HE state government agency responsible for ending the workers’ compensation payments of thousands of permanently injured workers has almost 10 per cent of its 600-strong workforce earning between $230,000 and $700,000 a year.
The revelation has angered those who say changes to workers’ compensation laws have thrown them on the scrapheap, and led the Labor opposition to renew its fight against what it says were “mean spirited” changes introduced five years ago during a temporary deficit in the system triggered by the global financial crisis.
Labor says the workers’ compensation fund is in growing surplus, meaning there is no financial rationale for throwing 4000 permanently injured workers on the scrapheap.
Under the 2012 changes, anyone whose “whole person impairment” was measured at less than 20 per cent had their payments ended after five years. People began to lose their payments from late last year.
The government agency, Insurance and Care NSW – which goes by the name icare – says it introduced new services to help those losing their compensation payments to “return to work and get back to life”.
But one Hunter person caught up in the changes, Yvette Roskell, of Caves Beach, says iCare is joking if it thinks people in her situation can suddenly get better.
Ms Roskell, 45, says she was working at Bi Lo in Mount Hutton about 15 years ago when her back went on her while cleaning the store’s meat cabinet.
Bi Lo’s insurers accepted liability but despite years of treatment, including surgery a few years after the accident, Ms Roskell eventually had to stop work.
“I had two kids growing up, I was working as much as I could but it got so bad, even with the numbers of tablets I was taking, that I couldn’t work any more,” Ms Roskell said.
“I had permanent nerve damage, I had spinal damage. I went to court and won a whole person impairment judgement.
“Instead of taking a lump sum I chose weekly payments because I knew I was going to need more surgery. If I’d have taken it in one go they couldn’t have touched me but I did the right thing and look what they are doing!”
Ms Roskell is still receiving payments, but is waiting for the outcome of an arbitration case that may move her impairment above 20 per cent.
“Because of my husband’s income, I will be unlikely to get any government benefits, which will make us $45,000 a year worse off through no fault of mine,” Ms Roskell said. “That’s a lot of money when you are still paying off a house.”
Sydney solicitor Sue Bowrey says the insurer is fighting Ms Roskell’s specialist’s recommendation that she have a spinal fusion.
“The argument in Yvette’s case is whether the surgery is ‘reasonably necessary’, to use the correct legal language,” Ms Bowrey said.
“It all depends on whether it’s decided that she has reached ‘maximum medical improvement’ or not.”
Ms Bowrey said the “perverse outcome” in Ms Roskell’s case was that even though the spinal fusion could improve her situation, it would also increase her level of impairment on icare’s scale.
If the arbitrator decided Ms Roskell should have the surgery, her whole person impairment would move above 20 per cent, with her payments continued.
If not, she would lose her payments.
Ms Bowrey described the five-year cut off as “dumb and mean”.
“It’s dumb because it doesn’t meet an economic need any more, and it doesn’t help the economy in any way, and it’s mean because it’s kicking people when they are down and taking down a support that they thought would be there for as long as they needed it.
“It’s somewhat ironic that the Liberal Party of all things would try and socialise the cost of people injured in private enterprise by saying they can go onto Centrelink, but the reality is that many people will not get any benefits from Centrelink.
“Their incomes will drop dramatically, if not disappear entirely. It’s not only distressing for the injured people, it’s also distressing for those of us who work with them.”
Clayton Barr, the Labor Cessnock MP who has led the fight against the changes in his role as opposition finance spokesperson, says many of the people who are losing their compensation payments are in desperate situations.
Mr Barr said Labor had been pushing during Budget Estimates to learn more about the executive pay structure within icare but had been “stonewalled” by the government, which said the information would “all be in the annual report”.
The latest icare annual report for the year to June 30, 2017, reveals the organisation, which has about 600 full-time equivalent employees, had 55 senior executives on average earnings of between $230,790 and $703,112.
Mr Barr said the number of executives, and their incomes, seemed excessive.
The report showed five executives on the $703,112 average, with 18 on an average of $374,632, 10 on an average of $295,681 and 22 on an average of $230,790.
Executive remuneration accounted for 19.9 per cent of icare’s employee-related expenditure. The 55 executives – 35 men and 20 women – accounted for 9.2 per cent of icare’s workforce.
Given that Hunter Water, for example, spent just over 4 per cent of its wages bill last year on executives, the Newcastle Herald asked icare how it could justify such a top-heavy structure. Icare’s answer did not address executive earnings, saying only that its overall wages bill was “competitive in relation to any other comparable public or private insurance scheme in Australia”.
Mr Barr said he doubted that statement was accurate, saying “expenses” last year equated to 31 per cent of icare’s premium income, three times as high as it had been and well above the cost base in other states.
“Under the current scheme the average injured worker is getting around $40,000 per year,” Mr Barr said.
“By comparison, you’ve got executives at icare taking home that much every month! Where is the justice and fairness in that?”
Another person caught up in the changes is a 63-year-old Cessnock woman, who says Cessnock is “too much of a small town” to be named.
The woman, who says she worked for the NSW Attorney General’s department for 25 years before things went wrong in a series of workplace bullying incidents, said she had been told by her insurer in 2015 that her fortnightly compensation payments would continue until she turned 65.
Then, in October, she was notified that her payments would stop on December 23, which they did.
The woman said the bullying began when she moved to a new workplace in 2006, which had a “toxic” work atmosphere.
Unable to cope with the situation, she took sick leave and took long service leave from 2010, while her workers’ compensation claim was worked through.
She said she won her case in 2012, with the insurer accepting she was “totally and permanently incapacitated” by the psychological trauma she had suffered at work.
As is often the case in compensation matters, her own doctors scored her a higher whole person impairment – 17 per cent – than the insurer’s doctors did, although the insurer still accepted liability, paying her about $1400 a fortnight.
“Those who had admitted to the bullying in mediation kept their jobs, but my career was over through no fault of my own,” the woman said.
“I thought there was an unspoken rule between political parties that you don’t make legislation retrospective. I was assessed as being unfit to return to work, with compensation to continue until I was 65. It’s unfair, and it’s wrong.”
As part of Labor’s effort to combat the five-year cut off law, Mr Barr introduced a private member’s bill into state parliament on September 21 last year, telling parliament he would happily withdraw his Workers Compensation Amendment (Protection of Injured Workers) Bill 2017 if the government introduced similar legislation.
“There is no light at the end of the tunnel for people with complicated injuries,” Mr Barr told parliament. “Things will not get better for them. These injured workers, who have 1 per cent to 20 per cent whole body impairment, have satisfied myriad doctors, lawyers and insurers that their future is so bleak their payments should continue.
“Five years is simply a commercial figure – an insurer's figure – so that they know when they can close the file.”
Mr Barr said the government had ignored his bill, which will lapse on March 20 if not debated in the meantime.
“I desperately wanted it debated before people were cut off,” Mr Barr said this week. “Nevertheless, if the debate comes on I will have it, because I want government MPs to justify themselves. Every one of them has dozens of injured workers in their electorates who are being cut off. Let them explain that!”
Has your compo been cut off? Contact firstname.lastname@example.org