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Preliminary Report into the Workers Rehabilitation and Compensation Act

The Law Society Northern Territory (the Society) welcomes the opportunity to provide comment to NT WorkSafe on the Preliminary Report[1] (the Report) into the Workers Rehabilitation and Compensation Act (Act) dated November 2013.

The Society provides comment on the law for the purpose of improving the law and maintaining individual rights. The Society is the peak body for Legal Practitioners in the Northern Territory and has sought input from practitioners with considerable experience in this area in addition to the Legal Practice Committee.

We attach below for your assistance, a copy of the Society?s comments on the Report.

General Observations

The legislation is beneficial and exists to provide workers with a no fault right to workers compensation. No worker should be worse of as a result of sustaining an injury at work.

The Society supports the need to strike a balance between competing goals such as:

  • adequacy of benefits to the injured worker;
  • a competitive premium; and
  • achievement (or maintenance) of full funding and viability of the Scheme.

The Society also supports evidenced based law reform and is encouraged that the Workers Rehabilitation and Compensation Advisory Council considered that[2]:

  • the proposed review of the scheme should be carried out locally by Territorians taking into account the best ideas and practices both nationally and internationally; and
  • the review took into account the unique aspects of the Northern Territory.

Despite these considerations the Report does not contain sufficient contextual information or supporting data and analysis. In short the Report does not clearly state the local issues that ought to be addressed by legislative reform.

The Report embarks on a 'like for like' comparison with the 2013 Review of the Commonwealths Safety, Rehabilitation and Compensation Act[3] and does not account for the differences between the schemes. The absence of evidence supporting the changes proposed in the Report is deeply concerning.

If the assertion that there is an ?insurance crisis? is not accepted then there is nothing to support making any significant changes to the scheme. Particularly, absent evidence of substantial increase in claims or premiums, there is little justification for a ?re-balancing? of the interests of workers and insurers.

Despite the said use of Guiding Principles, the recommendations in the Report cannot be said to fair and balanced in relation to the main stakeholders in the Scheme.

The Society notes that the Report does not recommend the rewriting of the Act, yet makes recommendations that appear dire in their effect.

Many of the proposed options for reform would amount to significant diminution of the rights of workers to the benefit of the insurance industry. Further to the above, no evidence has been presented that workers in the Northern Territory, who are injured in the workplace, are any slower or less willing to return to work following injury than workers in other jurisdictions. The Report states the principal cost driver in NT is claimants? duration on benefits but then identifies that the number of days on benefits is significantly lower in the NT compared to the national average[4]. Nearly 60% of claims resulted in less than six weeks compensation.

The Report does not provide the necessary examination of the scheme?s structure and the business assumptions that insurers have used to set premium rates to allow the conclusion that the scheme is not viable.

Given:

  • the sensitivity of the assumptions upon which the Marsh report is based;
  • the history of insurers seeking approval under the scheme; and
  • the NT claims history set against national data

there is little to support the broad ranging proposals for reform.

Any review of the scheme should consider why the claims costs are not adequately reflected in commercial insurance premiums. The ?Actuarial review of the Northern Territory Workers? Compensation scheme as at 30 June 2012? (the Marsh report)[5] considers the premium adequacy and finds that the estimated rate to break even is 2.4% of payroll compared to 2.2% of payroll which is currently charged. However page 77 of the Report states:

?It is possible the changes recommended above will not reduce costs and costs could in fact increase?.

Despite this variation between the actuarial ?break even rate? and the actual rate charged there has historically been a significant deficiency between actual premium rates and actuarial recommendations. The Marsh report notes that the scheme was generally profitable until 2008 when premiums dropped. This appears to be the same time GIO became an Approved Insurer under s.12 of the Act, the fifth Approved Insurer for the Northern Territory.

