The main purpose of this article is to inform injured workers that their weekly payments can be changed (reduced) or terminated, that it happens frequently, AND OFTEN in an ILLEGAL manner!
When can weekly payments in Victoria be terminated
In addition to the termination of weekly payments after the expiry of the second entitlement period (which is 130 weeks after the date of injury for injuries sustained on or after 1 Jan 2005, or 104 weeks for injuries sustained before 1 Jan 2005) weekly payments can be terminated for the reasons outlined below.
Termination due to non‑entitlement
The worker is not entitled to compensation.
The agent had accepted liability but the worker was not entitled to compensation because the:
· worker’s employment was not connected with the State of Victoria
· worker was not a worker within the meaning of the Act
· injury did not arise out of or in the course of employment
· worker did not suffer an injury
· worker suffered a mental injury to which s82(2A) applies
· worker’s employment was not a significant contributing factor to the injury as required under s82 of the Act
· injury was self-inflicted or due to serious and wilful misconduct
· worker has made a false or misleading disclosure
· worker has failed to disclose a pre-existing condition at the time of employment if requested in writing by the employer to do so from 1 July 1998 onwards
Terminate because worker is no longer entitled to weekly payments
· is not or is no longer entitled to weekly payments because the worker:
– is not or is no longer incapacitated for work
– has an incapacity for work but it does not result from nor is it materially contributed to by the injury for which liability was accepted
– is breaching their RTW obligations
· suffered an injury which was a temporary aggravation of an underlying or non-work related condition, the effects of the aggravation have ceased and the underlying condition is the cause of the incapacity.
Termination due to fraud
The worker fraudulently obtained payments.
However, it should be noted that a worker’s weekly payments are not to be terminated solely on the ground that the worker has returned to full-time work.
Reducing weekly pay
Weekly payments must not be reduced unless the agent has reviewed the facts and made a determination of the worker’s entitlement.
Grounds for reducing weekly payments
The agent may reduce weekly payments on the grounds that:
· there is a change in the worker’s work capacity
· the worker enters a different entitlement period (‘step down’)
· in the case of a worker who has a CWE, the CWE amount alters
· payments for overtime or shift allowances are no longer included in the worker’s PIAWE
When weekly payments are reduced
Weekly payments are reduced:
· where there is an increase in the worker’s CWE
· at the end of the first entitlement period
· at 26 or 52 weeks if overtime or shift allowances are included in the PIAWE
· the worker is receiving a non pecuniary benefit
· at the end of the second entitlement period
· where the worker:
– suffers an injury in a transport accident
– the injury was caused by the worker’s drink or drug driving
– the worker is convicted or found guilty of a drink or drug driving offence
· where the worker accesses income from another source related to their injury (superannuation, lump sum or pension).
See: 9.1.4 – Entitlement periods below
No alteration if worker on paid annual leave or long service leave
If the worker’s CWE are reduced because the worker is on paid annual leave or paid long service leave, the agent must not alter the worker’s weekly payments by reason only of that reduction.
Send a notice of alteration
Before reducing weekly payments, agents are to send a written notice as explained below
If weekly payments not reduced at end of first entitlement period
If an agent identifies a claim where weekly payments have not been reduced at the end of the first entitlement period the agent must:
· reduce the rate of weekly payments for the correct entitlement period
· issue a reduction notice.
Note:In these circumstances the reduction in weekly payments cannot be backdated and takes effect from the date specified in the notice.
For example we recall the recent story of an injured worker who received a telephone call a few minutes before her weekly pay was due to inform her s/he would no longer receive weekly payments (based on a biased pain doctor’s report). This is ILLEGAL. Or what about the injured worker who fell in her backyard and aggravated (temporarily) her back injury and had her weekly payments ceased at the snap of an uneducated case manager? Wonder what the termination notice did say? Evidence? How many innocent and genuinely injured workers have had their weekly payments terminated ILLEGALLY? How about all those poor sods accused of “FRAUD”, only to be cleared in a court of law? Meanwhile those poor injured workers had their weekly payments stopped – ILLEGALLY and forced into extreme financial hardship for months if not years! Take the case of Aunela and Telstra Corporation Limited  AATA 683 (9 September 2009) or WorkCover Corporation of SA v Trask  SASC 339 (20 September 2007), where we wrote that “what is perhaps most disturbing of all is that weekly payments to the spied upon accused “fraudulent” injured workers are routinely ceased by workcover insurers BEFORE a proper determination on the alleged fraud is reached.”.
