Victoria has recently enacted the Workplace Injury Rehabilitation and Compensation Amendment (WorkCover Scheme Modernisation) Act 2023, a significant overhaul aimed at modernising the WorkCover scheme. 

Unfortunately, these changes will make it far more difficult for many injured workers to access and remain in receipt of Workcover benefits.  

The main changes are:

  • New Eligibility Requirements for Mental Injury Claims
    Introducing updated criteria and definitions for workers to qualify for mental injury claims. An exclusion for stress and burnout because of normal workplace activities. 
  • New Eligibility Requirements for Weekly Payments After 130 Weeks
    After 130 weeks, workers must meet an additional impairment standard to keep receiving weekly payments, in addition to the current test of “no current working capacity”.

This article will explore the new WorkCover law changes and their implications, adopting a human-centred perspective to understand the real-life impacts on current and future recipients.

Workcover Changes

Overview of the WorkCover System & WorkCover Claims

WorkCover Victoria is a crucial component of Victoria’s worker protection framework. It provides financial support and medical benefits to employees who suffer work-related injuries or illnesses. The WorkSafe Victoria regulator oversees the scheme, which helps injured workers focus on recovery without the additional burden of financial stress.

Key Changes Under the Scheme Modernisation Act

From 31 March 2024, there are 

It should be noted that these changes do not apply retrospectively. 

New Eligibility Requirements for WorkCover Mental Injury Claims: 

The definition for mental health claims has been adjusted and is now much more difficult. In order for such a claim to be accepted, an injured worker must establish:

  • That they have suffered a psychiatric injury which causes significant behavioural, cognitive or psychological dysfunction;
  • Be diagnosed by a medical practitioner such as a GP or psychiatrist (not a psychologist) in accordance with the DSM-5;
  • The injury must have been predominately caused by employment. 

The changes have introduced an exclusion to those suffering reason of stress and burnout, from normal workplace activities such as normal work pressures and additional hours.  This does not include stress and burnout caused by bullying, harassment, or exposure to traumatic incidents through normal duties. 

These changes do not impact a worker’s entitlement to provisional payments (up to 13 weeks) under the scheme. 

Eligibility For Workcover Weekly Payments After 130 Weeks

Previously, to remain in receipt of weekly payments post 130 weeks, an injured worker must establish that they have no current work capacity and that this is likely to continue indefinitely. 

The changes will make this test much more difficult. From 31 March 2024, in order to continue to receive weekly payments post 130 weeks, an injured worker must establish that:

  • They have no current work capacity and this incapacity is likely to continue indefinitely;
  • They have a whole person impairment of more than 20% (i.e. 21% or greater) as assessed pursuant to the American Medical Associations Guides to the Evaluation of Permanent Impairment 4th Edition.  

The proposed changes also require that the Authorised Insurer conduct a review of a person’s entitlement after 130 weeks, every 2 years. 

How is Impairment calculated?

An injured worker’s level of impairment for physical injuries will be assessed pursuant to the American Medical Association’s Guides to the Evaluation of Permanent Impairment Fourth Edition. For psychiatric injuries, the whole person impairment is assessed pursuant to the Guides to the Evaluation of Psychiatric Impairment for Clinicians. 

The Authorised Insurer will be required to arrange and fund independent examinations with specialists qualified in the abovementioned Guides. 

Should this occur but the injured worker be unhappy with the result, it is possible to seek a final and binding assessment with the Medical Panel. 

Impact on Current WorkCover Recipients

For those currently on WorkCover, these changes may bring about several immediate effects:

Adjustment to Mental Health Claims 

Workers with existing mental health claims may be affected by the new eligibility requirements. While they will have access to provisional payments and enhanced support, the cessation of ongoing weekly benefits may cause uncertainty and financial stress during the adjustment period.

New Impairment Testing

Those approaching the 130-week mark from March 21st, 2024, will need to prepare for the additional impairment test. This may result in some workers losing their weekly benefits if they do not meet the new criteria, highlighting the importance of staying informed about their rights and the new processes. WorkCover or a representative will be in touch with anyone who is in this situation and may be affected.

Implications for Future WorkCover Claimants

Future claimants can expect the following implications from the updated WorkCover laws:

Stricter Eligibility and Testing Requirements

The new eligibility criteria for mental health claims and the additional impairment test after 130 weeks may make it more challenging for some workers to qualify for extended benefits. Understanding these requirements will be crucial for navigating the system effectively.

Enhanced Rehabilitation and Return-to-Work Focus

The emphasis on rehabilitation indicates a proactive approach to injury management. Future claimants can anticipate more structured and supportive rehabilitation programs, aiming to reduce downtime and promote quicker recoveries.

Human Impact and Community Perspective

While legal changes can often feel abstract, the real-world impact on individuals and communities is profound. For injured workers and their families, these updates mean navigating a new landscape of support and compliance. 

Emotional and Psychological Effects

Adjusting to new compensation structures and compliance requirements can be stressful. Support systems must be in place to ensure that workers feel informed and supported during this transition.

Community and Employer Roles

Employers must adapt to these changes by enhancing workplace safety measures and ensuring compliance with the new standards. Community support networks, including healthcare providers and legal advisors, play a crucial role in helping workers understand and navigate the new system.

Final Comments

National Compensation Lawyers is extremely disappointed and concerned with these changes that the Victorian Government has imposed. Ultimately these changes will make claims much more challenging for many deserving claimants. 

Please do not hesitate to contact our expert lawyers with any questions to the above changes.  

For more information, you can watch the WorkSafe Scheme Modernisation webinar here.

Please get in touch with our team if you have specific questions relating to a WorkCover matter or employment injury.