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Chapter 2: The Seacare Authority – performance of its statutory functions

 

2.5 Seacare Business Plan 2003 – 04

The Seacare Business Plan for 2003 – 04 was endorsed in August 2003. The Business Plan disaggregated the Output (Regulate the Seacare scheme of workers’ compensation, rehabilitation and occupational health and safety) into two sub-outputs:

  • Sub-Output 1: Regulation of the Seacare scheme of workers’ compensation, rehabilitation and occupational health and safety; and
  • Sub-Output 2: Implementation of Seacare Authority decisions arising from performance of its statutory functions.

The key initiatives and actions under each sub-output included:

2.5.1 Regulation of the Seacare scheme of workers’ compensation, rehabilitation and occupational health and safety

Provision of support for the Seacare Authority

From 1993 until 1998, support for the Seacare Authority was provided by the Department of Transport and Regional Services. From 1998 until 11 June 2003, support for the function was provided by the Department of Employment and Workplace Relations (DEWR). From 11 June 2003, following commencement of relevant sections of the Workplace Relations Legislation Amendment Act 2002, support for the Seacare Authority has been provided by Comcare.

Comcare makes available staff to support the Authority. Over the past six years there have generally been two staff supporting the Authority. That staffing level remains in Comcare. The support unit is known as the Seacare Management Group (SMG). Staff have been co-located with Comcare since 1 July 2002.

The Authority’s objective is that the Authority functions efficiently and effectively. In 2003 – 04 there were five meetings of the Authority – four regular scheduled meetings and one special meeting held by teleconference to approve the draft 2002 – 03 Annual Report. Papers were provided to each meeting in accordance with the seven-day rule in all cases, except by prior agreement.

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Provision of interpretative and policy advice for the Authority

During 2003 – 04 the SMG produced 53 papers for consideration by the Authority at its five meetings, as well as providing a range of advice and assistance to the Chairperson, Deputy Chairperson, members and deputy members between meetings. Some of the key matters on which advice has been provided to the Authority include:

  • Seacare scheme legislation and issues associated with reform of the legislation;
  • the operation of the Seafarers Safety Net Fund, including the rate of levy, levy collection, insurance for the Fund, appropriate reserve levels, options for the future management of the Fund and claims on the Fund;
  • Seacare scheme performance, including the Standing Report to each Authority meeting, Seacare input into the national Comparative Performance Monitoring (CPM) Report and Australasian Return to Work Monitor (ARTW Monitor), as well as the Seacare Authority Annual Report;
  • advice to the Minister;
  • Strategic and Business Plans including a revised OHS Strategy;
  • adoption of national OHS standards and codes of practice;
  • contracts with consultants;
  • a review of support services to the Authority;
  • Seacare scheme insurance, legal costs and claim settlements;
  • applications for exemption under s20A of the Seafarers Act;
  • improved rehabilitation provider services to maritime industry employers;
  • national inquiries such as the HIH Royal Commission and Productivity Commission Inquiry into Occupational Health and Safety (OHS) and Workers’ Compensation frameworks; and
  • accreditation of health and safety representatives training courses.


In addition, the SMG obtained advice on a range of legal issues to assist Authority decision making. Legal advice was provided to the Authority by Comcare Legal Services Group, and in specific cases by the Australian Government Solicitor.

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Coverage

An important issue on which advice was provided to the Authority is coverage, or the application of Seacare scheme legislation. While the Authority provides guidance to stakeholders and government agencies on whom and what is covered by scheme legislation, it has always advised industry stakeholders to seek their own legal advice.

On becoming the manager for the Seafarers Safety Net Fund in 2002, the Authority has been required to decide on whether the Levy Act applies to particular employers, as levy can be collected only from those employers with a statutory liability to pay the levy. In a number of cases this has required detailed legal consideration of issues such as whether there is employment (some operators claim to engage crew under partnership or independent contractor arrangements), whether particular vessels are prescribed ships
(for example, legal advice was obtained on the interpretation of the term “coasting trade”) and whether there are seafarer berths (as defined) on prescribed ships.

The Authority has continued to ensure the application of the Seafarers and OHS(MI) Acts to employers and operators where it becomes aware of a new employer or operator, or of a new ship, or new voyage pattern that would bring the employer/ operator or ship/employees under the Seafarers and/or OHS(MI) Acts.

