NSW Workers Compensation System

Transcription

1 NSW Workers Compensation System In June 2012, the NSW Liberal Government implemented a series of drastic cuts to the workers compensation system. NSW Labor has committed to repealing these cuts. Unions NSW WHS & WC Committee has considered what system of workers compensation works best. We have consulted with our affiliated unions and have developed 12 Guiding Principles for reform as well as a very detailed set of policy positions to guide NSW Labor when it repeals the current system. 12 Guiding Principles 1. Workers compensation should be available on a no-fault basis where an injury arises out of or in the course of employment, even where it is the aggravation of an existing injury or disease. 2. Premiums must recover the costs of the system as well as encourage safe work practices. 3. WorkCover must be properly resourced to carry out its functions properly including an increased emphasis on prevention and compliance. 4. Meaningful tripartite consultation must be a central part of the system. 5. The system of scheme agents and self-insurers should be abolished and all workers compensation functions should be internalised within WorkCover. 6. Trade unions must have the power to enforce non-compliance with workers compensation law together with rights of entry, inspection and other investigative powers. 7. The Workers Compensation Commission should provide a quick, easy, effective and legally binding mechanism to resolve disputes about all aspects of the workers compensation system. 8. Return to work should be elevated as a central tenant of workers compensation by: 8.1. placing an absolute obligation on employers to provide suitable duties; 8.2. preventing termination unless the injury management plan states that the return to work goal is a different job and a different employer; and 8.3. incentivising the employment of injured workers. 9. Journey claims and recess claims should be covered by the system. 10. Weekly payments should be set at a level equivalent to an injured worker s pre-injury average weekly earnings irrespective of their fitness for work and should not be subject to any caps or step-downs. 11. Costs associated with medical and all related treatment should be covered for workers compensation purposes with no arbitrary caps or limits. 12. Work Capacity Reviews and Decisions should be removed from the workers compensation legislation. Consideration of a worker s functionality is properly addressed as part of their rehabilitation plan.

2 2 Workers Compensation Principles Detailed principles 1. Eligibility 1.1. Workers compensation should be available on a no-fault basis where an injury arises out of or in the course of employment Compensation should be available where an injury results in the aggravation, acceleration, exacerbation, deterioration or recurrence of any pre-existing injury or disease There should be no eligibility tests requiring a significant or substantial connection to employment. The test in 1.1 above is sufficient Provisions used to determine the eligibility of stress claims should be reviewed to create definite parameters of what equals reasonable managerial action Strokes or heart attacks should be treated in the same way as all other conditions which workers may suffer. 2. Scheme Funding 2.1. Premiums should not be set with a claims experience rating systems as a basis for assessments. Ideally, assessments on payroll would be set high enough to cover all worker compensation scheme costs, based on a minimum figure State wide. Workers compensation should be funded through a combination of: premiums paid by employers being a percentage of wages or corresponding payments equivalent to meet the schemes costs arising from injuries occurring within the State, the cost of the regulator and associated costs (e.g. Workers Compensation Commission) adjusted per industry based on risk profiling; and a fee for bad employers based on one or both of the following: The Canadian system of demerits (additional levies) would be made on employers who score lower on health and safety prevention audits, conducted by certified third parties in consultation with the unions and employers; The British system of charging employers per visit. 3. Tripartite Consultative Mechanism 3.1. In line with the State s obligations under the intergovernmental agreement relating to the Work Health and Safety laws, NSW should establish a tripartite consultative body broadly in line with the original provision of the WIMWCA 1998 or schedule 2 of the South Australian WHS Bill Role of the Regulator 4.1. The Regulator should be constituted under the Act The Regulator should operate under a Board appointed by the Minister reflective of the social partners The Board should report and make recommendations to the Minister on such matters as the Minister requests or it considers appropriate The Regulator must be sufficiently resourced to enable it to properly carry out its functions. The level of resourcing of the Regulator should be subject to independent verification The functions of the Regulator should include: Enforcement of compliance with WHS and workers compensation laws Being responsible for the day to day operational matters relating to legislation which

