Consultative Forum on Mature Age Participation

Presentation at the Consultative Forum on Mature Age Participation, Monday 26 March 2012 by Professor Rosalind Croucher* President, Australian Law Reform Commission.

The Inquiry

On 7 March 2012, the Attorney-General of Australia, the Hon Nicola Roxon MP, asked the Australian Law Reform Commission (ALRC) to inquire into and report on Commonwealth legal barriers to older persons participating in the workforce or other productive work. The ALRC was asked to consider all relevant Commonwealth legislation and related legal frameworks that directly, or indirectly, impose limitations or barriers that could discourage older persons from participating, or continuing to participate, in the workforce or other productive work and to provide its Final Report by 31 March 2013.

(Thanks to the Forum for suggesting that we do this work!)

Key themes

Law reform work needs to be anchored in a framework of principle.

In this field, the Government’s overarching objective is to keep people in work, and paying taxes, longer—rather than being on old age pension. (A complementary theme may be to support people into self-funded retirement rather than being on old age pensions.)

The Consultative Forum document of December 2011, Ageing and the Barriers to Labour Force Participation in Australia, refers to the Productivity Commission’s emphasis on ‘the employment participation of mature age people (aged 50 years and over) [as] an important way of lessening the economic challenges of an ageing population’: ‘It will increase the ability of people to fund their own retirement and lessen reliance on Government pensions. Further, a high proportion of mature age people in employment will increase the Government’s revenue base, as well as potentially lowering the costs associated with ill health.’

At the international level, UN Principles emphasise:

  •  ‘independence’—opportunity to work; participation in decision making about when and what pace to withdraw from labour force; and access to training;
  •  ‘participation’—in formulation of policies; and ability to serve as volunteers.[1]

These relate strongly to the principle of ‘self-agency/autonomy’, that the ALRC identified as a key principle in the inquiry into family violence and Commonwealth laws, completed in November 2011. I also note that under our Act the ALRC is directed to have regard to ‘all of Australia’s international obligations that are relevant to the matter’.[2]

The Turning grey into gold report of the Advisory Panel on the Economic Potential of Senior Australians (2011) emphasises:

  • Participation 
  • Lifelong learning (encore careers, training)
  • Volunteering and philanthropy

Similarly, the emphasis here is on self-agency, the ability to make choices, and to be allowed to participate fully.

Specific focus of the inquiry

The Terms of Reference focus on Commonwealth law and age-based limitations on, or disincentives to, participation in the workforce or other productive work. We have interpreted this as requiring the identification of:

  • limitations on participation;
  • disincentives to participation (and incentives to leave); and
  • incentives to remain in the workforce

As a preliminary note I should mention the work in relation to the consolidation of Commonwealth anti-discrimination laws. This is happening at the same time as our Inquiry.

An exposure draft bill is expected over the coming months. There is a range of possible amendments to the age discrimination component of any consolidated Act that were raised in the Government’s Discussion Paper and submissions to the process—the ALRC is monitoring these and will be considering them in the course of the Inquiry. In particular, there is an exemption with respect to insurance under the current ADA and changes to anti-discrimination law may have a flow-on effect on the general protections provisions (or the use of those provisions) under the Fair Work Act 2009 (Cth).


Limitations may be relatively easy to identify—specific ages acting as a limitation. Here is a sampling of examples uncovered by the team already.

Workers’ Compensation

This is a matter on which Commissioner Susan Ryan has spoken often.

Each state and territory has their own workers’ compensation scheme and the Commonwealth has three schemes. Most jurisdictions (including the Commonwealth) have retirement provisions which restrict access to workers’ compensation, in particular income replacement payments, when a worker reaches the age of 65. The original rationale for such provisions is that once an injured worker reaches the retirement age of 65 they have access to their superannuation or other forms of income support—they are no longer a ‘worker’ or ‘in the workforce’ to attract workers’ compensation. However, a number of issues arise.

Where an older person wishes to remain in the workforce (or to volunteer) after 65 and the person is injured, he or she is not eligible to receive workers’ compensation—this is a disincentive to ‘participation’, a key theme. Instead the person has to rely upon any private support, such as superannuation or sickness benefits, or the age pension. But when the age is increased for the latter until 67, it will only be private resources in the main.

