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Licensing

Operation of licensees

Under the SRC Act, certain Commonwealth authorities and eligible corporations may apply for a licence to self-insure their workers’ compensation liabilities and manage compensation claims.

The Australian National University commenced as a self-insured licensee from 1 July 2018. DHL Express (Australia) Pty Ltd was granted a licence which commenced on 1 January 2019. The Australian Capital Territory Government was granted a licence which commenced on 1 March 2019.

Comcare provides support to the SRCC in the performance of its functions regarding licensing. Comcare evaluates licence applications, recommends the amount to be charged for licence application fees, monitors licensee performance against licence conditions and recommends actions to the SRCC.

Table 32 summarises licence types, licensees and expiry dates at 30 June 2019.

Table 32: Licence types, licensees and expiry dates—at 30 June 2019

Licence type

Features

Licensee (expiry date)

Claims management arrangements

Corporation

Self-management of claims (with capacity to arrange for third-party claims managers)

Pacific National Services Pty Ltd (formerly Asciano Services Pty Ltd) (30/06/2025)

In house

Australian air Express Pty Ltd (30/06/2025)

QBE Insurance (Australia) Limited

BWA Group Services Pty Ltd (30/06/2022)

Commonwealth Bank of Australia

Bis Industries Ltd (30/06/2023)

In house with claims review performed by QBE Insurance (Australia) Limited

Border Express Pty Ltd (30/06/2022)

In house with claims review performed by Paratus Claims Pty Ltd

Cleanaway Operations Pty Ltd (formerly Transpacific Industries Pty Ltd) (30/06/2022)

Employers Mutual Limited

Colonial Services Pty Ltd (30/06/2022)

Commonwealth Bank of Australia

Commonwealth Bank of Australia (30/06/2022)

In house

Commonwealth Insurance Limited (30/06/2022)

Commonwealth Bank of Australia

Commonwealth Securities Limited (30/06/2022)

Commonwealth Bank of Australia

CSL Limited (30/06/2023)

QBE Insurance (Australia) Limited

DHL Express (Australia) Pty Ltd (31/12/2026)

In house

DHL Supply Chain (Australia) Pty Ltd (30/06/2022)

In house

Fleetmaster Services Pty Ltd (30/06/2023)

In house with claims review performed by Paratus Claims Pty Ltd

John Holland Group Pty Ltd (30/06/2024)

In house

John Holland Pty Ltd (30/06/2024)

John Holland Group Pty Ltd

John Holland Rail Pty Ltd (30/06/2024)

John Holland Group Pty Ltd

K&S Freighters Pty Limited (30/06/2024)

In house

Linfox Australia Pty Ltd (30/06/2023)

In house

Linfox Armaguard Pty Ltd (30/06/2023)

Linfox Australia Pty Ltd

Medibank Private Limited (30/06/2023)

Employers Mutual Limited

National Australia Bank Ltd (30/06/2024)

In house

National Wealth Management Services Limited (30/06/2024)

National Australia Bank Ltd

Optus Administration Pty Limited (30/06/2023)

QBE Insurance (Australia) Limited

Prosegur Australia (formerly trading as Chubb Security Services Limited (30/06/2025)

In house with claims review performed by Moray & Agnew

Ron Finemore Transport Services Pty Ltd (30/06/2025)

In house

StarTrack Express Pty Ltd (30/06/2022)

Australian Postal Corporation

StarTrack Retail Pty Ltd (30/06/2022)

Australian Postal Corporation

Telstra Corporation Limited (30/06/2022)

In house

Thales (formerly known as ADI Limited) (30/06/2025)

In house with claims review performed by QBE Insurance (Australia) Limited

TNT Australia Pty Ltd (30/06/2022)

In house with claims review performed by QBE Insurance (Australia) Limited

Virgin Australia Airlines Pty Ltd (29/09/2024)

Employers Mutual Limited

Visionstream Pty Ltd (30/06/2023)

Employers Mutual Limited

Wilson Security (30/06/2023)

QBE Insurance (Australia) Limited

Declared Commonwealth Authority

Self-management of claims

Australian Capital Territory Government (28/02/2027)

Employers Mutual Limited

Australian National University (30/06/2026)

Comcare (on a contracted basis)

Australian Postal Corporation (30/06/2022)

In house

Reserve Bank of Australia (30/06/2023)

Australian Postal Corporation

Licence conditions and performance standards of licence

The SRCC expects licensees to continuously improve their prevention, rehabilitation and claims management performance outcomes, to comply with licence conditions and to meet performance standards of licence.

Licence conditions require compliance with the SRC Act and any applicable laws and regulations regarding the health, safety and rehabilitation of employees. Licensees are required to meet financial, prudential, and performance reporting requirements as part of their licence conditions.

Performance standards of licences require licensees to develop and implement effective management systems for prevention, rehabilitation and claims management and to work towards the attainment of outcome-based performance goals.