The Authority has recommended to the Minister that the application provisions of the Seafarers Act be revised. Consideration of the application provisions will form an important part of Stage two of the review of scheme legislation.

The Authority continues to provide advice regarding the application of the Seafarers and OHS(MI) Acts to those operators servicing the offshore oil and gas industry that had previously been considered to have been marginally connected to the legislation by virtue of their industrial agreements. Many industrial agreements applying in the maritime industry specify that the Seafarers Act shall apply to the employees of these companies. Such industrial provisions establish an industrial requirement to apply the provisions of the Seafarers Act, which would be enforceable under the Workplace Relations Act 1996, but
they do not impose statutory obligations under the Seafarers Act. Statutory obligations can only apply if scheme legislation applies.

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Performance of statutory functions under delegation

On 21 May 2003 the Chairperson of the Authority, acting in accordance with a resolution of Seacare Authority meeting 46 of 21 May 2003, revoked all previous delegations made by the Authority and
in place of previous delegations, the Authority delegated powers to the Chief Executive Officer of Comcare as specified in section 125(1) of the Seafarers Act in relation to the following:

  • Section 3 – power to approve industry training courses;
  • Section 20A – power to exempt employment from the operation of the Seafarers Act;
  • Section 63(2) – power to approve a form or forms;
  • Sections 72, 73 and 79 – power to determine further period/s for the determination of the employer’s liability;
  • Section 95 – power to require an employer to provide evidence of an insurance policy under section 93;
  • Section 98 – power to obtain information relating to the operation of the Seafarers Safety Net Fund; and
  • Section 106 – power to require employers to provide information to the Authority.


On 16 June 2003, the CEO of Comcare delegated the performance of all the above functions to the Deputy CEO of Comcare and to certain staff of Comcare (those performing the functions of the Seacare Management Group) pursuant to section 125(5) of the Seafarers Act. The main sections of the Act where the delegation to the SMG has been exercised are in relation to applications for exemption, provision of information on insurance and provision of information to the Authority.

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Exemptions under section 20A of the Seafarers Act

An employer may, by applying to the Authority using the approved form, seek an exemption under section 20A from the application of the Seafarers Act with respect to a particular employee, group
of employees, or employees on a particular ship. The Authority has in place guidelines identifying procedural requirements as well as circumstances under which it will consider granting an exemption.

Any request for an exemption must be accompanied by evidence which identifies that the employees will be covered by an alternative valid workers’ compensation policy (usually under State or NT workers’ compensation legislation) for the duration of the voyage or period of the requested exemption.

If a voyage undertaken falls within the jurisdiction of the Seafarers Act and the employer does not have an insurance policy under the Seafarers Act or a certificate from the Seacare Authority exempting the employees on the particular ship for a particular voyage or voyages from the application of the Act, the employer risks prosecution.

A possible prosecution action could arise for failure to have a policy of insurance in accordance with the Seafarers Act. Additionally, an employer may be liable for payment of all costs associated with any claims under the Seafarers Act that arise in the course of the particular voyage where no seafarer insurance policy was current.

During 2003 – 04 the Authority received applications for exemption for employment on 14 vessels. Exemptions in relation to 13 vessels were granted as set out in Table 3 below. Exemptions were granted in accordance with the Seacare Authority exemption guidelines.

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Extension of time for consideration of compensation claims

Employers may request an extension of time to consider or reconsider a claim for compensation on application to the Authority. During 2003 – 04 the Authority received no requests for an extension of time under sections 72, 73, 73A or 79 of the Seafarers Act.

Reviewable decisions under the Seafarers Act

The Seafarers Act entitles an aggrieved person or organisation to seek a review of a decision by the Administrative Appeals Tribunal (AAT) in a number of circumstances. Two such circumstances are where: (i) an employer seeks an AAT review of a decision by the Authority where it refuses to grant an extension of time to determine a compensation claim; and (ii) a claimant requests an AAT review
of a decision by an employer regarding a negative outcome of a request for a reconsideration of a claim. Applicants to the AAT may appeal a decision of the AAT to the Federal Court on a point of law.

The Seacare Authority reviews the AAT and Federal Court decisions to determine if there are any significant court judgments and any implications
for Seacare scheme legislation. Significant matters are analysed in Chapter 5.

