ALA tells inquiry Newstart puts injured workers in hardship

27th Aug 2012

Concerns about Newstart Allowance payment inadequacy and the transition from alternative payments such of WorkCover has prompted the Australian Lawyers Alliance to submit to and appear before an Inquiry on the subject today.

ALA’s ACT President, Angus Bucknell and ALA member, Mal Byrne, gave evidence to the Senate Education, Employment and Workplace Relations Committee Inquiry into the adequacy of the allowance payment system for jobseekers and others. They appeared to voice concerns about the adequacy of payments to one of Australia’s most marginalised groups – injured workers.

Organisations such as the Australian Council of Trade Unions, the National Employment Services Association, Mission Australia, Combined Pensioners and Superannuants Association and the Salvation Army, also appeared before the committee – many with similar concerns.

“Injured workers are one of our most vulnerable community groups, yet, complexities surrounding transition between schemes such as workers compensation income maintenance and Centrelink benefits is leaving many with financial difficulty – particularly in South Australia,” Mr Bucknell said.

This follows an end to workers compensation income maintenance and a new determination now based on section 35B of the Workers Rehabilitation and Compensation Act 1986.

“When a worker is injured, he or she is paid workers compensation income maintenance at a rate of 100% of his or her pre-injury employment earnings for three months, 90% of such a rate for a further three months and then 80% for as long as substantiation of total employment incapacity can be maintained,” Mr Bucknell said.

“The scheme purpose is to transition the injured back to pre-injury employment conditions, but a problem arises when injury prevents this and makes rehabilitation plans difficult.

"Not unreasonably, injured workers ideally would like similar work to which they are accustomed and trained rather than something foreign or demeaning. This is not happening in South Australia and is leading to a downward spiral of depression, litigation and an adversarial relationship between rehabilitation provider, the corporation and the worker.

"In the past, when these relationships developed, disputes would often be resolved by way of capital lump sum payment,” he said.

“But since the 1 April 2009 Workers Rehabilitation and Compensation Act 1986 amendments, such payments have stopped at 130 weeks post injury on the basis of partial capacity that now results in a forcible transfer to Newstart payments as an income maintenance substitute.

"This is creating a subclass of injured that are suffering psychologically because of the way they feel they are being treated and because of a stigma of having made claims prejudicing potential employers against them. This is coupled with insufficient, meaningful training being offered that might provide a new vocational direction,” Mr Bucknell said.

Tags: Workers' rights WorkCover Workers compensation