Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

At the request of Senator Wong, I move:

That the Guide to the Assessment of the Degree of Permanent Impairment [second edition], made under subsection 28(1) of the Safety, Rehabilitation and Compensation Act 1988, be disallowed.

The Comcare guide is in the form of a disallowable instrument and was tabled on 10 October 2005 in both the House and the Senate. The guide is an updated guide prepared by Comcare, a department under the responsibility of the Minister for Employment and Workplace Relations. The guide was approved by the minister.

The existing guideline is based on a United States model. In light of medical science advances, the US guide was updated. These changes led Comcare to take the view that the Australian version should also be reviewed and updated. The guidelines are in extremely technical language. The review process took approximately two years. There are three general areas where the new guide will affect employees: (1) the musculoskeletal tables under the new guide; (2) the commencement of the new guide and its impact on third party claims; and (3) the distinction between non-military and military personnel.

The amended guide provides for new parameters for an injured employee to satisfy the threshold requirement of 10 per cent whole person impairment to enable an injured employee to receive compensation for non-economic loss. There is a concern that the reduction of entitlements is primarily due to the changes made to the musculoskeletal table, the most commonly used table for injured employees. Not only are the criteria much more difficult to satisfy but there are a number of tables which have sought to reduce workers’ rights without legislative authority.

For example, section 24(7) currently provides that, subject to section 25, if (a) the employee has a permanent impairment other than hearing loss and (b) Comcare determines that the degree of permanent impairment is less than 10 per cent, an amount of compensation is not payable to the employee under this section. But looking closely at the guide it becomes clear that there is no specification for a 10 per cent criterion. Tables 9.15, regarding the cervical spine, 9.16, regarding the thoracic spine, and 9.17, regarding the lumbar spine, do not specify a 10 per cent criterion. Instead, an eight per cent criterion is specified followed by a 13 per cent criterion in the case of the lumbar spine and an 18 per cent criterion in respect of the cervical and thoracic spines. In doing so, the new guide has raised the percentage required of a permanent impairment from 10 per cent to 18 per cent. This has the effect of excluding a large number of employees from compensation.

Another area worth mentioning briefly is part 4: the restriction of compensation to 10 per cent for a whole person impairment. To put it more plainly, permanent impairment is to be assessed on the basis of the employee as a whole person, not on the permanent impairment of any body part system or function of the employee. The new guide goes on to require that the employee suffers from 10 per cent whole person impairment before being entitled to compensation.

Section 24(1) clearly provides that Comcare is liable to pay compensation where an injury results in permanent impairment. Section 24(7) provides that compensation is not payable where Comcare determines that the degree of permanent impairment is less than 10 per cent. This is despite the fact that the Safety, Rehabilitation and Compensation Act defines ‘impairment’ to mean the loss of use of any part of the body system or function or any part of a system or function. So, in effect, the new guide appears to seek to further restrict the meaning of this section—a restriction that an employee is required to suffer not a 10 per cent permanent impairment to part of his or her body function or system but a 10 per cent whole person impairment. This will risk leaving, for example, an employee who may suffer from limitations in the movement of their cervical spine without any significant assistance because, while this would be a permanent impairment of the cervical spine greater than 10 per cent, under the new guide it would not satisfy the 10 per cent whole person threshold.

The new guide also impacts on third party claims. There is a concern that the commencement of the guide from 1 March places many employees at a disadvantage. It is well known that employees permanently impaired through work often base their decision to not make a third party claim on the basis that a lump sum payment for permanent impairment will be made. Under the old guide, employees had five months to lodge a third party claim. This will not assist those people whose conditions are not yet permanent or those who are not aware of the changes. As a result, many workers will lose the entitlement to lodge a claim as they have failed to adhere to limitation periods.

We remain concerned that the new guide, as drafted, potentially introduces a discriminatory system for the assessment and treatment of workers compensation. The government’s decision, for instance, to exempt the military from application of the new guide is problematic. Setting up a two-tier system which treats more favourably injured military employees as against other Commonwealth employees is unjust and unfair. A work related injury, particularly one that results in permanent impairment, should not be compensated differently because they have a different employer. All work related injuries are to be deplored and, as a matter of principle, victims deserve appropriate compensation from a scheme and benefit structure which is equitable and transparent. We remain concerned that this principle has been lost under the new guide. I use these examples to illustrate how this new guide does not serve the interests of all employees well. Labor cannot accept that the guide in its current form is in the best interests of all applicable employees. Labor seeks to disallow this guide.

