ARTYUR ROBll,lSQN ~ HEDDERWlCKS UBfW~Y Accident Compensation (Common Law and Benefits) Bill As Sent Print EXPLANATORY MEMORANDUM Clause 1 Clause 2 Clause 3 Clause 4 sets out the purpose of the Bill. provides for commencement provisions. amends the definition of "medical question" in section 5 of the Accident Compensation Act 1985 so as to enable medical questions to be either prescribed or determined by the Court for the purposes of applications for leave to commence proceedings for the recovery of damages under the provisions to be inserted in that Act by clause 18. amends section 5A of the Accident Compensation Act 1985 to require that regular overtime and shift allowances be included in a worker's pre-injury average weekly earnings for the purposes of calculating the worker's weekly payments in respect of the frrst 26 weeks after an injury in respect of which a weekly payment has been paid or is payable. However, these amounts will only be included if, during the relevant period prior to the injury, the worker had worked overtime or shift work respectively in accordance with a regular and established pattern which, in the case of overtime, was substantially uniform in the number of hours of overtime worked and if the worker would have continued to work overtime or shift work in accordance with that pattern if not for the incapacity resulting from or materially contributed to by the relevant injury. The amendments made by this clause apply in respect of a claim for weekly payments given, served or lodged on or after the date of commencement of this clause. 541081 1 BILL LA AS SENT 121512000
Clause 5 amends section 45 of the Accident Compensation Act 1985. Sub-clauses (1) and (3) make amendments which make it clear, if a party to proceedings requests a court under section 45(1)(b) to refer a medical question or medical questions to a Medical Panel for an opinion, that the court may refuse to refer the question if it is of the opinion that the referral would, in all the circumstances, constitute an abuse of process and that the court has the discretion as to the form in which the medical question is to be referred. Sub-clause (2) inserts a new sub-section (la) into section 45 which extends the operation and application of section 45 so as to enable or require (as the case may be) certain medical questions to be referred for the opinion of a Medical Panel by a court hearing an application for leave to commence proceedings for the recovery of damages under the provisions to be inserted in the Act by clause 18. If the court exercises its discretion under section 45(1)(a) (as so extended), it may refer any medical question within the definition of that term (as amended by clause 3). If a party to the application requests the court to refer a medical question under section 45(1)(b) (as so extended), the party is limited to medical questions as currently defined and any medical questions which are prescribed for the purposes of these applications. Clause 6 Clause 7 inserts a new sub-section (3) into section 48 of the Accident Compensation Act 1985 which has the effect of enabling a consultant engaged to provide expert advice to a Medical Panel to give evidence as to matters relating to that advice but preventing the consultant from being compelled to give such evidence. inserts new section 55A into the Accident Compensation Act 1985 which enables the Victorian WorkCover Authority or a self-insurer, with the consent of the worker and in the absence of a dispute, to apply to the Senior Conciliation Officer for the referral by a Conciliation Officer of a medical question relevant to a claim for compensation by the worker for an opinion of a Medical Panel. The provision requires that the Conciliation Officer must refer the medical question to a Medical Panel if, after considering the application, the Conciliation Officer is satisfied that the medical question is in an appropriate form, the 2
worker has given informed and genuine consent, the medical question is relevant and would assist in the consideration and management of the worker's claim and the Authority or selfinsurer, and the worker, have provided all the relevant documents and information. The provision also requires the Authority or self-insurer to bear all the costs reasonably incurred by the worker in relation to an application. Clause 8 Clause 9 makes an amendment to section 58(3) of the Accident Compensation Act 1985 consequential upon the amendment made by clause 7. amends section 63 of the Accident Compensation Act 1985 so as to provide for the appointment of a Deputy Convenor of the Medical Panels in addition to a Convenor. Clause 10 inserts a new sub-section (6A) into section 63 of the Accident Compensation Act 1985 which provides legal protection to a consultant engaged to provide expert advice to a Medical Panel in respect of matters or things done or omitted by the consultant in good faith in the provision of such advice. Clause 11 inserts