Facilitate jobs growth through policies and programs that promote fair, productive and safe workplaces

Summary

Satisfaction with the department's administration and service provided across functions

Strategic Priority

• Strategic Priority Workplaces

Source

• Corporate Plan 2019–23, p. 9
• Portfolio Additional Estimates Statements 2019–20, Programs 2.1, 2.2, p. 29¹

Target and performance result

• 80 per cent of claimants are satisfied with the department’s administration of the Fair Entitlements Guarantee (FEG)

Achieved – 84.59 per cent of claimants were satisfied.

• 80 per cent of insolvency practitioners are satisfied with the department’s administration of the FEG

Achieved – 96.32 per cent of insolvency practitioners were satisfied.

• Accredited company satisfaction greater than 90 per cent with the service provided by the Office of the Federal Safety Commissioner

Achieved – 97 per cent of accredited companies indicated they are happy with the service provided by the Office of the Federal Safety Commissioner.

• 75 per cent of accredited companies consider that accreditation has improved their workplace safety performance

Achieved – 93 per cent of accredited companies indicated they have achieved better safety performance by becoming accredited.

Rationale

Fair Entitlements Guarantee

The FEG provides a safety net for workers who have lost their jobs and entitlements through the liquidation or bankruptcy of their employer. It covers five employment entitlements, payable for different time periods. Payments are subject to a maximum weekly wage cap, which was $2,451 in 2019–20.

To determine claimant satisfaction with the department’s administration of the FEG, we send an electronic survey to each claimant approximately five weeks after their final claim decision, irrespective of whether they received an advance or not. This timing is based on the premise that claimants will be better able and more likely to respond to the survey if they are asked closer to the point when their application was finalised.

To determine the proportion of insolvency practitioners satisfied with the department’s administration of the FEG, we send a survey to all insolvency practitioners who were involved in scheme cases in the previous 12 months. The survey is typically sent mid-May and is open for six weeks until the end of June.

Both surveys are conducted through the online Qualtrics survey platform.

Office of the Federal Safety Commissioner

To determine satisfaction with our service and whether accreditation has improved workplace safety performance, we conduct an annual survey of all accredited companies. Respondents complete the survey on a voluntary basis and responses are anonymous. Performance results are calculated as the percentage of respondents rating the service as satisfactory or better.

Fair Entitlements Guarantee

In 2019–20, 1,574 of 10,429 claimants responded to the satisfaction survey, representing a 15 per cent response rate. Compared to 2018–19, the response rate decreased by six percentage points. Results are calculated as the percentage of respondents who indicate they are ‘satisfied’ or ‘very satisfied’ with the program. Nil responses to the headline FEG satisfaction question were excluded.

FEG claimants who are dissatisfied with the outcome of a departmental review can apply to the Administrative Appeals Tribunal for further review. In 2019–20, only 34 applicants lodged a further review with the tribunal. This is 5.2 per cent of the total number of claimants who sought a departmental review and double the number lodged with the tribunal in 2018–19.

The tribunal finalised 16 FEG matters in 2019–20. Of these:

• the tribunal affirmed the department’s decision, or dismissed the claimant’s application, in 11 matters
• the claimant withdrew their application in five matters.

The tribunal did not set aside or vary the department’s decision in any matter.

The number of matters finalised in 2018–19 was 34 and included seven that the tribunal set aside. While the tribunal finalised fewer matters in 2019–20, none of those matters were either set aside or varied by the tribunal.

In 2019–20, 226 of 1,277 insolvency practitioners responded to the insolvency practitioner survey, representing an 18 per cent response rate. Compared to 2018–19, the response rate increased by five percentage points. Results are calculated as the percentage of respondents who indicate they are ‘satisfied’ or ‘very satisfied’ with the program. Nil responses to the headline satisfaction question were excluded.

Office of the Federal Safety Commissioner

The Office of the Federal Safety Commissioner has achieved consistently high satisfaction ratings from scheme-accredited companies, at the same time as seeing growth in scheme coverage. Our collaborative and adaptive approach, built on years of experience and engagement, has resulted in delivery of all key outcomes. Lessons learnt through finding efficiencies and adapting to the COVID‑19 pandemic restrictions will have positive effects when the office returns to business as usual.

The 2019–20 survey was distributed to the 362 accredited companies, spanning small, medium and large businesses. We achieved a response rate of 63.5 per cent, which is an increase of 14.3 percentage points from the 2018–19 survey. Results were consistent with the high results achieved in 2018–19.

Work Health Safety Accreditation Scheme

During 2019–20, Mr David Denney was appointed Federal Safety Commissioner. The Federal Safety Commissioner administers the Work Health Safety Accreditation Scheme as defined by the Building and Construction Industry (Improving Productivity) Act 2016. This year the Federal Safety Commissioner accredited 49 new companies, bringing the number of accredited companies to 500.