Gary Humphries (ACT, Liberal Party) Share this | Link to this | Hansard source

I rise to indicate that the government does not support the motion of disallowance that Senator Conroy, on behalf of Senator Wong, moved. Instead, I indicate that the regulations that have been tabled, the new Guide to the Assessment of the Degree of Permanent Impairment, are considered to be a modern updating of a guide which is very important in the assessment of entitlement to compensation. In fact, it greatly improves the position compared with the previous guide, which was something like 16 years old and clearly in need of updating.

The Minister for Employment and Workplace Relations approved the new Guide to the Assessment of the Degree of Permanent Impairment on 8 September last year. Under the Safety, Rehabilitation and Compensation Act 1988, the guide provides the basis for assessing the compensation payable for permanent impairment and non-economic loss resulting from a work related injury. The guide was tabled in September, as I have indicated, but has been in operation since 1 March and it applies to all permanent impairment applications made from that date.

It is obvious that a guide which was some 16 years old needed to be updated. Indeed, the previous guide was based on the outdated second edition of the American Medical Association’s Guides to the Evaluation of Permanent Impairment. The American Medical Association’s guide, as updated from time to time, appears to be the best practice or world standard that is used in these matters, and I understand a number of countries use this guide as the basis of their assessment of permanent incapacity as well. So, since the original second edition came out, there have been very significant advances in medical knowledge and clinical practice of impairment assessments.

The American Medical Association guide is now in fact in its fifth edition; there have been three further additions since the one upon which the previous Australian guidelines were based. The old guide simply no longer provided a clear and objective system for measuring impairment. Indeed, the former guide was heavily criticised by the Administrative Appeals Tribunal and the Federal Court as being confused, poorly drafted and ambiguous. It was also, incidentally, inconsistent with the majority of state and territory schemes operational in this country—those of Queensland, New South Wales, the Northern Territory, Tasmania and Victoria—as well as, by the way, New Zealand. Those states and territories, and that country, base their assessment guides on either the fourth or the fifth edition of the American Medical Association guide.

The new Australian guide, which the minister brought down last year, requires medical assessors to use more specific measurements of impairment. It has more comprehensive instructions about which measurements are required and how ratings may at times be combined. Comcare has already provided training in the new guide to more than 100 specialists and is in the process of training more. Many more will be trained in the next few months. Senator Wong’s motion is simply designed to delay the commencement of the revised guide, thereby denying a significant number of employees covered by the SRC Act the right to have an assessment of their impairment conducted under a regime which is both relevant and consistent with contemporary practice.

This is not a measure to reduce costs. I do not think that allegation was made by Senator Conroy, but, in case it is inferred that this is some way of reducing the cost to employers or the Commonwealth that is entailed in the process of compensating injured employees, let me assure the Senate that the guide actually provides for higher payments for a number of impairments, particularly impairments which are considered to be more severe. The guide is not a cost-cutting exercise; rather, it is about using the best medical assessment processes available today.

In order to produce the most contemporary and up-to-date guide to practice, Comcare as the agency charged with overseeing these guidelines consulted very widely in developing and finalising the new guide, involving a large number of important stakeholders. The Australian Government Solicitor and a number of other legal practices were brought in for that task, as were representatives of plaintiff lawyers, employee representatives, ex-service organisations and expert medical specialists. As part of the process of putting in place the new guide, Comcare conducted trial parallel assessments using the draft new guide side-by-side with the old guide. Where necessary, Comcare adapted elements of the new guide to suit Australian clinical practice. So it has not been taken holus bolus; it has been carefully adapted and carefully canvassed with stakeholders in this field.

As I said, one important difference in the new guide is that it requires medical assessors to use more specific measurements of impairment and has more comprehensive instructions about which measurements are required and how ratings might at times be combined. Comcare expects that medical specialists rather than general practitioners will do assessments under the guide and, as I said, has already provided training to more than 100 of those specialists in anticipation of the guide coming into operation.

I do not wish to respond specifically to the technical issues that were raised by Senator Conroy. The fact is, however, that those issues were no doubt considered very carefully, as stakeholders and others contributed to the process. It would be unfortunate if the advantages the new guide provides to the industries affected by it were delayed. It is now in operation. It is now understood by a large number of participants in the sector. There are more than 100 specialists now conversant with the terms of the new guide. It is an important step towards guaranteeing contemporary and up-to-date practices in the field of assessing permanent impairment. I therefore urge the Senate to reject the disallowance motion in Senator Wong’s name.

Question negatived.