new sub-section (6A) and (6B) into section 65 of the Accident Compensation Act 1985. New sub-section (6A) requires a person or body referring a medical question to a Medical Panel to submit to the Medical Panel, in a document, specified information relevant to the medical question. New sub-section (6B) requires a person or body referring a medical question to a Medical Panel to submit to the Medical Panel copies of all documents relating to the medical question in the possession of that person or body. The clause also consequentially repeals existing section 67( 4A) of the Accident Compensation Act 1985 which is rendered redundant by new section 65(6B). Clause 12 substitutes a new section 65(8) of the Accident Compensation Act 1985 which makes it clear that any guidelines as to the procedures of the Medical Panels issued by the Minister under that provision are for the purposes of ensuring procedural fairness in those procedures and facilitating the proper administration of the Medical Panels. 3
Clause 13 makes a number of amendments to section 91 of the Accident Compensation Act 1985 which relates to the assessment of impairment for certain purposes under the Act. Sub-clauses (1),(2),(4) and (5) amend the section so as to permit the AMA Guides, as defined in the section, to be modified by regulation. While the section currently provides for the methods of assessing impairment to be prescribed by regulation, these regulations would have to completely replace the AMA Guides. The amendment will permit more limited modifications to be made. Sub-clause (3) inserts a new sub-section (7A) into section 91 consequential upon later amendments which require that assessments of a worker's degree of impairment for the purposes of determining both any entitlement of the worker to compensation under section 98C and whether or not the worker is deemed to have a serious injury within the meaning of the new common law provisions are to be made together as part of the one process. Clause 14 inserts a new sub-section (8A) into section 92A of the Accident Compensation Act 1985 which corrects an unintended anomaly in the provisions which introduced the new death benefits under the Act as from 12 November 1997. The new provision ensures that, in all circumstances, the dependent children of a deceased worker will be entitled to a share in the lump sum compensation available as well as a weekly pension. Because the amendment corrects an unintended anomaly, it has been made retrospective to 12 November 1997. Clause 15 amends section 98C of the Accident Compensation Act 1985 so as to increase the compensation paid to workers with lower levels of physical impairment under Section 93C of the Act. The minimum whole person impairment eligible for a payment under this section remains at 10%. However the amount paid for a 10% whole person physical impairment is doubled from the current rate of $5040 to $10 300. 4
As the sections applying to these and other figures in Section 98C are expected to be proclaimed after 30 June 2000, all amounts have also been indexed by 2 2% to facilitate the annual indexation of these amounts in accordance with Section 100 of the Accident Compensation Act 1985. The increase in compensation for each percent of whole person physical impairment between 10% and 30% remains as currently defined but is indexed. From 30% to 70% the increase in compensation for each percent of whole person physical impairment is reduced to ensure that the amount of compensation paid at 70% whole person impairment remains unchanged except for the impact of indexation. Under this new table the compensation paid for each level of impairment will be the same or greater than the amount currently available. The other amounts in this section of the Act have been amended to ensure they are indexed by the same rate as the rate applied to section 98C (2) Clause 16 amends section l04b of the Accident Compensation Act 1985 so as to give effect to the intention that the assessments of a worker's degree of impairment for the purposes of determining both any entitlement of the worker to compensation under section 98C and whether or not the worker is deemed to have a serious injury within the meaning of the new common law provisions must be made together as part of the one process. Sub-clause (l) inserts new sub-sections (la), (lb) and (lc) which- require that, except for claims for industrial deafness, claims for compensation under section 98C or 98E must be made no earlier than 12 months after the date of the relevant injury; provide the Victorian WorkCover Authority or a selfinsurer with a discretion to receive such a claim within the 12 months period if the relevant injury has stabilised; 5
