Workcover NSW reforms – have the “savings” been achieved?

Workers-Comp-Butcher

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!

What is really happening is that the NSW workcover scheme has now also transferred its costs and responsibility for injured workers onto the tax payers.

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.

The bottom line is that insurers are making significant profits at the expense of employers, injured workers and taxpayers.

Examples

  • 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.

 

8 Responses to “Workcover NSW reforms – have the “savings” been achieved?”

  1. Thankyou At A Loss, that news has cheered me up a lot. Maybe in the future the courts will have a case where it can be shown that the O Farrell government trashed common law by bringing in amendments that destroyed the actual legislation. He was too cowardly to actually bring in legislation that replaced WC, he and his insurance mates tried the backdoor way with amendments. This is really a threat to democracy as any NSW law can now be amended to destroy what it is, this has to be stopped by the courts. XChanging, I know some unions have been less than fair to their members, however in my case, I would have been a total mess without my union and they still provide support. At the moment Unions are the only voice many workers have, take that away and abuses of workers will skyrocket

    • Hi Bunny, it is not just O’Farrell and Pearce it is the liberal Party state or federal that will always target the weak and vulnerable the injured and the sick.

      Based on the stories below the Liberals have wanted to punish the injured for many, many  years.

      A brief look from 2005 till present

      http://www.abc.net.au/news/2005-01-04/call-for-workers-compo-review/612866

       January 2005

      Call for workers’ compo review

      Posted Tue Jan 4, 2005 11:16am AEDT

      The president of the Armidale branch of the Liberal Party, Clive O’Connor, says there needs to be a review into workers’ compensation and occupational health and safety legislation.

      Mr O’Connor has called on the Opposition Leader and Opposition spokesman for industrial relations to support a review, if a Coalition government is voted in at the next New South Wales election.

      He says the current legislation is like a bomb waiting to explode and is having a detrimental effect on small businesses and farmers in the New England region.

      http://www.abc.net.au/news/2006-09-28/workers-compensation-payouts-to-rise/1273432

      September 2006

      Workers compensation payouts to rise

      Posted Thu Sep 28, 2006 12:12pm AEST

      The New South Wales Government says it will increase payouts to people injured in the workplace by 10 per cent, after the settlement of WorkCover’s $3 billion liability.

      The Industrial Relations Minister, John Della Bosca, says the Government has paid off the liability and can now introduce benefits for workers.

      Mr Della Bosca says workers compensation premiums will also be cut by 5 per cent from January next year.

      “The scheme is back in the black, we’re able to increase benefits to injured workers by 10 per cent and provide a further cut to premiums by 5 per cent – this is a total covered premium of 20 per cent in 12 months,” he said.

      “The Iemma Government is doing a lot to boost business and protect injured workers.”

       

      http://www.abc.net.au/news/2007-10-24/iemma-to-cut-workcover-premiums-by-5pc/707772

      October 2007

      Iemma to cut WorkCover premiums by 5pc

      Posted Wed Oct 24, 2007 11:47am AEST

      New South Wales Premier Morris Iemma has announced the Government will reduce WorkCover premiums after the state experienced its lowest work related injury rates in 20 years.

      Mr Iemma says the workers compensation scheme has a surplus of more than $800 million.

      He says the average workers compensation premium will be cut by around five per cent.

      “This will result in an annual saving of about $110 million for NSW businesses,” he said.

      “The five premium rate reductions in two years amount to a 30 per cent discount, saving NSW businesses $785 million per year.”

      The reductions will apply to policies renewed or started from December 31.

      2012 -2013

      Liberals Get their Way

      O’Farrell & Pearce punish and penalize the injured to help their mates in Insurance.

      Injured hung out to dry whilst insurance companies increase premiums and deny claims.

      Insurance Doctors no longer needed as clerks now empowered with work capacity decision  to deny benefits and medicals

      Insurers celebrate as O’Farrell and Pearce set to serve them more huge profits by screwing the CTP green slips by denying injured motorists and pedestrians the right to fair compensation

  2. Xchanging I think your on the wrong track here with the union,s there like everything in life theres good and bad on both sides and yes i am still a financial member of my Union CFMEU always will be tax dedutable as well they have always looked after there members great wages great benifits 9 day fortnight doulble time on all O/T clean site anmenties heat and rain policy redundancy paid weekly by your employer etc etc.

    Also all unions are funded by there members dues NOT THE TAXPAYER.

     

  3. Its not wiping the slate clean but its  a  start.

    • I do agree this is just a start because those perverted hyenas always look for new tricks and most scary thing is that “someone” (independent!) has given them (the insurance companies) power to decide and to make rules. It’s also interesting to note that there is NO ANY mention of Unions that took any presence in those disputes so why the hell Union even exist? We can save millions of taxpayers money $$$$ if we could shut down all Unions!

      Xchangingvictim April 20, 2013 at 9:17 am
  4. And here is what they have not told people. I ask every single owner of a small business if their WC premiums have gone down, the answer from 100% of them is that they have gone up. It is only a small sample but if we all asked shop owners, businesses we have to deal with etc, I think we will find the same pattern. If NSW can have an ICAC investigation into the business dealings of corrupt former ALP members then surely there is a whistleblower somewhere prepared to let us know the payoffs from the insurance industry  to individuals like Greg Pearce.

    • Hi Bunny I totally agree.  I believe the tables are turning, we may not get  an ICAC,  inquiry what we will get is the Supreme court reviewing the legislation and interpreting it fairly.  There has been a case which has gone to the WCC and also the Supreme Court  Goudappel ̶  v- Adco Constructions Pty Limited. Mr Goudappel lodged his application 1 day after the 19th of June 2012 and his claim was denied, he later appealed and that was denied, it since gone to the Supreme court and the Judgment is said to be delivered shortly.

      “Very Very Soon”   I hope and if the Judgement falls in the favour of Goudappel then some justice will be available to the Injured.

      Effect of the Court of Appeal Decision:

      The Court of Appeal has heard argument and will shortly give a Judgment in relation to this issue.

      If the Court finds in favour of the worker then the likely effect will be that the changes to the legislation regarding lump sum compensation entitlements will not apply to a worker who had made an initial claim for workers compensation before 19 June 2012. Importantly, this will mean:

      1. A Worker will be entitled to be compensated for any impairment, notwithstanding that the level of impairment was less than 10%; and
      2. A worker who had suffered a deterioration of their condition would be entitled to ask for further compensation; and
      3. A worker in those circumstances will be entitled to recover compensation for their pain and suffering as well, provided the impairment is greater than 10%.

      All  hope the Court finds in Favour

       

       

       

    • Hi Bunny

      as with my post above please read

      http://wiro.nsw.gov.au/media/13000/2013___april___29___ronald_goudappel_v_adco_constructions.pdf

      the cracks in the O’Farrell / Pearce workers comp amendments are getting bigger