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NEWSLETTERS
Welcome to The Guardian - 2008 Summer Edition
NEWSFLASH
Additions to the WSIB Team & Changes to WorkCover South Australia
Additions to the WSIB Workers Compensation Team Warren Saunders Insurance Brokers is pleased to welcome Aaron Mallia to our workers compensation team. Aaron has been appointed to the newly created Account Executive role and brings with him many years of experience in the workers compensation industry. As Account Executive, Aaron’s focus will be working on strategies to improve customer service with a particular emphasis on pro-active claims management. Jacky will be taking time over the coming weeks and months to introduce Aaron to our valued clients and build on our strong and lasting relationships.
Changes to WorkCover South Australia
The South Australian Parliament recently passed some significant legislative amendments to the WorkCover Scheme. The amendments affect both the Workers Rehabilitation and Compensation Act 1986 and the WorkCover Corporation Act 1994. This Newsflash covers the changes that have come into effect from 1 July 2008. For full details on the changes please visit www.workcover.com
Average Weekly Earnings – effective 1 July 2008 and applies to new claims received on or after 1 July 2008.
Average weekly earnings (AWE) will be defined as the worker’s pre-injury average weekly earnings during the 12 months preceding the injury. This means that whatever the injured worker earned per week in the 12 months prior to their injury will be averaged over the year in order to determine their AWE. This figure will be the amount paid under the WorkCover Scheme for the first 13 weeks, reducing thereafter in line with reductions in weekly payments. If an injured worker was not employed by the same employer for the previous 12 months, the pre-injury AWE will be calculated as the average of the period the worker was in that employment. If this period of time is not suitable e.g., if the worker has just commenced employment, then their AWE will be worked out on the basis of what the worker could reasonably have expected to earn in that employment, with reference, for example, to a comparable employee over an appropriate period of time. In working out the worker’s pre-injury AWE, the worker’s ordinary time rate of pay for the worker’s normal number of hours per week will be calculated. Regular shift penalties, overtime allowances and prescribed non-cash benefits (such as a motor vehicle), based on the preceding 12 months, will also be included if overtime was likely to have been ongoing. In addition, an annual adjustment can be made to a worker’s weekly payments as and when adjustments fall due under an award or enterprise agreement with the annual adjustment of benefits applying in other cases.
Weekly payments - effective 1 July 2008 and applies to new claims received on or after 1 July 2008.
The new legislation sets weekly payments at a rate equal to the worker’s AWE for 13 weeks (i.e. 100%). The majority of injuries for which workers compensation is claimed heal within 12 weeks. Having weekly payments paid at 100% for 13 weeks ensures that there is full or near-full coverage for the majority of worker’s wages over the entire period of their claim. At 13 weeks there is a reduction in payments to 90%, followed by a further reduction to 80% at 26 weeks. The 80% reduction is in line with the reduction that already occurs in South Australia for longer-term claims (i.e., claims lasting more than 52 weeks). The maximum weekly amount payable to injured workers remains at the current level of twice the State average weekly earnings (currently indexed at $2,159.20, subject to change), higher than other comparable schemes. It should be noted that for existing claims (pre 1 July 2008) the current reduction in weekly payments will continue to apply.
Payments in the event of death – effective 1 July 2008 and applies to new claims received on or after 1 July 2008.
The maximum entitlement is now $400,000, in addition to ongoing weekly payments. This extends to ensuring that family members of deceased workers are provided with counselling to assist with grief and psychological pain.
Counselling services - effective 1 July 2008 and applies to new claims received on or after 1 July 2008.
In addition to increased payments in the event of death and ongoing weekly payments, the new legislation also allows for the provision of counselling services to family members of a deceased worker in the event of a compensable death.
Payments during disputes about ceasing weekly payments - effective 1 July 2008 and applies to new claims received on or after 1 July 2008.
Section 36 of the legislation is about the discontinuing of weekly payments. This section of the Act outlines the only reasons why weekly payments can be stopped and includes a worker’s refusal to participate in rehabilitation activities or to attend medical examinations (mutual obligation). There are a variety of other clauses that give rise to weekly payments being ceased outside of mutual obligation, For further details please refer to section 36 of the Workers Rehabilitation and Compensation Act 1986. Where weekly payments are stopped under the new section 36, weekly payments will not be reinstated for the duration of the dispute. If the dispute is found in the worker’s favour, the unpaid weekly payments will be repaid to the worker with interest.
