesses in practice. If the code requires additional compliance or administrative costs, these will inevitably be passed down to businesses, many of which are already struggling. The bill also mandates mandatory training for return-to-work coordinators, which will undoubtedly come at a cost. There are also concerns about how much this bill will burden employers, especially those who have few claims and will be required to pay for training and provide facilities to return-to-work coordinators. Given the already strained business environment, these additional costs could prove too much for some businesses to bear.

We also cannot discuss WorkCover without talking about the higher premiums businesses have faced in recent years, something that is continuously putting pressure on employers and driving up the cost of doing business in our state. Employers were forced to accept a massive 42 per cent increase in their premiums in 2023, making Victoria home to the most expensive WorkCover scheme in the entire country. Within my region the rise in WorkCover premiums can best be viewed through its impact on our local equine and breeding industry. In Euroa the equine industry is a cornerstone of our local economy. Hundreds and hundreds and hundreds of jobs are dependent on a successful equine industry. Breeders, equine service providers and farmers are some of the major employers in our region, providing thousands of jobs and driving our economy forward. But this sector has faced ridiculously high increases to WorkCover premiums in recent years. While this is somewhat understandable for jockeys and track riders, the risk faced by others in the equine industry does not merit the same premium cost.

The lack of understanding from WorkCover and the current government about how industries like this actually operate is so frustrating. The equine industry in Euroa is not just about horse racing. It includes the breeding sector, agriculture and tourism. These sectors are a major economic driver, contributing significantly to jobs, tourism and our entire economy. When businesses in this industry are burdened with excessive WorkCover premiums, it does not just hurt them, it hurts our entire community. The problem does not end there. As it stands, these premiums are pushing businesses to the brink. Farmers, breeders and service providers are paying the same WorkCover premiums as high-risk workers, despite having such different risk profiles. If the government continues to ignore this nuance, it will harm industries that are critical to the prosperity of regional Victoria.

While the impact to our region’s equine industry has been discussed, it is not the only one that is doing it incredibly tough. Take Kylie – and I want to thank Kylie for speaking with me today – who operates a concreting business out of Seymour, and in the past three years they have seen premiums go from $6000 to nearly $13,000 per year – and this is just in recent years. This is despite them never filling out a claim, never having any incidents and operating with the same number of staff as they did previously. There is no reason for these increases other than a broken system. They were just simply told one day they would now have to pay more than double what they had previously paid. And this is a small business that employs so many people in our community.

The increases are seriously having an impact on the viability of so many of our businesses. Kylie and her family’s business used to be able to pay quarterly, but with the new increase they have to move to a payment plan. It is so cruel, but this comes with an additional $1000 cost on top of what they have already paid. Business is doing it tough in our regions, in particular for building and construction, which has seen major cuts and a lack of work coming out of usual locations such as Puckapunyal. There are simply no viable alternatives for many of our small businesses, and these premiums are making it too hard for them to survive.

We need to make it easier for businesses to operate in Victoria, especially in regional areas where we already grapple with business closures and a lack of investment. We need policies that attract businesses and investment and make it easier to stay in regional Victoria, not policies that drive them away with unfair premiums and unmanageable compliance costs. A recent report from the Business Council of Australia ranked Victoria last for business settings, citing high property taxes, payroll costs and burdensome licensing requirements. We have all heard it. All of our businesses are screaming out for some help. This is reiterated by the Australian Bureau of Statistics, which painted an equally grim picture, showing Victoria lost nearly 23,000 businesses between 2021 and 2023, the highest drop of any state in Australia. This is being reflected right across the region in my electorate, with Heathcote, Benalla, Seymour, Kilmore and Broadford all reporting fewer businesses operating than the year before.

In Benalla alone 36 businesses closed their doors in the past year, and when I met with business owners in Heathcote to hear firsthand about the challenges they are facing, WorkCover premiums were the number one issue of concern. Half of the businesses I spoke to were either shutting down or moving interstate because doing business in Victoria is just too damn hard. Skyrocketing WorkCover premiums, along with rising taxes and crime, are crushing our local businesses. To make matters worse, these businesses owners feel like the government is not listening. I am sure many of these people will still feel the same if this bill is passed.

I understand the intention behind many of the provisions in the bill, and it is crucial, but we must pay attention to the real-world impacts of businesses, especially in our regional communities. For my region and several other rural areas the bill could create more uncertainty and costs, making it harder for them to continue operating and contributing to our economy. They are the backbone of our regional economy. This bill does bring forward necessary changes that will benefit families of those who suffer workplace incidents, and that should not be ignored, but these changes can also be legislated in a way that does not harm small businesses at a time when they are already doing it tough.

I thank the member for Evelyn for putting forward a reasoned amendment that would freeze any further increases to WorkCover premiums and ensure this legislation is more suitable going forward.

Paul EDBROOKE (Frankston) (15:58): It is absolutely a great time to be on this side of the chamber and to get up and speak on this bill today. I have heard many people on this side of the chamber talk about their experiences with this bill, but I do see a lot of note reading on that side of the chamber, which would lead me to think that they do not know much about this WorkCover bill, this workplace injury bill.

Members interjecting.

The SPEAKER: Order! Member for Euroa! Member for Lowan!

Emma Kealy: On a point of order, Speaker, I ask you to bring the member back to the bill.

The SPEAKER: Member for Frankston.

Paul EDBROOKE: In my lived experience this kind of bill is something that affects people’s lives profoundly. As an emergency service worker responding to – some people say accidents; I do not believe accidents happen. I do not believe there is anything that is just an accident, there is a reason it happened. But responding to industrial incidents was never a pleasant experience, and in the wash-up, in the debate afterwards with employees, with staff, with bosses, with other emergency services and in debriefs there was always the question of ‘How did we get here?’, ‘How did this happen?’ Whether or not you choose to look at the Swiss cheese model, which I know is very popular in this area, the conclusion we always came to is that this could have been avoided. It is very, very important that we continue to strengthen the bills in this place to support workers.

Business interrupted under sessional orders.