Veterans’ Entitlements

A service pension under the Veterans’ Entitlements Act 1986 (Cth) is essentially an income support payment payable subject to a means test, yet available five years earlier than the Age Pension in recognition of premature aging of service personnel.[3] It is currently available to male veterans who are 60 years or older, and to women who are 55 years or older. The payment of a service pension was originally premised on the notion that armed service led to premature ageing and earlier susceptibility to diseases which affected the aged. In order to retain consistency with the incremental increase to Age Pension age to 67 (by 2023)—and to create incentives to remain in paid employment—it may be argued that the ages for eligibility for the service pension under the Veterans’ Entitlement Act also be increased incrementally.


Income protection insurance protects the insured in the event that he or she is unable to work due to sickness or injury. However income protection insurance is generally unavailable to persons aged over 65 years.[4] This leaves those people who choose to continue their economic participation after the age of 65 unable to cover themselves in the event of illness or injury. This may necessitate reliance upon retirement savings and/or the Age Pension and consequently can act as a ‘push factor’ out of paid employment.

The difficulty the ALRC faces here is that such age limits in insurance policies are determined by private insurance companies. That insurance companies are able to set such age limits is because of the exemption in s 37 of the Age Discrimination Act 2004 (Cth). Section 37 contains an exemption in relation to age-based discrimination in the terms and conditions on which an insurance policy is offered or refused where the discrimination is based upon actuarial or statistical data on which it is reasonable for the discriminator to rely or in a case where no such actuarial or statistic data is available, and cannot reasonably be obtained—the discrimination is reasonable having regard to any other relevant factors.[5]


This is an active policy space. There are a number of age-based rules in superannuation laws which limit superannuation contributions for older persons. The Australian Government has recently announced that it intends to remove one such limitation: the upper age limit for the applicability of the superannuation guarantee (i.e. mandatory employer contributions), which is currently set at 70 years. But other age-based rules remain—particularly in relation to voluntary superannuation contributions. For example:

  • superannuation funds may not accept voluntary (pre-tax and after-tax) superannuation contributions from persons aged over 75, nor from those aged 65 and over unless they meet certain conditions;
  • low income earners 71 and over are ineligible for the government co-contributions that other low income earners receive when they make voluntary (after-tax) superannuation contributions to their funds;
  • employers cannot claim a tax deduction for superannuation contributions they make on behalf of employers aged 75 and over.

These rules act as barriers to the accumulation of superannuation for older people, and potentially impede their ability to prepare for retirement. But do these age-based rules act, in themselves, as barriers to continued employment? Perhaps not directly—but they do send a strong message about society’s expectations around retirement and retirement age. This message may be at odds with the realities posed by the increasing longevity of Australians.


The idea of ‘disincentives’ is more difficult. An incentive to leave work may be a disincentive to continue working. Is this necessarily contrary to the Government’s objective?

What if the incentive to leave does not impose a burden on Government, in the sense of the person’s ‘retirement’ being self-funded and the opportunity to volunteer is thereby created? How much is a ‘law reform’ problem?

Here are some examples the team has identified.

One overarching issue in this Inquiry is the operation of the tax-transfer system. It is well documented that means testing for various income support payments can be a disincentive to work. That is, when a person spends more time in paid employment, his or her taxable income increases, which can increase the amount of tax paid and may mean that he or she no longer satisfies the means test for a certain payment. This can therefore reduce his or her level of income support (such as the Age Pension) and other concessions and supplements tied to that payment (such as concession cards). Some measures have been put in place to maintain incentives to work, including various tax offsets and provisions that enable a person to retain their concession card for a period of time after commencing work. This equation raises actuarial questions that may be out of the ambit of the ALRC’s expertise—and not so much a ‘law reform’ problem.

Access to superannuation benefits may constitute a direct incentive to exit the workforce. The age that persons may access superannuation benefits—once they have retired or under the transition to retirement rules—is gradually increasing from 55 to 60. (If a person has not retired at 65, however, he or she may access their superannuation even though continuing in the paid workforce.) If this age setting is too low, it may provide an incentive for early retirement. It may also send an outdated message about expectations of retirement age. The ‘Australia’s Future Tax System’ review—chaired by Dr Ken Henry—recommended that the superannuation access age should be aligned to the Age Pension age, and both should gradually increase to 67. This gradual increase has been implemented in relation to the Age Pension. Increasing the superannuation access age so that it aligns with the Age Pension, as recommended by the Henry Review, may remove an incentive for early retirement, and help set a more appropriate cultural standard around expectations of retirement age.


