I recently read article from Risk & Insurance Online, where they state that the Boston-based Workers Compensation Research Institute looked at more than 2,000 workers injured in Michigan in 2004 who received workcover lumpsum payments. The researchers found that more injured workers returned to work after receiving a lump-sum settlement than exited the workforce, says a new study. The findings offer answers about the positive effect of settlements on return-to-work efforts…and yet injured workers are accused over and over again of having a “lumpsum culture”!
WorkCover lumpsum payments help injured workers returning to work!
Lump sum payments
WorkSafe / WorkCover can award lump sum compensation payments for permanent significant injury. These are part of the scheme of benefits that WorkSafe manages. The criteria for entitlement to a lump sum claim are tough and claims can be rejected by WorkSafe / WorkCover. The best rule if you are considering making a lump sum claim is therefore to get legal advice.
As a general rule, you must have suffered at least a 5% physical permanent impairment as assessed by WorkSafe for certain body part injuries but usually 10%. Here’s a rough guide (VIC):
|30% psychiatric impairment:||$69,540|
Read more about lumpsums here >>
Workcover lumpsum study
The Boston-based Workers Compensation Research Institute looked at more than 2,000 workers injured in Michigan in 2004 who received lump-sum settlements. The researchers followed their employment experience for the next four years.
The study found:
- Three-quarters of the injured workers who received a lump-sum settlement did not change their employment status, “which means that many of those who were employed at the time of the lump sum stayed employed and those who were not employed remained unemployed.”
- Of those who did change their employment status, nearly a third who were employed at the time of the settlement left work and nearly a fifth of those who were not employed attained employment.
- Average employment in the sample increased from 25 percent of workers at the time of the lump sum to 32 percent of workers one year after a settlement. “The exception is older workers who experienced a decline in employment after a settlement.”
So why are injured workers continually accused of having a “lump sum culture”. We have yet to come across any injured worker that doesn’t want to return to work in some capacity, yet the underlying assumption of the O’Farrell [or any other] Government (misinformed by WorkCover and their actuaries) is that most injured workers are looking for ‘easy money’.
As we posted some time ago, a personal injury lawyer with 23 years’ experience virtually lampooned claims that WorkCover’s $4.1 billion deficit is linked to an “explosion” in damages claims and a lump-sum culture [WTF].
Lumpsums, settlement monies and other hard $ facts1. Only a very small percentage of injured workers are looking for “early retirement”
- Only a very small percentage of injured workers are looking for an early retirement: The common consensus or stereotype among our thick workcover case managers is that injured workers are trying to obtain a lump sum settlement for the wrong reasons, namely for a way to fund paid “holiday”, an early “retirement” and remove themselves form having to work forever. After all injured workers are all lazy malingerers. According to this study this is definitely not true, and would apply to an extremely small percentage, along with the real fraudsters (0.1 to 1 % of all cases). And may we say, good luck to any potential fraudster, for as we have explained in detail, we believe this would be impossible to obtain.
- Fact is that there are a million reasons which hinder genuinely injured workers to return to GAINFUL employment – the primary reason being that workcover really hinders our return to work, by not allowing us to recover from our injuries, by forcing us to prematurely return to work, by repeatedly re-injuring us and by using coercive techniques and tactics to have our treating doctors amend our certificates of incapacity. Terrible return to work plans, unsuitable duties, refusal of our employers to accommodate us for our genuine physical limitations and restrictions (i.e. denying ergonomic aides in the workplace). Add to that demeaning “vocational assessments” and most often, denials to retrain. And then, of course, injured workers face real problems getting hired as most employers do not want to hire injured workers. Then there are a myriad of other factors that may genuinely impede return to work, including age of the injured worker, type and severity of injury and post-injury medical and physical limitations.
- Most workcover case managers “forget” that an injured workers’ life does not end after a settlement has been reached, rather it is just the end of the file for case manager and a sense of being released from jail for the permanently injured worker, who has been treated with contempt, disrespect, who has been treated like a criminal and a suspect during the workcover nightmare. Any little money an injured worker may receive will eventually be depleted, and the injured worker will continue in their life with their pain, disability and symptoms.
- What case managers (and politicians, governments etc) really “forget” is that for example young(ish) permanently and severely injured workers could rarely sustain a prosperous life from the time of their settlement to their death, meaning that they would have to stretch those settlement monies over the course of their whole lifespan! Take a case where let’s say someone like me, who has lost an entire dominant arm, would receive $400,000 in a common law damages claim. Take the lawyer fees off and that leaves about $300,000. When you get a common law damages claim your weekly payments STOP. So this $300,000 (which may sound like a lot) will in fact need to last me – as my INCOME – until I die. This is the equivalent of $30,000 per year for 10 years; or $15,000 per year for 20 years. I am hoping to live another 40 years, so that would leave me with barely $7000 PER YEAR for 40 years – a life of UTTER POVERTY. Don’t you hate people who say “oh but you’ll get the compo, it will be like the lottery, set up for life”! WRONG! Think again! On the other hand, and as the study showed, older workers nearing retirement would rarely return to full time gainful employment after a settlement, since they may not need to work anymore, but again this could vary on Pensions, savings account amounts etc. Also, let’s say an injured person is aged 55 and is severely permanently injured and can never return to the job he liked and was qualified for. Now why would any person in this age bracket want or feel the need to formally retrain (i.e. 2-3 years) in order to find a suitable but also gainful form of employment? By the time they would have retrained (if they get retraining from the insurer) they would be close to 60 years of age before they would get a job (if they get one). So if your are older and have enough money to make end meets with a settlement, by all means retire. But the opposite is more likely to happen and that is that many older injured workers who wish to retire simply cannot afford to retire after a settlement, based on their own personal economic needs!
- Another important point I wish to raise is that many injured workers who were for example over and over again denied re-training, will use a portion of their meagre lumpsum to retrain, learn a new skill, or start for example a legit little home business (i.e. selling stuff on ebay, breeding birds, breeding dogs, whatever) as to feel useful again in society and contribute to the best of their injured abilities.
[post pre-dictated and entered on behalf of WCV]