Amendments to Workers Compensation Legislation

Law Society Northern Territory ("Society") notes the first and second reading of the Workers Rehabilitation and Compensation Legislation Amendment Bill 2015 ("Bill") in the Legislative Assembly on 26 February 2015.

The Society provided significant feedback on the Preliminary Report into the Review of the Workers Rehabilitation and Compensation Act ("Act") ("Review"). A copy of our submission is attached.

In your second reading speech on 26 February 2015 you noted that the Bill is the first stage in the implementation of the recommendations arising from the Review and that the balance of the recommendations will be addressed in a second bill which is expected to be introduced in the May 2015 parliamentary sittings.

The Society is concerned that the amendments to the Act in the Bill go well beyond the recommendations in the Final Report of the Review. We are further concerned that the amendments to the workers compensation scheme in the Bill are not in the public interest and in line with community expectations. By way of example we note:

1. The underlying philosophy of the Act is that it is a remedial, no-fault scheme providing for the rehabilitation and compensation for injured workers. That has been the case in the Northern Territory since 1987 when workers"™ common law rights were abolished in favour of a complete no-fault scheme which is interpreted and applied beneficially.
2. The workers compensation scheme is funded on this basis. In consideration of the development of the scheme the limit placed on benefits in the new s.61A arbitrarily curtail the rights of workers, who remain unable to pursue common law remedies i.e. the limit of payments of compensation to 260 weeks means that in some cases workers who are in need of ongoing compensation beyond this period of time will be left unable to access that compensation and unable to pursue other legal remedies.
   This will have the effect of moving those workers from accessing compensation under the no-fault scheme and into the public health system. This will result in a cost shift to the public and away from insurers under the specifically targeted and funded scheme, a cost shift that is likely to affect not only Medicare and the public health system but also to the Territory government through the National Insurance Injury Scheme.
   The Society is unaware of any evidence that the scheme as currently funded is not sustainable and understands that premiums have remained stable, giving certainty to employers.
3. Additionally, the introduction of a 15% whole of person impairment ("WPI") in s.61A as a limit on a worker"™s ability to access compensation will put falling under the scheme well beyond the reach of a significant proportion of injured workers, as for an injury to be classified as 15% WPI it would need to be close to catastrophic.By way of example injuries such as loss of range of movement in a limb or elbow, loss of fingers or toes, fractures to right leg and ankle bones requiring surgery and leaving one leg longer than the other and pain in both legs when standing and sitting, loss of mammary gland for a woman of childbearing age, complete loss of smell and taste would not be likely to reach 15% WPI. Again, the Society is concerned that this move will result in increasing pressure on the public health system and is not in the public interest.
   It is also not in line with the philosophies of no-fault, remedial and beneficial legislation. Whilst other jurisdictions have an equivalent or higher WPI threshold limit to accessing compensation, those jurisdictions also have access to common law damages. This is not available to Territorians and so a situation where the Act precludes access to common law rights and then continues to erode the rights of workers fails to meet community expectations.For these sorts of reasons the Society suggests that any comparisons to the schemes in other jurisdictions as a means of justifying the amendments in the Bill are not reliable. If accessibility to the prescribed scheme continues to be curtailed without access to the common law then any comparison is to be avoided.
4. The Society is also concerned that the changes to the definition of "worker" creates uncertainty insofar as the Act ought to apply to workers and not contractors in circumstances where it is in the public interest that workers and employers have certainty about the application of the Act.
5. The Society is also concerned that the amendments proposed in relation to firefighters in the Bill (s.50A, regulations 5B and 5C) are unclear and unworkable e.g. in record keeping. In circumstances where the qualifying periods of diseases range between 5 and 25 years, it is not clear how the recording of the prescribed number of fires in particular will be monitored and regulated. The Society is concerned that this creates an additional, unnecessary layer of complexity and uncertainty for workers and employers alike.

The Society suggests that it is in the interests of workers, employers and the community at large that the workers compensation scheme genuinely reflects the abolition of workers"™ common law rights and the funding of the scheme which is then required to absorb the total costs of rehabilitating and compensating injured workers.

Any derogation of rights and any shifting of costs outside of the scheme to the public is not in the community interest and the above points represent just some of the Society"™s broader concerns about whether the amendments proposed in the Bill are likely to meet the expectations of the broader community and are in keeping with the critical philosophies of the Act.

The Society asks that you give this correspondence your urgent attention and would be happy to be further consulted on the amendments in the Bill and into the second phase in May 2015.