Questions and Answers: BSWAT Payment Scheme

General

What is BSWAT?

The Business Services Wage Assessment Tool (BSWAT) was developed by the Australian Government for use by Australian Disability Enterprises (ADEs) to assess wages of supported employees.

Where do I take my concerns about wages in Australian Disability Enterprises (ADEs)?

In the first instance, if you feel comfortable it is appropriate to discuss your concerns with the relevant ADE.  All ADEs funded by the Australian Government must be able to explain to supported employees, and if appropriate, their guardians and advocates, how wages and conditions are determined and the consequences of this.  The Complaints Resolution and Referral Service (CRRS) may be able to assist you.  The CRRS exists to discuss any problem you might have regarding a disability employment service and will be able to talk with you about how best to approach an ADE about wage matters. CRRS can be contacted on freecall 1800 880 052.  For further information please go to the CRRS website.

You may also wish to contact the Fair Work Ombudsman.  The Fair Work Ombudsman’s services are free to all workers and employers in Australia.  Please call them on telephone  13 13 94 for the cost of a local call, or send an email to the Fair Work Ombudsman.  For further information please visit the Fair Work Ombudsman website. If you would like some personal assistance, you could also consider contacting a National Disability Advocacy Program (NDAP) agency.  NDAP agencies offer free individual support to any person with disability and also offer information to people with disability about how to advocate for themselves.  A full list of NDAP agencies can be found on the Department of Social Services website.

How does income from my employment at an ADE affect my Disability Support Pension (DSP)?

Pension recipients who work are always better off in terms of their total income than when they are not working.

A DSP recipient can receive an amount of income before their pension starts to be reduced.  This amount is called the income test free area.  From 20 March 2015, the DSP income tested free area is $160 a fortnight ($4,160.00 a year).

Single Disability Support Pension recipients

For each dollar of income over the income test free area, the single pension is reduced by 50 cents.  This is called the taper rate. You can earn up to $1,880.40 ($48,890.40 a year) if you are a single DSP recipient before your payment cuts off.  As long as you receive $1 of DSP, you still keep your Pensioner Concession Card.

Couple Disability Support Pension recipients

For each dollar of income over the income test free area, the couple’s combined pensions are reduced by 50 cents.  This is called the taper rate. This means that for a pensioner couple, their individual pensions are reduced by 25 cents a fortnight for each dollar of income that the couple has over the income test free area. A part-pension is currently payable up to an income of $2,877.60 a fortnight ($74,817.60 a year) for pensioner couples combined, and they keep their Pensioner Concession Cards if their combined income is under this amount.

NB People who are permanently blind receive DSP free of any income or assets testing arrangements. For further information visit the Department of Human Services website.

Why did the Government lodge an application for an exemption under Section 55 of the Disability Discrimination Act 1992 (Cth) with the Australian Human Rights Commission (AHRC)?

It will take time to implement a new approach to wage setting across the supported employment sector.  It is important that people with disability working in ADEs do not experience significant disruption to their working lives.

A three year exemption was sought due to the complexity of the legal and policy issues involved and the time necessary to develop and/or implement a new wage tool. The AHRC decided to give a one year exemption which expired on 29 April 2015.  On 30 April 2015 the AHRC agreed to an interim exemption of four months until the outcome of a request for further 12-month exemption is decided.

Does the BSWAT decision (Nojin and Prior v Commonwealth) have implications for quality assurance certification of ADEs?

All ADEs funded by the Australian Government are required to comply with Services Standards in the delivery of supported employment to people with disability.  The Joint Accreditation System of Australia and New Zealand (JAS-ANZ) amended its Disability Employment and Enterprise Scheme (DEES) in light of the outcomes from the BSWAT court case.  The full DEES requirements including the amendment can be found on the JAS-ANZ website.

The amendments will increase the Quality Assurance risks for some organisations and may result in an observation or a non-conformance being recorded.  

Is the future of ADEs secure?

The Australian Government values the important role of ADEs and is committed to the ongoing supported employment of 20,000 workers with moderate to severe disability in the around 190 ADEs across Australia.

In order to strengthen the focus on employment outcomes for these workers, it is essential for ADEs to be strong and viable to ensure they can continue to provide not only employment opportunities, but also good employment outcomes.

Are all ADEs affected by the BSWAT decision?

The Australian Government considers that the BSWAT decision does not affect all ADEs.  The decision may affect those ADEs that have used the BSWAT to assess the wages of their employees. However, the effect of the decision on an ADE and its employees will vary.

There is a range of views within the sector on how the BSWAT decision will affect an ADE and its employees.  ADEs should seek independent legal advice on their own situation.

Why is the Commonwealth working towards a second productivity-based wage tool?

The Commonwealth is the sole respondent in the Tyson Duval-Comrie representative proceeding in the Federal Court concerning the BSWAT.  While the Commonwealth is of the view that competency is an appropriate inclusion in wage assessment tools, it also has a strong commitment to support the ongoing employment of people with disability.  In attempting to maintain this outcome, the Australian Government wants to develop a tool that attempts to consider the needs of all parties and reflects feedback received from all sections of the sector.  The issue of wage outcomes in the supported employment sector has been a long-standing issue which now needs to be brought to a final resolution prior to full roll out of the National Disability Insurance Scheme (NDIS).

