Workers Compensation laws in Western Australia provide that workers who are injured at work are entitled to weekly payments, to compensate for lost wages, up to a limit of $224,921. This limit is referred to as the “prescribed sum”. Changes are made to the prescribed sum each July.
Under Section 217 of the Workers Compensation and Injury Management Act 1981 WorkCover may extend the workers weekly payments up to 75% of the prescribed sum. A fully successful application can thus result in increased payments of up to $168,690.
To succeed in an application under Section 217 an applicant worker must prove:
- The worker has an injury that is compensable under the Act.
- The worker has “total permanent incapacity for work”.
- An order is appropriate to the worker’s “social and financial circumstances and the reasonable financial needs of the worker.”
Injury Compensable Under the Act
If the worker has received compensation up to the prescribed sum it is highly likely that he or she will have to be able to prove that the injury is compensable under the Act. For the employer to argue otherwise there would need to be a plausible argument that compensation was paid to the worker by mistake or as a result of fraud.
Permanent Total Incapacity
Permanent total incapacity has been held to mean that the worker has incapacity to work in the foreseeable future, not necessarily forever. For an example, see the case of Lockwood & Hall v BHP Billiton Nickel West Pty Ltd  WASCA232.
Whether a worker has “permanent total incapacity” will usually be a question of fact for each case.
Often there will be evidence that a worker is not fit for his or her old job but is capable of some form of alternative employment. In cases of this sort a worker may still be able to qualify as having permanent total incapacity for work if there is no reasonable prospect of the worker finding employment.
A worker with a partial capacity to work may therefore fall into the category of being an “odd lot” in the employment market. In other words, the worker has a theoretical capacity to do something but no real capacity to find work.
In practise it is not easy to prove that a worker with partial capacity is an “odd lot” particularly in a large employment market such as Perth. The type of evidence required to run this argument would be a vocational assessment and labour market assessment as well as the usual medical evidence. The matters which an arbitrator would consider are the worker’s location, the availability of work in that location, the workers age and skills and the likelihood of the worker finding employment.
There are also problems for the employer in this type of case. Once a worker makes available some evidence to support his or her case the employer has to prove that the worker can find suitable employment.
Social and Financial Circumstances
In each case under Section 217 the Arbitrator will consider the personal situation of the worker to determine the appropriate award, if any. The legislation does not list the factors to consider but decided cases indicate that the worker’s financial situation and his or her needs are the most likely relevant factors.
Procedure for Making a Claim
A worker will generally know approximately when his or her workers compensation payments will run out. It is advisable to have all the evidence ready to go before the prescribed sum runs out so that the claim can be made under Section 217.
There is no reason why the Section 217 claim cannot be raised with the insurer before workers compensation payments expire.
If the claim is disputed the first step in the process of making the claim is to lodge an application for conciliation (WorkCover Form 100) and Statement of Social and Financial Circumstances (WorkCover Form 101).
At the conciliation the parties are given an opportunity to settle the case. If successful on the claim it does not necessarily follow that the worker will recover the maximum payment. The level of award is discretionary and as such it is reasonable for both sides to look at a compromise. It also needs to be kept in mind that if any award is paid out in weekly payments the amount received would be taxable.
If conciliation fails to achieve settlement the next step is for the worker to lodge an application for arbitration (WorkCover Form 150) and Statement of Social and Financial Circumstances (WorkCover Form 153). The application would then proceed to an arbitration hearing.
Applications under Section 217 can involve reasonably significant cost to both parties.
To the extent that medical and expert evidence has to be obtained there is the expense of paying for the reports.
The Workers Compensation (Legal Practitioners and Registered Agents) Costs Determination sets the maximum number of hours that a lawyer may charge for particular services.
The cost of conciliation could be around 12 hours work. The cost of the arbitration would depend on the length of the hearing and the number of directions hearings but after a 2 day hearing the legal time might be around 30 hours.
Hourly rates vary depending on the seniority of the lawyer but currently a senior practitioner (admitted over 5 years) may charge $380.00 per hour plus GST.
For the vast majority of workers the prescribed sum will cover their claim. For the minority, where the prescribed sum does not cover the worker’s full loss, it is well worth considering a claim to extend the prescribed sum. If such an application is under consideration it is wise to prepare the claim and gather all the relevant evidence well before the time that the prescribed sum is due to expire.