Incapacity payments to employees aged over 63

On 1 October 2001 the Safety, Rehabilitation and Compensation Act 1988 (the SRC Act) was amended in several areas, including the provisions relating to compensation for incapacity payable to employees aged over 63.

Subsection 23(1) of the SRC Act provides that compensation for incapacity is not payable to a person who has reached the age of 65, which was the normal retirement age at the time the act originally came into effect. Section 30 provided for the redemption of weekly incapacity payments where certain criteria are met. The section contained a formula for calculating the redemption amount based on weekly incapacity payments ceasing at age 65.

Jurisdictional Policy Advice 1999/02 notified determining authorities that, following abolition of compulsory retirement provisions with the passage of the Public Service Act 1999 (the PS Act), the SRC Act had been amended to provide that subsection 23(1) would not apply to people employed under the PS Act (APS employees). These employees would have access to a maximum of 104 weeks' incapacity payments.

The amendments extend to non-APS employees covered by the SRC Act the additional eligibility made available to APS employees.

Subsection 23(1)

Compensation is not payable under section 19, 20, 21, 21A or 22 to an employee who has reached 65.

Subsection 23(1A)

However, if an employee who has reached 63 suffers an injury (whether before or after the commencement of this subsection):

subsection (1) does not apply; and
compensation is payable under section 19, 20, 21, 21A or 22 in respect of the injury:

to the extent that this Act (other than subsection (1)) allows; and
for a maximum of 104 weeks (whether consecutive or not) during which the employee is incapacitated.

Section 30 (3) has been amended by changing the definition to include the following:

n means the number worked out using the formula:

Number of days

365

where:

number of days means the number of days in the period beginning

on the day after the day on which the determination is made and

ending:

(a) if the employee is injured before reaching 63 years of age—

on the day immediately before the day on which the

employee reaches 65 years of age; and

(b) if the employee is injured on or after reaching 63 years of

age—on the day immediately before the employee would

cease to be entitled to receive compensation under section 19,

20, 21 or 21A of this Act.

Date of effect

injured after the date of royal assent, or
who have reached 63 years of age and who are receiving compensation under section 19, 20, 21, 21A or 22 of the SRC Act, or are eligible to apply for such compensation at that date.

In relation to redemption of compensation for an employee to whom this amendment applies, the number of days for the purposes of paragraph (b) of the definition at 30(3) should be calculated by subtracting the number of days' incapacity since the injury from the total number of days in 104 weeks.
The effect of the application provisions (paragraph 7 above) is that an employee injured after the age of 63 may continue to receive incapacity payments for a maximum of 104 weeks after injury, regardless of his or her age at the time when the 104 weeks expires. If the employee was injured before the age of 63, incapacity payments continue to be available up to the age of 65.
Incapacity payments under the amended provisions are available to ex-employees whose date of injury is taken, for the purposes of section 7, to be a date after the date of royal assent.

Any issues relevant to this policy advice may be discussed with the Policy & Co-ordination Group on 1300 366 979.

Regulatory Services Division

Comcare

October 2001

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