Attachment 3 of the Report goes on to state:

?For the most of the past decade approved insurers have continued to demand inadequate premiums from NT employers sufficient to meet claims expenses. Several specific claim settlements amounting to multiple million dollar costs to the scheme have also seriously impacted on scheme profits over the past 5 years. In the most recent reporting year 2011/12, the scheme actuary reports that average premiums are 2.2% of payroll and for the scheme to break even average premiums should have been set at 2.4% of payroll?.

This pattern by the approved insurers appearing to not meet the estimated ?break even rate? suggested by the Marsh report has apparently not impacted on profitability of the scheme or attractiveness of the scheme to new providers. Whilst it would seemingly indicate that premiums are not adequate to cover scheme costs the rates set by insurers are based on their own actuarial assessment and business drivers. This is in essence a commercial decision for the insurers.

The Work Health Authority approves insurers to underwrite workers? compensation business on the basis of the following criteria:

  • the insurer's ability to provide the necessary insurance service, including its ability to meet time limits imposed by this Act;
  • the likely market share of the insurer and its likely effect on its cost efficiency in supplying the service;
  • the financial viability of the insurer; and
  • the insurer's ability to provide the statistical and other information required or likely to be required under this Act.

The Society respectfully submits that any proposed changes be submitted to an actuary for an assessment of their impact on the recommendations made in the Marsh report such as the financial strength of the scheme and premium adequacy.

Attachment

In formulating a response to the Report it is apparent that matters raised in the Terms of Reference have not been addressed to the fullest extent. With this in mind the Society provides preliminary comments addressing the Report below. The Society is keen to assist in providing more targeted consultation that can take into account the varied experiences of the legal profession that advocate the interests of workers and insurers under this scheme. The Society has preferred to adopt a cautious approach but would encourage greater consultation if reforms are anticipated.

Definition of Worker (page 24)

The Society suggests a cautious approach to a further proposed change to the definition of Worker.

Crew Members of Fishing Vessels (page 24)

The Society supports this recommendation.

The Society considers an amendment to regulation 3A(1)(g) would be required. If this regulation was repealed, then a member of a fishing vessel would be covered if they normally fitted within the defintion of ?Worker?.

Jockeys/Taxi Drivers

The Society supports this recommendation.

However, the Society considers that Jockeys and Taxi Drivers are already included in the definition of ?Worker? by virture of regulation 3A(1)(b) and (c).

Interpretation of Legislation (page 25)

The Society does not support this recommendation.

The Society does not support the recommendation to codify the decision in Pengilly[1]. There is no evidence in the Report that the Act has not been applied in an objective and balanced way. The legislation exists to provide workers with a no fault right to workers compensation. No worker should be worse off as a result of sustaining an injury at work.

In BAE Systems Australia Ltd v Rothwell [2013] NTCA 3, the NT Supreme Court of Appeal made a clear statement in relation to the interpretation of the Act and one which is easy to follow:

"The Act is beneficial legislation. The general approach in this jurisdiction towards remedial or beneficial legislation is that the words used by the statute must be given a construction so as to give the most complete remedy which is consistent with the actual language employed and to which its words are fairly open. This approach is not confined to cases of ambiguity: see Woodruffe v Northern Territory of Australia.[2000] NTCA 8; (2000) 10 NTLR 52".

Subject to any other information or supporting evidence, the Society submits this is sufficient.

Rehabilitation (page 30)

The Society does not support this recommendation.

The Society supports a scheme which will assist injured workers in their rehabilitation and return to work. However, without any evidence regarding the problems around the operation of the Act in this area, the Society does not support this recommendation.

Return to Work Programs (page 32)

The Society does not support this recommendation.

There is no evidence in the Report which clarifies the difficulties with the current provision. The Society notes the recommendations made on page 32 are identical to those made in the Hanks Review of the Safety, Rehabilitation and Compensation Act Report, February 2013. The Society can see a benefit in ensuring workers and employees understand their obligations in relation to rehabilitation and return to work but there should be an analysis of the NT situation to identify any local challenges. The Society is aware of anecdotal evidence that rehabilitation overall is a difficult process for injured workers in the Northern Territory due to the types of employment available and the general lack of any semi sedentray or mid point types of work available to injured workers between heavy manual employment and clerical/sedentary types of work.