Operation of the Licence Compliance and Performance Model

The Licence Compliance and Performance Model (LCPM) provides the regulatory framework under which the SRCC monitors and assesses licensee performance. The model seeks to ensure compliance with licence conditions and focuses on licensee performance against set standards and measures in claims management, rehabilitation and prevention by using a holistic, risk-based approach to performance evaluation. The model contributes towards the Government’s agenda to reduce regulatory burden on business by affording a reduced level of regulatory oversight for established licensees that have mature management systems and demonstrated high performance against the SRCC’s standards and measures.

The LCPM examines licensees’ prudential performance, results of internal and external reviews in prevention, rehabilitation and claims management performance, and provides for regulatory action by the SRCC where non-compliance or performance concerns are identified.

Under the LCPM, licensees are classified as a ‘developing/transitioning licensee’ or an ‘established licensee’. Developing/transitioning licensees are new scheme participants in their first two years of licence. Following the initial two-year period, licensees are considered to be established in the scheme.

Developing/transitioning licensees work closely with Comcare to develop systems by participating in, and being subject to, reviews throughout the first two years of licence to ensure that a licensee can meet the conditions of licence and performance standards set by the SRCC.

The SRCC uses this initial period to closely monitor the performance of a new licensee as they transition into the scheme. The SRCC may choose to lessen the extensive reviews in the developing/transitioning phase where a licensee can evidence strong, consistent results against compliance and performance requirements.

Established licensees are required to be compliant with the conditions of licence and continue to meet the performance standards set by the SRCC.

The SRCC can, at any time, determine that due to issues with compliance, reporting or performance results, a regulatory response is required. The status of a licensee (that is, developing/transitioning or established) does not inhibit the SRCC from taking action to address a compliance or performance issue. For example, a targeted review may be conducted at any point should the SRCC consider the performance of a licensee warrants a more thorough review.

A key feature of the LCPM is the quarterly monitoring of the SRCC-defined performance standards and measures, including the Licensee Key Performance Indicators (LKPIs). The SRCC sets performance targets against these LKPIs, which include the incidence of serious and accepted claims based on industry benchmarks, return to work performance, and timeliness of claims management and reconsideration decisions. Licensees are provided with the opportunity to provide input and information regarding their quarterly results for consideration. The SRCC uses the LKPI results and any further information provided by licensees to determine whether any regulatory action is required.

The self-insurance licence and the LCPM also provide a framework for the prudential obligations required of licensees under the licence. This includes the provision of a liability report describing current and predicted outstanding workers’ compensation liabilities (this information is used to calculate the guarantee amount) and the provision of a guarantee plus a reinsurance retention policy, yearly accounts and financial statements. Some licensees are also subject, based on risk, to ongoing financial monitoring which comprises a regime of continuous monitoring through media and rating agencies and annual desktop reviews of licensees’ financial statements.

Each year licensees provide an annual Licensee Compliance and Performance Improvement (LCPI) report certified by licensee senior management. The LCPI report provides the SRCC with an overview of key activities undertaken and outcomes achieved by a licensee during the previous year. The LCPI report also details a licensee’s objectives for the coming year and is the primary tool for licensees to: report to the SRCC on performance against the SRCC’s performance standards and measures; provide annual certification as per the prudential conditions of licence; and to demonstrate continuous improvement.

Continuous improvement

The SRCC has an ongoing focus on the continuous improvement of its regulatory model. In the 2018–19 year, the SRCC has undertaken the following activities to improve the operation of the LCPM:

  • published an updated version of the LCPM incorporating changes agreed by the SRCC
  • reviewed the operation of LKPI 5 (median incapacity)
  • updated the reporting of LKPIs 6 and 7 (timeliness – initial claims determination and reconsiderations)
  • published information products to ensure clarity of roles and accessibility for employees and affiliated unions and other stakeholders in relation to feedback and complaints mechanisms
  • reviewed licensee reporting requirements to reduce duplication and streamline reporting
  • introduced governance mechanisms to assist in ensuring consistent regulatory responses
  • commenced a review of the general conditions of licence, to be completed in 2019–20
  • considered the operation of the LCPM to evaluate its effectiveness and identify areas for further improvement.

Licensees’ performance

Table 33 provides the operations of each licensee through the summary of claims activity during 2018–19. Table 34 provides a summary of SRCC monitoring of overall licensee performance against the LKPIs during 2018–19.

Care should be exercised in comparing the claims activity of licensees given the different risk profiles of individual employers.