Why isn’t the government providing the sector with more support to transition to new wage setting arrangements?

While we acknowledge that some ADEs may not view the transition to new wage setting arrangements as an ideal outcome, it is important to emphasise that the support for this transition is a significant investment by the Australian Government at this time.  The government remains strongly committed to the delivery of supported employment, but is striving to see a more independent and viable sector with wage outcomes for people with disability that work effectively to reduce income support reliance. Further details about sector support will be provided in the near future.

Why aren’t other people with disability who have had their wages assessed by BSWAT eligible for the Scheme?

In the Federal Court decision of 21 December 2012, two ADEs were found to have indirectly discriminated against two supported employees with intellectual disability because the employees’ wages were assessed under the BSWAT.  The court did not look at the use of the BSWAT to assess the wages of people with other types of disability.

While the Commonwealth is of the view that the decision applies only to those two individuals, the scheme has been established to provide people with intellectual disability, their families and carers with certainty that their ADE will not close because of concerns about perceived liability for discrimination. 

Because the court did not look at the BSWAT in relation to the wages of people with other types of disability, there is no perceived liability for the payment of wages assessed using the BSWAT where the person does not have an intellectual disability.

Is there more the Commonwealth could do?

This is a significant investment by the Australian Government at this time.  The government remains strongly committed to the delivery of supported employment, but also wishes to see a more independent and viable sector with wage outcomes that effectively work to reduce income support reliance.

While there is a role in supporting the sector, ADEs are not run, owned, or managed by the Australian Government.  The day to day business decisions and overall strategic direction of each enterprise belong to its management team and Board.  Over time the Commonwealth has demonstrated significant and ongoing support for ADEs to undertake reform and address a range of challenges. Working collaboratively will allow solutions to be developed and implemented to address the current issues that harness investment from both the Government and the sector itself.

Why should ADE businesses be supported?

The not for profit sector is a key element in delivering a civil society capable to assist the economic and social participation of Australians experiencing significant disadvantage.  ADEs employ some of the most vulnerable workers within the community.  The Australian Government is committed to ensuring those employees have opportunities to reach their potential in work and their communities.

How exactly will the $173m be spent?

$32 million has been committed to the development of a new, productivity-based wage tool for use in supported employment environments.  These funds will be used to develop and test a new tool with relevant stakeholders, and pay for wage assessments using the tool over the transition period.

$141 million has been contributed to the tapering supplementation of wage outcomes for people with disability in supported employment from 1 February 2015.  These funds will be disbursed to ADEs to supplement workers' wages as transition to a new productivity-based tool occurs. A small pool of funds has also been allocated to assist organisations unable to continue to deliver employment services to exit the market and to assist their supported workers to find suitable alternatives. ‘

An additional $17 million was provided in the 2015-16 Budget for the business development to improve the viability of ADEs. These initiatives will be delivered from 1 July 2015 until June 2019 to assist ADEs to be ready for the full roll-out of the NDIS in 2019.  The funding will enable ADEs to use professional services to help them improve their sustainability and prepare for likely higher wage costs over time.

BSWAT Payment Scheme

What is this Scheme?

The Scheme will provide an additional payment in certain circumstances to eligible supported employees with an intellectual impairment whose wages were assessed and paid using the BSWAT.

Why has this Scheme been established?

The BSWAT Payment Scheme was established by the Australian Government following the Federal Court finding in December 2012 that the BSWAT indirectly discriminated against two ADE employees with an intellectual disability.

It will provide an additional payment to eligible employees in certain circumstances and provide certainty to employees about their future employment with ADEs.

The Business Services Wage Assessment Tool Payment Scheme Bills 2014, the legislation underpinning the BSWAT Payment Scheme, has successfully passed both Houses of Parliament.The payment scheme will commence from 1 July 2015.

Further information about the Scheme’s registration and application process will be provided in the near future.

You can view the Bill on the Australasian Legal Information Institute website.

How much will payments be?

The payment amount to be offered will be half of the difference between the amount the supported employee would have been paid had only the productivity element of the BSWAT had been applied and the amount the supported employee was paid, or the amount determined under the BSWAT assessment (whichever is the greater).  To ensure the person retains the payment amount after tax, the amount will be increased to take account of expected tax.

If the payment amount is greater than zero, the applicant will receive a letter setting out, amongst other things, an offer to pay that amount and the time in which the applicant may accept the offer.

Do I need to talk to anyone before I accept a payment?

An applicant must seek independent financial counseling and legal advice before accepting an offer and may also need to see a financial counselor. Certificates from the financial counselor and the legal adviser must accompany the applicant’s acceptance of the offer. Access to a legal adviser and a financial counselor is funded through the scheme. An applicant may choose to have a nominee, advocate and/or a support person at any stage of the process.

