GN 5.5 Payments to workers with highest needs

Published: 12 August 2019

Last edited: 8 March 2024

- GN 5.5 Payments to workers with highest needs

Application: this guidance does not apply to exempt workers

Overview

June 2012 workers compensation reforms

The Workers Compensation Legislation Amendment Act 2012 introduced a number of changes to workers compensation benefits.

This included new weekly payment arrangements where a worker’s entitlement to weekly payments are made with reference to their pre-injury average weekly earnings (PIAWE). Changes to these weekly payment arrangements came into effect on 1 October 2012 for all new claims, and 1 January 2013 for existing claims.

Workers with a degree of permanent impairment of more than 30 per cent (‘seriously injured workers’) are entitled to additional benefits, this change came into effect on 17 September 2012.

2015 benefit reforms

In 2015, the Workers Compensation Amendment Act 2015 (2015 Amendment Act) introduced amendments providing additional benefits to meet the needs of the most seriously injured workers.

The 2015 amendments also replaced the definition of ‘seriously injured worker’ with that of ‘worker with highest needs’. As defined in section 32A of the Workers Compensation Act 1987 (1987 Act), a worker is a ‘worker with highest needs’ if they have an injury which has resulted in permanent impairment, and:

the degree of permanent impairment has been assessed by a trained assessor of permanent impairment as being more than 30 per cent, or
an assessment of degree of permanent impairment is pending and has not been made because a medical assessor has declined to make the assessment because maximum medical improvement has not been reached and the degree of permanent impairment is not fully ascertainable, or
the insurer is satisfied that the degree of permanent impairment is likely to be more than 30 per cent.

An additional entitlement was introduced for 'workers with highest needs’ to enable access to a special provision amount.

Special provision for workers with highest needs

Section 38A of the 1987 Act commenced on 4 December 2015 and provides that the amount of weekly compensation that a worker with highest needs may be eligible to receive is $788.32 (as indexed). This is known as the special provision amount. The special provision amount applies to periods of incapacity from 17 September 2012.

Note:

The special provision amount is indexed in April and October each year, with the applicable rate found in the Workers compensation benefits guide.

When the special provision does not apply

Transitional provisions (Parts 19H and 19I of Schedule 6 to the 1987 Act and Schedule 8 to the Workers Compensation Regulation 2016) provide that in certain circumstances, section 38A of the 1987 Act does not apply.

These circumstances include periods of incapacity before 17 September 2012 when seriously injured workers were first transitioned. This also includes workers whose pre-injury average weekly earnings have been deemed to be equal to the transitional amount for the purposes of the application under clauses 9 or 10 of Part 19H of Schedule 6 to the 1987 Act of the weekly payments' amendments.

The table below outlines the differences between the special provision amount provided by section 38A of the 1987 Act and the amount available to existing recipients, being 80 per cent of the transitional rate as indexed twice a year.

From	To	Transitional rate	80% of Transitional rate	Section 38A special provision amount
1/04/2024	30/09/2024	$1,231.10	$984.88	$996.00
1/10/2023	31/03/2024	$1,194.50	$955.60	$978.00
1/4/2023	30/9/2023	$1,180.60	$944.48	$955.00
1/10/2022	31/03/2023	$1,154.20	$923.36	$917.00
1/04/2022	30/09/2022	$1,142.50	$914.00	$887.00
1/10/2021	31/03/2022	$1,125.20	$900.16	$871.00
1/04/2021	30/09/2021	$1,111.20	$888.96	$861.00
1/10/2020	31/03/2021	$1,105.20	$884.16	$854.00
1/04/2020	30/09/2020	$1,096.20	$876.96	$854.00
1/10/2019	31/03/2020	$1,082.20	$865.76	$845.00
1/04/2019	30/09/2019	$1,073.20	$858.56	$840.00
1/10/2018	31/03/2019	$1,057.40	$845.92	$831.00
1/04/2018	30/09/2018	$1,049.10	$839.28	$826.00
1/10/2017	31/03/2018	$1,035.90	$828.72	$814.00
1/04/2017	30/09/2017	$1,027.60	$822.08	$808.00
1/10/2016	31/03/2017	$1,014.40	$811.52	$796.00
1/04/2016	30/09/2016	$1,006.90	$805.52	$793.00
1/10/2015	31/03/2016	$993.70	$794.96	$788.32

Entitlement to weekly payments

The worker's entitlement to the special provision amount commences from the date confirming a worker is a worker with highest needs and not the date of injury (see Meat Carter Pty Limited v Melides [2020] NSWCA 307).

The NSW Court of Appeal in Meat Carter Pty Limited v Melides [2020] NSWCA 307 considered whether a worker is entitled to the special provision amount from the date of injury or from the date the worker satisfies the definition of “worker with highest needs”. The worker was employed as a casual delivery driver. On 14 August 2014 he contracted Q fever in the course of his employment at an abattoir. In June 2017 he was assessed as having a degree of permanent impairment of 60 per cent, satisfying the definition of worker with highest needs. The worker claimed the special provision amount from his date of injury in August 2014.

The Court found that the special provision amount is only payable from the date the worker satisfies the definition of worker with highest needs in section 32A of the 1987 Act.

Insurers should note the NSW Court of Appeal decision in Hee v State Transit Authority [2019] NSWCA 175 regarding section 38A of the 1987 Act. Insurers are required to apply section 38A of 1987 Act in a manner consistent with the Court's interpretation.

The New South Wales Court of Appeal handed down its decision in Hee v State Transit Authority of New South Wales [2019] NSWCA 175 on 17 July 2019. The Court considered the construction of section 38A and held that:

a determination that a worker is able to return to his pre-injury employment within the meaning of the definitions of “current work capacity” and “no current capacity” in clause 9 to Schedule 3 of the Workers Compensation Act 1987 requires a finding that not only is he or she able to do his or her full pre-injury duties but also that he or she is able to fulfil those duties to “the full extent” that he or she had been able to do pre-injury;
the correct construction of section 38A is that it only applies when there is an entitlement to an amount of compensation in accordance with sections 36, 37 or 38 of the 1987 Act. Due to the operation of section 35(2), that “amount” can be zero. In circumstances where section 38A applies, then, the worker is entitled to the full $788.32 (as indexed) in addition to his or her earnings.

Insurers should also note:

a work capacity assessment of a worker with highest needs is not to be conducted unless the insurer thinks it appropriate to do so and the worker requests it (section 44A(4) of the 1987 Act).
a work capacity decision can be made for a worker with highest needs, however only workers with a ‘current work capacity’ or ‘no current work capacity’ (as defined under clause 9 to Schedule 3 of the 1987 Act) have an entitlement to weekly payments.

A worker with highest needs is currently working 30 hours per week, and their current weekly earnings are $1,260.00 per week.

Their PIAWE was calculated at $1,596.00 per week. They are in the second entitlement period.

To calculate their weekly payment:

($1,596.00 x 95%) - $1,260.00 = $256.20

The worker is entitled to the special provision amount as they are a worker with highest needs; the transitional provisions do not operate to exclude the worker; weekly payments of compensation are payable, and the amount of compensation is less than $788.32 (as indexed).

In this scenario, the worker would receive the special provision amount ($788.32 as indexed), in addition to their earnings.

GN 5.4 Weekly payments after the second entitlement period

GN 5.6 Weekly payments for exempt workers

Related: Legislation and regulations

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