The other important idea is the idea of ‘incentives’ to enter/re-enter or remain in the workforce. The key incentives the ALRC is examining include:

  • the operation of the Job Services Australia system;
  • flexible working arrangements including the right to request under the National Employment Standards (NES);
  • individual flexibility arrangements in enterprise agreements and the scope in awards); and
  • workplace barriers and employer responsibilities under OHS legislation—given the potential workplace modifications that could be made to accommodate mature age workers the ALRC is interested in stakeholder views on the appropriateness of including information on mature age workers and OHS issues in Codes of Practice and other guidance material.

Just looking at one of these, the right to request flexible working arrangements under the NES, this was something the ALRC looked at in the Inquiry on Commonwealth Laws and Family Violence, tabled last month. Given that this is on the agenda for the Forum, I thought it would be useful to share with you our conclusions here.

The National Employment Standards enshrine 10 statutory minimum requirements that apply to all national system employees, and encompass areas such as working hours and arrangements, leave, and termination and redundancy pay. The NES are an absolute legislative safety net and cannot be excluded by an enterprise agreement or modern award. As a result, any amendments to the NES would have a wide-ranging impact on the entitlements of mature age employees.

An example—flexible work arrangements. Under the NES, employees who satisfy the service requirements[6]—being a parent or otherwise hasving responsibility for a child who is under school age, or who is under 18 and has a disability—may request that their employer change their working arrangements to assist with the care of that child.[7] Section 65(5) of the Fair Work Act provides that such a request may only be refused on ‘reasonable business grounds’.

In our previous inquiry, focused on family violence, the ALRC identified concerns with the existing provision. First, in its current formulation the right is based on parental or child care-related responsibilities. However, stakeholders suggested that the section could be amended to include other bases upon which an employee could request flexible working arrangements. Some overseas jurisdictions, for example, have enacted legislation which entitles victims of family violence to reduce or reorganise their working hours, change workplaces and make other flexible working arrangements.[8]

Secondly, the current NES provision is procedural rather than substantive. It provides that an employee is entitled to request flexible working arrangements, receive a response and, if that request is refused, be provided with a written statement of reasons.

Thirdly, there are limited enforcement mechanisms available. Section 44 of the Fair Work Act provides that an order cannot be made under the civil remedies provisions in relation to contraventions of s 65(5).

Since our inquiry was completed, the Fair Work Amendment (Better Work/Life Balance) Bill 2012 was introduced in February by Adam Bandt MP. This Bill would amend the Fair Work Act by extending the right to request flexible working arrangements to all employees and strengthening the right to request for employees with caring responsibilities.

The legislation would:

  • give employees who have been in their job for 12 months enforceable rights to request flexible working arrangements, including the number of hours they work, the scheduling of those hours and the location of work;
  • provide for employers to respond to a request within 21 days;
  • in the case of carers looking after another person, allow employers to refuse flexible arrangements only where there are serious countervailing business reasons;
  • for all other employees, allow employers to refuse on operational grounds; and
  • give Fair Work Australia the ability to hear and determine any disputes if an employer refuses a request.

A significant feature of the Bill is that it removes the ‘flexible working arrangements’ provisions from the NES and moves them to a new Part of the Fair Work Act.

The Bill was referred to the House of Representatives Standing Committee on Education and Employment. The ALRC made a submission based on our work in the Commonwealth Family Violence Inquiry.

Also coming in after we completed our work was the report of the Advisory Panel on the Economic Potential of Senior Australians, dated 12 December 2011. Of note is Recommendation 15, which recommends that the federal government work with industry to extend flexible work arrangements to people aged 55 and over, by amending the NES to include the right to request flexible work for this age group or through best practice industry standards.

In our Commonwealth Family Violence report, we recommended a whole-of-government five-phased approach to reform of employment-related legislative, regulatory and administrative frameworks; but emphasised that none of the phases are mutually exclusive, nor must they necessarily be sequential.

Ultimately, recognising the specific role of the NES, the ALRC recommended that as the final phase of implementation of reforms the Australian Government should consider amending s 65 of the Fair Work Act to provide that an employee who is experiencing family violence, or who is providing care or support to another person experiencing family violence, may request the employer for a change in working arrangements to assist the employee to deal with circumstances arising from the family violence.

Inquiry process

The law reform process involves a number of steps: sizing up the problem within the constraints of the Terms of Reference; defining the conceptual/policy landscape in which the development of law reform recommendations will occur; consultation, consultation, consultation; and, finally, the report, containing recommendations for reform. Most importantly, we never start with answers, only questions.

