SIRA Logo

Workers compensation compliance and enforcement activity

The State Insurance Regulatory Authority’s (SIRA) compliance and enforcement activity delivers on its strategic goals of improving customer experience and results, maintaining scheme and policy affordability and building public trust.

SIRA’s regulatory activities are focused on areas of highest risk to injured people, policy holders and the workers compensation scheme. SIRA takes firm and fair enforcement action as needed, based on the severity of harm or potential harm, the degree of negligence, and/or the need for deterrence.

During the COVID-19 period, SIRA’s regulatory activity has been affected by the need to respond to the pandemic. SIRA has adapted the way it engages with insurers, providers and stakeholders in the scheme in order to comply with the COVID-19 restrictions established by Government.

Key compliance and enforcement activity from 1 July 2019 include:

Key activity between 1 February 2020 and 1 May 2020:

Employers:

  • For this reporting period, 2,767 businesses purchased a workers compensation policy after SIRA commenced non-insurance investigations. This reflects $2.58 million in additional premium raised and 5,537 more employees now being covered by a workers compensation policy. This financial year, SIRA has generated $11.84 million in policy premiums and covered an additional 25,887 NSW workers by targeting uninsured businesses.
  • During this reporting period, $84,750 in penalty notices issued to businesses who were not insured.
  • During this reporting period, $62,320 was collected from businesses as a further penalty for failing to purchase a workers compensation policy.
  • 7 referrals were made to Revenue NSW to commence recovery action for $210,330 of avoided premiums under s156 of the Workers Compensation Act 1987.
  • 13 notices were issued to employers who had failed to establish a return to work program, failed to appoint a return to work coordinator, or not provided suitable work pursuant to the Workplace Injury Management and Workers Compensation Act 1998.
  • 231 visits were made by inspectors to employers with injured workers at risk of not returning to work (as identified through predictive modelling).
  • 35 complaints regarding employers not providing suitable work were referred for investigation.
  • In response to complaints about not providing suitable work, 5 businesses were issued notices to provide information.

Insurers:

  • A quarterly conduct and compliance audit of the Nominal Insurer (icare) was undertaken under s202A of the Workers Compensation Act 1987 pursuant to implementation of the 21-Point Action Plan. The action plan is SIRA’s response to the Compliance and Performance Review of the Nominal Insurer (managed by icare).
  • SIRA requested information/data from the Nominal Insurer under s40C of the Workplace Injury Management and Workers Compensation Act 1998 in order to review PIAWE risk.
  • A self and specialised insurer self-assessment for weekly payments of compensation has been undertaken. The self-assessment reviewed actions taken by 10 insurers in response to a claim for weekly payment to ensure the appropriateness of actions taken to gather timely information to determine PIAWE, accuracy, timeliness and governance.  SIRA is currently reviewing the results.

Providers:

  • Four allied health practitioners had approval to operate in the NSW workers compensation system revoked (as at 18 June 2020).
  • One referral to the Legal services commissioner regarding business practices of a legal firm in relation to industrial deafness claims.
  • Two referrals to the Health Professional Councils Authority regarding conduct of health practitioners.

Key activity between 22 November 2019 and 31 January 2020:

Employers:

  • 1,205 businesses purchased a workers compensation policy after SIRA commenced investigations for being uninsured. This reflects $1.6M in additional premium raised and 4,475 more employees now being covered by a workers compensation policy. To date, SIRA has generated $9.39 million in policy premiums and covered an additional 20,350 NSW workers by targeting uninsured businesses.
  • $19,500 in penalty notices issued to businesses who were not insured.
  • $146,607 collected from businesses as a further penalty for failing to purchase a workers compensation policy.
  • SIRA inspectors visited 149 businesses checking workers compensation insurance coverage as per s238 of the Workplace Injury Management and Workers Compensation Act 1998 which relates to powers of entry by an inspector.
  • 16 notices were issued to employers who had failed to establish a return to work program, failed to appoint a return to work coordinator, or not provided suitable work.
  • A further 13 complaints regarding employers not providing suitable work were investigated by SafeWork NSW inspectors under delegations from SIRA.

Providers:

  • One chiropractor and one psychologist had their approvals to operate in the NSW workers compensation system suspended for failing to meet SIRA requirements under the Workers Compensation Act 1987.
  • Warning letters were issued to three medical practitioners and specialists regarding non-compliance with Fees Orders.
  • Insurers were advised how to reduce the potential for fraudulent medical provider behaviour.

Insurers:

  • report from the independent review into Compliance and Performance of the Nominal Insurer (managed by icare) was released in December 2019.
  • As a result of the review SIRA published a 21-point action plan.
  • Penalties totalling $82,500 were imposed on the Nominal Insurer (managed by icare) for failure to comply with the Workers Compensation Market Practice and Premiums Guidelines capping requirements.
  • The Nominal Insurer (managed by icare) was issued with a letter of censure for non-compliance with a direction issued by SIRA in relation to data accuracy requirements in accordance with the Workers Compensation Act 1987.
  • Six directions for security deposit increases were made to self-insurers under s213 of the Workers Compensation Act 1987.
  • SIRA granted the Coles Group Pty Ltd a one-year licence renewal term and requires data quality issues to be remedied.
  • SIRA imposed a special licencing condition on Catholic Church Insurance to ensure a corrective action plan is implemented to improve case management practices.

