A major contributor to this is the year on year increase in accepted mental injury claims. Currently at 16 per cent of all claims, WorkSafe is predicting mental injury claims will account for 30 per cent of all claims.
The Andrews Government is making significant changes to the Scheme – to increase revenue and reduce costs. However, this will come at a massive cost to Victorian businesses.
The first move will be to increase the premium rate (effective 1 July 2023) from 1.272 per cent of payroll (where it has remained since 2014) to 1.8 per cent in 2023/24 – a 41 per cent increase.
The other kicker is to increase the premium ‘cap’ from 30 per cent to a whopping 75 per cent. What this means is – a premium, no matter how high the claims costs for an individual employer, could not increase more than 30 per cent per year. The effect of a 30 per cent could double a premium over a claim life of three years. A 75 per cent cap could take a $100,000 premium to over $500,000 in three years.
For employers, a focus on returning injured workers back to work will be more important than ever before in order to prevent that hike in premiums.
Apart from making employers pay more, the Government is proposing to exclude claims (i.e. not pay weekly benefits) to employees suffering from stress and burn out. Instead, these employees will be actively encouraged to return to work and will be eligible for provisional payments for up to 13 weeks to cover medical treatment costs. What will occur after 13 weeks is unclear.
A new ‘Return to Work Victoria’ will be created after seeking input from unions, employers and the medical profession. One hopes this can only be a positive move, as statistics show employees recover more quickly at work than at home, and the longer an employee remains off work, the less chance there is of a return to work.
The value for employers is undeniable as it should result in less time off work / interruption to productivity, and lower WorkCover claim costs so less impact to premium. However, will employees lodge claims for bullying, instead of being overworked, to overcome the exclusion?
Careful management of employees, monitoring psychological health and creating good workplace culture will be key to mitigate the effects of these changes.