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Table 3: Section 20A exemptions approved by the Seacare Authority in 2003 – 04

Temp Table 3

 

Rope Trip

Falls, slips and trips remain one of the highest causes of workplace compensable injuries in the Australian maritime industry

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Insurance arrangements

Under section 93 of the Seafarers Act, an employer must have a policy of insurance from an authorised insurer or be a member of a protection and indemnity association (a P&I Club) that is approved in writing by the Authority and is a member of the International Group of Protection and Indemnity Associations. This section of the Seafarers Act aims to ensure each employer is insured or indemnified for the full amount of the employer’s liability for all employees employed by the employer under the Seafarers Act.

Under sections 94 and 95 of the Seafarers Act an employer is required to provide the Authority with information relating to their insurance coverage within 14 days of being issued with
or renewing a policy of insurance or indemnity. During 2003 – 04 the Authority has worked to ensure employers provide the information required for compliance with section 94 of the Seafarers Act within the statutory time limit.

From the information provided to the Seacare Authority on insurance arrangements, there are three insurers providing workers’ compensation policies under the Seafarers Act. There remains only one protection and indemnity association approved by the Seacare Authority – the Standard Steamship Owners’ Protection and Indemnity Association (Bermuda) Ltd.

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Seacare scheme workers’ compensation data collection

The Australian Maritime Industry Compensation Agency Ltd (AMICA), the trustee to the Australian Maritime Industry Compensation Foundation (AMICF), is responsible for the collection, storage and reporting of workers’ compensation data for the Seacare scheme. A copy of each workers’ compensation claim lodged with an employer by an employee (using a form approved by the Authority) is required to be forwarded to AMICA for data recording.

AMICA performs this function in a voluntary capacity (in that there is no legislative requirement for it to do so) and as a service to the maritime industry. As part of the claims data gathering process, AMICA also seeks updated claims history information from employers through a six monthly Claim Update Report. Statistics maintained in the data base are provided to the Seacare Authority, the National Occupational Health and Safety Commission (NOHSC) (for the national Comparative Performance Monitoring report and for the national OHS statistics collection) and to Campbell Research and Consulting Pty Ltd (for the Australasian Return to Work Monitor) for scheme and national OHS reporting purposes.


The board of directors of AMICA Ltd at 30 June
2004 comprises:

  • Mr David Sterrett (Chairman of Directors);
  • Mr Peter Bremner (Director), General Manager Shipping, CSR Ltd;
  • Mr Dermot Loughnane (Director), Managing Director, Teekay Shipping (Australia) Pty Ltd;
  • Mr Peter Beekman (Director), General Manager, Stolt (NYK) Australia Pty Ltd; and
  • Mr Robert Bird (Director), Chief Operating Officer, ASP Ship Management Pty Ltd.


There are 16 member companies of AMICF at 30 June 2004.

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Scheme Performance Reporting

The Authority worked closely with employers, AMICA, AMSA and scheme insurers to produce and disseminate a range of performance reports on the Seacare scheme during 2003 – 04. The Authority now analyses a package of scheme statistics and performance reports at each quarterly meeting. The key reports are published in the Authority’s quarterly report to industry, Seacare News.

The standing reports include statistics on:

(i) employee numbers and hours worked;
(ii) compensation claims data reported to AMICA, including a breakdown of the status of claims;
(iii) OHS incidents reported to AMSA, and qualitative information on reactive investigations;
(iv) ships covered by Seacare scheme legislation; (v) employer insurance details (section 94);
(vi) applications for extensions of time and reconsiderations (relating to compensation claims made under the Seafarers Act);
(vii) applications for exemption from the Seafarers Act (section 20A);
(viii) AAT and Court cases;
(ix) incidence of injuries (claims per 1 000 employees);
(x) injury frequency rate (claims per 1 million hours worked); and
(xi) return to work and rehabilitation outcomes.

The Authority again engaged Taylor Fry Pty Ltd (Taylor Fry), an actuarial firm, to obtain from insurers and AMICA a range of employer insurance data for aggregation and reporting. Taylor Fry collect data on Seacare scheme workers’ compensation insurance premiums and related data such as scheme legal costs and long tail claims. The Taylor Fry report for 2002 – 03, provided in May 2004, provides comprehensive and reliable data of premium costs in the industry, which are analysed in Chapter 4 of this report.