However subject to the actual terms of the proposed amendments, the Society may support attempts to more properly and clearly define the roles and obligations of all stakeholders, including injured workers and employers on the issue of return to work programs.

Suitable Employment (page 33)

The Society does not support this recommendation.

There is no evidence in the Report which clarifies the difficulties with the current provision. The Society notes the recommendation made on page 33 are identical to those made in the Hanks Review of the Safety, Rehabilitation and Compensation Act Report, February 2013. The Society considers should this definition be amended then consideration be given to the actual employability of the worker consistent with the beneficial nature of the legislation to ensure bother employers and employees are dealing with genuine and available employment opportunities.

The 104 Week Rule (page 34)

The Society does not support this recommendation.

The existing Act has rehabilitation of the worker as a fundamental aim. The Society does not support any amendment to s65(2)(b) ?the 104 week rule? that would in effect deviate from this objective. The Report suggests ?any plan or document prepared as part of the RTW process? could enliven the rule. This does not take into account:

? whether the worker has been offered appropriate re-training; or

? whether the worker has been given appropriate notice of such a document.

This provisions would be significantly watered down if the employer merely has to provide a plan for rehabilitation without any other mechanisms in place to ensure compliance. The Society may review its position if further safeguards are in place to ensure that employers do not misuse any such RTW process.

Mitigation of Loss (page 35)

Subject to the following comments, the Society does not support this recommendation.

The Report states that the Supreme Court of the Northern Territory has been willing to imply the concept of mitigation of loss through common law.

Given this is the case it is questionable as to whether there is a need to legislate for this provision in the Act. Currently a worker is required to comply with all reasonable rehabilitation requests.

Rehabilitation Costs for Counselling (page 36)

The Society partly supports this recommendation.

The Society supports insureres providing access to rehabilitation costs for necessary counselling services. However, we note further in the Report, recommendations are made so as to cap medical and treatment costs. A cap on counselling services could be detrimental to an employees ability to rehabilitate and to access suitable and reasonable rehabilitation treatment and assistance.

Medical Panels (page 38)

The Society does not support this recommendation.

Given the stated difficulties in the use of medical panels in the past, the Society does not recommend the use of medical advisory committees for the purpose of preparing treatment guidelines.

Medical and Treatment Costs (page 39)

The Society does not support arbitrary caps on the rates of payment for specific types of medical treatment.

The Northern Territory experience is such that access to health services is already limited and this increases with remoteness. It is anticipated that curtailing fees would have the effect of further reducing available service providers. In other words there may well be doctors who are not prepared to provide services in the Northern Territory at the rate specified by the authority. The Society submits that fees and costs for treatment to injured workers provided by service providers should be reasonable in the circumstances of each case. There should be no dollar or time limit on legitimate medical expenses in respect of a workers? compensation claim.

In the event that a culture of co-payments emerged this is likely to act as a barrier to workers obtaining effective treatment and rehabilitation. This would be contrary to the beneficial nature of the Act and current best practice. Further, this would result in a cost shifting and additional burden on Medicare. The Industry Commission[2] was of the view that:

?People suffering a work-related injury or illness should not be financially disadvantaged when it comes to paying for directly attributable medical costs (including rehabilitation). The danger with such an approach is that any good or service which is free invites overuse?Over servicing, - whether by doctors or other providers is best tackled directly via ?best practice? or by effective fraud control?rather than by (arbitrarily) cutting back on the extent to which such services are reimbursed under workers? compensation. The Commission recommends that attributable medical, rehabilitation and related expenses are to be fully compensated?.

The Society supports this approach.