if liability has been accepted or determined in respect of a prior claim for compensation for an injury, enable the Authority or a self-insurer, after the 12 months period has elapsed, to initiate the impairment assessment process by requesting the worker to attend an independent examination under sub-section (4). Sub-clause (2) inserts a new paragraph (a) into sub-section (5) which provides that the purpose of the independent examination under sub-section (4) includes obtaining assessments of the degree of impairment of a worker for the purposes of determining both any entitlement of the worker to compensation under section 98C and whether or not the worker is deemed to have a serious injury within the meaning of the new common law provisions. Sub-clause (3) inserts new sub-sections (SA) to (SF). These subsections establish the following rules governing the making of assessments of a worker's degree of impairment under the section- an assessment can only be made in respect of one injury of a worker unless the worker has more than one injury arising out of the same event or circumstance, in which case, all of those injuries must be included in the one assessment; if th~ assessment process has been initiated by the Authority or a self-insurer, the Authority or self-insurer must give the worker a written statement of the injury or injuries to be included in the assessments; the worker then has 60 days either to make a new claim for compensation under section 98C or 98E in respect of any additional injuries that the worker believes have arisen out of the same event or circumstance or to dispute the statement; if the worker does not make a new claim or dispute the statement of injuries within the 60 days period, the injury or injuries specified in the statement are deemed to be the only injury or injuries arising from the same event or circumstance which are to be included in the assessments; 6
if the worker had not reached the age of 18 years at the time of the injury, the assessments of impairment resulting from the injury can not be made until the worker attains the age of 18 years. Sub-clause (4) makes a number of amendments to section I04B which are necessary to provide for the process under the section to encompass assessments for the purposes of both section 98C and the new common law provisions. If, after the independent examination under sub-section (4), the worker disputes either of the assessments, the consequent reference to a Medical Panel will encompass both assessments as well as the question whether the worker has an injury which is a total loss under section 98E. Sub-clause (5) inserts new sub-sections (14), (15) and (16) which contain transitional provisions. Clause 17 makes a number of amendments to section 104B of the Accident Compensation Act 1985 the overall effect of which is to require a worker, who has been advised under the section that he or she has an entitlement to compensation under section 98C or section 98E, to advise the Victorian WorkCover Authority or the self-insurer (whichever is applicable) whether or not the worker wishes to receive the compensation. Only if the worker advised that he or she wishes to receive the compensation is the Authority or self-insurer required to pay the compensation and, after the worker so advises, he or she may not recover damages for pain and suffering in respect of the relevant injury or injuries. If the worker does not so advise, he or she remains free to pursue whatever rights to recover damages for pain and suffering may be open. If such damages are awarded or a settlement is made in respect of such damages, the worker's entitlement to the compensation ceases. If, in the end, no such damages are awarded and no settlement is made in respect thereof, the worker may advise the Authority or self-insurer that he or she wishes to receive the compensation which will then be payable. Clause 18 inserts new sections 134AA, 134AB, 134AC, 134AD, 134AE and 134AF into the Accident Compensation Act 1985. These provisions have the effect of reintroducing the right of a worker who has a compensible injury which arose out or in the course of, or due to the nature of, employment on or after 20 October 7
1999 and which is a serious injury (as defined), to recover damages in respect of that injury. New sections 134AA and 134AB(1) and (2) establish the basis on which such damages may be recovered. If the injury or death is also an injury or death arising out of a transport accident within the meaning of the Transport Accident Act 1986, recovery of damages must be in accordance with the relevant provisions of that Act and certain of the provisions introduced by this Bill. In cases where the injury is deemed by reason of section 83(1) of the Accident Compensation Act 1985 to be work-related and where the worker has a fixed place of employment and the injury has occurred away from that fixed place of employment and where the employer is not a party to the proceedings, damages may be recovered in accordance with the laws applying generally. In all other cases, damages may only be recovered as permitted by and in accordance with the provisions introduced by this Bill. New section 134AB(3) to (6) provide