The Authority also participated in the 6th national CPM report, due for publication in the new financial year, and participated in the ARTW Monitor 2003 – 04.

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Communications

Following the commencement of the Occupational Health and Safety (Maritime Industry) (National Standards) Regulations 2003 on 31 December 2003, the Seacare Authority published Guidance on the Prohibition and Use of Asbestos in Australian Maritime Industry Workplaces,
Version 1. Two further versions of the Guide were published in 2003 – 04, with Version 3 current at
30 June 2004.

The Seacare Authority maintains its own website at www.seacare.gov.au. The primary purpose of this site is to provide access to information about the Seacare Authority, the Seacare scheme, the Seacare Authority’s activities and publications/ forms, as well as news on current events impacting on the operation of the Seacare scheme.

The Seacare Authority’s website contains sections on:

  • the Seacare Authority including its membership, contact details, legislation, functions and strategic/business plans;
  • latest news, where new initiatives and projects are reported;
  • Seacare forms, including secure employer access to on-line reporting forms;
  • workers’ compensation;
  • rehabilitation;
  • occupational health and safety;
  • Seacare Authority publications; and
  • links to related sites.


There have been continual improvements made
to the website throughout the year, including easier accessibility of information.

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Seacare Authority forms

The Authority currently has nine approved forms under the Seafarers Act and two approved forms under the OHS(MI) Act. Seacare Authority forms and their issue date are listed in Appendix 2. Copies of all forms are available on the Seacare Authority website.

Advice to the Minister

The Authority, through the Chairperson, maintained regular communication with the Minister for Employment and Workplace Relations during 2003 – 04. The Chairperson kept the Minister informed in writing of key issues following meetings of the Authority.

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2.5.2 Implementation of Seacare Authority decisions arising from performance of its statutory functions

Advice on Seacare scheme legislation

Stage two of the review of Seacare scheme legislation commenced in November 2003 when the Australian Shipowners Association and Australian Mines and Metals Association lodged a joint submission with the Authority. During the latter half of the financial year, representatives of employers and employees have been discussing the employer proposals with a view to determining the extent to which consensus can be reached to assist the Authority provide advice to the Minister.

Coinciding with the joint submission, the SMG developed a Legislation Reform Proposals paper which sought to consolidate and categorise all current legislative reform proposals. The categories are: (i) application and coverage; (ii) scheme governance, finances and resourcing; (iii) scheme design (including definitional issues); (iv) regulatory functions; and (v) other.

Stage one proposals which the Authority presented to the Minister in November 2002 and March 2003 for his consideration are currently being costed at the request of the Minister, as a final step before the Minister considers giving policy approval to enable the proposals to be developed into a Bill for introduction into the Parliament.

Many of the Stage one amendments proposed by the Authority follow from amendments to the Safety Rehabilitation and Compensation Act 1988 (on which the Seafarers Act is based) as a result
of the Safety Rehabilitation and Compensation and Other Legislation Amendment Act 2001, and are
of a technical nature. However, several substantive reforms have been proposed, eg inclusion of
a definition of remuneration for calculation of workers’ compensation insurance; new hearing loss thresholds and limitation of the circumstances in which employers/operators granted exemptions under section 20A of the Seafarers Act are subject to the application of the Seafarers Safety Net Fund levy.

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Occupational Health and Safety

The Seacare Authority Strategic Plan places a strong emphasis and importance on the Authority’s occupational health and safety functions.

In November 2002, the Seacare Authority endorsed an OHS Strategy for the period
2002 – 03 to 2003 – 04. The Strategy was updated in August 2003. The Authority’s OHS Strategy is aligned with the National OHS Strategy developed by NOHSC and endorsed by Workplace Relations Ministers’ Council. Central to the Authority’s OHS Strategy is the adoption of OHS improvement targets for the maritime industry, which are:

  • for work related fatalities, zero for the five years to 2007 and zero for the 10 years to 2012; and
  • for injury incidence (compensation claims per 1 000 employees), a 20% reduction over five years to 2007 and a 40% reduction over 10 years to 2012.


