Changes To The Act in NSW And It's Effect on You
Following the passing of the Workers
Compensation Legislation Amendment Bill 2012, new laws were created that
have meant significant changes to the way workers’ compensation benefits claims
are assessed and paid, and will affect the majority of all new and existing
workers’ compensation claims in NSW.
Reference WorkCover NSW
The changes are a significant win for
employers, in terms of premium costs being held at May 2012 levels. The changes however
mean increased responsibilities and accountability for most stakeholders, including
employers.
Although the
previous scheme also required a worker who was able to work to do so, in
co-operation with the employer or insurer, there is now more emphasis on the
employer accommodating the request for suitable duties. It is now a requirement that:
- The employer must comply
with this request so far as it is practicable.
- WorkCover inspectors are
now authorised to issue employer ‘Improvement Notices’ if they believe the
employer is not meeting their obligations in this regard.
- In addition, it is an
offence for the employer if they fail to meet their obligations, subject
to a penalty of up to $11,000.
- If a worker who is able to
work fails to make reasonable efforts to do so, he or she may have their
weekly payments suspended or – in extreme cases - terminated.
CHANGES TO WEEKLY BENEFITS PAYMENTS
From 1 October 2012, employers have needed to
change the way they determine the amount of initial weekly payments for workers
whose claim was notified to the agent after 1 October 2012.
The changes to weekly benefit payments that came into effect on 1 October 2012
only applied to claims received on or after 1 October 2012. Workers whose
claims were notified prior to 1 October 2012 should continue to be paid
according to the existing legislation (i.e. pay either the base award rate or
80 per cent of average weekly earnings) and have been transitioned to the new
legislation after 1 January 2013.
The new legislation removes the distinction between award and non-award workers
and also introduces the concept of Pre-Injury Average Weekly Earnings (PIAWE)
which will replace Current Weekly Wage Rate (CWWR) as the basis for calculating
benefit amounts.
Benefit levels during the first 13 weeks of incapacity (first entitlement
period)
Workers who
are totally unfit.
During the first 13 weeks of incapacity, workers who are totally unfit for all
work should be paid 95 per cent of their PIAWE.
Workers who
have a partial incapacity.
During the first 13 weeks of incapacity, workers who have a partial incapacity
and are able to work should be paid 95 per cent of their PIAWE. This amount
will comprise the actual wages they are earning and a top-up compensation
payment.
Pre-injury Average Weekly Earnings (PIAWE)
The PIAWE is the average of weekly earnings over the 52 week period prior to
the injury (subject to some exceptions). The calculation of earnings must take
into account any periods of paid leave, but must not include any periods of
unpaid leave. For more information about how to calculate PIAWE, please consult
the WorkCover
NSW Calculating Pre-Injury Average Weekly Earnings form.
Non immediate changes to weekly benefits
other changes to weekly benefits that come into effect on 1 October 2012 will
not impact employers immediately. These changes are:
Changes to
entitlement periods.
The method of calculating initial payments outlined above applies to the first
entitlement period (0-13 weeks). The second entitlement period will commence
after 13 weeks of weekly benefits have been paid. More information will be
provided on these changes in coming weeks on our Changes page.
Cessation of
weekly benefits after 260 weeks.
Weekly benefits will cease after 260 weeks (whether or not consecutive) unless
worker has been assessed at greater than 20% whole person impairment.
Changes to payment of medical benefits
The key changes to medical benefits as of 1 October 2012 are:
A time
limitation on payment of medical and related treatment expenses.
Medical payments will cease 12 months after the last payment of weekly
compensation.
Requirement
for prior approval of treatment by the insurer (with some exceptions).
Reference: hcamag
website 2013
WORK CAPACITY ASSESSMENTS
Another aspect of the new act is the introduction of Work Capacity Assessments (WCAx) for all workers compensation
claimants. While the initial focus
will be on new claimants, it is anticipated that within 2 years all
injured workers whose injury occurred before and after
the 2012 act was passed will be have undertaken a Work Capacity Assessment.
Work
Capacity Assessments as defined in S44A of the new legislation, are not a
single event or test, but a continual process of assessment, reassessment and
information gathering throughout the life of a claim. The WCAx will take into
account medical evidence, vocational retraining and other material specified in
WorkCover Guidelines. The WCAx will be used to customise the return to work
(RTW) plan and ensure workers who have a capacity to work can be matched to
suitable employment.
Reference: yourhrmanager website 2013
Work
capacity decisions (S43) may relate to:
- Current work capacity
- What constitutes suitable
employment;
- The amount a worker can earn
in suitable employment
- The amount of a worker’s
pre injury average weekly earnings or current weekly earnings
- Whether a worker can
engage in suitable employment without increasing risk of re injury or
- Any decision affecting a
worker’s entitlement to weekly benefits.
The Workers
Compensation Commission has no jurisdiction to determine a dispute about a work
capacity decision.
A worker may
refer a work capacity decision for review according to the following hierarchy:
- An internal review by the
insurer
- A merit review by
WorkCover
- A process review by the
WorkCover Independent Review Officer (WIRO)
- A Supreme Court – Judicial
review.
Any disputes
related to liability for weekly benefits or medical disputes are NOT work
capacity decisions and will still be heard in the WCC. More information is available (see the topics displayed)
THE WORKCOVER INDEPENDENT REVIEW OFFICER (WIRO)
Functions
associated with the WIRO office commenced from 1 October 2012. Kim Garling, who
reports to the Minister and parliament, has been appointed to head the WIRO
office.
The WIRO has
five main functions:
- To consider complaints
about insurers
- To conduct procedural
reviews of disputed work capacity decisions
- To resolve disputes
between employers and insurers
- To review matters in the
scheme of concern / interest
- To implement a new free legal service for workers (ILARS)
Reference:
QBE website 2013