3 the Regulator is called to manage Consultation with all workplace parties, including unions Providing information, support and advice to all workplace parties, including unions Supporting and protecting workplace representatives Bringing prosecutions in a timely, appropriate and courageous manner Monitoring and reporting to the Minister, Board and the Tripartite Consultative Mechanism the effectiveness of the WHS and workers compensation legislation Actively monitoring self-insuring companies and ensuring transparency and fairness of their workers compensation and return to work systems A workers compensation inspectorate that is adequately resourced, pro-active and instructed to fulfil an enforcement role as well as an advisory role Such other functions as conferred or imposed on it by WHS, workers compensation or any other legislation. 5. Role of the Insurer 5.1. The State should internalise all claims management of workers compensation within the nominal insurer (WorkCover). Until such a process is carried out the following would apply to scheme agents: The mechanism by which they are remunerated must be tabled at the Tripartite Consultation Mechanism for scrutiny That WorkCover provide the Tripartite Consultation Mechanism with an annual compliance report, reported against key performance indicators, in relation to the scheme agents contracts (should they be retained) That WorkCover conduct an audit on every scheme agent prior to the expiry of their contracts and provide the Tripartite Consultation Mechanism with the result of such audits prior to renewing any contract Prior to commencing in the role of a claims manager, or in any other role with responsibility for the management or oversight of workers compensation claims, (whether for a scheme agent or insurer or WorkCover), a mandatory training course be completed delivered by WorkCover. Such a course should provide a practical understanding of the role and associated legislation. The course should also contain topics geared towards improving communication and general people skills Self-Insurance creates a conflict of purpose between the objectives of workers compensation and the desire of the employer to make profit. Accordingly self-insured employers should be wound back and subject to strict audits resulting in removal of a license where non-compliance is identified. Until such a process is carried out the following would apply to self-insurers: That WorkCover conduct an audit on every self-insurer prior to the expiry of their license and provide the Tripartite Consultation Mechanism with the result of such audits prior to the issuing of licenses. The audit would assess both viability and case management performance. 6. Role of the Inspectorate 6.1. The inspectorate s role should be as follows: to promote healthy and safe work; to issue notices where there has been (or is likely to be) a non-compliance with the 3 Workers Compensation Principles

4 Act; to enquire if there is a union in the workplace and if so, consult with the union; include Return to Work Inspectors who would be empowered to enter a workplace and satisfy themselves that employers are complying with their return to work obligations under the legislation. 7. Role of Trade Unions 7.1. An Official of a registered union with rules of coverage of workers working at the workplace should be permitted to enter the workplace for the purposes of investigating a suspected contravention of the workers compensation laws In the course of such an investigation the Official should have the right to inspect any place or document which the Official may deem relevant to the suspected contravention including return to work policies and procedures, location of suitable duties, safe working procedures and risk assessments, return to work plans, workers compensation policies and/or certificates of currency and injury registers In the course of such an investigation the Official should have the right to take copies of any documents the Official may deem relevant to the suspected contravention In the course of such an investigation the Official should have the right to consult any worker and the employer or its delegates including the return to work coordinator where one is in place. Following the course of such an investigation should the Official conclude there is, has been, or is likely to be in the future, a contravention of the workers compensation legislation the Official should have the right to issue a notice to the employer compelling the employer to take action to remedy the non-compliance. Should such a notice not be complied with then a penalty should be applied Any worker should have the right to have their union represent them with regards to any workers compensation matter and should such a request be made the employer/insurer should be compelled to facilitate such a request The New South Wales provisions governing coverage for workplace based representatives (section 12 WCA 1987) should be included as part of any workers compensation legislation. 8. Return to Work/Suitable Duties 8.1. The employer should have a Return to Work Program, which means the policies and procedures they have for managing workplace injuries and return to work An employer s Return to Work Program should be agreed with their workers and their representatives (including a union where one is present) There should be substantial penalties for employers who don t have a Return to Work Program or fail to abide by an agreed Program The hierarchy of return to work should be enshrined in the Act and legally enforceable There should be a requirement for all injury management plans to be reviewed by relevant parties every 12 weeks built into the contracts with the insurer and licensees of specialised and self-insurers There should be an absolute obligation on an employer to provide suitable duties There should be a prohibition on terminating an injured worker as a result of an injury unless the injury management plan states that the return to work goal is a different job and a different employer. Further, the termination of an injured worker should only occur only after alternative employment is secured unless this would be contrary to medical advice A host employer should equally assume the obligation to provide suitable duties to a worker 4 Workers Compensation Principles