Written notice of a change or termination of weekly payments must be sent to the worker.
If terminating or altering weekly payments, agents must send:
- a written notice to the worker
- advice to the employer.
[Act ref: S114]
There are only a small number of situations that do not require a written notice.
The Act does not require a notice to be given to a worker when terminating or altering a weekly payment in the following circumstances. However, WorkSafe recommends that agents give notice to workers when terminating or altering weekly payments in these circumstances.
If the worker:
- has returned to work, either as a self employed person or in employment and continues to claim weekly payments
- has CWE and the amount of the worker’s CWE alters (CWE = Current Weekly Earnings. When a worker is incapacitated for their pre-injury job but is able to carry out other work, the earnings from the other work are the CWE.)
- has voluntarily reduced their CWE or removed themselves from employment for reasons unrelated to their incapacity
- was injured within 130 weeks before retirement age and 130 weeks of weekly payments have been received
- was injured after retirement age and 130 weeks of weekly payments have been receivedreceived weekly payments for an incapacity after retirement age related to a pre-retirement claim
- has reached retirement age
- receives superannuation or retirement pensions and lump sums and disability pensions exceeding the supplemental pension limit
- no longer resides in Australia
- is in prison.
The termination or alteration of weekly payments in the above circumstances has effect without the giving of notice and from the day on which the circumstances establishing the relevant grounds first arose. In effect, the date on which the agent makes the decision is the date from which the alteration or termination is effective as no notice period applies.
Incomplete notice could be invalid
This could result in the claim being deemed accepted or payments being reinstated from the date of the invalid notice.
It should be noted that a worker’s weekly payments are not to be terminated solely on the ground that the worker has returned to full time work.
Worker’s entitlement continues up to specified date
If a notice is sent, the worker is deemed entitled to weekly payments after the first or second entitlement period:
- until the date specified in the notice has expired
- provided the worker is otherwise entitled to weekly payments.
Notices must be send by registered mail or courier
If the notice is to be sent by registered mail, allow for two postal days. Unless the contrary is proved, service is deemed to be effected two working days from the date of posting (excluding weekends and public holidays). [Act ref: S246]
Workcover agents must keep proof of delivery for rejection notices
Proof of service of the rejection notice must be on file by the workcover insurer.
They must keep file notes together with registered mail and/or courier slips confirming delivery of the notice. This clearly demonstrates compliance with the time limitations under the Act.
Notice for workers paid for less than 12 weeks
Although the Act does not specify it, WorkSafe requires that agents send notices to workers who have received weekly payments for less than 12 weeks advising them of an alteration or termination. This satisfies administrative needs and maintains good customer relationships.
Workers can recover compensation if their payments have been wrongfully terminated.
WHICH IS OFTEN THE CASE!
Wrongful termination might be the result of the agent failing to give the worker the required period of notice.[Act ref: S114(11), S114(3)]
Calculation of amount of recoverable compensation
The amount can be calculated as either:
- If the agent failed to send the written notice: the recoverable amount is equal to the compensation that would have been payable during the period of notice or
- If less than the required period of notice has been given: the recoverable amount is equal to the compensation that would have been payable during the balance of the required period of notice.[Act ref:S114(12) ]
Content of a written notice to terminate of alter weekly pay
The agent must possess and summarise the evidence, factual and/or medical, which supports the grounds relied on.
It is not valid to make a decision based on lack of evidence. They need to clearly state the reason for their decision.
