Experts say mental health payouts may become impossible
The architect of a globally recognised scale designed to measure psychological injuries in worker compensation cases says changes proposed by the Minns government will effectively kill the scheme by making it next to impossible for injured workers to claim damages from employers.
Retired Sydney psychiatrist Dr Julian Parmegiani, who led the design of the Psychiatric Impairment Rating Scale for the Carr government in the late 1990s, said NSW Labor's proposal to lift the level of Whole Person Impairment needed to claim lump sum damages from employers for psychological injuries from 15 to 30 per cent was tantamount to ending the scheme.
'If you're going to take that step and say 'we're increasing it to 30 per cent impairment', you might as well euthanise the entire scheme and just say: 'We're not paying out any claims for any psychological injury', because that is the effect,' he said.
'They might as well come clean and say that is what they are going to do.'
The government's proposals – which it says are still subject to consultation and yet to be finalised – also include plans to require injured workers to take claims to the Industrial Relations Commission before seeking workers compensation.
The government says the changes are necessary due to the rising number of psychological injury claims and falling return-to-work rates. Mental health compensation claims have doubled over the past six years, a rise that is placing financial pressure on the state's nominal insurer, icare, and forcing insurance premiums up by 36 per cent over the three years from 2026, the government says.
NSW Treasurer Daniel Mookhey has said the laws are not about curbing workers' rights; creating a bullying and harassment division of the IRC, he said, would create an avenue for workers to report unsafe workplaces before an injury occurs.
'Far from trying to curb people's rights to take action, this is about expanding them,' he said during an interview last month.
But the reforms have drawn the ire of unions, legal professionals and the NSW Greens, who say they will cut workers' rights by severely limiting workers – including nurses or child protection workers – who seek compensation for injuries such as post-traumatic stress disorder.
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