Clinical Framework (page 39)

The Society does not support this recommendation.

The Society does not accept the unsubstantiated comments regarding a medical practitioner?s ability to be objective. There is no NT analysis to show that medical practitioners are not bound by professional obligations and the recommendations are again identical to those in the Hanks Review of the Safety, Rehabilitation and Compensation Act Report, February 2013.

Medical Certificates (page 41)

The Society does not agree that this position needs to be legislated.

WorkSafe already publishes a Guide for Doctors[3] which specifically requests the doctor to focus on the capacity of the worker rather than the incapacity. The Guide specifies that doctors should consider the workers capacity for modified or alternative work and states "you should not automatically certify an injured worker as unfit for work". There is no evidence that medical pracitioners are not following this guideline.

Household and Attendant Care (page 41)

The Society does not support a limit on care.

The Report suggests that household services and attendant care should be limited to three years. It is unclear why this would be necessary. In line with the objects of the Act attendant care should be provided where it is reasonable.

Permanent Impairment (page 41)

The Society does not support this recommendation.

The current model relies on the AMA guidelines which are problematic. The Society considers the guidelines are arbitary and the AMA themselves state that the guide is not to be used for direct finacial awards nor as the sole measurement of disabilty. It is widely accepted that use of AMA Guides for determining compensation can be ?unfair? in that it is at best a crude representation of the impact of the aftermath of injury on an individual.

The Society supports the introduction of specific guidelines to assess permanent imparement for the purposes of workers compensation.

The Society does not support the adoption of an algorithmic method for the calculation of permanent impairment compensation. The effect of the algorithmic method is to reduce the differences in entitlements at a lower level. The permanent impairment tables indicate a significant difference between impairments of 10% and 20% in most instances and a linear model more properly reflects those differences.

The Society believes that the current model provides greatest equity between injured employees and is a simpler, preferable model.

Provisional Liability (page 42)

The Society does not support this recommendation.

The Society can see the benefit of allowing a worker to obtain early intervention while continuing to receive income. The Society considers that this provision will encourage employers to assist injured workers return to work in a timely fashion.

What is proposed is the insertion of a clause that the payments can be recovered in the event that an injured employee has obstructed or delayed the determination of the claim and liability is subsequently determined not to exist. This appears to be unnecessary given that during the 56 day deferral period, the insurer can determine to deny liability at any time. Again these recommendations are identical to those made in the Hanks Review of the Safety, Rehabilitation and Compensation Act Report, February 2013 and there is little basis for their inclusion in the NT scheme.

Insurer and Employer Toolkit (page 43)

The Society partly supports this recommendation.

The Society supports the use of incentives and benefits over and above the base level. However, in order to maintain flexibility in case management, the Society does not consider such a proposal needs to be legislated.

Death Claims (page 43)

The Society does not support this recommendation.

The Report does not provide enough information on how this proposal would work. Common law damages can only be awarded where it can be established that the Employer or third party were at fault in causing the death. This is potentially a significant curtailment of the current no fault workers? compensation scheme.

Any amendments that would involve a partial or total revival of the common law should be subject to a thorough independent review and costing.

Recurrence Claims (page 43)

The Society does not support this recommendation.

The Society is concerened that there is no analysis of eveidence regarding this recommendation. The Society is concerned that this unidentified mechanism may be curtailing the objects of the Scheme.

The Role of Independent Medical Assessments (page 45)

The Society supports the retention of current practice.

Fraud (page 45)

The Society does not support this recommendation.

The Society is concerned that there is no evidence presented to identify whether the current penalties are of deterrent value. Further the Society believes that there may be other be more effective mechanisms to deter fraudulent claims.

Mental Stress Claims (page 47)

The Society is concerned at the implication of the proposed changes and does not support this recommendation.

