Australia’s work and transport crash compensation schemes deal with around 300,000 new claims every year. New claim numbers are often regarded as an important marker of injury prevention and scheme performance. COVID-19 is having a massive range of impacts on our work and health, and these will flow on to the nation’s compensation schemes.
In this post, we consider how these impacts might shape the number of new claims in compensation schemes. Work and transport generate incidents, injuries and illness and resultant compensation claims. Changes in our activity will impact upon the number of new claims in different ways. While we await the data, there is time to speculate on what the number of new claims in compensation schemes in COVID-times might look like.
Less commuter travel means fewer injuries and claims
COVID-19 restrictions have seen an immense reduction in traffic on our roads, which would be expected to translate into fewer injuries and claims. Bike sales may be up – but unless recreational cyclists collide with vehicles, they will be ineligible for transport crash compensation.
Image by Lyle Fowler (Malvern Star bicycle factory interior views, 1940)
(State Library Victoria www.slv.vic.gov.au)
News reports indicate that traumatic injury presentations to hospitals are down. Many of those who are still regularly using the roads will be doing so for work, and there is increased demand for deliveries. A person involved in a crash in the course of their employment will be covered by workers’ compensation for their immediate no-fault benefits (income, health expenses etc). Surprisingly, road deaths in Victoria for the first three weeks of lockdown were slightly higher than the equivalent period last year, though the data are limited at this point.
Activity in some claim-generating sectors may be down, but not all
Workers’ compensation provides support for workers injured in the course of their employment. With fewer Australians in employment – ABS data reported on 21 April indicated 800,000 jobs had been lost – fewer claims should be expected. In sectors where activity is reduced and job losses are greatest (such as hospitality, tourism, arts and recreation) we should see a significant reduction in claim numbers. The top three industry sectors for serious workers’ compensation claims are health care and social assistance, construction and manufacturing. Each of these sectors are playing a critical part in the virus response or the path to economic recovery. As a result, they can be expected to continue to generate claims. The mental health consequences of COVID-19 are far-reaching, and could also present in the form of increased psychological claims connected to stress and anxiety of working during the pandemic.
Claims associated with working from home
Media coverage has emphasised the possibility of a spike in claims associated with people working from home. Where employers have authorised employees to work from home, the employer still has obligations to ensure the work environment is safe and claims may result if workers are injured while working remotely. A sharp increase seems unlikely, though. Interestingly, while data on the prevalence of working from home are relatively elusive, the ABS reported 45 per cent of workers used home-based internet for work purposes in 2016-17. The HILDA study also found that 28 per cent of people worked some of the time from home. Many workers, then, are not complete strangers to the new conditions. Preliminary analyses suggest that low-income workers outside capital cities are less likely than others to be able to work remotely, which may shape the nature and extent of claims associated with home-based work.
Image by Djurdjica Boskovic on Unsplash
Claims for COVID-19 infections at work
Some workers – those on the front lines of industries still active in COVID-times – face a risk of contracting the virus in the course of their employment. This exposure is giving rise to virus-based workers’ compensation claims. The NSW State Insurance Regulatory Authority is publishing a count of COVID-19 workers’ compensation claims, updated daily (with 201 reported claims as at 1 May). These claims remain small in number. As a result, they are unlikely to generate a significant increase in view of the 250,000 new claims the workers’ compensation schemes deal with annually.
Safe Work Australia indicates that in the normal course of business, ‘diseases are significantly underrepresented’ in claims data because of difficulties in making the required links between workplaces and work-related disease. Nurses and paramedics in NSW are among those raising concerns about the need to prove a link between exposure at work and contracting the virus being a problematic barrier to claims. A private member’s bill before the NSW Parliament is seeking to remove that bar for workers in high-risk occupations.
Underclaiming, claim suppression and delays in COVID times
The negative economic conditions created by the pandemic will put many workers in fear of retaining their jobs. It may be that this concern drives injured workers to refrain from claiming for work conditions or transport crash injury.
Outside of the COVID context, stigma about claiming may prevent workers from lodging claims. The ABS reports that 69% of people who sustain work-related injury or illness do not apply for workers’ compensation. Though the main reason is that they consider their condition minor to bother, a small proportion (5%) are concerned about the potential impact on their employment. Where workers are fearful for their job, this concern will increase and could have the effect of suppressing claims.
Some injured workers and people who sustain injuries in transport crashes may also delay necessary treatment for compensable conditions in COVID-times. Media reports suggest people needing treatment for serious conditions or experiencing sudden health problems might be avoiding attending health services for fear of overburdening the system or encountering infectious patients. If people with potentially compensable conditions are doing the same, this too may indirectly suppress claims, or at least exacerbate the seriousness of compensable conditions, and recovery timelines.
Claim drivers are complex and head in multiple directions
COVID-19 consequences of the kind discussed here seem likely to affect claims numbers in a range of ways: some bring new sources of claims, while others change activity in ways that are bound to reduce claims volumes in commensurate ways. The biggest driver of the ultimate impact of the pandemic on the number of claims in schemes will be the duration of the social distancing measures, and their ongoing economic repercussions.