Under the OHS Strategy, the Authority responded to its OHS responsibilities during 2003-04 by taking the following actions:

  • provided advice to Government resulting in commencement of a regulation under the OHS(MI) Act prohibiting the use of asbestos in maritime industry workplaces (ships) from
    31 December 2003;
  • amended the Seacare Authority OHS Strategy aimed at clarifying definitional issues to enable commencement of reporting performance against the OHS performance improvement targets in the OHS Strategy;
  • promoted a Seacare Authority Sea Safe-Work Day on 28 April 2004 to coincide with ILO World Day for Safety and Health at Work;
  • supported the establishment of the first OHS Practitioner’s Network in Victoria;
  • participated in briefings of AMSA surveyors at its Port State Control conferences in Melbourne and Sydney in May and June 2004;
  • commenced discussions with the National Offshore Petroleum Safety Authority regarding a Memorandum of Understanding between Seacare and NOPSA and on joint industry advice on the application of OHS legislation in the offshore petroleum industry;
  • considered OHS legislative proposals in the context of the Authority’s legislation review;
  • committed to hold a second Seacare Authority Sea Safe-Work Awards and OHS Conference in late 2004, following the success of the inaugural awards and conference in April 2003; and
  • worked closely with NOHSC to improve OHS
    data collection.


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The Australian Maritime Safety Authority (AMSA) performs the occupational health and safety inspectorate function as provided in Section 82 of the OHS(MI) Act. The functions of the inspectorate are:

  • to ensure, in accordance with the Act and regulations, that the obligations imposed by or under the OHS(MI) Act or the regulations are complied with;
  • to advise operators, employees or contractors, on occupational health and safety matters; and
  • to provide the Authority with information. AMSA marine surveyors, who are trained in OHS, are appointed as inspectors under the OHS(MI) Act and as required perform a range of functions
    under the Act, including investigations of accidents and dangerous occurrences, issuing prohibition notices, issuing improvement notices and advising employers of their duty of care as well as on approaches to safety prevention.


A review of the AMSA Code of Safe Working Practice for Australian Seafarers, contained in Seacare Code 1/2000, commenced during 2003 – 04.

AMSA advised the Authority that one provisional improvement notice and one prohibition notice were issued by AMSA during the year. Following on from OHS initiatives in previous years that included campaigns which focussed on signage, machinery guarding, manual handling and slip, trip and fall hazards, AMSA in more recent times has concentrated on inspections that targeted specific ships where concerns existed that OHS performance was not adequate. With the completion of an OHS checklist to assist
inspectors, AMSA advised the Authority that it has commenced a program of annual OHS inspections.

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Rehabilitation and return to work

The Authority launched a package of best practice guidance material on rehabilitation and return to work in early 2002, supported by adoption of rehabilitation and return to work (RTW) benchmarks, against which performance is reported for the second year in this report. Rehabilitation and RTW performance reported in Chapter 4 of this report suggests that performance is yet to reach satisfactory levels.

Against that backdrop the Authority considered further steps that might be taken to improve rehabilitation performance in the scheme. The key Authority decision was to focus on working with rehabilitation providers. Two steps were taken in 2003 – 04. First, the Authority identified, through Comcare’s provider reapproval process, those providers that are providing, or may in the future provide, services to maritime employers, and commenced communication with those providers. Second, Seacare has commissioned Comcare’s Learning and Development Solutions to develop a training package for rehabilitation providers, expected to come on stream late in 2004.

The Seacare Authority continued to participate in the ARTW Monitor during 2003 – 04. The ARTW Monitor is an Australian and New Zealand survey of the return to work experience of injured workers, including seafarers. All workers’ compensation schemes in Australia (and including New Zealand), with the exception of Western Australia and the Northern Territory, participate in the survey. The ARTW Monitor is managed by a private consultancy firm, Campbell Research and Consulting Pty Ltd, with which the Authority has an annual contract. The Seacare Authority commenced participation in 1999 – 00.

The ARTW Monitor surveys all seafarers who lodged a compensation claim in the seven to nine months prior to each survey period – for the Seacare scheme there are four surveys each year in August, November, February and May. Each survey involves approximately 10 to 20 seafarers.

In addition to interviewing injured seafarers, the ARTW Monitor analysed compensation payments data provided by AMICA relating to the interviewed seafarers, to ascertain compensation costs per claim. Seacare scheme performance arising from the ARTW Monitor surveys is reported in Chapter 4 of this report. The ARTW Monitor results contribute the data for four of the six Seacare Authority rehabilitation and RTW benchmarks.

