07 Nov 2013

Significant changes to Queensland workers' compensation legislation; how they affect your workplace

by Hedy Cray

While significant changes have been made, key processes and obligations under the Workers' Compensation and Rehabilitation Act have not changed

Following the release in May 2013 of the report of the Inquiry into the Operation of Queensland's Workers' Compensation Scheme, the Workers Compensation Rehabilitation & Other Legislation Amendment Bill 2013 was passed on 17 October 2013. Significant changes were made to the Queensland Workers' Compensation and Rehabilitation Act 2003. The Act was assented to on 29 October 2013 and the changes are now in effect.

The Attorney-General has outlined that the purpose of the changes is to "strike a better balance between providing appropriate benefits for injured workers and ensuring the costs incurred by employers are reasonable". Whether that goal will be achieved and whether the number of claims will decrease is yet to be seen. Nonetheless, it remains crucial that employers are engaged with the workers' compensation process and understand their rights and obligations to deal with the changes and defend against claims.

The key changes to the Act include:

  • Replacing Q-Comp with the "Workers Compensation Regulator" and merging it into the Office of Fair & Safe Work Queensland. The explanatory notes regarding the change identify that the Workers Compensation Regulator will operate in a similar manner to the regulator under the Work Health & Safety Act 2011.
  • In order to make a common law claim a worker must now have a 5% Degree of Permanent Impairment (DPI) arising from the injury, which replaces the concept of whole person impairment.
  • The table of injuries has been removed from the Workers Compensation and Rehabilitation Regulation 2003 and replaced with a new calculation for lump sum compensation under the relevant DPI.
  • Amending the definition of "injury" under section 32 of the Act.
  • Allowing employers to seek disclosures from prospective workers about prior injuries / conditions and obtain their workers' compensation claims history.

Who can make a common law claim for work related injuries?

The Act now contains a threshold that must be met in order for the worker to make a common law personal injuries claim in relation to a work related injury sustained on or after 15 October 2013. The concept of "work related impairment" has been replaced with a method of assessment of Degree of Permanent Impairment (DPI).

Workers are now only able to file a common law damages claim for a work-related injury where a worker's DPI is assessed as being greater than 5% or who have a terminal condition. Dependents retain their ability to seek damages if the work-related injury resulted in the worker's death.

Workers who sustain an injury prior to 15 October 2013 will have their workers' compensation claims processed and dealt with under the old provisions of the Act.

What is an "injury"?

The definition of "injury" in relation to physical injuries remains unchanged. For physical injuries, employment still needs to be "a significant contributing factor" to the injury.

However, in response to the Committee's recommendation, the definition of injury in relation to psychiatric or psychological injuries has changed to require that employment be "the major significant contributing factor to the injury". This changes will commence on assent of the amended Act and represent a higher threshold to be met by claimants seeking compensation for psychological injuries.

The exemption of psychiatric/psychological injuries arising from reasonable management action taken reasonably in relation to the worker's employment has not been changed.

Workers also remain able to make journey claims (ie. claim in relation to injuries that occur during certain journeys).

Access to workers' compensation histories

From 29 October 2013, prospective workers, upon receiving a written request by a prospective employer, are required to disclose all pre-existing injuries of which they are aware could reasonably be aggravated by performing the duties of the position they applied for.

A prospective employer must advise the prospective worker:

  • of the nature of the duties the subject of the position he prospective worker has applied for; and
  • that if they do not comply with the request, or they supply false or misleading information, the worker will not be entitled to compensation or damages under the Act for any event that aggravates the non-disclosed pre-existing injury.

Where the prospective worker fails to disclose relevant pre-existing injuries, or provides false or misleading information, and aggravates the non-disclosed pre-existing injury, the worker will lose their entitlement to compensation and damages.

For employees who were engaged before being requested to make the disclosure, their ability to make claims for pre-existing / non-disclosed injuries remain unchanged.

In addition to this, with the consent of the worker and payment of a fee to the Regulator, a prospective employer is now able access a prospective worker's claims history summary. The amended Act provides that the prospective employer must maintain confidentiality of the summary and not disclose the contents to anybody else. The summary can only be used for considering and selecting the prospective worker for employment.

While this information can be accessed and used by prospective employers, the prohibition in the Act on obtaining and using "workers' compensation documents" (as defined in the Act) for selecting a person for employment or determining whether a worker's employment is to continue still exists. Similarly, other laws, including discrimination laws and the Fair Work Act 2009 will continue to apply. As a result, access to information about a prospective employee's workers' compensation history and pre-existing conditions will need to be carefully managed and considered to ensure legal compliance.

Further information

It is important for employers to understand the implications of the recent amendments of the Act, not only to defend against workers' compensation claims but also so they do not inadvertently breach other legislation that impacts this area, such as discrimination laws.

While significant changes have been made, key processes and obligations under the Act have not changed, such as employers having 8 business days to provide a response to a workers' compensation claim to the insurer.

However, other aspects of the Act that employers often raise queries about, including workers' ability to commence workers' compensation common law claims, will be impacted, not only in terms of the number of claims but also the potential increases in % DPI being assessed.

As a result, managing and addressing workers compensation matters continues to be a crucial area and employers need to understand their rights and obligations. It remains important that employers are engaged and participate in the workers' compensation process from the beginning, as well as ensure that policies and procedures:

  • to maintain reasonable management action;
  • to meet workplace health and safety requirements to minimise injuries; and
  • to address access to medical and workers compensation documents and use of those documents;

are followed.

Employers should seek advice from their key Clayton Utz workplace relations, employment and safety contact if they have any queries about the operation and impact of the changes to the Queensland workers' compensation legislation.

Thanks to Laura Hillman for her help in writing this article

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.