This paper has been submitted for those workcover victims in South Australia
The Workers Compensation System in SA was designed in 1986 to provide
rehabilitation and return to work for injured workers and also compensation
for their injuries.
The aim was to create a fair system for workers which neither blames the
worker, or the employer and therefore contains no ability to sue for damages.
The scheme is funded through a levy on employers.
The finances of the scheme have not been good for some time due to the reduction
of this levy by the previous Liberal Government, the outsourcing of claims to
private insurance companies and general poor management.
When the Rann Government came to office they appointed a new Board which
put in place a number of measures which have improved the funding position
of the scheme but not the projected long term liability which is calculated by the
actuary. The levy paid by employers in SA is higher than in other states so there
is pressure from business to reduce their levy payments. Last year the Board
made recommendations to the Minister to change the law by severely cutting
workers entitlements in order to change the liability projection.
The Union Reps on the Board did not support these recommendations and
put in a minority report.
The Minister announced a Review into the Board recommendations which
reported to Government in late December 2007.
Without any consultation with Unions or the community (or Members of
Parliament) a Bill was drafted and put into Parliament with the announcement
that the Government would also move to reduce employer levies.
What does the Government Bill propose?
13 weeks after injury salary is reduced by 20% if not yet returned to work.
Nearly all workers kicked off all payments if still on WorkCover two and a
half years after the injury. This will be retrospective so anyone currently on
the scheme will be affected.
Payments for loss of limb or body function significantly reduced. If a worker
disputes a decision about a WorkCover claim they will have their pay suspended
while they are in dispute. No financial penalty on employers who dispute.
No increased penalties for employers who do not take their injured workers
back and no penalties for service providers who do not fulfill their obligations
to return people to work.
Reduction of democratic control of Parliament with bits of legislation now set
through WorkCover policy. Removal of the obligations for employers to find
work that is similar to the previous work of injured workers making it easier
to give them the bad jobs and force them out. No ability to sue employers for
negligence or damages. Levy cut for employers
What does it mean for injured workers?
If the Bill proceeds, injured workers will have their pay cut and their rights
reduced. Although most work injuries are fixed in under 13 weeks some take
longer. These workers will have to live on 20% less pay while they recover
and this will add financial stress. Low paid workers will be paid lower than
the legal minimum wage. At 2 and a half years there will be a work capacity
test and if there is any capacity to work even if they do not have a job, then
the worker will be kicked off payments. This part of the Bill is retrospective
so anyone currently on the scheme would be affected.
These people will be forced onto Commonwealth benefits It is likely that
workers would no longer be able to afford to complain if they are not happy
with the way their workers comp claim is dealt with as they will have their
pay suspended if they do so
What does it mean for employers?
There will be a reduction in their costs as their levy payments will be reduced.
Also there is a reduction in their obligations to employ their injured workers,
no financial penalty for doing the wrong thing by their workers and it is possible
that they will not bother much with supporting workers to return to work or get
better because they know that if they wait 2 and a half years the worker will be
off the scheme anyway. Those employers who currently are self insured and do
not have financial problems with their workers compensation will get a windfall
as they will have their obligations significantly reduced.
What do the unions want?
Firstly we want meaningful negotiations with the Government which should
have happened before the Bill was drafted or placed in Parliament. We want to
minimize the impact of any changes to the law on injured workers and ensure
that any changes are balanced between the interests of injured workers
and employers. We also want to help with the financial issues facing the scheme
by Improving the management of injured workers including ensuring that
the agent, rehab provider, medical profession and lawyers all do their jobs well
with a focus on speedy safe return to work. Ensure that employers are penalized
for not giving suitable duties for their injured workers. Improving access for
injured workers to retraining. Improving occupational health and safety to
prevent injuries in the first place.
What about the unfunded liability?
In simple terms, the unfunded liability is the balance between the assets of
WorkCover and the future payments to injured workers which are an estimated
over the next 40 years by an actuary.The actuary uses complex calculations,
based on a range of assumptions, to make an estimate of the value in current
dollars of all the costs associated with current claims. This is an amount the actuary
expects will be paid over the life of those claims, but is not payable today, tomorrow
or even this year. The unfunded liability does not effect the state economy or the
AAA rating.
Is it still the fairest scheme in the country?
The Premier has said that this scheme would still be the fairest in the country
if these changes are made. This is not true. Most of these changes are modeled
on the Victorian system which was introduced by Jeff Kennett. The big difference
is that Victorian workers are able to sue their employer for negligence and
damages. This means that they can receive payments from their employer on
top of workers comp payments. This also means that employers often take
out additional insurance on top of their Workers compensation levy which means
they pay more.
This Bill would make it "fairer" for employers but not fairer for
injured workers.
What’s the timeframe?
If the Liberal party supports this Bill it could be made law before July this year.
That is why it is important that we campaign publicly and make our voices heard.
What can be done?
We need to let the Premier know that he should not proceed with the bill in
its current form. Join the campaign.
Go the website; saveworkcovernow.wikispaces.com.
You can also assist by writing letters to the Premier, your
local MP's,Worksafe, signing the petition, helping with
leafleting, talking to your friends, family and workmates
and joining in with the public actions
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