The Society is concerned about the suggested changes. The Society notes that the criteria of ?reasonableness? embodied in the defence of reasonable administrative action is an existing curtailment of the no fault concept of the Scheme. What this means is that any action taken by the Employer, provided such action is reasonable, can be considered as a defence to a workers compensation claim.

Although most of the recommendations in the Report are taken directly from the Hanks Review of the Safety, Rehabilitation and Compensation Act Report, February 2013, the Report seeks to add a further requiremnt of "good faith" which is not included in the Hank Review.

The Report does not provide any analysis of claims in the Northern Territory to demonstrate that this provision needs to be changed. This is possibly because there is no better test than ?reasonableness?. The Report states that the application of the reasonableness exclusion appears to have been ameliorated or curtailed by the courts. Anecdotal evidence suggests that the existing defence of reasonableness results in claims not reaching the Courts because the reasonable administrative action test can be met and therefore the application is simply not run.

The Society does not support legislating definitions such as ?reasonable administrative action?. These definitions have been judicially interpreted on numerous occassions and appear to be sufficient. It is difficult to see what additional benefit may arise for stakeholders in the Scheme from defining such terms.

While there is a need to monitor the financial burden that psychiatric injury claims have on the administration of the Act, it is our submission that this needs to be balanced with the beneficial nature of the no fault scheme. To widen the scope of the defence would see nearly all administrative action falling under this exemption.

Disease Claims (page 51)

The Society does not support this recommendation.

These changes would be contrary to the beneficial intent of the legislation. If such a test were to be applied this would potentially result in an increased number of disputed and litigated cases, as it is medically and factually difficult to isolate and identify the various factors that may play a role in the disease process. Further it would unnecessarily restrict a worker's compensable entitlements. However the Society is mindful of employers consideration that they ought not be liable for any inherent conditions or diseases suffered by workers that do not relate to the worker?s employment, but that may be the nature of a no fault compensation scheme, which is what we have in the Northern Territory.

A possible and more balanced approach may be to effect changes that would give the Courts and stakeholders more discretion as to whether particular diseases claims should or should not be compensated under the current Scheme, bearing in mind the circumstances of each case and on a case by case basis.

Medical and Rehabilitation Costs ? Reasonable and Necessary (page 51)

The Society does not agree that these definitions need to be codified into the Act.

It will be a question of fact as to what constitutes what is "reasonable" and "necessary" in each case. The Society submits the treating doctor and examining medical specialists would be in the best position to decide what medical and rehabilitation treatment is reasonable and necessary.

Weekly and Other Entitlements (page 53)

The Society does not support a revised definition of 'normal weekly earnings'.

One example of the way in which this section is proposed to be used is that if a worker?s normal weekly earnings are calculated by taking into account regular and established overtime and the workplace subsequently changes after the injury so that no overtime is available, the worker?s normal weekly earnings could be varied downwards to reflect the workplace change. This is detrimental to the injured worker as his or her weekly compensation benefit will be decreased and this could lead to significant financial hardship. Further it may also result in a changing normal weekly earnings figure which for the sake of certainty should be stable throughout the life of a worker?s claim. In addition, currently an injured worker is paid his or her normal weekly earnings as his or her compensation benefit for the first 26 weeks. What is being suggested is that rather than simply deducting the amount actually earnt by the worker during the 26 week period, the employer be entitled to be able to deem an amount of earning capacity to reduce the level of benefits instead of relying on the amount actually earnt during this period. Once again without some clear safeguards, such a change may lead to significant financial hardship to injured workers in the first 26 weeks of their claim.

Non Cash Benefits (page 55)

Without further information and details on how it is proposed to effect this change, the Society does not support the recommendation to cap non-cash benefits.

Maximum Weekly Benefit Rate (page 56)

The Society does not support this recommendation.

What is being suggested is that there be one step down at 13 weeks, another at 26 weeks and a third at 52 weeks. There is a suggestion that weekly payments should be limited to eight years for less serious claims (note ?less serious? is not defined and elsewhere in the paper there appears to be different levels of step down proposed).