Key activity between 11 September 2019 and 22 November 2019:

Employers

  • 11,169 businesses contacted by SIRA for potentially operating without the required workers compensation policy.
  • $135,750 in penalty notices issued to employers failing to take out compulsory workers compensation insurance.
  • 2,685 new workers compensation policies taken out by employers following SIRA regulatory intervention. This has resulted in approximately
  • $3.9M in additional premium raised from employers detected by SIRA as not having workers compensation insurance, and 7,578 more employees being covered by a workers compensation policy.
  • 17 referrals made to Revenue NSW to commence recovery action for $246,584 of avoided premiums under s156 of the Workers Compensation Act 1987.
  • One penalty notice for $500 was issued to an employer for failure to comply with a s174 Order under the Workers Compensation Act 1987 which relates to keeping and supplying records of wages and contracts.
  • 15 complaints regarding employers not providing suitable work were responded to by SafeWork NSW under delegations from SIRA. Of these, one employer was issued with a notice under s49 of the Workplace Injury Management and Workers Compensation Act 1998 requiring them to provide suitable work.
  • 19 notices were issued to employers for either failing to establish a return to work program or failing to appoint a return to work coordinator.
  • Three employers were the subject of return to work disputes which required further information to be sought to assist inspectors to make a determination. SIRA-authorised inspectors used powers under s238AA of the Workplace Injury Management and Workers Compensation Act 1998 to obtain information in relation to these return to work matters.

Providers

  • SIRA revoked its approval of 90 Allied Health Providers (AHPs) who no longer comply with SIRA requirements. Reasons included the provider no longer registered on the AHPRA (Allied Health Practitioner Regulation Agency) website.
  • SIRA revoked its approval for one AHP after they were found guilty of professional misconduct by the NSW Civil and Administrative Tribunal, which led to cancellation of the provider's registration as a physiotherapist.
  • SIRA detected a chiropractor with allegedly non-compliant billing practices and used its powers to require the provision of information as part of its investigation. SIRA is now requiring this provider to show cause as to why SIRA should not suspend or revoke the chiropractor’s approval as a workers compensation allied health practitioner.
  • SIRA detected a provider overcharging for services and the intervention resulted in the recovery of $154,552.

Insurers:

  • In February 2019, after having identified a deterioration in the performance of the Nominal Insurer, SIRA commissioned Ms Janet Dore as an independent reviewer to conduct a Compliance and Performance Review into the Nominal Insurer. That Review is presently in its final stages with the report of the independent reviewer due to be published by SIRA by the end of the year.
  • Three formal warnings were issued to insurers for breach of licence conditions pursuant to s181 of the Workers Compensation Act 1987. Those breaches involved failures to provide timely and/or accurate claims data to SIRA.
  • SIRA is currently reviewing the performance tier for self-insurer Woolworths in accordance with SIRA’s tiering guidelines.
  • SIRA conducted audits of icare and Toll Holding as per s202A of the Workers Compensation Act 1987.
  • Twelve directions for security deposit increases were made to self-insurers under s213 of the Workers Compensation Act 1987.
  • SIRA imposed a special licencing condition on Catholic Church Insurance as a result of a case management audit.

Key activity between 1 July 2019 and 10 September 2019:

Employers

  • 155 penalty notices approved for the amount of $750 each, issued pursuant to s155 of the Workers Compensation Act 1987, for employers failing to take out compulsory workers compensation insurance.
  • $3.4M in additional premium raised, from employers detected by SIRA as not having workers compensation insurance.
  • 4,556 additional employees now covered by workers compensation insurance (noting that icare does provide cover in the event of a business failing to have a workers compensation insurance policy).

Providers

  • 49 caution letters sent to medical practitioners/providers regarding compliance obligations.
  • Seven education letters sent to insurers to leverage practitioner/provider compliance.
  • One medical practitioner and one allied health practitioner subjected to SIRA site visits using powers under s238AA of the Workplace Injury Management and Workers Compensation Act 1998 to obtain information.
  • Two providers subjected to SIRA’s investigative powers pursuant to s238AA of the Workplace Injury Management and Workers Compensation Act 1998, due to suspected duplicate invoicing, overcharging and over-servicing.
  • Investigations commenced against one provider for failure to comply with SIRA inspectors under s238 of the Workplace Injury Management and Workers Compensation Act 1998. Potential maximum penalty of $11,000.

Insurers

  • 86 notices issued under section 40B of the Workplace Injury Management and Workers Compensation Act 1998 (data gathering power) to obtain information for suspected legislative breaches.
  • Two insurers, Catholic Church Insurance Limited and Veolia Environmental Services (Australia) Pty Ltd, notified of SIRA’s intention to impose new licence conditions.
  • Catholic Church Insurance Limited was issued three penalty notices with respect to non-compliance with claims management practices within their portfolio.
  • Civil penalties imposed on the Nominal Insurer in relation to 24 breaches of s267 of the Workplace Injury Management and Workers Compensation Act 1998 (duty to commence weekly payments following initial notification of injury).
  • Direction notice issued to the Nominal Insurer under s194 of the Workers Compensation Act 1987 (directions to insurers with respect to claims procedures) requiring compliance with Return to Work data items from 1 August 2019.
  • Nine formal warnings issued for breach of licence conditions pursuant to section 181 of the Workplace Injury Management and Workers Compensation Act 1998, in respect of the failure to provide timely and/or accurate claims data to SIRA:
    • Coles Group Limited
    • Racing NSW
    • Inghams Enterprises Pty Ltd
    • Statecover Mutual Limited
    • Toll Holdings Limited
    • Central Coast Council
    • NSW Trains
    • Boral Limited
    • Bluescope Steel Limited.
  • Five notices issued under s238AA of the Workplace Injury Management and Workers Compensation Act 1998 (notice served by an inspector, with the power to obtain information) in relation to claims information.