5 who was injured There should be a prohibition on anyone interfering with a medical appointment of a worker, including by seeking to attend with the worker. Should a party, other than the worker concerned, require a face to face meeting with a medical practitioner this is to be arranged via a case conference with appropriate written notice Case conferences are to be conducted every 26 weeks unless to do so would serve little or no purpose based on the current medical information. Written notice must be provided at least 14 days prior to the case conference. An injured worker has the right to have a representative present during the case conference There should be incentives for employers who hire workers with existing workplace injuries or illnesses such as premium discounts and procurement advantages. 9. Weekly Payments 9.1. In accordance with the no more but no less principle, weekly payments should be set at a level equivalent to an injured worker s pre-injury average weekly earnings irrespective of their fitness for work In the event that a worker is injured within 3 months of the commencement of their employment, the worker has the right to request that the insurer take into account the earnings of another employee doing the same or substantially the same work as the injured worker for the same employer Where a worker has been underpaid by their employer, the injured worker has the right to request a review of the pre-injury average weekly earnings with reference to the applicable industrial instrument If as a result of an injury a worker is forced into lower paying employment they should receive make-up pay to increase their income to their pre-injury earnings There should be a simplified definition of pre-injury earnings to reflect the former s.40 of the 1987 Act Existing caps on the amount of weekly earnings should be abolished. Weekly payments should be paid in a timely manner consistent with pre-injury arrangements for the payment of a worker s wages or salary Step down provisions are rejected as cost shifting mechanisms that impose economic hardship on injured workers, especially those with serious and ongoing issues The Act should allow all forms of leave (including annual, sick, long service etc.) to be accrued and taken while on workers compensation The increased emphasis on return to work will ensure the no more but no less principle will not result in increased costs under the Scheme Given superannuation is included for premium setting purposes, superannuation payments should be paid on compensation payments for injured workers, whether in continuing employment or not Indexation arrangements for weekly payments, as well as those associated with noneconomic loss, work related fatalities and reasonable funeral expenses, should be made on a half yearly basis. 10. Medical and Related Costs Costs associated with medical and all related treatment should be covered for workers compensation purposes There should be no arbitrary limits placed on compensation for medical and related expenses reasonably incurred by injured workers and workers whose medical and related expenses 5 Workers Compensation Principles

6 have been terminated should have them reinstated Workers should not be liable for medical and related costs, including for charges above those contained in fee schedules, or other regulatory instruments Where fee schedules for medical and related expenses are proposed this should be undertaken in consultation with representatives of trade unions and employer organisations. 11. Work Capacity Reviews Work Capacity Reviews are profoundly inequitable and consequently their inclusion in any workers compensation legislation should be rejected Consideration of a worker s functionality is properly addressed as part of their rehabilitation plan. 12. Journey and Recess Injuries Journey and recess injuries should be covered by the scheme and should cover trips to and from work and be based on the former sections of the New South Wales legislation (ss10 & 11 WCA 1987). 13. Compensation Payments for Work-related Death The maximum lump sum payment for the death of a worker should be equal to ten times NSW s average weekly full-time earnings (set twice yearly) The definition of dependent should be broadly and inclusively defined as a person who at the time of the death of a worker was wholly, mainly or partly dependent on the earnings of the worker : supplemented by a, non-exhaustive, list of different types of dependents Where a worker is in receipt of weekly payments but later dies as a result of the injury, weekly payments should not be deducted from the lump sum payment for death Where a worker has received a permanent impairment payment but later dies as a result of the injury, this payment should not be deducted from the lump sum payment for death Any earnings derived by a spouse of a deceased worker should not be taken into account for the purpose of determining whether the spouse is to be treated as a dependent The lump sum payment should be paid into the worker s estate where there are no dependents The total amount of weekly payments for dependents should be equivalent to the deceased worker s pre-injury earnings All reasonable funeral expenses should be covered, subject to an upper limit determined in consultation with the Tripartite Consultation Mechanism All reasonable expenses for counselling services should be covered, subject to an upper limit determined in consultation with the Tripartite Consultation Mechanism Immediate family members of the deceased worker should be eligible for payments for nervous shock. 14. Lump Sum Payments for Permanent Impairment Eligibility thresholds for lump sum payments should be abolished. Eligibility would be on the basis of a medical report supporting a permanent impairment exists There should not be an artificial barrier put in place which would restrict injured workers from making more than one claim for whole person impairment should they suffer an aggravation or deterioration of an injury Lump sum payments should be available for permanent impairment, pain and suffering, gratuitous care and for terminal conditions associated with latent onset injuries. 6 Workers Compensation Principles

