In June 2020, the McGowan Government introduced the Workers’ Compensation and Injury Management Amendment (COVID-19 Response) Bill 2020, proposing a number of amendments to the Workers' Compensation and Injury Management Act 1981 (WCIM Act). The changes are designed to benefit healthcare workers who contract COVID-19 and require access to workers’ compensation entitlements. The Bill also proposed other amendments. The most significant of these being the abolition of a worker's 'Termination Day'.

The Workers' Compensation and Injury Management Amendment (COVID-19 Response) Act (COVID-19 Response Act) and supporting regulations came into effect on 12 October 2020. It addresses five key changes to the WCIM Act:

1. Establish a presumption of a work-related injury for COVID-19 contracted by healthcare workers.
2. Abolish the common law 'Termination Day'.
3. Provide for notice to workers about common law claims.
4. Allow email service of liability notices to workers from insurers and self-insurers.
5. Clarify annual indexation of capped entitlements.

1. A presumption of a work-related injury for COVID-19 contracted by health care workers

The COVID-19 Response Act modifies the requirement for healthcare workers who contract COVID-19 to prove that the disease was contracted at work. It reverses the onus of proof so that employers are required to rebut the presumption that the disease was contracted at work. The presumption will apply if:

• The worker is diagnosed with COVID-19 by a medical practitioner based on a prescribed test result or the worker dies from COVID-19 before such a diagnosis;
• The worker is in prescribed employment when taken to have suffered the injury (date of diagnosis or date of death); and
• The day on which the worker is taken to have suffered the injury is on or after 16 February 2020 (being the date of the first known COVID-19 case in WA).

Where these conditions are satisfied, a worker's employment will be taken to have significantly contributed to their contraction of COVOD-19, unless the employer proves otherwise.

2. Abolition of the common law 'Termination Day'

Prior to these amendments, if a worker wished to preserve their right to pursue a claim for common law damages from their employer, they were required to make an election to do so on or before the expiration of their 'Termination Day'. Subject to certain exceptions which allowed for an extension, the 'Termination Day' was the date 12 months from the date the worker made a claim for compensation.

The amendments under the COVID 19 Response Act have abolished this requirement. The effects of the amendments are that:

• While a worker is still required to meet the requisite Whole Person Impairment (WPI) of not less than 15% in order to pursue a claim for common law damages, the only time constraint to the pursuit of such a claim are those provided by the Limitation Act 2005 (WA) (ie three years from the date the cause of action accrued). Other than for asbestos related claims, the date which a cause of action accrues is usually the date of the accident given it is the earlier of either the date when the worker becomes aware that they have sustained a not insignificant personal injury or secondly, the date of the first symptom, clinical sign or other manifestation of personal injury consistent with the worker having sustained a not insignificant personal injury.
• Workers still need to register an election before commencing any claim for common law damages against their employer.
• It remains a requirement that a worker's WPI be assessed once their condition has reached maximal medical improvement. Workers will still be able to seek a Special Evaluation in certain circumstances. Effective from 12 October 2020, a Special Evaluation can be performed if, after the period of 18 months from the date the worker made a workers’ compensation claim, an Approved Medical Specialist (AMS) certifies the worker’s condition has not stabilised sufficiently for a normal evaluation to be done.
• From 12 October 2020, workers will no longer be required to provide medical evidence from an AMS by way of an AMS Form 8 for the purposes of applying for an extension of the 'Termination Day'.
• Workers whose 'Termination Day' expired prior to 12 October 2020 will still be able to make an election to retain the right to common law damages provided that their rights under the Limitation Act 2005 are preserved or they are entitled to an extension of the limitation period.

3. Revised requirement for notice to workers about common law claims

From 12 October 2020, insurers and self-insurers will no longer be required to issue Form 36 Notices pursuant to s93O of the WCIM Act. Effective from 16 November 2020, insurers and self-insurers will be required to provide workers with alternative notification (in the approved form) in relation to their common law rights in the following circumstances:

• Insurers – where liability is accepted for a claim for weekly payments, at the same time the worker is notified under Section 57A that liability is accepted.
•  Self-insurers – where liability is accepted for a claim for weekly payments, on or before making the first weekly payment.
  The amendments also provide that the relevant notice may be given to a worker by emailing it to an address nominated by the worker. A worker is taken to have nominated such an address if it is included in the worker's claim form.

4. Email service of liability notices to workers from insurers and self-insurers

The amendments make provision for notices issued under Sections 57A or 57B of the WCIM Act to be emailed to a worker and/or an employer.

5. Annual indexation of capped entitlements

Worker entitlements and caps are indexed annually using various indices. The amendments recognise that the economic impact of COVID-19 may be reflected in such indices, resulting in a reduction of some worker entitlements. The effect of the changes are that:

• The capped amount for the ‘Prescribed Amount' and ‘Amount C' for 2020/2021 will be based on the amounts already in force, and will preserve amounts for prior years.
• The indexation method is shifted to regulations for financial years from 1 July 2021 of the ‘Prescribed Amount', ‘Amount C' and amounts set in accordance with section 5A of the WCIM Act.
• Protection against any reduction in the Prescribed Amount, Amount C or section 5A amount if that would otherwise occur due to the indexation method in the regulations.

The Impact of the Amendments

We expect that most of the amendments are unlikely to be significantly contentious.
However, the abolition of the 'Termination Day' will have a significant impact on employers and insurers. In particular:

• It is likely to take longer for employers and insurers to become aware of common law exposure with respect to a worker's common law claim. This will have a negative impact on collecting evidence to defend a common law claim, particularly if a worker waits until almost to the end of their limitation period before registering an election to pursue common law damages. It will also potentially prolong larger claim reserves for insurers and claim allowances for self-insurers as the traditional 12 months to determine whether there is any common law liability to an injured worker will no longer apply.
• The retrospective nature of the amendments means that there will be some claims in which the worker's right to elect to pursue a claim for damages has been preserved notwithstanding that they have not yet made an election and their 'Termination Day' has passed. This will occur where the limitation period has not yet expired (or the worker is entitled to an extension of the limitation period) and the worker can establish the prescribed WPI. Insurers and self-insurers will be faced with potential common law exposure in respect of a number of these claims, where they had otherwise assumed the exposure did not exist. Due to the provisions of the Limitation Act 2005, it is also possible that in some (rare) circumstances, a worker could apply for an extension of the limitation period after it has expired if they meet certain criteria.
• Given that the step-down provisions in relation to the registration of an election to retain the right to common law damages, workers are now likely to delay their election for as long as possible so as to not extinguish their statutory rights. The impact for insurers and self-insurers will be an increase in statutory expenses as well an increase in the duration of claims.