June 2014

Is it too late to transition workers to the new weekly compensation system?

In review decisions #61 (and beyond), WIRO has considered the emerging problem of validly transitioning the weekly payments entitlement of an existing recipient of weekly payments immediately before 01/10/2012 (ERWP) not properly transitioned before 31 March 2014.

Overview

An ERWP whose weekly compensation payments were ceased by the insurer on 27/09/2013 sought procedural review by WIRO in April 2014.

The insurer was required to conduct a work capacity assessment (WCA) for the purpose of facilitating the application of the amended weekly benefits provisions to the worker as required by Clause 8 of Part 19H of Schedule 6 of the 1987 Act.  Clause 17 of Schedule 8 of the Workers Compensation Regulation 2010 sets an 18 month time limit from 01/10/2012 for this to occur, namely by 31 March 2014.

WIRO observed the insurer made a work capacity decision (WCD), but did not specify whether a WCA had been undertaken.  The WIRO delegate said the WorkCover Guidelines compelled the insurer to reveal the outcome of the WCA and, therefore, determined the insurer had failed to follow the procedures set out in the Guidelines as required by section 44A of the 1987 Act and also the Workers Compensation Regulation 2010. 

WIRO recommended the insurer conduct a new WCA and make a new WCD.  Recommendations made by WIRO are binding on the insurer (section 44(3)(h)).  The delegate also recommended the insurer pay the worker the weekly benefit she was entitled to prior to 27/09/2013 until such time as she is properly transitioned.

The delegate observed the transitioning of an ERWP to the new weekly compensation system, after 31 March 2014, presents a dilemma as the time has now passed for transitioning in accordance with the legislation.  He said in the circumstances “the regulator might be well advised to take urgent remedial action if still possible”.

Comment

Although WIRO has questioned whether an ERWP can now be validly transitioned, it is clear insurers do not have any choice but to give effect to the recommendations made by WIRO.

A potential solution to the problem may the promulgation of a further regulation to extend the date for transitioning the weekly payments claim of an ERWP beyond 31/03/14.
 

Authors: Judith Edwards and Mick Franco

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