ARTICLE
1 August 2012

Reform of the New South Wales Workers Compensation Scheme - Part 2

This article is Part 2 of a summary of changes introduced by new bills to reform the workers compensation scheme in NSW.
Australia Employment and HR

Reform of the New South Wales Workers Compensation Scheme - Part 1

SCHEDULE 8 – COMMUTATION

Insurers will now be able to commute workers compensation liabilities despite the claim not satisfying the current preconditions for commutation, if the Authority is satisfied.

Commencement

The amendments relating to commutations are not yet operative and await proclamation to commence.

Implication

The relaxation of the preconditions for commutation will likely provide the Authority with the flexibility to finalise more claims.

SCHEDULE 11 – MISCELLANEOUS AMENDMENTS

Section 74

The new s 74 requires insurers to provide a notice to the worker that includes a "concise and readily understandable statement of the reason the insurer disputes liability and of the issues relevant to the decision".

Legal costs and disbursements

The amendments repeal certain sections on costs in the current Workplace Injury Management and Workers Compensation Act 1998 that essentially provide that each party to a dispute bears its own costs.

The Workers Compensation Commission appears to have been deprived of any authority to order costs in compensation matters.

Commencement

The amendments relating to Schedule 11 are not yet operative and await proclamation to commence.

Implication

In relation to s 74 Notices, insurers should ensure that their current s 74 Notice templates are amended to reflect the new changes.

The costs amendments may pose significant changes to future legal disputes. It is likely that there may be an increase in self represented workers at proceedings in the Workers Compensation Commission.

SECTION 151Z

The amendments do not appear to affect recoveries against third party tortfeasors pursuant to s 151Z except for any impact arising from amendments made to journey claims.

WORK INJURY DAMAGES

The amendments do not appear to affect a worker's right to work injury damages. The threshold of 15% whole person impairment pursuant to s 151H of the Workers Compensation Act 1987 remains unchanged.

However, s 314(3) of the Workplace Injury Management and Workers Compensation Act 1998 provides that acceptance by the insurer of a degree of permanent impairment pursuant to s 66 will also constitute acceptance of the degree of permanent impairment for the purposes of a work injury damages claim.

REVIEW

A review will take place after 2 years from the assent date of the amending Act. This review will seek to ascertain whether the amending Act has achieved its policy objectives.

AMENDMENTS AT A GLANCE

SCHEDULE COMMENCEMENT
Schedule 1: Weekly payments of compensation Not yet, awaiting proclamation.
Schedule 2: Lump sum compensation Assented to on 27 June 2012 and applies to claims made on or after 19 June 2012.
Schedule 3: Damages for nervous shock Assented to on 27 June 2012 and applies to claims made on or after 19 June 2012.
Schedule 4: Medical and related expenses (s 59) Not yet, awaiting proclamation.
Schedule 4: Medical and related expenses (s 60) Assented to on 27 June 2012. Does not apply to treatment or services provided prior to date of assent.
Schedule 5: Journey claims Assented to on 27 June 2012 and applies to claims made on or after 19 June 2012.
Schedule 6: Heart attack and stroke Assented to on 27 June 2012 and applies to claims made on or after 19 June 2012.
Schedule 7: Disease Injuries Assented to on 27 June 2012 and applies to claims made on or after 19 June 2012.
Schedule 8: Commutations Not yet, awaiting proclamation.
Schedule 11: Miscellaneous Amendments Not yet, awaiting proclamation.

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