It is no secret that the Return to Work Act 2014 (the Act) has introduced some significant changes to the South Australian workers compensation system.
The transitional provisions govern the way in which “existing injuries” (meaning, an injury which occurred on or before 1 July 2015) are dealt with under the Act. In essence, those provisions have ensured that workers with an existing injury have continued to receive various species of compensation for a limited period of time following the introduction of the new scheme.
For those workers, and unless a worker is categorised as a “seriously injured worker” (meaning, a worker who has been assessed with 30% or more whole person impairment), the entitlement to income maintenance will cease by no later than 30 June 2017. The entitlement to medical expenses will continue for a further 12 months after that date (subject to some exceptions set out in section 33(21) of the Act).
We anticipate that there will be some trends and increased claims in the lead up to 30 June 2017 and following that date. Employers and insurers should be aware of those likely trends and be mindful of matters to consider carefully. These are set out below:
1. Aggravation Claims
- Section 7(3) of the Act provides that workers who suffer an aggravation, acceleration, exacerbation, deterioration or recurrence of a prior injury are entitled to compensation (so long as the aggravation has occurred in compensable circumstances) for the extent and duration of the aggravation only.
- Following the end of the entitlement period, we envisage that there will be increase in aggravation claims, particularly upon some workers return to work.
- The compensability of an aggravation (acceleration etc) must be considered with reference to section 7 of the Act. The circumstances of the aggravation needs to be considered carefully to determine whether it is in fact an aggravation pursuant to section 7(3) of the Act which may give rise to a further entitlement to income maintenance or whether the alleged aggravation is in fact part and parcel of the original injury which should not give rise to any further entitlement to income maintenance.
- Careful consideration should also be taken when determining the appropriate average weekly earnings rate for a compensable aggravation injury, particularly if the worker has been off work for some time in the 12 months prior to the aggravation and paid income maintenance during that period.
2. Seriously Injured Interim Applications
- Section 21(3) of the Act provides workers a right to apply for an interim decision to the effect that they will be taken to be a seriously injured worker.
- An interim decision can be made by the compensating authority, subject to them being satisfied, or it appears, that a worker’s injury has or will result in permanent impairment and it appears that the degree of whole person impairment is likely to be 30% or more.
- An interim decision has effect until an assessment of whole person impairment has been made.
- If an interim decision is not made, then the decision not to treat a worker as seriously injured on an interim basis is a reviewable decision.
- On the fact of it, there do not appear to be any provisions permitting the cessation of an interim decision in circumstances where workers are not assessed for whole person impairment. Therefore, extra care should be taken when considering an application to make an interim decision and, preferably, legal advice should be sought before any decision is made.
- It is conceivable that there will be an increasing number of interim applications being made by workers with existing injuries in the lead up to 30 June 2017, as the entitlement period to claim income maintenance comes to an end.
3. Return to Work
- Workers with an existing injury and who are presently incapacitated for work will likely be faced with a situation where they will have to return to some form of paid employment or be without income post 30 July 2017. Some may have paid leave entitlements that they will be able to access, but others will not be so fortunate.
- It is quite likely that workers who have been off work and incapacitated for some time will produce medical certificates which certify them with some or full capacity to return to work.
- That will do doubt cause some concern for employers when a) the worker has been off work for a lengthy period of time or b) the worker has had significant restrictions on any capacity for work.
- Employers have work health and safety obligations to provide workers with a safe work environment. That includes providing a safe workplace for the worker themselves and other workers.
- Those obligations should be considered carefully before automatically accepting a certificate which suddenly provides for some capacity for work in circumstances where there has been consistent medical evidence in the past which is contrary to any capacity for work.
- In some instances, it will be appropriate to undertake further investigation to determine the worker’s true capacity for work before identifying and offering suitable employment. Further advice should be sought.
- Any delay in accepting a certificate and having a worker return to worker (due to further enquiry and investigations) may result in workers filing an application pursuant to section 18 of the Act to be provided with suitable duties.
4. Sequel Injuries & Applications for WPI Assessments
- In light of the impending end of the entitlement period to claim income maintenance, it is likely that workers will be a) submitting new claims for sequel injuries allegedly arising from the original injury and b) requesting assessments of their whole person impairment – predominantly for the purpose of determining whether they are seriously injured work and therefore entitled to income maintenance beyond 30 June 2017.
Although workers with an existing injury will have their entitlement to income maintenance come to an end due to the passage of time, it is important for compensating authorities to issue a formal determination discontinuing the worker’s entitlement to income maintenance.
The workers compensation space in South Australia is fluid at present and the interpretation of the provisions of the Act, and practical application of those provisions, is the subject of significant litigation and will be for the next 12-18 months. We therefore recommend that you obtain further advice from your legal service providers on the strategic management of these issues as and when they arise.
This article was written by Shane Thurnwald, Partner and Samara Harley, Senior Associate.