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Workers’ compensation

In 2003 – 04 the Authority’s main focus in relation to workers’ compensation was to monitor workers’ compensation insurance premiums and develop better workers’ compensation data collection arrangements for scheme performance reporting.

In November 2003 the Seacare Authority again engaged Taylor Fry Pty Ltd, actuarial consultants, to collect comprehensive Seacare scheme insurance premium data from Seacare scheme insurers for 2002 – 03 (the late extraction date for premiums data enables claims and insurance data to mature before collection). Taylor Fry also obtained comprehensive data on the insurance policy excesses negotiated by Seacare scheme employers in seafarer workers’ compensation insurance policies, and on the extent of identified burning cost policies (policies where the premium is adjusted over a specified premium contract period according to claim performance).

In the Seacare scheme, premiums, or income derived from the premium, contributes primarily to payment of weekly compensation, medical and other rehabilitation costs, when the claim exceeds the insurance policy excess. Premium income does not contribute towards the cost of scheme services such as those listed below, unlike the arrangements in some of the centrally managed schemes in Australia, where for example the premium or scheme income contributes towards:

  • provision of occupational health and safety services – in the Seacare scheme OHS services are provided by AMSA, which performs the OHS inspectorate function under the OHS(MI) Act. AMSA incorporates the costs of this function into its ship safety regulatory functions funded through revenue raised from employers by the application of the Marine Navigation (Regulatory Functions) Levy Act 1991;
  • provision of other scheme regulatory services including the operation of the Authority which is directly funded by Government;
  • dispute resolution costs – to the extent that dispute resolution rests with the AAT in the Seacare scheme, this cost, leaving aside legal representation, is met by the Commonwealth Government which supports the AAT through a budget appropriation; and
  • claims administration costs – in the Seacare scheme these are largely met by employers and insurers (though insurers include claims and premiums administration costs in the cost of the policy).

However, Seafarers Act workers’ compensation insurance premium covers some employers, at their request, for liabilities which may arise from the application of sections 128, 132 and 132A of the Navigation Act 1912. Those sections impose obligations on employers to meet expenses of seafarers where the seafarer is left on shore sick or injured.

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Claims Management

The Authority continued to provide advice to employers and seafarers on obligations and rights under the legislation and on good claims management practice. Communication with stakeholders on claims management practices is revealing that the quality of communication between employers and claimants may be contributing to the dispute rate in the scheme, and to the problematic rehabilitation and return
to work performance, both of which are reported in detail in chapter 4.

Accreditation of health and safety representatives (HSR) training courses

The Authority’s objective for HSR training is to ensure that accreditation of HSR training courses promotes competency standards equivalent to the highest national standards, and that HSRs are equipped to competently perform their functions as set out in the OHS(MI) Act.

At the commencement of the financial year there were three occupational health and safety representatives training courses accredited
by the Seacare Authority, sponsored by three organisations. The courses and course sponsors are:

  • Maritime Industry Health and Safety Representatives Distance Learning Course, sponsored by the Australian Centre for Work Safety (this course was also delivered in face to face mode);
  • CSR Shipping Health and Safety Representatives Training Course, sponsored by CSR Shipping (only delivered in house); and
  • Australian Maritime Safety Consultants Health and Safety Representatives Training Course, sponsored by Australian Maritime Safety Consultants Pty Ltd.


During the year, the three year accreditation of each course expired. Only the Australian Maritime Safety Consultants Health and Safety Representatives Training Course had its accreditation extended while the course is being redeveloped for reaccreditation. CSR has advised that it is seeking a partnership with an external Registered Training Organisation (RTO) before seeking reaccreditation of its course. The Authority agreed to not reaccredit the Distance Learning course, but to seek expressions of interest from RTOs on development and delivery of a new HSR course, including delivery in flexible or distance learning mode.

As a consequence of these developments, no training was delivered under the CSR or the Distance Learning courses during 2003 – 04.

Table 4 below summarises the aggregate outcome of training delivered over the period 2001 – 02
to 2003 – 04 under each of the three Seacare
Authority accredited courses.

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Table 4: Outcomes from accredited training course delivery — 2001 – 02 to 2003 – 04

Temp Table 4

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