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Worker's Compensation Thresholds

In 2012 the O’Farrell State Government made changes to the Workers Compensation Act and Workplace Injury Management and Workers Compensation Act which severely curtailed injured workers rights. These changes were made with little warning and hardly any consultation with the Law Society and the NSW Bar Association.

Due to regressive restrictions on ‘advertising’ lawyers had until the 1st of July 2015 been restricted on commenting on these changes even on their own websites. It was until recently an offence to even mention that a lawyer practised in the area on workers compensation law. Due to recent changes in legislation we can now provide commentary on the workers compensation scheme.

There were two significant changes to lump sum compensation for the effect of injuries suffered in the workplace. The first was to abolish compensation for pain and suffering. Previously injured people were entitled to receive up to $50,000 for pain and suffering if they had injuries equal to at least a 10% Whole Person Impairment. The amount they were entitled to depended on how they compared to a most extreme case. If their injuries were found to be 10% of a most extreme case they received $5,000 being 10% of the maximum amount available. In most cases the sums awarded were not significant but given the relatively low amounts available for whole person impairment compensation compared to the often very significant impact on people’s lives any amount was welcome. Pain and suffering compensation was abolished on the basis that claims for these amounts sometimes had to be resolved by an arbitrator and this increased the cost to the scheme. It was also argued the method of determining the appropriate amount was too arbitrary and subjective. In the discussion paper put out prior to the changes taking effect it was suggested that the amounts of compensation available for whole person impairment be increased to compensate for the abolishment of pain and suffering compensation under section 67 of the 1987 Act. This did not occur. They simply abolished section 67.

Another significant change to lump sum compensation was to bring in an impairment threshold of 10% to receive compensation for whole person impairment. An injured worker must now have injuries of at least 11% to receive any compensation. This threshold knocks out many common claims for significant back injuries and knee injuries. To receive compensation for a back injury now you essentially need to have undergone surgery or to have suffered fractures at multiple levels. A bulging disc by itself is unlikely to get you over the threshold even though it can be very debilitating and stop you working, particularly in manual labouring occupations such as building and bricklaying.

An 11% whole person impairment assessment equates to $15,400. The 10% threshold is the same threshold that applies in Motor Vehicle Accident Claims but an 11% whole person impairment assessment under motor vehicle accident legislation would equate to significantly more compensation.

The combined effect of these changes is that vast numbers on injured workers no longer qualify for lump sum compensation.

The workers compensation scheme operates as a ‘no fault’ scheme meaning that it doesn’t matter how you are hurt at work you were entitled to some coverage for your injures. The trade-off was that the amounts of compensation available were low. With the 2012 changes even if you are injured as a result of negligence on the part of your employer you are not entitled to seek any lump sum compensation unless you have at least an 11% whole person impairment. We feel that this goes against the spirit of what was intended when workers compensation laws were put in place.

The State Government has recently indicated that it is considering some changes to the scheme which includes increasing the amount available for whole person impairment and relaxing the restrictions for future medical treatment. A bill has been tabled and is currently before Parliament.

If you have suffered an injury at work and need advice on whether you may be entitled to lump sum compensation please do not hesitate to contact us. Ben Carroll has been approved by the WorkCover Independent Review Office to provide advice under the Independent Legal Advice Review Service (ILARS). Ben can review your circumstances with you and if it is likely that your injures will exceed 11% he can seek a grant of funding from WIRO to investigate your entitlements. This grant incudes money to get supporting medical reports.

For help or advice in this regard please contact Ben Carroll on 1300 277 000.

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