Licensee data

Table 33: Licensees’ claims activity

Number of

FTE employees

Incidence of

claims received

Incidence of

claims accepted1

201718

201819

201718

201819

201718

201819

ACT Government2

-

23,279

-

23.5

-

19.0

Australia Post

26,950

27,022

44.9

51.6

35.4

39.7

AaE

450

382

22.2

23.6

np

20.9

ANU3

-

4,898

-

5.3

-

4.7

BankWest

3,708

3,587

6.5

5.6

6.5

4.2

BIS Industries

939

997

24.5

25.1

17.0

21.1

Border Express

900

993

44.4

30.2

36.7

27.2

Cleanaway Operations

4,291

5,975

38.2

36.0

27.7

27.3

Colonial Services

2,488

2,265

3.2

4.4

np

3.1

CBA

22,846

25,959

6.6

5.8

4.6

4.2

CommInsure

373

398

16.1

np

np

np

CommSec

5,197

2,619

2.7

3.8

1.9

np

CSL

2,147

2,313

2.8

3.5

np

np

DHL Express4

-

606

-

31.4

-

19.8

DHL Supply Chain

2,315

3,069

28.9

20.5

20.7

8.5

Fleetmaster

305

331

np

24.2

np

0.0

John Holland

2,749

3,767

103.5

88.5

99.4

84.0

John Holland Group

483

1,334

9.8

7.4

8.0

6.1

John Holland Rail

161

192

62.1

57.3

49.7

52.1

K&S Freighters

3,174

3,137

38.1

53.2

32.8

41.1

Linfox Armaguard

1,817

1,792

29.7

20.6

17.1

6.1

Linfox Australia

4,807

4,934

14.1

13.2

6.0

5.5

Medibank Private

2,038

2,187

7.9

5.0

5.9

np

NAB

24,645

24,629

3.7

3.7

2.0

2.1

NWMS

1,531

1,543

np

np

np

np

Optus

8,279

7,367

4.8

3.0

3.1

1.0

Pacific National Services

2,552

2,451

24.3

22.4

19.6

18.4

Prosegur

760

735

56.6

50.3

43.4

42.2

Reserve Bank of Australia

1,340

1,340

np

np

np

np

Ron Finemore Transport

441

729

18.1

49.4

18.1

41.2

StarTrack Express

3,457

3,333

63.3

45.0

57.0

36.6

StarTrack Retail

191

176

31.4

34.1

np

np

Telstra

28,056

25,652

8.8

8.1

7.2

6.0

Thales

3,403

3,456

6.8

13.9

5.6

10.1

TNT Australia

4,092

4,201

63.8

61.4

58.2

50.2

Virgin Australia Airlines

7,810

8,144

26.2

25.2

23.8

22.3

Visionstream

1,400

2,125

5.0

7.1

4.3

5.2

Wilson Security

6,249

6,249

8.5

7.7

5.0

4.8

ALL LICENSEES

182,344

214,166

18.3

19.2

14.6

14.8

np – not publishable. In order to protect privacy, results are not published where the numbers used to calculate incidence rates are between one and five.
1. This measure captures those claims are that initially accepted in the reporting period.
2. ACT Government joined the licensee sector 1 March 2019.
3. ANU joined the licensee sector 1 July 2018.
4. DHL Express joined the Comcare scheme 1 January 2019.

Note: All incidence rates are calculated per 1,000 FTE employees.

Table 34: Performance against LKPIs – All licensees

201718

201819

Number of notifiable worker fatalities

7

5

Incidence of serious claims1

6.6

8.2

Incidence of accepted claims2

14.6

14.8

Median incapacity (weeks)

5.0

4.8

Percentage of claims determined within 20 days (injury) and 60 days (disease)

95%

95%

Percentage of reconsiderations decided within 30 days

95%

95%

Number of reconsideration requests decided

996

1,091

Number of AAT appeals received

379

464

1. Serious claims are those claims that reach one week or more of time lost during the reporting period.
2. This measure captures those claims are that initially accepted in the reporting period.

Note: All incidence rates are calculated per 1,000 FTE employees

Recordkeeping and reporting requirements under the Safety, Rehabilitation and Compensation Directions 2019

The following table provides details of the recordkeeping requirements outlined in the Safety, Rehabilitation and Compensation Directions 2019 (SRC Directions) and is reported in accordance with section 20 of the SRC Directions.

Table 35: Recordkeeping requirements under SRC Directions

Requirement

Number

Details

Applications for licence received

1

Australian Capital Territory Government

Refusals to grant licence

Nil

Nil

Expiry of licence

Nil

Nil

Suspension of licence

Nil

Nil

Revocations of licence

Nil

Nil

Grants of licences, including the scope of the licences and the conditions to which the licences are subject*

Licences granted

Australian Capital Territory Government, DHL Express (Australia) Pty Ltd

Licences commenced

Australian National University, Australian Capital Territory Government and DHL Express (Australia) Pty Ltd

Variations granted due to change in scope or conditions of licence

The following licence notices were varied in relation to claims manager, special conditions or prudential requirements:

> Australian Postal Corporation

> Cleanaway Operations Pty Ltd

> Linfox Armaguard Pty Ltd

> Pacific National Services Pty Ltd

> Prosegur Australia Pty Ltd

> Ron Finemore Transport Service Pty Ltd

> TNT Australia Pty Ltd

Licence extensions

Nil

Breaches of licences and preserved licences

2

> Failure to comply with the requirements of the SRC Act, including failure to manage claims guided by equity, good conscience and the substantial merits of the case, and failure to comply with the SRCC’s Performance Standards and Measures.

> Failure to inform the SRCC within 30 days of the addition of parties to a deed of cross guarantee.

*The scope and conditions of licences granted by the SRCC are available on the Federal Register of Legislation.

Further information is available in the ‘Licensing’ section of this report.