that a worker may not bring proceedings in accordance with that section unless assessments of the degree of impairment of the worker have been made under section l04b and the worker has made an application under sub-section (4) and impose a number of requirements in relation to that application. New sub-sections (7) to (9) require the Authority or self-insurer to respond to an application under sub-section (4) within 120 days and impose a number of requirements and conditions in relation to that response. New sub-section (10) provides the worker with the opportunity to make a limited response in return. New sub-section (11) operates to make certain material required or permitted by the preceding provisions to have been forwarded with the worker's application and response and the Authority or self-insurer's response respectively inadmissible in evidence in proceedings in accordance with the new section if it had not been disclosed as required or permitted. New sub-sections (12) to (14) establish a pre-litigation compulsory conference and statutory offer and counter offer process. 8
New sub-section (15) provides that if the assessment of a worker's degree of impairment under section 104B is 30 per cent or more, the worker's injury is deemed to be a serious injury. New sub-sections (16) to (21) provides the basis on which and the processes in accordance with which a worker whose degree of impairment is less than 30 per cent may establish that he or she nevertheless has a serious injury in accordance with the new provisions. New sub-section (22) imposes monetary thresholds and caps which will govern the recovery of damages under the new provisions. New sub-section (23) requires that, in a trial of a proceeding brought under the new provisions, a jury must not be informed of the details specified in the sub-section. New sub-section (24) to (26) impose certain limitations and reductions in relation to the damages which may be recovered in accordance with the new provisions. New sub-sections (27) to (31) contain provisions relating to legal costs in respect of proceedings in accordance with the new provisions. New sub-sections (32)and (33) imposes a discount rate of 6% in relation to certain components of damages awarded in accordance with the new provisions. New sub-sections (34) and (35) contain provisions governing the awarding of interest in relation to damages awarded in accordance with the new provisions. New sub-section (36) provides that, if a worker recovers respectively damages for pecuniary loss or pain and suffering damages in accordance with the new provisions, no further compensation under the Accident Compensation Act 1985 of the equivalent type is then payable. New sub-section (37) contains definitions for the purposes of the new provisions. New sub-section (38) contains provisions which apply to the assessment of "serious injury" in accordance with new subsections (16) and (19). 9
New section 134AC has the effect of pennitting an appeal as of right to the Court of Appeal from a decision granting or refusing leave under new section 134AB(16)(b) in circumstances where such an appeal could otherwise only be made by leave of that court. New section 134AD imposes certain requirements on the Court of Appeal on the hearing of an appeal from a decision made on an application under new section 134AB(16)(b). New section 134AE requires a court deciding an application under new section 134AB(16)(b) to provide detailed reasons which are as extensive and complete as the court would give on the trial of the action. New section 134AF empowers the Minister to issue directions for or with respect to procedures under new section 134AB. Clause 19 inserts new section 134AG into the Accident Compensation Act 1985 which empowers the Governor in Council to, by Order in Council, make a legal costs order specifying the legal costs that may be recovered by a legal practitioner acting on behalf of a worker in respect of any claim, application or proceedings under new section 134AB and prescribing or specifying any matter or thing required to give effect to the legal costs order. Clause 20 makes amendments to the Accident Compensation Act 1985 consequential upon the amendments made by clause 18. Clause 21 limits the operation of section 134A(1) of the Accident Compensation Act 1985 consequential upon the amendments made by clause 18. Clause 22 substitutes a new section 135AC of the Accident Compensation Act 1985 which imposes less onerous time limits than those currently imposed applying to certain proceedings in accordance with sections 135 and 135A ofthe Act. Clause 23 amends section 135B(1) of the Accident Compensation Act 1985 to make it clear that proceedings in respect of an injury arising before 1 December 1992 to which section 135A(2)(b) would apply are not caught by the requirement contained in section 135B that certain proceedings must have been commenced before 30 June 1994. It also inserts provisions to 10
