On 30 October 2019 assent was given to amendments to the Workers’ Compensation and Rehabilitation Act 2003 (‘the Act”). The amendments follow a review by Professor David Peetz and, make a number of changes to the rights and entitlements of workers suffering from a psychological condition.
Definition of Injury
The requirement that a worker’s employment be the major significant contributing factor to psychological (and psychiatric) injuries has been removed. As with physical injuries, the worker’s employment must be a significant contributing factor to the psychological injury. This is a far easier test to overcome.
This is a return to the definition that existed prior to the “Newman Amendments” in 2013 and brings the definition in line with other Australian jurisdictions.
Stressors contributing to a psychological condition are often multifactorial with stress existing at work and outside of employment. The previous definition allowed workers’ compensation insurers to exclude a psychological condition when other significant non-work related stressors also contributed to the condition. Despite workers spending a majority of their waking hours at work, value judgments could be made by employers, claims officers and doctors about non-work related stressors being the “major” stress in a worker’s life.
The change to the definition will ensure that, where the contribution of employment to the development of a psychological injury is significant, the condition will not be excluded just because a worker experiences stressors outside of their employment.
Employers remain protected by the reasonable management action exclusion. This prevents workers from claiming compensation for psychological injuries where the workplace stressor causing the condition was management action taken by their employer (including disciplinary action, demotion, dismissal or re-deployment) which was carried out in a reasonable way.
Another significant change is the requirement that insurers must now take reasonable steps to provide support to workers suffering from a psychological injury whilst their claim is being investigated.
The intention of this amendment is to provide treatment to a worker whilst their claim is assessed. This can be an extremely stressful period during which workers are often unable to work and are reliant on their leave accruals until a decision is made about their claim, which can take months. Psychological injuries can arise from traumatic workplace events, disputes between workers and bullying. Employers and co-workers refuting a worker’s allegations can cause that worker to feel isolated and excluded which in turn can heighten their psychological distress.
Although the amendment does not remove the potential for financial stress before a decision is made about a claim, funding of early intervention treatment may assist the worker cope with the aftermath of becoming a “claimant”, provide support during the claim determination process and assist with long term recovery.
Interestingly, funding of hospitalisation during the period before the claim is accepted has specifically been excluded.
The time for applying for compensation has also been amended. Insurers now have a discretion to accept a claim for an injury outside the 6 month time limit if they are satisfied the claim was lodged within 20 business days of the worker being found to be incapacitated for work as a result of their injuries.
The explanatory notes to the Bill observed that the previous time limit could negatively impact on workers with “chronic, insidious or psychiatric injuries who attempt to manage their injury at work before deteriorating and do not lodge a claim when they are assessed by the doctor, but at a later time when they become incapacitated for work.”
As the power is discretionary and “may” be exercised by the insurer, workers may still have their claim rejected if they do not lodge a claim within 6 months of consulting a doctor. Professor Peetz also recommended a “practice note” about the discretion be implemented by the Regulator. The implementation of such a recommendation may be crucial in the benefit to workers from this amendment.
The new definitions and the requirement to fund treatment will apply to psychological injuries sustained after 30 October 2019.
Overall the amendments have expanded the rights of workers suffering a psychological condition during the course of their employment. In my opinion the actual benefit to workers will depend on how insurers incorporate the amendments into their existing claims assessment practices.
 See Workers’ Compensation and Rehabilitation and Other Legislation Amendment Bill 2019