Current issues, news and updates. - NSW Farmers Association

Industrial Relations Update
August 2012
Current
issues,
news
and
updates.
Quad Bike Safety
You would have noticed the increased media interest
on the issue of quad bike safety, and obviously, this
affects many of our members. As an industry, a
strategy to reduce injuries and fatalities related to
quad bike use was developed last year through the
Heads of Workplace Safety Authorities.
Manufacturers and dealers have agreed to improve
point of sale material to guide farmers in purchasing
the vehicle best suited to the needs and conditions of
the farm. Also, part of the strategy is to encourage
riders’ behavioural change by requiring the wearing
of appropriate helmets, compliance with
manufacturers’ guidelines on load or rider age, and
training.
One of the most contentious issues that still remains
in relation to quad bike safety is the use of crush
protection devices (“CPD”), and there is a large
degree of uncertainty and disagreement in this
area. It is expected that some resolution of this issue
will come soon following recent decisions by
governments to give quad bike safety the attention
and resources it needs. The Federal Minister for
Employment and Workplace Relations, Bill Shorten,
has convened a round table meeting to address this
matter and announced the creation of a community
based network, QuadWatch. In addition, the NSW
Minister of Finance, Greg Pearce has announced an
investment of $1 million to fund research into quad
bike safety. NSW Farmers believes that a CPD is
useful to lessen the gravity of injury related to the risk
of quad bike roll over. However, we look forward to
the results of the research.
Workers Compensation Reform
As you may be aware, the NSW government recently
passed a piece of legislation (Workers Compensation
Legislation Amendment Bill 2012) which will result in
some significant changes to the workers compensation
scheme in NSW. We will have a briefing note to
members shortly on the changes.
The key dates for implementation of the changes notified
by the Minister:
• Seriously injured workers (those with more that
30% whole person impairment) who are on weekly
benefits, will receive the new weekly benefit amount
from 1 September 2012 (there are currently about
500 claimants in this category),
• Claims for injuries occurring on or after 1 October
2012 will be covered by the new arrangements.
This means that these injured employees will be
receiving more compensation in the initial 13 weeks
under the new “pre-injury earnings” definition,
• Claims for injuries occurring before 1 October
2012 will stay in the old scheme and move across
to the new system from 1 January 2012, and
• The changes to treatment of journey claims, lump
sums, nervous shock and employers return to work
obligations have already commenced as of 19 June
2012.
Reforming the workers compensation scheme is a
mammoth task for the government and WorkCover.
NSW Farmers is in close communication with
WorkCover on their progress of implementing this
reform. We have been informed that new forms and
operational guidelines are still in development. We will
inform members of further progress as they are finalised
progressively.

Employment law
reminders…
helping you to
remain compliant.
What’s the
difference
between IR
Basics and IR
Essentials
membership?
All NSW Farmers’ producer
members have an IR Basics (IRB)
membership. This gives them
access to phone support (4 x per
year) and limited access to the IR
website.
For an additional fee, members
can upgrade to the IR Essentials
(IRE) membership option giving
them unlimited access to the
support services provided by the
IR team, including assistance with
drafting all forms of employment
documentation such as contracts,
policies and Individual Flexibility
Agreements (IFA’s).
This month: The importance of notification of workplace
injuries
It has come to our attention recently that a number of members
have been penalised as a result of failing to notify their scheme
agents of injuries within the specified time frame, so it was timely
to give a reminder about the importance of this.
In the first instance, whenever an injury occurs in the workplace,
the employer needs to be notified as soon as possible. This
requirement needs to be communicated to all employees and
managers, so that when an injury does occur, the employer is not
placed in a position of failing to notify simply by virtue of the fact
that they were unaware of the injury occurring. It may be
appropriate to implement a workplace health and safety policy in
your workplace that includes a clause on injury notification to
ensure that everyone in the workplace understands the
requirements in relation to notification.
Once the employer has been notified of the injury, the injury
should be entered into an injury register. We have provided a
template injury register document which members may wish to
use for these purposes. It can be accessed through the IR
website here.
Importantly, the employer has a legal requirement to notify the
Scheme Agent or insurer within 48 hours of the injury being
notified. If this notification is not made within the specified
timeframe, employers are at risk of paying a claims excess on the
claim, which is the equivalent of one weeks pay. Notification of the
scheme agent can be done in a number of ways including phone
and email.

Employee or contractor?
Farmers often engage contractors on the farm to help them out in busy
times or to do jobs they are unable to do. Many farmers believe that hiring
someone as a contractor means that they don’t have to worry about the
various laws which apply to employment. This is not always the case.
The law says that just because a person has an ABN and calls themself a
contractor does not necessarily stop them being regarded as an employee
- and this means you could be liable for such things as employment
entitlements, superannuation guarantee charge and workers
compensation.
So how do you decide if the law will support someone’s claim to
being a contractor?
Sometimes it will be easy to work out, for instance in the case of a
contractor who provides a crop spraying service to you and others in the
district.
At other times it may not be so clear, for instance if your neighbour comes
in and does some tractor work for you. Initially, the courts applied the
control test, that if you can control the way work is done, where it is done
and when it is done, the person is an employee. If not, they are an
independent contractor.
Over time the courts have adopted a totality approach where various
different considerations are taken into account, and decide if on balance
the total picture points to employment or independent contracting. We have
summarised matters considered by the courts into a to assist you in
considering whether a worker is a contractor or employee. You can access
the list via the IR website here.
The Australian Tax Office (ATO) has a useful online decision tool to assist
in distinguishing between employee and contractor for the purpose of
deciding whether you will need to make superannuation guarantee
contributions. The tool can be found here. WorkCover also has an online
self-assessment tool designed to assist employers to determine whether a
person is an employee or contractor for workers compensation purposes.
What are the consequences for not correctly classifying a
person as a contractor?
An employer may be in trouble under three heads of claim for wrongly
classifying a person as a contractor rather than an employee. First, an
employer may be required to back-pay superannuation guarantee
contributions and the relevant charges. Secondly, an employer may be
required to back-pay workers compensation premium because the wage
declaration for premium calculation is inaccurate. Thirdly, the Fair Work Act
2009 provides for penalties for sham contracting. Falsely classifying an
employee as a contractor is breach of the Fair Work Act 2009 sham
contracting provisions.
What is an IFA?
Award covered employees need to
be given the conditions prescribed
by the Award and be paid in
accordance with the Award
provisions. Awards generally
prescribe a base rate of pay and
additional penalties and loadings
payable in certain circumstances
(e.g. overtime penalty, annual leave
loading).
Employers in agreement with
employees can use Individual
Flexibility Agreements (IFA’s) to
vary certain award conditions.
IFA’s are not a substitute for an
employment contract but they
provide a degree of flexibility in
adopting a flat hourly rate or above
award salary by absorbing award
entitlements (e.g. annual leave
loading, penalty rates, overtime
rates, allowances), thereby
simplifying the administration for
payment of wages.
In implementing an IFA, employers
must ensure that the employees pay
is greater than the award condition
by applying the Better Off Overall
Test (BOOT).
In essence, by adopting an IFA, the
employee should not be worse off
compared to the award conditions
they would be entitled to.
Employees must willingly agree to
the conditions of the IFA.
See Grant Smith, IR Advisor,
talking about IFAs here.