For example: The decision is to reject the claim for compensation. If the decision is to terminate the weekly payments, the notice must also state the date when they will stop.
The injured worker also clearly needs to be advised of details of any appeal rights.
Period of notice required under the Act
Workcover agents must not terminate or reduce weekly payments during a period of incapacity without giving the worker the required period of notice. [Act ref: S114]
Terminations due to expiry of second entitlement period
If the termination of weekly payments is solely on the grounds of the expiry of the second entitlement period the period of notice is 13 weeks (91 days).
A reminder letter should be sent to the worker and if applicable, the employer 28 days before the termination takes effect. [Act ref: S114(9), S114(10), S114B]
For other terminations and reductions
If the worker has been continuously receiving weekly payments
The period of notice
less than 12 weeks
at least 12 weeks but less than one year
one year (52 weeks) or more
[Act ref: 14(11), S114(13)]
Start of period of notice
The period of notice starts from the date of the notice. For example: if the period of notice is 14 days and the notice is dated on the 11th day, the period of notice ends on the 25th day.
Notices are deemed delivered in two days
Unless proved otherwise the notice is deemed to have been served on the day it is hand delivered or served two days after the date of by registered mail. For example: the notice must be posted by day 26 at the latest if the period of notice is 28 days.
As a general practice, agents should allow three days from the date of notice.[Act ref:S246]
Workers who are convicted or found guilty of drink or drug driving or a serious road traffic offence re a transport accident which caused the injury
On becoming aware that a worker who is receiving or is entitled to receive weekly payments has been convicted or found guilty of a drink driving, drug driving or serious road traffic offence which caused the worker injury, agents must give written notice to the worker of their decision to reduce or terminate weekly payments.
The date on which the agent issues the notice to the worker is the date from which the termination is effective. [Act ref: S82A-S82C, S114BA]
Types of notices
Agents must give written notice of terminations or alterations of weekly payments where required by the Act.
1. Worker is not entitled to compensation or no longer entitled to weekly payments
If the worker is not entitled to compensation or is no longer entitled to weekly payments the termination/alteration takes effect only if:
- written notice is given
- the notice must state the reasons for the termination or alteration. It must include:
- for a termination ‑ when weekly payments will be stopped
- for alterations ‑ the new rate of weekly payments and when payments at the new level will commence.
[Act ref: S114(2)(a)-(b), S114(10)]
2. Termination due to fraud
Termination of weekly payments for fraud has effect from the day the decision is made.
Written notice must be given stating:
- the reasons for giving notice of termination
- when weekly payments will be stopped.
[Act ref: S114(3), S114(6), S114(10)]
3. Reduction of weekly pay at 13, 26 or 52 weeks
A reduction in weekly payments on the expiry of 13, 26 or 52 weeks has effect if:
- written notice is given and includes:
- the reasons for giving notice
- the new rate of weekly payments and when they will commence
- S114A has been complied with.
[Act ref: S114(8), S114(10)]
4. Reduction due to drink or drug driving
A reduction in weekly payments due to the worker’s conviction or finding of guilt relating to an act of drink or drug driving causing injury as a result of a transport accident has effect if written notice is given and includes:
- the reasons for giving notice
- the new level of weekly payments and when they will commence.
Weekly payments are reduced for an aggregate period of 130 weeks (whether consecutive or not) from the date on which notice of the reduction is given to the worker.
Weekly payments must not be reduced before the notice has been given.
Note: Agents must not disclose any details of the worker’s conviction or finding of guilt to an employer.
[Act ref:S82A, S82B, S114(10), S114BA]
5. Termination at end of second entitlement period
A termination of payments solely because of the expiry of the second entitlement period has effect if written notice is given and includes:
- the reasons for giving notice of termination
- the date when payments will be stopped.
The decision to terminate may be made before the end of the second entitlement period but does not take effect until the worker has reached the end of the second entitlement period.
The worker must be given 13 weeks notice of the decision.
[Act ref: S114(9), S114(10), S114B]