Regular on-site audits are used to accredit, assess and review the compliance of scheme-accredited companies. The COVID‑19 pandemic affected the operations of the construction industry and the Office of the Federal Safety Commissioner adapted its approach by using virtual auditing technology. This was trialled to supplement physical on-site audit and to enable audits to be conducted without the need for physical contact. The Office also adapted its proactive on-site audit program in light of COVID‑19 pandemic restrictions, temporarily postponing some compliance activities. However, it still conducted 395 of the planned 452 on-site audits during 2019–20. This allowed accredited companies to manage the health and safety of workers during this period. The Federal Safety Commissioner engaged regularly with the Industry Reference Group during COVID‑19 restrictions and published regular advice and information on the website to help companies minimise the risks while sites remained operational.

Claim payments are correct

Strategic Priority

• Strategic Priority Workplaces

Source

• Corporate Plan 2019–23, p. 9
• Portfolio Additional Estimates Statements 2019–20, Program 2.2, p. 29²

Target and performance result

• 95 per cent of Fair Entitlements Guarantee payments are correct

Achieved – 95 per cent of payments were correct.

Rationale

To determine whether FEG payments are correct, we sample a statistically significant random sample of claim decisions. The random sample of claims are tested against 23 criteria to evaluate the accuracy of the decision made. Results are collected and reported monthly.

Analysis

Between July 2019 and January 2020, we sampled and audited 280 claim decisions out of 8,420 claim decisions made during the reporting period. Each claim decision tested was deemed as being either ‘fully compliant’, ‘inaccurate’ or having a ‘compliance issue’. The following table summarises the results.

In 2019–20, we improved the administration of the FEG to deliver fast and accurate outcomes for redundant workers and ensure insolvency practitioners can easily engage with the program.

Business improvements in 2019–20 include:

• a new web-based claim form that makes it easier for people who have lost their jobs due to an insolvency to access assistance
• the development of a new online portal for insolvency practitioners, FEG IP Online, to initiate communication that will make providing services and information efficient
• an Administrative Appeals Tribunal module on internal business systems to improve the administration of external reviews of FEG decisions
• a temporary measure to allow claimants extra time to obtain a foreign passport that shows their Australian permanent-residency status (this helps claimants to meet the 12-month deadline for lodging a claim).

This year we also provided program-specific fraud detection training for staff in the program and business system controls. We worked with the Commonwealth Fraud Prevention Centre to conduct pressure testing of critical fraud controls. We also ran an internal assurance forum that helped us identify and addresses emerging issues through compliance and review processes.

In addition to meeting the 2020 target, in 2019–20 other significant achievements in delivering the FEG include:

• maintaining timely FEG advances (average processing time of 8.1 weeks)
• advancing $162.29 million in claim payments to 11,228 people
• responding to 16,883 telephone calls and 13,304 emails received through the FEG hotline and mailbox
• initiating internal reviews of 1,233 claim decisions (10 per cent of the total number of claimants seeking assistance); reviews were done where additional information is provided to the department, or the department becomes aware of circumstances that warrant re-examination of a claim
• finalising 672 requests from people seeking a review of their claim (5.4 per cent of the total number claiming assistance); the total number of reviews received was 693.

Fair Entitlements Guarantee Recovery Program

During 2019–2020, the FEG Recovery Program expended approximately $7.59 million to recover approximately $92.63 million of FEG advances and associated costs. This brought the total amount expended to $34.71 million to recover a total of $194.37 million since the program began on 1 July 2015. The recovered amounts are returned to consolidated revenue. The program also incidentally recovered $14.94 million of employee entitlements that were not covered by the FEG.

Under this program, we were successful in identifying and resolving ambiguities in the laws relating to repayment of employee entitlements. Ambiguities in the law are typically solved incrementally as opportunities arise and are brought before a court. However, disputes are often settled before trial and ambiguity persists in the absence of a judicial decisions. Similarly, court decisions may resolve certain ambiguities but may give rise to other issues in the program that need to be tested by further case law.

The FEG Recovery Program was affected by a slowdown in the progress of civil matters before the court and by a general slowdown in industry responses as a result of the COVID‑19 pandemic.

Responding to the 2019–2020 summer bushfires and COVID‑19 pandemic

We implemented measures to ensure the FEG could deliver timely advances to redundant workers during the exceptional circumstances that occurred during 2019–20.

In anticipation of increased demand for the scheme from the 2019–20 summer bushfires, we put in place mechanisms to identify and respond as quickly as possible. We fast-tracked bushfire-related claims and gathered information from insolvency practitioners to identify any links between new insolvencies and the bushfire events. This helped claimants to obtain evidence to support their claim. We also temporarily suspended debt recovery action in fire-affected areas.

