Australia: NSW workers compensation scheme failing, review finds

A review of the controversial changes to the NSW workers compensation scheme has found it is "dysfunctional", confusing, riddled with delays and unfair.

In the past I have been very critical of changes made in 2012 by the NSW government under the Workers Compensation Legislation Amendment Act 2012 to the workers compensation scheme that is meant to assist people who are injured at work.

Poor treatment of injured workers by insurers

There were some improvements in government adjustments to the scheme in 2015 after Stacks and others campaigned against the harshness and unfairness of the 2012 changes. But injured workers still suffer an unfair burden and are often treated atrociously by insurers.

Now the NSW Parliament's Standing Committee on Law and Justice has released a review, First review of the workers compensation scheme, that found the administrative process for injured workers to seek assistance was "impenetrable" and generated more problems than it solves.

Workers Compensation Insurance Fund almost $2 billion in surplus

The parliamentary committee found that, despite the scheme being meant to help injured workers, it was now $1.87 billion in surplus.

Claims for compensation by injured workers have fallen dramatically, from 110,000 in 2011-12, to just over 60,000 in 2015-16.

The Workers Compensation Insurance Fund now has total assets of around $17.5 billion. The fund's assets are 23 per cent more than its liabilities.

Six thousand workers to lose benefits after Christmas

The fund is likely to pocket even more money from 27 December, when an estimated 6,000 injured workers are due to be cut off from their weekly benefits. This is the date on which workers injured before the 2012 changes are deemed to have received the allotted maximum of five years of weekly benefits.

Only a small percentage of workers, those with extremely severe or catastrophic injuries, will be immune from these unfair changes.

Scheme helps insurance firms, not injured workers

That might suit insurance companies, but it means that thousands of injured workers are being denied proper compensation and assistance.

These billions of dollars should go towards assisting injured workers, restoring the assistance that was removed in the 2012 changes.

The committee found that the government was slow to introduce a process where registered lawyers could represent injured workers in a dispute at no cost to the worker.

Obstacles to receiving adequate compensation for workplace injuries

The insurer holds all the cards. The insurer's agent is the case officer for the injured worker. The insurer picks the doctor the injured worker sees to assess their level of incapacity. If challenged, the insurer reviews its own decision. The entire scheme is geared to making it as difficult as possible for an injured worker to get adequate compensation.

I support the committee's recommendation for an independent judicial "one stop shop" for workers compensation disputes, provided workers have properly trained and experienced legal representation, and have the right to appeal to a superior court.

However, the committee's recommendations don't go far enough to restore what was taken away from the rights of injured workers more than four years ago.

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