The often described "draconian" Amendments made to the
Workers Compensation Laws in 2012 prevented legal
practitioners from recovering costs for legal services in
connection with providing workers with legal advice with respect to
a Work Capacity Decision made by an insurer, and any subsequent
Application for Merit Review by the Merit Review Service of the
State Insurance Regulatory Authority.
This resulted in the unfair situation where insurers, as a
consequence of their extensive knowledge of the Workers
Compensation Scheme, could make complex work capacity decisions,
whilst a worker, with little to no knowledge of the now complex
scheme, was unable to properly review and consider such decisions
without some extensive legal expertise.
This imbalance was corrected somewhat by the provision of advice
to workers from the Workers Compensation Independent Review Office
(WIRO). WIRO Officers could provide good advice with respect to the
procedural operation of the work capacity decision review process,
although, due to the complexity of the matters that needed to be
taken into account, could not properly devote the time to providing
a comprehensive and individualised advice. As a result workers
could not receive the detailed individual advice necessary to
ensure that their Application for Merit Review had the best
prospects of success.
On 16 December 2016, the Minister for Innovation and Better
Regulation, Victor Dominello, MP, published on the NSW Legislation
Website, the Workers Compensation Amendment (Legal Costs)
Regulation 2016. The regulation provides that a legal
practitioner is entitled to be paid by, or recover costs from, an
insurer for providing advice to a worker in respect of an
application, or proposed application, for a merit review of a work
capacity decision. The regulation applies for work capacity
decisions made on, or after, 16 December 2016.
The practical effect of the regulation is that a worker is now
entitled to obtain detailed legal advice in respect of a merit
review of a work capacity decision, and obtain assistance in making
an application for merit review to the State Insurance Regulatory
The cost of such advice is to be borne by the insurer who makes
the work capacity decision, and the costs are regulated so a lawyer
cannot charge any additional fee to a worker for their work.
Workers who have received a work capacity decision from an
insurer should immediately seek legal advice in respect of the
decision as strict time limits apply to any review request.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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