The COVID‑19 pandemic has presented operational challenges, with the majority of staff working from home from late March 2020. Support measures were put in place to ensure continuity of service to claimants as well as insolvency practitioners. An additional 48 staff were transferred temporarily to bolster our capability to respond to increased demand on the program.

Industrial action is minimised

Strategic Priority

• Strategic Priority Workplaces

Source

• Corporate Plan 2019–23, p. 9
• Portfolio Additional Estimates Statements 2019–20, Program 2.1, p. 29

Target and performance result

• Maintenance of the number of working days lost per thousand employees

Achieved – Three working days were lost per 1,000 employees over the year to June 2020, compared to 9.8 working days lost per 1,000 employees over the year to June 2019.

Rationale

The department monitors the number of working days lost per thousand employees because it is a key measure of industrial disputes across the economy. We monitor industrial disputes to understand the effectiveness and efficiency of the industrial relations framework. We provide sound, evidence-based policy advice on industrial relations and enterprise bargaining.

Source: Australian Bureau of Statistics, Industrial Disputes (Cat No. 6321.0.55.001).

Analysis

The rate of industrial disputes over the year to the June quarter 2020 was 3 working days lost per thousand employees, compared with 9.8 working days lost per thousand employees over the year to the June quarter 2019. The rate of industrial disputation is maintained at a low level.

While this measure can be influenced by a range of factors, some of which are outside the department’s direct control, it reflects the industrial relations framework to which the department’s policy and legal advice have contributed.

Enterprise bargaining is used by employers and employees to negotiate pay and conditions

Strategic Priority

• Strategic Priority Workplaces

Source

• Corporate Plan 2019–23, p. 9
• Portfolio Additional Estimates Statements 2019–20, Program 2.1, p. 29

Target and performance result

• Increase in the number and coverage of enterprise agreements

Not achieved – The number of current agreements and the number of employees covered by current agreements have decreased since 30 June 2019.

Rationale

Enterprise agreements provide businesses and employees with wages and employment conditions that are tailored to the circumstances of individual workplaces. We use data from the Workplace Agreements Database we maintain to assess this measure. The database contains information on all known federal enterprise agreements in operation since the introduction of the Enterprise Bargaining Principle in October 1991.

Analysis

Analysis of the database indicates that as at 30 June 2020, there were 10,701 current agreements (not expired or terminated) covering 2.16 million employees. This compares with 11,337 agreements covering 2.19 million employees at 30 June 2019.

This measure can be influenced by a range of factors including those outside the department’s direct control but reflects the industrial relations framework to which the department’s policy and legal advice have contributed. Disruptions to ordinary operations caused by the COVID-19 pandemic have likely contributed to the decline in enterprise bargaining.

Timely processing of applications and claims

Strategic Priority

• Strategic Priority Workplaces

Source

• Corporate Plan 2019–23, p. 9
• Portfolio Additional Estimates Statements 2019–20, Programs 2.1, 2.2, p. 29³

Target and performance result

• 80 per cent of effective FEG claims processed within 16 weeks of receipt

Achieved – 89 per cent were processed within 16 weeks of receipt.

• Average processing time of claims is 14 weeks

Achieved – The average processing time was 8.1 weeks.

• Accreditation applications to the Office of the Federal Safety Commissioner are assessed and applicants are contacted within ten working days

Achieved – 100 per cent of accreditation applications were assessed and applicants were contacted within ten working days.

Rationale

Fair Entitlements Guarantee

This performance indicator benchmarks the timeliness of FEG claims management processes. Our internal benchmarks for the time taken to process effective claims of 14 and 16 weeks is an indicator to us of both efficiency in claims processing throughput and effective workflow management procedures. For a claim to be effective, it needs to meet the necessary requirements for lodgement. Data is derived from the internal claims processing system.

Office of the Federal Safety Commissioner

The Office established a benchmark of ten working days in which to complete its initial assessment of accreditation applications to reduce delays in progressing to the next stage of the application process. Measuring performance against this benchmark allows the Office to determine whether its procedures continue to support efficient processing of applications.

Analysis

The FEG exceeded both its timeliness measures for 2019–20. Taken together with our effectiveness measures, the performance results show that we are processing FEG claims in a timely manner while maintaining high levels of accuracy and stakeholder satisfaction.

The Office of the Federal Safety Commissioner has ensured all 141 applications for accreditation received during the reporting period were processed and applicants contacted within the set timelines. This is an outstanding result that demonstrates the client-focused delivery of the accreditation application requirements of the Work Health and Safety Accreditation Scheme.