In June 2012 the NSW government amended the Workers Compensation Scheme, dramatically reducing the entitlements of injured workers.
The Workers Compensation Legislation Amendment Act 2012 (NSW) had far-reaching implications for injured workers in respect to medical and related expenses, weekly wage entitlements, lump sum claims and access to legal advice.
Previously, injured workers had been entitled to weekly benefits paid whilst unable to work, reasonable medical expenses and a lump sum compensation payment for the permanent injuries sustained. This was assessed as a percentage of the individual body part (for injuries prior to 2002) or of their whole body (for injuries post 2002). They were also entitled to have their legal fees covered by the insurer, should their claim be successful.
The 2012 changes increased the weekly wage benefits, but reduced the long-term claiming of such benefits and gave more power to the insurers when making decisions to cut payments.
For the vast majority of workers, those who have substantial impairment below 31 per cent, support is now only available for up to 2.5 years. Prior to the changes, this group received ongoing financial support helping them back into work or until retirement.
The changes also curtailed the time people had to claim medical expenses to a modest 12 months from the date of the accident or 12 months from the last weekly wage payment received from the insurer. This resulted in tens of thousands of workers who had previously been awarded treatment and medical benefits for life under the old scheme losing these essential payments on 1 January 2014.
Another significant change is that injured workers are only entitled to claim a lump sum payment for a permanent injury if assessed in excess of 10 per cent whole body impairment. Under the previous system, an injured worker who was assessed to have any level of impairment was entitled to compensation and those assessed above 10 per cent whole body impairment would also be entitled to an additional payment for pain and suffering. Pain and suffering payments were also abolished.
Most importantly problems have arisen as a result of new provisions with respect to work capacity assessments and decisions and the review process for such decisions by insurers. The legislation is extremely complex and yet workers are denied access to legal assistance or advice with respect to work capacity decisions which may have resulted in the withdrawal of their benefits.
The NSW Government recently undertook a review of the Act to gauge the impact the changes have had on an economic scale and also on injured workers. The Law Society of NSW provided submissions with recommendations on how the system should be amended to properly compensate injured workers.
What’s clear is that the reformed workers scheme is now making large profits but delivering little to those businesses that pay into it. In the recent state budget, the NSW Government announced that the scheme had gone from a $4 billion deficit, to a $1.3 billion surplus, however it failed to mention that this has only been possible by slashing benefits at the expense of some of the most vulnerable members of our community.
We believe that the pendulum has swung too far, and we now have a scheme that is harsh and unjust. The NSW government must go back to the drawing board and fix it. That’s why we are strongly encouraging members of the public to contact their state MP to provide feedback if the amendments have directly affected them. It is important that our local representatives are aware of how harsh these amendments are to local workers and families, so that serious consideration can be given to further amendments that will strengthen the benefits available to injured workers in NSW.
Wollongong and District Law Society president David Potts