Effective 1 July 2013, the definition of “worker” under the Workers’ Compensation and Rehabilitation Act 2003 has changed.
Section 11 of the Act previously defined a worker as simply “a person who works under a contract of service”. Schedule 2 further defined who was or was not a worker in particular circumstances for the purposes of Section 11.
The amendments now define a worker as a person who:
(a) Works under a contract and
(b) In relation to the work, is an employee for the purpose of assessment for PAYG withholding under the Taxation Administration Act 1953 (Cwlth), Schedule 1, Part 2 – 5.
In the Finance and Administration Committee’s inquiry into the operation of the Queensland Workers’ Compensation Scheme in May 2013, it did not recommend any change to the definition of worker. The only changes proposed were amendments to Schedule 2 to strengthen the considerations of who was or was not a worker.
The Committee found that the building and constructive industry was most supportive of change to the definition. They submitted Schedule 2 was not sufficiently clear. Also, they felt it was inconsistently applied to their industry, which incorporated subcontractors, consultants and operators.
They submitted particularly in relation to sub contractors a determination of whether or not they may be an employee was often made on a case by case basis and often after the injury had occurred, such as through a Q-Comp Appeal.
The Schedule 2, Part 1, Point 1 definition of a person being a worker if they work under a contract “for labour only or substantially for labour only” is a patently subjective assessment. By comparison, the amendment appears to contain a simple, objective assessment of whether the person is subject to PAYG withholding payments.
The Committee noted employer groups opposed to amendment considered restricting the definition of “worker” would only aid employers in avoiding their statutory obligations by implementing artificial contract arrangements to avoid premiums.
Irrespective of the Committee advocating no change, the amendments were passed in the Industrial Relations (Transparency and Accountability of Industrial Organisations) and other Acts Amendment Bill 2013. The basis behind the Attorney General’s reasoning was that the alignment with taxation office guidelines would provide clarity to the definition.
