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Della's Compo Plan

Labour lawyer Richard Brennan places the NSW workers compensation reforms under the microscope.

	Richard Brennan

The effect of the Workers Compensation Legislation Amendment Bill 2001 is to:-

1. Remove the right of injured workers to have a proper hearing of their claims determined by independent judicial body. This was attempted by changes brought in by the Unsworth Government in the 1980's and it was a failure. Following complaints of interference, the Senior Commissioner resigned.

2. Introduces binding medical assessments. Those who perform these assessments do not have to be medically qualified. The local chiropractor at Tumut has completed the equilivent necessary course to become such a person under the Motor Accidents Act and may well be called on under this Bill.

3. Effectively eliminates common law claims by changing the method of assessment of permanent impairment from the current system under the existing legislation to a different system using the American Medical Association Guidelines for permanent impairment. An injured worker would probably have to be dead or a quadriplegic to qualify.

4. As a consequence of changing the basis permanent impairment assessment workers entitlements to lump sum compensation under the Workers Compensation Act for permanent disabilities and for pain and suffering will be very greatly reduced. In addition, a threshold has been introduced by the Bill into lump sum compensation entitlements.

5. Introduces the appointment of Commissioners for a term which again was tried before by the Unsworth Government and didn't work. There is no appeal from their decisions. They don't even have to have an open hearing and they are only required to give brief reasons with a system of internal review.

6. Replaces the Court with an administrative system.

7. Introduces the AMA Guidelines to assess the permanent impairment.

8. There are aspects of the Bill which on the first glance appear to be an improvement. Examination of the detail indicates they will probably be completely ineffective.

For example: (a) There are special provisions for the commencement of weekly payments of compensation following initial notification of injury. Such payments are to be commenced within 7 days after initial notification unless the insurer has a reasonable excuse. "Reasonable excuses" regularly used by insurers now are that they require further factual investigations or medical examination. In addition, an insurer may require the worker to provide it with a medical certificate or an authority to obtain any information it wishes about the worker. If the worker doesn't comply with this request within 7 days the insurer may discontinue payments. The obligation of the insurer to make such payments ceases if the insurer disputes liability and the whole arrangements does not even apply to self insurers.

(b) On the face of it there are time frames for dealing with lump sums claims which appear very favourable for injured workers. The Bill provides that a lump sum claim must be determined within a month after the injury has stabilised as agreed by the parties or as determined by a medical assessor or within 2 months after the claim has provided all relevant particulars which ever is the later. There is a half page of the Bill taken up by the particulars that must be provided which is a straight steal from the Motor Accidents Compensation Act (more about that later). In addition if the insurer wants a medical practitioner to examine the claimant, the claimant is deemed not to given all the relevant particulars until that examination has taken place. Delays in the current system for insurers to arrange medical examination are extensive. One can only wonder what they will be like under this system.

(c) Provisions for referral of disputes to conciliation for determination on the face of them, appear reasonable. It is not until you read the legislation that you realise there are many grounds upon which determination can be deferred. For example, there can be a deferral pending an outcome of a medical assessment, pending negotiations and lump sum claims cannot be even referred to a Commissioner unless certain preconditions are met.

(d) About the only good news in the Bill is that there is provision for interim payment directions with a presumption that there are warranted unless the claim has minimal prospects of success or the worker has returned to work or the injury was not correctly reported or there is insufficient medical evidence. One can only wonder how many such interim payment directions will be made bearing in mind the loopholes. In addition, such interim payment directions cannot exceed a period of 12 weeks.

9. The changes that are made by this Bill are worse than the changes made to the system by the Unsworth Government in 1987. The reasons are this Bill introduces binding medical panels and there is no obligation for an injured workers case to be heard by an independent judicial officer.

10. An examination of 17 outcomes for referral of claims for industrial deafness by construction workers to medical panels indicates that upon the medical panel assessment, none of them crossed the 6% threshold so as to be entitled to compensation for deafness. Assessments made by the treating ear, nose and throat specialist in every case exceeded 6% yet in every case the medical panels returned a finding of less than 6%. The most extreme example involves a deaf worker being examined by a court medical panel in 1997 and being found to suffer 14.5% hearing loss. He returned to work and was exposed to further noise and his treating specialist in 2000 found that he suffered 31.4% hearing loss. The insurance company's doctor found that he suffered 12.5% hearing loss yet a further medical panel on 12 March 2001 assessed his hearing loss as 4.9% . It must be remembered that the first medical panel and the last medical panel are binding. The system of dispute resolution involving the appointment of Commissioners is convoluted with referrals to the Compensation Court on questions of law that are "novel or complex".

11. In the Daily Telegraph published on 29 March 2001 the Minister for Industrial Relations is quoted as saying "there is no reduction in the level of compensation........". he goes on "at present, workers must be assessed as being 25% permanently injured in order to mount a common law claim. Under the new system that is also the case". It isn't, and the statement is completely wrong.

12. The most charitable interpretation that can be placed upon the Minister's article is that he simply doesn't know what he has done.

13. The Bill introduces into the workers compensation system great slabs of the Motor Accident Compensation Act. This Act is an absolute disaster and its continued operation in its present form is being questioned in many quarters. Victims with serious injuries are not meeting the 10% threshold required to obtain damages under the scheme. There is an example of a victim who was hospitalised for 17 days and medically retired by the employer who submitted a claim to the insurer and was told that he did not meet the 10% threshold. The victim now must go through a complicated bureaucratic procedure to see if he is or isn't over the threshold. If he passes that test he must then go to the claim assessment service. This victim will more than likely miss out. The threshold under the Compensation Bill is two and half times higher than that threshold. The Australian Medical Association has been extremely critical of the scheme and its harshness in relation to the medical assessments based on the guidelines referred to above.

14. Under the Motor Accidents Act, only one matter has been assessed (12 March 2001) with the relevant tribunal being set up in October 1999. In 18 months of operation, only 2 victim has received a settlement and the Government wants to transpose that scheme into workers compensation.

15. In addition, the Motor Accidents Authority reported to the Motor Accidents Council in November 2000 that in the first 12 months of its scheme, insurers took 1.4 billion dollars in premium income and made payments of 14.6 million. This is exactly what will happen to the workers compensation system if this Bill is allowed to proceed.

16. You might think of reading the Bill that current claims for current injuries are safe from the new system. They aren't. The Bill contains regulations to transfer a class or classes of existing claims to be treated as new claims. It provides that those claims cease to be existing claims and become new claims for the purposes of the legislation. This procedure includes common law claims.

17. In summary, if the Bill becomes law, it will annihilate workers access to the common law system and will greatly reduce any lump sum compensation to which they are entitled for work injury. The system enhances the bureaucracy which has taken the system over and will probably increase delays in resolving matters and leave decision making in the hands of two totally uncountable bodies with no real right of appeal or proper review. It will eliminate the Compensation Court which has served to properly compensate injured workers and to protect them from insurers and bureaucrats for so long.

18. The Bill is a disgrace and must not proceed.

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  Issue 90 contents

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»	Breakthrough on Sweat-Shops
»	Beazley to Force Executive Disclosure
»	Call Centre Union Busters Get Wake-Up Call
»	Victorious Workers Paint the Picket Red
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»	Feed the Shangri-La Workers Fund
»	STOP PRESS: Union Numbers Up - ABS

»	The Soapbox
»	The Locker Room
»	Trades Hall
»	Tool Shed

»	Crumby Company

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