There is also a suggestion that during the first 26 weeks the benefit should be reduced to the amount a worker is deemed to be able to earn. These changes will cause significant financial hardship to an injured worker who may otherwise have no other sources of income in the first 26 weeks of incapacity, bearing in mind that injured workers are required to submit medical certificates during this period.

What is also proposed in the Report is that there be three step downs (currently there is one to 75% at 26 weeks).

Step Down (pages 56-58)

The Society does not support any change to the current step down arrangements.

The Report proposes that weekly benefits be paid in accordance with the three tier approach which would see a worker with an impairment of 15% with no benefits after two years.

The mechanism has potential to:

  • apply to a small number of claims only;
  • involve additional procedures (functional capacity assessments, vocational assessment, labour market research etc.); and
  • increase administration costs and probability of disputes.

It is concerning that weekly benefits should stop after two years for serious injuries and be substitued with a lump sum without any discussion on how this is caculated. Unless the lump sum is determined equitably, cutting weekly benefits off for such workers will result in significant hardship.

If such an approach was to be used then the permanent impairment level should be lowered as the range of 15% permanent impairment and 85% permanent impairment are very high and most workers may not reach this level of impairment. For example a 75% permanaent impairment injury includes complete paraplegia with loss of bladder and bowel function.

The Society is also concerned with the use of the American Medical Association (AMA) Guidelines to the Evaluation of Permanent Impairment in determining levels of impairment for compensable purposes to decide on eligibility to ongoing weekly payments. The Society submits the guide is arbitary and ought not to be used for direct finacial awards nor as the sole measurement of disabilty. It is widely accepted that use of AMA Guidelines for determining compensation can be ?unfair? in that it is at best a crude representation of the impact of the aftermath of injury on an individual. Should the step down provision change, the Society calls for an amendment to provide that as a result of a step down no insured worker should receive less than the minimum wage and that step downs should not be arbitarily imposed.

Again, arbitary limitiation on benefits can lead to cost shifting to the tax payer.

Portability of Benefits (page 58)

The Society does not support restricting entitlements to an injured worker on the basis of their locality. However, the Society does appreciate the difficulty faced by employers and insurers in relation to management of an injured worker?s claim and his or her treatment and rehabilitation if he or she no longer lives in the same jurisdiction.

The reason that benefits were extended to allow for the continuation of payment after a worker left Australia is because these are workers who have an entitlement to work in Australia and having their benefits then subsequently disputed or terminated on the basis that they were no longer in Australia is problematic and reflects poorly on the social and economic reputation of the Territory. The Society would suggest that rather than the proposed changes, other means of more accurately montoring injured workers progress overseas be adopted so that a balance can be struck between the interests of employers, insurers and injured workers who may require ongoing assistance to return to work in their home countries outside Australia.

Journey Claims

The Society does not support the removal of this provision.

This would affect only a small number of workers. It affects people who are injured travelling to and from work (not by a motor vehicle). Again there is no evidence or analysis in the Report to identify any issues arising from the current provision.

Dispute Resolution (pages 63-65)

The Society supports the recommendation relating to legal representation.

Worker?s should be able to access legal representation for mediation so as to be fully informed. It is a requirement of the Act to attend concilliation prior to appearing in the Work Health Court. That process requires the parties to attempt a settlement. Accordingly for meaningful settlement discussions to take place, it will be necessary for the parties to access legal advice.

Judicial Review (page 65)

The Society does not support this recommendation.

Northern Territory Magistrates have been working with the scheme since 1987. They have a wealth of experience in the area. Generally it is less expensive to go to the Magistrate?s Court than to go to the Supreme Court. The Society considers a that such a change may add significantly to the workload of the NT Supreme Court.

Occupational Diseases (page 66)

The Society strongly supports occupational diseases being covered by a deeming provision.

