Page 2671 - Week 09 - Thursday, 25 August 1994
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The Workers Compensation Monitoring Committee has recommended time limits for deciding claims. These time limits are reflected in new sections 26A and 26B in the Bill. They are an important step forward for injured workers, as they should result in injured workers receiving initial weekly compensation payments no later than the fifth week after they are injured.
Madam Speaker, this brings me to the provisions of the new Bill which deal with termination of weekly compensation payments to workers. Unlike in respect of the previous elements of the Bill, the Workers Compensation Monitoring Committee had only partial success in agreeing to revised provisions to cover the termination of weekly compensation payments to workers. The problem arises because of a legal decision, commonly referred to as Barbaro's case, which provides that, once an employer has commenced weekly compensation payments to a worker, the employer cannot unilaterally terminate those benefits without first seeking the approval of the court.
Insurers have said that this decision makes them reluctant to commence weekly compensation payments in cases where there is some doubt about their liability, because it is so difficult to terminate them. Both insurers and unions agreed that a worker should be given eight weeks' notice before weekly compensation payments are terminated; but they disagreed about how the termination should take place. Insurers asked for the right to give a worker eight weeks' notice of termination of the weekly compensation payments. Unions asked that court approval always be required where the termination of weekly compensation payments was contested.
The Government has decided on a compromise position. The Bill provides that, for the first 12 months, insurers can unilaterally terminate weekly compensation payments by giving eight weeks' notice. After 12 months, court approval will be needed. Thus the Bill provides a 12-month window in which employers can readily terminate benefits in the way that they would envisage. This 12-month period enables the insurer to collect evidence and information and to determine whether they are, in fact, liable. At the end of 12 months the insurer can still terminate benefits but must seek court approval. This provides a measure of protection to the long-term, more seriously injured workers. Madam Speaker, it is my understanding from informal discussions that that will probably provide the major point of argument in relation to this initiative. Insurers believe that the Barbaro principles should be done away with unilaterally. Unions believe that they are a protection which they are entitled to at law and, therefore, it would be a retrogressive step to do away with them unilaterally. In making the decision that I have, to bring forward the legislation in the form in which it is presented today, I had to take into account those two competing issues.
Principally, the insurers' position has been that, once they have commenced payments to an injured worker, they require some method, other than proceeding to court, to allow for valid termination. We have provided that in this legislation; but what we have said is that within the first 12 months of such payments occurring would be the appropriate time for an insurer to gather evidence to test the validity of a continuing liability in respect of an injured worker and to make a decision. The insurer would be required to notify the injured worker, giving them eight weeks' notice and setting out the reasons for the termination. At the same time, the insurer would be required to provide to the nominal insurer such information as it provided to the injured worker. This requirement is
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