Legislative Changes (COVID-19) – Effective 12 October 2020 – Worker’s Compensation and Injury Management Amendment (COVID-19 Response) Act 2020

The Workers’ Compensation and Injury Management Amendment (COVID-19 Response) Act 2020 and supporting Regulations come into effect on 12 October 2020 address a small number of what the WA Government considers to be “priority issues in response to the COVID-19 pandemic”. There are 5 key areas and they are summarised below:

1. Presumption of a work-related injury for COVID-19 contracted by health care workers

The Government acknowledges health care workers are at a heightened risk of COVID-19 the introduction of a rebuttable presumption of a work injury will ensure the scheme supports them if they contract the disease. It applies if:

  • The worker is diagnosed with COVID-19 by a medical practitioner based on a prescribed test result or the worker dies from COVID-19 before such a diagnosis.
  • The worker is in prescribed employment when taken to have suffered the injury (date of diagnosis or date of death).
  • The day on which the worker is taken to have suffered the injury is on or after 16 February 2020 (the first COVID-19 case in WA).

If these conditions are met, work is taken to have been a contributing factor and to have contributed to a significant degree, to their contraction of the disease unless the employer proves otherwise.

2. Discontinue the common law termination day

Up until these amendments, workers were required to elect to pursue common law damages by the “termination day” (generally 12 months from the date the worker made a claim for compensation). The termination day concept has been deleted from the Workers Compensation and Injury Management Act 1981 (Act). The Government says this will have the following effect:

  • Save for the effects of the Limitation Act 2005 there is no longer any time constraint impacting on a workers’ ability to pursue common law damages.
  • Workers are still required to elect to pursue common law damages based on a whole person impairment (WPI) of at least 15%, and to commence proceedings after an election is registered.
  • Transitional arrangements provide for workers to make an election to pursue common law damages even if their termination day had expired before 12 October 2020.
  • An employer’s obligation to notify a worker about the termination day under Section 93O of the Act (see further below) ceases from 12 October 2020 but an alternative notification is required to be sent to workers about common law claims by insurers and self-insurers from 16 November 2020.
  • From 12 October 2020 an AMS will no longer be required to provide an opinion on a Form AMS 8 for the purpose of recommending an extension of the termination day.
  • A worker’s condition must still have stabilised before an evaluation of the degree of WPI can be done but there are changes to when a ‘special evaluation’ can be done.

3. Revised notice to workers about common law claims

Section 93O notices are no longer required. The Regulations provide for an alternative notice to be given by insurers and self-insurers, in the approved format. From 16 November 2020 insurers and self-insurers are required to notify workers about common law claims if:

  • Insurers – If liability is accepted for a claim for weekly payments, at the same time the worker is notified under Section 57A that liability is accepted.
  • Self-insurers – If liability is accepted for a claim for weekly payments, on or before making the first weekly payment.

The required notice may be given to a worker by emailing it to an address nominated by the worker (a worker is taken to have nominated such an address if it is included in the worker’s claim firm).

4. Email service of liability notices to workers from insurers and self-insurers

A notice under Sections 57A or 57B may also be emailed to a worker or an employer.

5. Annual indexation of capped entitlements

Worker entitlements and caps are indexed annually using various indices. The applicable indexation depended on the type of entitlement. Before 12 October 2020 the indexation method was generally written into the Act, which was problematic if the indexing authority (e.g. the Australian Bureau of Statistics) changed its methodology or frequency of published indices in a way that did not complement the Act (this had occurred before). The Government acknowledged the economic impacts of COVID-19 may be reflected in such indices again, which may result in some worker entitlements reducing so decided to make changes to the legislation.

  • The capped amount for the ‘Prescribed amount’ and ‘Amount C’ for 2020/2021 will be based on the amounts already in force and preserve amounts for prior years
  • The indexation method is shifted to regulations for financial years from 1 July 2021 of the ‘Prescribed Amount’, ‘Amount C’ and amounts set in accordance with section 5A of the Act.
  • Protects against any reduction in the Prescribed Amount, Amount C or section 5A amount if that would otherwise occur due to the indexation method in the regulations.

The impact of these changes is yet to be seen but it is likely no-one will mourn the passing of the termination day. The rebuttable presumption for COVID-19 contracted by health care workers is likely to be met with approval, as will the adoption of email (at last) for various notifications. Finally we note shifting the indexation issue to regulations will prevent anomalies like those which occurred when the Australian Bureau of Statistics Average Weekly Earning index reduced (twice since 2015/16) resulting in a decrease in the cap on workers’ weekly payments and a consequential reduction in the weekly compensation to workers who on the capped amount.

For further information please contact any of the Kott Gunning Insurance Partners.

Stephen Williams

Vidal Hockless

Ash Crisp 

The information published in this article is of a general nature and should not be construed as legal advice. Whilst we aim to provide timely, relevant and accurate information, the law may change and circumstances may differ. You should not therefore act in reliance on it without first obtaining specific legal advice.