National Injury Insurance Scheme (page 67)

The Society is concerned to see that the injured worker would continue to have all existing rights and entitlements despite the introduction of the NIIS.

Lump Sum/Negotiated Settlements (pages 67-71)

The Society partly supports this recommendation.

Nearly half of direct compensation payments to injured workers are in lump sums. The Society submits that there should be a mechanism for payment of lump sums in appropriate circumstances, inclusive of rehabilitation and medical costs. Appropriate criteria would be required to protect all parties in such a settlement. Such reform would need actuarial assessment.

Negotiated Settlements have been taking place for a long time and have been and continue to be an efficient means to resolve a claim. Settlements should require the worker to have legal advice prior to entering into such a settlement. The present basis of such negotiated settlements is that they do not involve the Court process and this feature should not be changed as these type of settlements have allowed injured workers to finalise and resolve long term and difficult claims in the interest of all parties involved in line with the objects of the Act.

Common Law (page 73)

The Society considers that any return to the common law (as indicated above for death benefits) should be the subject of a thorough review and costing.

Setting of Premiums (page 75)

The Society is concerend about this recommendation.

The Society supports a sustainable scheme in the interests of business and workers.

The Report does not present evidence of market failure nor evidence of anti-competitive pricing. Any mechanism that required insurers to receive premiums in excess of that which their own business judgements recommends would distort the market and needlessly inflate premiums.

There is no evidence that this market is not profitable. In fact insurers continue to seek access to the market and to compete on a level playing field.

Premiums have always been charged at rates below the recommendation in the Mash report. This indicates healthy competition for market share to the benefit of business.

The Northern Territory is in the middle band of premium levels in Australia. The scheme was generally profitable in 2001 to 2008. Rates fell in 2008/2009 and the insurers have not been charging premiums since that time to keep up with the estimated cost of the scheme. As predicted by the Marsh report if the insurers charged 2.4% of wages instead of 2.2% of wages, then they would not be trading at a loss. Based on a scheme wide average, this difference is estimated to amount to less than $40 per week (per business) for a small business with a yearly wages bill of $1,000,000.

The Report fails to establish that the setting of premiums would have a positive effect.

Recovery of Incapacity Payments (page 75)

The Society does not support this recommendation.

The problem with allowing a recovery for sick leave is that if an injured worker returns to the workplace and doesn?t receive a sick leave re-credit, then if that worker becomes sick through an alternative cause (other than his work related injury), then there would be no sick leave to cover this leave. This provision would clearly beneift the insurer to the detriment of the worker.

Legal Costs (page 76)

The Society does not support this recommentation.

Currently costs are almost always paid at 100% of the Supreme Court scale. There are only 50-70 cases that go to the Work Health Court per year. This is an extremely small percentage of the number of claims under the scheme. It would be unfair if this rate was to be reduced particularly where there are often complicated medical causation issues to be determined. Sometimes in the Work Health Court it is necessary to take an action purely for medical expenses. This action usually would not be able to be taken by a worker using a Legal Practitioner unless the worker was entitled to recover up to 100% of Supreme Court Scale. The Baluyut[4] case raised in the Report (awarding of compensation for less that $600) is an extreme case and not something of common occurence. The Society would suggest alternative means be explored to deal with the award of legal costs (apart from and / or in addition to the costs of the actual claim or compenation recovered by the worker) that may arise in limited circumstances such as the Baluyut case.

Regular Scheme Review (page 76)

The Society supports this recommendation.

The Society considers it important to review the effectiveness of the scheme. However, we submit that a substantive review every five years is not warranted.



[1] Northern Territory of Australia v Pengilly [2004] NTCA 4

[2] Industry Commission, Workers? Compensation in Australia (pp 122-123), Report No 36, AGPS, Canberra, 1994.

[4] Richfort Pty Ltd trading as JEBPAB v Edna Baluyut [1999] NTCCA 98

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