Thank you for your continued commitment and support as we work together to implement the recent Workers Compensation reforms.
Almost one month after the introduction of the ILARS Amending Instrument, several common questions and themes have emerged. This alert provides clarification on what is required when submitting an ILARS funding application under the new criteria and addresses common questions.
The new funding requirements implement changes to the PIC Act, Schedule 5. Clause 9A. The IRO must apply the funding criteria in the Act.
Most applications are addressing the new criteria and are being approved. Some applications cannot be approved, because they don’t address or meet the criteria but, in these cases, the IRO staff revert to the approved lawyer and explain what additional information is required.
Applying the Funding Criteria
Sustainability of the Workers Compensation Funds
Clause 9A(1)(a) requires the IRO to consider the sustainability of workers compensation funds when administering the ILARS scheme.
The IRO considers that this obligation relates to how the scheme is structured and managed. The ILARS Funding Guidelines are therefore being administered in accordance with the Amending Instrument to support the ongoing sustainability of the scheme.
When making an application, lawyers should address this clause by clearly explaining the likely benefit to the worker.
What we need from you:
- A brief statement outlining the expected benefit to the worker or workers in the scheme.
- Specific details about the benefit, rather than leaving this for the IRO to determine.
- Information that will assist the IRO to identify the purpose of the funding request and determine which disbursements may be approved.
Reasonable Prospects of Success
Clause 9A(1)(b) requires the IRO to be satisfied that a matter has reasonable prospects of success.
The level of information required will depend on the type of funding being sought.
For Stage 1 funding, a simple explanation may be sufficient. For example:
"The worker believes their PIAWE has been incorrectly calculated because shift payments do not appear to have been included."
For Stage 3 funding, the IRO expects more detailed information demonstrating that the matter has reasonable prospects of success if determined by the Personal Injury Commission or a court.
Prudent Person Test
Clause 9A(1)(c) requires the IRO to consider whether the likely benefit to the worker justifies the proposed expenditure. It’s a combination of how much benefit there would be and whether a prudent person would pay for the representation in the context of how likely it is the benefit will be realised. Lawyers should clearly explain the real value of the proposed action to the worker.
The benefit may include:
- A direct monetary outcome; or
- Establishing liability that may lead to future benefits of significantly greater value.
Other common questions
Defining a "Matter"
The IRO has been asked whether it will provide a formal definition of the phrase:
"Matter to which the proposed funding relates"
At this stage, the IRO does not consider a definition necessary. Introducing a formal definition may unintentionally restrict the operation of Clause 9A(1)(b). However, the IRO will continue to monitor this issue and may determine that some definitions are helpful for the new ILARS Funding Guidelines.
Death Benefit Claims and Dependants
Funding may be available where a person requires legal advice about whether they are a dependant for the purposes of current or proposed proceedings in the Personal Injury Commission.
This may apply even where:
- The advice ultimately concludes the person is not a dependant; or
- The person decides not to pursue a death benefits claim.
Provided the Funding Criteria are met, these matters are eligible for funding.
Where an application for funding a death benefit claim is for a dependant child of the deceased worker, the IRO will fund these applications. In applying for funding, as with all applications, Approved Lawyers are still required to address the funding criteria.
Requests for IRO to Make Assumptions
The IRO has been asked whether it can assume a likely benefit exists in certain categories of matters.
The IRO considers that doing so would be inconsistent with Clause 9A and the policy intent of the amendments.
For example, a worker may have reasonable prospects of success in an appeal against a Medical Assessment Certificate, but there may be no reasonable prospect of obtaining additional compensation or meeting a relevant statutory threshold.
Making assumptions about benefits may also result in funding decisions that are unclear or do not meet the worker's actual needs.
For this reason, each application must provide sufficient information about the likely benefit to the worker.
Stage 1 Funding
Stage 1 funding continues to be available. However, it is not intended for generic legal advice.
Stage 1 funding may be available where specific legal advice or assistance is required, including:
- Advice relating to a contemplated claim or dispute; or
- Advice regarding a proposed single assessment of permanent impairment.
Stage 1 funding will generally not be available solely to assist a worker in completing a claim form. Exceptions may apply where the worker faces difficulties, which requires legal assistance as opposed to other forms of assistance. If this is relevant, lawyers should clearly explain the circumstances in their funding application.
Director Reviews
There has been an increase in the volume of Director Reviews received. While this has impacted demand and processing timeframes, Director Reviews remain an important review mechanism that ensures decisions are subject to appropriate oversight and consideration. Considering the increased volume, and to help manage stakeholder expectations, we are currently working towards a target turnaround time of 20 days. Efforts are continuing to maintain the quality and integrity of the review process while improving timeliness and ensuring matters are progressed as efficiently as possible.
How to share your feedback
As we continue to work through this period of change, it is important that we do so collaboratively and with a shared focus on achieving the best possible outcomes for injured workers. We recognise that changes to processes and service delivery can create challenges and differing perspectives, and we welcome constructive feedback to help inform ongoing improvements. If you would like to provide direct feedback regarding the changes, please send your comments to [email protected] for consideration. We also ask that all communication remains respectful and professional.
Our IRO staff are committed to supporting injured workers and ensuring they receive timely and effective review services, and respectful engagement with staff is essential to maintaining a positive and productive environment during this transition period.
Jody Grima
Acting Independent Review Officer