Once the ALRC has completed its work on any inquiry, a report is presented to the Attorney-General, who must then table it in each House of Parliament ‘within 15 sitting days’ of that House after having received it.[9] Once tabled in Parliament, the report becomes a public document.[10] The report will not be self-executing—rather, each inquiry provides recommendations about the best way to proceed, but implementation is a matter for others.[11] But we do keep watch. Each Annual Report now provides a table of ‘Implementation Status’ of all ALRC Reports.[12]

On the one hand, ALRC reports and consultation documents give leverage at a high public level for achieving reform, providing a voice, through the consultative processes and their embodiment in the public documents (consultation papers and Report), in a coherent public way for key stakeholders on the issue the subject of each inquiry.

We are just at the beginning in this Inquiry. It is the point where we have lots of questions and many people to talk to. One of the most important features of ALRC inquiries is the commitment to widespread community consultation.[13] The nature and extent of this engagement is normally determined by the subject matter of the reference—particularly whether the topic is regarded as a technical one, of interest largely to specialists in the field, or is a matter of interest and concern to the broader community.

We will have at least two consultation rounds throughout this inquiry before we report at the end of March next year. We will be releasing a short Issues Paper at the end of April. Then we ‘hit the road’ talking to key stakeholders, government agencies, community groups, academics, lawyers, and so on. In August we will pull all our preliminary thinking together in a Discussion Paper in which we will put out draft recommendations as ‘proposals’—flying some ideas way up the mast, maybe to bring them down a little, or a lot, but really testing the waters (happily to mix my metaphors). We will then hit the road again, with a wider round of consultations, finally leading to the report early next year. We seek, and press, for submissions to both our consultation documents, and this provides us rich material to inform our thinking and also to quote in our work.

Our inquiry process is described on the ALRC website:

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Thank you again for allowing me to speak this morning. And let me conclude by saying how fortunate the ALRC is to have Commissioner Susan Ryan join the inquiry team as part-time Commissioner. Her experience, standing and wisdom will be of enormous benefit to the inquiry and I am so grateful we have her on board.

* Prepared in conjunction with the ALRC legal officer team: Sara Peel, Krista Lee-Jones and Amanda Alford.

[1]United Nations Principles for Older Persons, adopted by General Assembly resolution 46/91 of 16 December 1991.

[2]Australian Law Reform Commission Act 1996 (Cth) s 24(2).

[3] Clarke Veterans’ Entitlements Review p.248. It is also available on grounds of permanent unemployability at any age and pulmonary tuberculosis at any age.

[4] ‘[D]ata on life insurance shows that salary continuance coverage for workers older than the pension or retirement age is also very limited. Benefit periods for workers aged 65 or more are generally limited to between six months and two years and some schemes provide no coverage for older workers. There is a trend to increase this age restriction, but it is quite limited.’ Aon Hewitt, ‘Time for a change in executive remuneration design?’ HR Connect Australia Volume 1, Issue 2, 2011. See also the work of Commissioner Susan Ryan ‘Remove age discrimination, and we’ll have more financially independent older people and a more productive economy’, published in The Equality Law Reform Project (10 October 2010).

[5]Age Discrimination Act 2004 (Cth) s 37(3).

[6] In order to be eligible to request flexible work arrangements, the employee must have 12 months of continuous service, or for a casual employee, be a long-term casual employee with a reasonable expectation of continuing employment on a regular and systemic basis: Fair Work Act 2009 (Cth) s 65.

[7] Ibid s 65(1), (2). The Note to s 65(1) states that examples of changes in working arrangements include changes in hours of work, patterns of work and location of work.

[8] See, eg, Organic Act on Integrated Protection Measures Against Gender Violence 2004 (Spain) art 21.

[9]Australian Law Reform Commission Act 1996 (Cth) s 25.

[10]Ibid s 23.

[11] However, the ALRC has a strong record of having its advice followed. About 59% of the Commission’s previous reports have been fully or substantially implemented, about 29% of reports have been partially implemented, 4% of reports are under consideration and 8% have had no implementation to date: Australian Law Reform Commission, Annual Report 2005–06, 38.

[12] See the tables in the Annual Reports available on the ALRC website:

[13]B Opeskin, ‘Measuring Success’ in B Opeskin and D Weisbrot (eds), The Promise of Law Reform (2005), 202.