Higher prices, workers cut warning unless compo is cut, business warns

A major survey shows businesses are preparing to cut staff and raise prices unless government legislation on workers compensation passes. Here’s why.

Businesses are warning there will be job losses if the government’s proposed reformsto the workers compensation scheme are not passed in parliament, a new survey shows.

The planned changes include treating a worker’s injuries individually rather than cumulatively, which the government says protects the workforce from paying a higher premium.

A survey of 757 members of nine peak industry groups has found 57 per cent will pass on the cost of higher levies to customers while 31 per cent will cut staff numbers.

Almost half say they will limit wage rises, 24 per cent will cut staff hours while a quarter said they will absorb the cost.

The workers compensation levy now stands at 1.7 per cent, rising to 1.8 per cent next financial year, but it is on track to hit 2.2 per cent in 2023-24, costing large firms hundreds of thousands of dollars in premiums.

The increase is driven by a legal ruling that injured workers can combine injuries, and subsequent problems caused by the original injury.

The result will mean many more workers will get above the 5 per cent impairment rate to receive a lump sum for non-economic loss.

But the proposed legislation has infuriated the union movement and caused a revolt in the Labor state executive.

Cameron Springbett, 48, has workplace injuries and would lose his compensation if Labor's legislation goes through. Picture: Roy VanDerVegt

The government maintains the existing system would double ReturnToWorkSA’s liabilities to $1.1bn – and that amount would be unsustainable without the change.

Attorney-General Kyam Maher conceded some workers would “be worse off”, but said the changes were crucial to ensuring “the scheme stayed viable”.

Business groups which have mobilised to support the change in the face of potentially soaring premiums to fund the system include the Australian Industry Group, Business SA, Food SA, Master Builders SA, Motor Trade Association SA, SA Wine Industry Association, Housing Industry Association, Australian Hotels Association and SA Tourism Industry Council.

Attorny-General Kyam Maher. Picture: NCA NewsWire / Morgan Sette

SA-Best MP Connie Bonaros. Picture: NCA NewsWire / David Mariuz

The opposition will discuss its position at a joint party-room meeting on Tuesday.

The Advertiser understands leader David Speirs has not yet formed a final opinion on the legislation and will meet with various interest groups throughout the day.

The Greens, SA-Best and One Nation MLC Sarah Game have indicated they will not support the bill in its current form, and each is planning to move amendments this week.

SA-Best MLC Connie Bonaros rejected government claims the bill was time-critical, and said it should not be rushed through.

“We need time to fix the scheme,” she said.