Due to recent and draconian workcover legislation changes introduced by the New South Wales (NSW) State Government, the anticipated increase in workers compensation premiums has-for now -been avoided. The Workers Compensation Legislation Amendment Act 2012 (Act), which received unholy assent on 27 June 2012, was supposedly – and hastily-designed to reduce WorkCover NSW’s 4 billion deficit, lower insurance premiums for NSW employers and fix some inequities in the system, in particular for seriously injured workers.
The horrible amendments drastically changed the face of the NSW Workers Compensation Scheme and are significantly impacting key players within the scheme, especially discarded injured workers and profiteering insurers.
Workcover NSW reforms – have the “savings” been achieved?
An “independent” investigation into WorkCover’s financial position revealed a $4.1 billion deficit, which was increasing at a reported AU$9 million a day. NSW employers’ premiums were 20% to 60% higher than competitive states (including Queensland and Victoria). As a result of the reforms, it was expected that the foreseen 28% rise in premiums would not be implemented.
How have these allmighty savings been achieved?
The evil reforms include:
- Schedule 9 of the Act permits the entry of “new insurers” into the NSW Workers Compensation Scheme. While not expressly stated, these “new insurers” could include specialised insurers to underwrite specific industry classes, who will take all of the risk in an industry (eg Coal Mines Insurance).
- Based on the Victorian model, the new evil Act’s primary goals is to reduce significantly entitlements to weekly payments so that all but “[extremely]seriously injured workers” have a closed period of entitlements to either two years or five years.
- The Act allegedly seeks to increase benefits for “seriously injured workers” who are totally unfit for work, up to the Commonwealth retirement age, and “advertises” this rather misleading “benefit”
- Based on the South Australian model, the Act now restricts journey claims to very limited circumstances where there is a real and substantial connection between the employment and the accident or incident. The Act basically cut off all journey claims, with some extremely rare exceptions.
- The Act also limits payment of medical expenses to injured workers to 12 months after the date of claim for an injury, or 12 months after the cessation of weekly payments (previously afforded a lifetime entitlement).
- The Act has also introduced a new, most dodgy, process to assess a worker’s capacity (thereby entitlements to weekly benefits) by way of Work Capacity Assessments.
- The new law has basically CUT OFF weekly pay and medical treatment to the BULK of its NSW injured workers, by misleading the ignorant stating that “seriously injured workers” will be looked after much better. They, of course, did not tell the public that it is virtually impossible to reach the required threshold to be considered a “serious injured worker” under this legislation. This evil law was rewritten to do one thing and that is to deny workers compensation to NSW injured workers; deny weekly payments and medical treatment to the vast majority of what a normal person would call “seriously injured” workers – those who can no longer return to work because of the severity of their injuries, those who -through no fault of their own – went to work and came home injured, only to be let down by a system they believed was there to protect and help them, driven into poverty and… yes, on the public purse. Great “savings!”.
Other important and awful changes include:
- Restricting an injured worker’s ability to dispute an insurer’s decision to reduce weekly payments
- Abandoning/squashing an injured worker’s entitlement to compensation for pain and suffering
- Restricting entitlements to lump sum compensation to one claim only, thus abandoning deterioration claims
- Squashing common law claims in negligence for nervous shock to non-workers
- Reducing an injured worker’s right to claim for heart attack and stroke injuries, (unless work exceptionally significantly increased the risk of injury)
- Loosening the criteria to commute a claim.
[Note the evil Act does not apply to police officers, paramedics and firefighters, who stood their ground].
Impact on profiteering insurers and on employers
The least one would expect is that, with the implementation of all the evil the reductions in injured workers’ entitlements, workers compensation premiums will remain static (the same) with only very small (if any) increases. It will be interesting to see what happens with the premiums. Employers obviously walk away scott-free, and reap the low premium benefit for continuing to injure workers. Insurers? Well, what can we say but that they have now been given Allmighty power – and more profits than ever, especially given that the evil law applies retrospectively and the bastards are having the time (and money) of their lives, denying and cancelling previous agreed upon “entitlements”. Old permanent impairments assessments are suddenly fished out of archives and are much more important that new ones showing for example catastrophic deterioration of injury (and as much as 15% WPI difference); injured workers’ weekly pay are being cut off, they are being sent for “work capacity” assessments in order to “legitimately” cut of weekly pay and any other benefit, and injured workers and their families are finding themselves in a terrible living nightmare.
The new laws are very controversial and extremely unpopular amongst most decent people. However, as we have mentioned here and there on comments, they have gone a long way to align NSW with competitive states, including South Australia, Queensland and Victoria, under disguise to help provide a scheme that is “affordable, efficient and financially sustainable”. Rrright!
The above draconian facts, coupled with the disturbing and heart-wrenching stories we hear from our NSW injured workers clearly demonstrate that the new evil NSW workers compensation laws only:
- make things much much easier for greedy workcover insurance companies, who can now literally discard injured workers instead of supporting them
- shift the (ongoing) medical costs for the injured worker onto the public health system
- shift the weekly benefits to unemployment benefits or onto disability pensions (Centrelink)
This basically means that the greedy workcover insurance companies will now continue to massively profit from the “workcover” system. They will also continue their “business as usual”, i.e. continue to increase workcover insurance premiums for employers based on injury and cost projections whilst transferring costs and responsibility to Australian taxpayers.
- Retrospective workers compensation laws
When making inquiries, many injured workers have been informed by WorkCover NSW, that any previous legal rulings under old laws along with entitlements would no long be honoured and they would likely be sent for a capacity assessment and have benefits cut – forcing injured workers onto Centrelink payments or disability pensions.
- Work capacity assessments
We have heard from quite a few severely injured workers they have now received letters informing workcover giving them 3 month notice to cease ongoing medical and weekly benefits. These injured workers face the unthinkable and are being forced to apply for taxpayer funded disability support pensions and ongoing medical treatment from the public health system.
- Impairment assessments
We have received a few horrendous emails called for help from injured workers whose injuries have seriously deteriorated are whose revised, new Whole Person Impairments (WPI) are simply NOT recognised. One WPIs changed from 12% to 23%. these injured workers are being told that under new laws they may only have one assessment which doesn’t take into account that some conditions deteriorate which prevents compensation for further disability, however, more importantly it prevents access to ongoing and necessary medical treatment.
- Ongoing abusive and hostile insurers
We know of an injured worker who was scheduled for major surgery was informed that he was required to undergo a work capacity assessment just prior to his operation and if he didn’t attend his benefits would cease. This is despite the fact that the full extent of capacity wouldn’t be known for at least 10 months after the operation. This highlights just how hostile insurers have become and also adds additional pressures on insurance company and rehabilitation case managers to comply with misguided policies and procedures.