States lose Comcare case
Australian states no longer have a monopoly over compulsory workers’ compensation insurance.
Large employers welcomed last week’s High Court decision that paves the way for more companies to self-insure under the Federal Government’s Comcare system. Smaller employers locked into state schemes may have cause to worry, however, without the big national companies pumping premiums.
The 5-2 High Court ruling found no constitutional objection to federal laws allowing private companies competing against current or former Federal Government entities to join the scheme.
In 2005 Optus was first to sign up, but the Victorian Government led the challenge to bring the telecommunications company’s 9000 employees back into eight state and territory systems.
Victoria, SA, WA and NSW argued the laws went against state rights in dealing with a given “state” insurance. But the court found the laws to be supported by Commonwealth corporations powers.
Federal Industry Relations Minister Joe Hockey has welcomed the ruling, saying businesses will be quick to take advantage of it.
“Joining Comcare is now a matter of choice for eligible private sector corporations,” he said. “By no longer having eight state and territory schemes, national employers can enjoy administrative savings of up to $2 million per annum per company.”
But the states won’t take the decision lying down. Victorian WorkCover Minister Tim Holding says the Commonwealth is wreaking havoc with state systems by encouraging some of their largest contributors to move away. That will affect premiums and also increase administration costs for remaining businesses.
“We took this case on because the Commonwealth’s expansion of Comcare not only creates a red tape nightmare for employers but undermines the states’ capacity to provide safe workplaces,” he said. “[Prime Minister John] Howard and Mr Hockey must now explain to Australian businesses and workers how they are going to deal with the mess they have created.”
Large employers welcomed last week’s High Court decision that paves the way for more companies to self-insure under the Federal Government’s Comcare system. Smaller employers locked into state schemes may have cause to worry, however, without the big national companies pumping premiums.
The 5-2 High Court ruling found no constitutional objection to federal laws allowing private companies competing against current or former Federal Government entities to join the scheme.
In 2005 Optus was first to sign up, but the Victorian Government led the challenge to bring the telecommunications company’s 9000 employees back into eight state and territory systems.
Victoria, SA, WA and NSW argued the laws went against state rights in dealing with a given “state” insurance. But the court found the laws to be supported by Commonwealth corporations powers.
Federal Industry Relations Minister Joe Hockey has welcomed the ruling, saying businesses will be quick to take advantage of it.
“Joining Comcare is now a matter of choice for eligible private sector corporations,” he said. “By no longer having eight state and territory schemes, national employers can enjoy administrative savings of up to $2 million per annum per company.”
But the states won’t take the decision lying down. Victorian WorkCover Minister Tim Holding says the Commonwealth is wreaking havoc with state systems by encouraging some of their largest contributors to move away. That will affect premiums and also increase administration costs for remaining businesses.
“We took this case on because the Commonwealth’s expansion of Comcare not only creates a red tape nightmare for employers but undermines the states’ capacity to provide safe workplaces,” he said. “[Prime Minister John] Howard and Mr Hockey must now explain to Australian businesses and workers how they are going to deal with the mess they have created.”