This amendment includes a safety net for workers, which enables them to apply for a review of the decision to stop payments on the basis of unreasonable decision making. The merit of the decision can be reconsidered by the WorkCover Ombudsman within 14 days. If it is found that the decision was made without merit, payments will be reinstated while the dispute continues. Under the new legislation, the stopping and re-starting of weekly payments can only occur for disputes under section 36, not disputes that otherwise pertain to the Act. This change is accompanied by stronger accountabilities for those empowered to make decisions. Claims that are currently the subject of dispute resolution and have had payments reinstated will continue to receive those payments.
Notice Periods – effective from 1 July 2008 and will apply to all claims
A notice period is the amount of time that must be given to an injured worker before weekly payments can be reduced or stopped. For weekly payments of duration between 0 and 52 weeks, the injured worker must receive 14 days notice. For weekly payments in excess of 52 weeks duration, the notice period is 28 days.
Code of worker’s rights – commencing 1 July 2008
The Code of worker’s rights will set out the rights of injured workers and the level of service they should expect from WorkCover and its claims agent, and self-insurers, as well as a process for dealing with breaches of the code. It will be developed in consultation with stakeholders and will help protect workers against poor decision making by WorkCover, it’s agent or self-insurers.
Requirement to register – effective from 1 July 2008
Employers whose leviable remuneration is less than $10,000 a year are no longer required to register and pay a levy, unless a claim is lodged by one of their workers. Incentives to employ apprentices and trainees – effective from 1 July 2008 Wages paid to apprentices and trainees will now be excluded from the calculation of the employer’s levy.
Self-insurance changes – effective from 1 July 2008
The term ‘exempt employer’ has been replaced by ‘self-insured employer’. There have been some changes to the pre-requisite requirements including reinforcement of WorkCover’s ‘one-in-all-in’ rule which states that all related entities must register as a group.
Innovations with a return to work fund – established from 1 July 2008
Under the reform package, a $15 million return to work fund will be established to improve rehabilitation and retraining activities, and to fund projects and research to improve return to work outcomes. A stakeholder reference group will have input into the setting of annual priorities for the return to work fund. There are a significant number of workers who, as a result of injury or illness are unable to return to their pre-injury employment but who, nonetheless, have valuable skills and experience. The return to work fund will support initiatives that will assist these workers to return to work, in particular, in areas where there are current skills shortages. Under the reform package, a $15 million return to work fund will be established to improve rehabilitation and retraining activities, and to fund projects and research to improve return to work outcomes. A stakeholder reference group will have input into the setting of annual priorities for the return to work fund. There are a significant number of workers who, as a result of injury or illness are unable to return to their pre-injury employment but who, nonetheless, have valuable skills and experience. The return to work fund will support initiatives that will assist these workers to return to work, in particular, in areas where there are current skills shortages.
 Ombudsman – effective from 1 July 2008
An office of the WorkCover Ombudsman will be established as an independent office to investigate complaints relating to the operation of the WorkCover Scheme. It will report to the Minister for Industrial Relations. The Ombudsman will also have responsibility to report on wider issues that may exist behind individual complaints. The Ombudsman will implement the ‘safety net’ for injured workers testing the reasonableness of decisions to stop or reduce weekly payments.
Return to work inspectorate – effective 1 July 2008
A return to work inspectorate will be established to oversee
WorkCover’s and employer’s responsibilities in relation to return to
work. It will provide advice and reinforce employer’s obligations to
return injured workers to work.
Auditor-General – commencing 1 July 2008
Changes to the WorkCover Corporation Act 1994 now require WorkCover to be audited by the Auditor-General. This will give employers, employees and the community the same level of transparency and confidence in the operations of WorkCover that
other Government business enterprises, audited by the
Auditor-General, provide to stakeholders.
Engage with workforce development strategies – effective 1 July 2008
WorkCover will engage with existing workforce development strategies and initiatives to enhance the employment opportunities for injured workers. WorkCover will also look into programs which have been successful at returning people to work who have been out of the workforce for long periods of time. If you require any further information on any of the items above, please do not hesitate to contact the Workers Compensation team on 02 9587 3500.
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