7 14.4. Calculation of Whole Person Impairment (WPI) for the purpose of determining lump sum payments should include pain and suffering, gratuitous care, terminal conditions and other relevant matters The lump sum payment should be paid as a percentage of the death benefit based on the equivalent percentage of WPI. 15. Common Law In view of the longstanding principle that Australian citizens should be able to pursue damages for harm caused by the negligence of others, and the unsatisfactory access to statutory payments under existing workers compensation arrangements, there is a clear need to consider an expanded role for common law damages in relation to work related injury consistent with the following principles: Employer negligence; Alternative dispute resolution in the first instance; Costs paid by the Insurer as per the schedule; and Access to common law where permanent impairment of 10% and above is reached, which will ensure injured workers have appropriate access to justice and employers have motivation to not act negligently. 16. Age Limits on Workers Compensation payments In order of preference, the following options are proposed for addressing the age limit for weekly benefits: The removal of all age limits for weekly payments A 2 year plus provision where an injury occurs post retirement age A Tribunal based mechanism to consider on a case by case basis extending weekly payments beyond the normal retirement age Medicals should be paid till death of the worker. 17. Industrial Disease Industrial disease schedules should be updated and modernised and should incorporate, as a minimum, scheduled diseases that have been adopted by the International Labour Organisation and findings by the World Health Organisation s International Agency for Research on Cancer An independent commission comprised of scientific, government, trade union and employer representatives should be established to enable industrial disease schedules to be revised on an annual basis. (See for example Ontario s former industrial disease panel.) 18. Penalties Penalties should be commensurate with the degree of the breach, including recognition of gross negligence Penalties should be sufficient to act as a deterrent A range of penalties, including but not limited to infringement notices, fines, imprisonment, enforceable undertakings, and adverse publicity orders should be provided to allow for a range of penalties for breaches of health and safety and compensation laws to be actively applied Where a breach has caused further harm to the injured worker, a percentage of the penalty will be apportioned to the injured worker. 7 Workers Compensation Principles

8 19. Dispute Mechanism Justice delayed is justice denied The Workers Compensation Commission (WCC) should be retained Appeals should go to the judicial members There should be the ability to get matters heard on an expedited basis (in 2-4 days) in relation to medicals, injury management, disputes (such as those about return to work/suitable duties and including termination contrary to the provisions of the Act), and changes to weekly benefits (where significant hardship) The WCC should be empowered to issue orders where matters are arbitrated in relation to return to work particularly where there s the threat of termination The work of the WCC should be guided by KPI s that set timelines for matters being heard (2 weeks for first conference etc.) The Act should include a mandatory dispute resolution mechanism for injury management disputes (return to work) to be followed prior to notifying the WCC, with penalties applying for employer s who breach the provision. 20. Notification of Injuries An employer should be required to provide notice to the insurer as soon as possible, but no later than 48 hours, of becoming aware of a potential compensable injury/illness In order to motivate employers to comply with this requirement, where notice is not provided to the insurer within this timeframe, the indemnity provided under the insurance policy should be void till such time as notice is provided. During this time the employer should be liable to directly meet any associated cost incurred. The employer should also be subjected to penalties for failure to notify the injury/illness. Notwithstanding this, the claim should be considered to have commenced on the date of injury. 21. Provisional Liability Workers should receive payments under the workers compensation system until the Insurer has made a definite decision against liability. There should be penalties against any insurer for non-compliance Provisional payments should commence within 7 days of the insurer being notified Provisional payments should cover weekly benefits and medical and associated costs. 22. Redemptions The use of redemptions as a scheme management tool should be limited so as not to undermine the objective of returning injured workers to safe and meaningful employment wherever this is reasonably practicable Where redemptions are used they should be determined on an actuarially fair basis so as not to disadvantage injured workers. 23. Scheme-related Doctors There should be a prohibition on employers directing, persuading or misinforming workers leading them to attend company preferred doctors Independent Medical Examinations should be strictly limited to situations where information is not available or forthcoming from an injured worker s treating practitioner The use of Injury Management Consultants should only be done with the consent of injured 8 Workers Compensation Principles

9 workers and in strict accordance with the Injury Management Consultant Guide 15th February There should be a prohibition so Doctors only provide information which is relevant to the workplace injury with severe penalties where this is breached. 24. Domestic Assistance and Ancillary Services Compensation for domestic care and ancillary services should be explicitly provided for in any workers compensation legislation Clarity and transparency is required in the definition of domestic care and ancillary services Entitlement to domestic care and ancillary services should be based on explicit criteria that address the needs of workers unable to undertake the basic activities of daily living following work-related injury Existing eligibility criteria should be reviewed to ensure that workers with genuine needs are not excluded from access to domestic care and ancillary services Domestic care and ancillary service expenses should be needs based and not subject to artificial limits. 25. Property Damage Compensation for property damage should be broadly defined, including provision for all reasonable expenses associated with damage to therapeutic appliances, personal effects, clothes and tools of trade Coverage should extend to recompense for fees and charges arising from medical and related consultations/costs concerning the repair or replacement of therapeutic appliances Compensation should also be available for any lost wages arising from such consultations Where prescribed limits to compensation for property damage exist, provision should be made for additional payments to be made where approved by dispute resolution tribunals. 26. Travel Expenses Compensation should be payable to an injured worker and any person who acts as their escort for any fares, travelling expenses and related accommodation and living expenses reasonably incurred as a result of obtaining treatment for medical and related services associated with their injury Where an injured worker uses his or her own motor vehicle to obtain treatment for medical and related services associated with their injury they should be fully, and promptly, reimbursed for the costs incurred. 9 Workers Compensation Principles