ensure that proceedings can still be brought that could not otherwise have been brought in the absence of this amendment. Clause 24 inserts a new section 135D into the Accident Compensation Act 1985 which provides for structured settlements to be ordered by a court with the consent of the parties. Clause 25 amends the Accident Compensation Act 1985 and the Transport Accident Act 1986 to provide the Victorian W orkcover Authority and, in certain circumstances, a selfinsurer, with a right of recovery from the Transport Accident Commission of the costs of compensation and damages under the Accident Compensation Act 1985 in respect of injuries or deaths arising out of a transport accident within the meaning of the Transport Accident Act 1986. The amendments also facilitate the appointment of the Transport Accident Commission as an authorised agent of the Victorian W orkcover Authority and as a claims agent of a self-insurer. Clause 26 inserts a new section 138B into the Accident Compensation Act 1985 which operates to prevent a court from making an order for the payment of compensation for pain and suffering under section 86 of the Sentencing Act 1991 if the pain and suffering arises from an injury or death in respect of which the person concerned has an entitlement to compensation (as specified in the new section) under the Accident Compensation Act 1985 and the relevant offence is only against the Dangerous Goods Act 1985, the Occupational Health and Safety Act 1985, the Equipment (Public Safety) Act 1994 or any regulations made under any of those Acts. Clause 27 amends the Accident Compensation (WorkCover Insurance) Act 1993 so as to make it clear that neither a W orkcover insurance policy nor a deemed contract of insurance under section 59B(1) of that Act operate to indemnify an employer in respect of any liability to pay compensation for pain and suffering awarded under section 86 of the Sentencing Act 1991. Clause 28 amends section 94 of the Transport Accident Act 1986 to make it clear that the Transport Accident Commission is not liable to indemnify any person in respect of any liability to pay compensation for pain and suffering awarded under section 86 of the Sentencing Act 1991. 11
Clause 29 inserts a new section 107 A into the Transport Accident Act 1986 which operates to prevent a court from making an order for the payment of compensation for pain and suffering under section 86 of the Sentencing Act 1991 if the pain and suffering arises from an injury or death in respect of which the person concerned has an entitlement to compensation (as specified in the new section) under the Transport Accident Act 1986 and the relevant offence is only against the Road Safety Act 1986 or any regulations made under that Act. Clause 30 makes amendments to the Dangerous Goods Act 1985 in relation to the regulation of the manufacture, supply, sale, transfer, transport, storage, handling, use or disposal of explosives in mining operations and quarrying operations. Mining operations are described as "activities carried out under the Mineral Resources Development Act 1990", while quarrying operations are described as "activities carried out under the Extractive Industries Development Act 1995". Sub-clause (1) repeals paragraph (b) from section 9, which has the effect of ensuring the application of the Dangerous Goods Act 1985, and Regulations made under it, in relation to explosives in mines and quarries. Sub-clause (2) inserts into section 11 a new sub-section (la), which provides that the Victorian WorkCover Authority may appoint employees of the Department of Natural Resources and Environment as inspectors under the Dangerous Goods Act 1985 with respect to mining operations and quarrying operations. Sub-clause (3) makes a consequential and clarifying amendment to section 14. Sub-clause (4) inserts new sub-sections (2A) and (2B) into section 14. These new provisions enable WorkCover to delegate certain of its powers, functions, authorities and discretions to the chief mining inspector under the Mineral Resources Development Act 1990 and the Chief Inspector of Quarries under the Extractive Industries Development Act 1995. The matters that may be delegated relate to the manufacture, supply, sale, transfer, transport, storage, handling, use or disposal of explosives in mining operations and quarrying operations. 12
Clause 31 makes an amendment to the Extractive Industries Development Act 1995 consequential upon the amendments made by clause 30. This amendment will prevent the making of Regulations under that Act that might be inconsistent with Regulations made under the Dangerous Goods Act 1985 in relation to explosives. Clause 32 inserts a new section 252D into the Accident Compensation Act 1985 in order to comply with the requirements of the Constitution Act 1975. Clause 33 inserts a new section 132B into the Transport Accident Act 1986 in order to comply with the requirements of the Constitution Act 1975. 13