Will the Scheme pay compensation?

The Scheme will not pay compensation.  It will make an additional payment in certain circumstances to former and current eligible employees in relation to work they have performed in the past.

When will the Scheme commence and how long will it go for?

The Business Services Wage Assessment Tool Payment Scheme 2014, the legislation underpinning the BSWAT Payment Scheme, has successfully passed both Houses of Parliament.

How do I access the Scheme?

The payment scheme will commence from 1 July 2015.

Further information about the Scheme’s registration and application process will be provided in the near future.

How does this fit in with the representative proceedings being undertaken by people with disability working in ADEs who have had their wages assessed using BSWAT? (Note: on 20 December 2013, a representative proceeding was commenced in the Federal Court (see Tyson Duval-Comrie v Commonwealth of Australia (VID 1367 of 2013))

People who take part in any representative or subsequent proceedings cannot also receive a payment through the BSWAT Payments Scheme.

These types of actions may take some time to be determined by the Court or resolved—possibly years.

How does this fit with the temporary exemption application the Department of Social Services made to the AHRC?

The BSWAT Payment Scheme is a separate matter to the AHRC temporary exemption.

Does this mean the BSWAT will still be used?

The AHRC has given a temporary exemption from the Disability Discrimination Act for the use of the BSWAT in certain circumstances.  More information is available at the Australian Human Rights Commission website.

Eligibility

Who will be eligible?

A person is eligible for the payment Scheme, if the person, at any time between 1 January 2004 and 28 May 2014:

  • had an intellectual impairment;

  • had been employed in an ADE and was provided employment support by the ADE; and

  • was paid a pro-rata wage determined using the BSWAT, or was paid a training wage while awaiting an assessment under the BSWAT.

The further eligibility conditions are that:

  • the person required daily support in the workplace to maintain employment in the ADE; and

  • the person has not accepted an amount of money in settlement of, or the court has not ordered payment of an amount of money to the person in connection with, a claim made relating to the use of the BSWAT to assess the person’s wage.

All eligibility criteria will need to be met for individuals to access the Scheme.

Will I need to prove that I meet these criteria to access the Scheme?

Wherever possible the Department of Social Services will use information held by the Commonwealth to assess Scheme eligibility.  In certain circumstances, additional information may be requested, however DSS will attempt to minimise these kinds of requests.

I have been working in an ADE and have had my wages assessed using a different tool. Am I eligible for the Scheme?

No.  Only people who have been paid a pro-rata wage assessed using the BSWAT (and who meet the other eligibility criteria for the Scheme) will be eligible.

If I access a payment from the Scheme, how will it affect my pension?

The lump sum payment to supported employees who have had their wages assessed by the BSWAT is exempt from means testing for income support payments in the social security law.

Lump sum payments received under the scheme are not exempt from income tax but a tax offset is calculated that will help reduce any tax payable. An additional payment will be included as part of the Payment Scheme offer to meet the cost of any tax payable.

What is the role of Australian Disability Enterprises?

ADEs have no formal role in the BSWAT Payment Scheme or in the representative proceeding. However, from time to time, ADEs may be contacted for information to assist the Department in determining payment amounts for the Scheme.

As part of the representative proceedings currently underway, relevant and or related information about how wages have been calculated or assessed by ADE’s may be ordered by the court. Where  this occurs DSS will endeavour to ensure that the relevant ADE/s are advised prior to any information being released.

Is there any support for ADEs outside of the Payment Scheme?

The Australian Government on 21 August announced $173 million to help the supported employment sector transition to new wage arrangements for supported employees currently working in ADEs.  The funding will be used to develop and implement a new productivity-based wage tool (including new assessments) for use across the supported employment sector.  This will also assist ADEs with additional wage costs associated with the suspension of BSWAT.  An additional $17 million was provided in the 2015-16 Budget for the business development to improve the viability of ADEs. These initiatives will be delivered from 1 July 2015 until June 2019 to assist ADEs to be ready for the full roll-out of the NDIS in 2019.  The funding will enable ADEs to use professional services to help them improve their sustainability and prepare for likely higher wage costs over time.

The development of the productivity-based assessment tool will lead to the phasing out of BSWAT.  The Government is committed to assisting the supported employment sector make the transition in a careful and methodical way.  Over the next few years, these businesses will need to evolve and become more robust.  The Government is committed to supporting ADEs as they make these changes and face possible additional costs from applying a new wage tool.  Work on developing the new tool will commence shortly, in consultation with relevant stakeholders, including employers and unions.

Further information

How can I find out more?

People with disability, their families and carers are able to call the BSWAT information line: 1800 880 052.

Easy English Information on the Scheme is available at the BSWAT Payment Scheme.

Queries can be sent to the BSWAT inbox: bswat@dss.gov.au.

All people with disability working in ADEs will receive a letter in January, telling them about the announcement.

When more detail is available, new letters will be sent to all supported employees and the following information locations will be updated:

Electronic Newsletter: Disability eNews

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