The Australian Lawyers Alliance (ALA) has criticised the current system for managing psychological injury claims under the NSW workers’ compensation scheme, calling it a “combative approach” that needs to be fixed.
ALA spokesperson Shane Butcher said they welcome icare’s recent plans to roll out a new model for managing psychological injury claims but were apprehensive as to whether this approach “will be effectively implemented in a timely manner and work to prevent harm to already injured workers.”
According to Butcher, managing psychological injury claims on behalf of an insurer requires an “entirely different set of skills, processes, and systems.” Without a specialised response, the current system is “failing workers with psychological injuries.” This is leading to many claims being denied for common reasons.
Butcher gave evidence on behalf of the ALA at the second hearing of the Standing Committee on Law and Justice’s 2022 review of the NSW workers’ compensation scheme. The review is focused on the increase of psychological claims.
“The real concern is the way that claims for psychological injury are handled,” said Butcher. “It is the ALA’s firm belief that the manner in which claims are currently handled, the conduct of the investigations, and the manner in which claims are disputed, all lead to unnecessary harm of the injured person.”
Butcher asserted that anyone who makes a psychological injury claim is faced with “continual barriers,” including being asked to retell their story to case officers, investigators, specialists, lawyers, and more, with liability being “more routinely declined than for physical injuries.”
The statement from Butcher also voiced the ALA’s concerns regarding the “unclear and contradictory” number of workers’ compensation claims being made for psychological injury, pointing to the fact that the available data fails to indicate “a concerning increase” in psychological injuries due to both NSW’s population growth and the challenges brought by the COVID-19 pandemic.
“A specialised response to the management of psychological injury claims is urgently needed to prevent further harm,” said Butcher.
