Best practice workers’ compensation for small business


(gentle music) – [Jennifer] Small business
accounts for more than 95% of all Australian businesses and are responsible for
the health and safety of approximately 4.8 million workers. For most small businesses, a
workers’ compensation claim may only occur once every several years. For many employers, they
pay their premium annually and have no further contact or relationship with their insurer. One of the most challenging elements of workers’ compensation
schemes is the number of stakeholders involved,
and the various relationships that exist between these stakeholders. At the immediate level,
you have the relationship between the employer and the worker. As the claim progresses, you
then have the claims manager or claims agent, the insurer, and the treating doctor involved. You may also have other
allied health professionals, such as the rehab providers. And finally, the regulator
may become involved, although not always. So managing these relationships is understandably challenging. In addition to this, our
employer members also report difficulties with the
lack of scheme experience, poor understanding of
roles and responsibilities, limited training options for their staff, in understanding these
workers’ compensation duties and responsibilities, an
increase in stress claims, poor understanding of, and
support of, claims management and return to work in general. The Australian Chamber is a
member of Safe Work Australia, and represents employers on
both work health and safety and workers’ compensation matters. Over the past year, Safe Work Australia has had an increased focus
in workers’ compensation with a number of active projects
addressing common issues such as the role of the GP,
best practice management of psychological claims,
and a focus and look into return to work data
and improvements there. The presentation today
is a partnership between the Australian Chamber, Biz
Better Together program, Safe Work Australia, and Smart
Company, aimed at providing audience members and viewers
with firsthand information from multiple stakeholders
within the scheme, information on resources, and clarification of roles
and responsibilities. (gentle music) – We’re lucky and fortunate
enough to have three different perspectives on the workers’
compensation process today. Our goal today is to
guide small businesses on the workers’ compensation
journey and process. So Liz, if we can start with
you for the first question. What are the top three concerns that employers have when it
comes to workers’ compensation? – Well, the Chamber
recently conducted a survey and there were quite a few
common themes that came out. But the overarching principle
was the need to understand the employer’s business and how a claim affects the workplace. But in terms of the
three top items, I guess, the importance of consultation
and communication, that’s very important, effective
return to work outcomes is also very important, as is premiums not being too volatile and having enough notice in advance so they can structure their
cash flow accordingly. I guess the underpinning driver is the communication
and consultation, that’s the most important thing, and basically talking to the employer. So what is the role of the injured worker when the injury occurred? What happened? What are suitable duties? And how do we get everyone back on track? – Sure, and so what about
small business in particular? Do they have the same concerns? Or do they differ considering
that they’re less resourced? – They have the same concerns, they just have additional concerns. – Yeah. – Because they are less
resourced, and as Jen said, that often, they don’t have
much experience with claims. It tends to be the larger employers that have more experience with
claims and claims management. So obviously, once you’ve had
one or two under your belt, you’re a bit more familiar
with the process, so I guess it’s the awareness of
what to do and when to do it, how to do it, who can I call on? And from a resourcing aspect, I think, it’s not just money. We tend to forget, it’s time-poor as well as not having
enough money to spend on things, adapting the workplace, and also, especially
with a small business, they’re under-resourced in terms of labor. So they can’t just pick up the phone and hire someone else. Often, you’ve got the
remaining employees there, so if someone’s off work,
then it’s basically everyone shoulder to the wheel and
try and cover all the bases until that person gets back to work and things can go back to normal. (gentle music) – Data shows that most small
businesses have one claim every 15 years, so as
Liz said, they don’t have the resources or it falls
under the HR manager, or somebody else whose main job
has nothing to do with safety or return to work or
anything like that, so scheme agency in the past
and Icare in the future will perhaps look at
providing, or have provided, return to work courses and
information around that to support employers,
especially small employers, but I guess to Liz’s point
earlier, communication’s key. Whether it’s Icare or EML,
or GIO moving forward, that contact with the employer to hep that return to
work process from day one is absolutely key to a successful outcome. – Sure. – If I can just pick up
on the HR management, many small businesses
don’t have an HR manager, so we do need to keep in mind that small businesses aren’t
big businesses shrunk. Small businesses start,
and they grow organically with one person or a couple of people. So you really need to keep in mind where small businesses come from. In terms of the communication,
one positive thing that came out was the experience
with insurance brokers, so we found those employers
who had insurance brokers, overall, had a much better experience with claims management and return to work, because they just found that
person was the go-between, and that person understood
their business well, and understood the system well, and it actually helped
them navigate the system. – So that extra layer of support. – Yes, yeah. (gentle music) – So, clearly insurance
is an issue of concern and perhaps a bugbear for businesses, and we all know that
insurance can vary greatly. So when it comes to workers’ compensation, what’s the insurer’s role? – The insurer’s role- – In supporting employers. – Yeah, I think the insurer’s role begins as a protection mechanism,
particularly for small employers. So it’s a statutory purchase, not all purchasers of
workers’ compensation necessarily want to buy it, (laughs) but it’s, as I say, a statutory purchase that all employers must buy,
well, virtually all employers, there are a few exceptions to that. But really what it’s
doing is it’s providing that protection mechanism to
the employers, and I think that’s particularly relevant
with small employers. If you have one significant
incident within your workplace, and you’re a small employer,
that could effectively be the end of your business in terms of the financial consequences
to that incident. So the provision of
insurance in the first place is that protection. That’s before the event. Once the event occurs, then, and again, relative to small employers, that’s where the insurer’s
role really kicks in, and actually providing support
at the time that it’s needed. So there’s that hard-line
financial support, so by buying the policy, what the employer’s
effectively doing is it’s what the insurer’s
effectively doing is saying, I will discharge your
financial liabilities associated with the injury. So I will pay the
benefits that are payable such as the weekly benefits to the worker, the medical expenses, that sort of thing. But the role is much broader than that, and the insurer can help in terms of orchestrating the rehabilitation
and the injury management for the worker following the injury. So that happens on a
number of levels, really. It happens quite on a high level, from an organizational
perspective, so all insurers should have an injury
management program in place, which just articulates their
processes and procedures that they’re going to
adopt in order to support their employers. But more specifically,
on a case-by-case basis, where there’s a significant
injury for a worker, and our definition of a
significant injury is where it involves an absence of
seven days from work or more. Then there’s a requirement
for an injury management plan, and that is basically
the insurer sitting down talking to all of the
stakeholders and saying, what do we need to do in
order to get this worker back to health, back to work? So they’re talking to the doctor, they’re talking to the
worker themselves, obviously, they’re talking to the
employer, and they’re saying these are the things that
we can put into place. So you’ve got soft tissue injury, we can put some physiotherapy in place. You have a psychological
injury, we can look at bringing a psychologist
in to provide some support We can make those payments of
weekly payments to the worker so that the worker’s not
financially disadvantaged whilst they’re going through this process, and we can actually get
everybody’s mind set on what it is we’re here to do,
which is actually achieve return to health, return to work. (gentle music) – What should an employer
expect from an insurer in terms of support? – Liz touched on earlier,
and Spencer has as well, for us, we need to
understand our customers. – Yeah. – It’s the fist time in 30
years that we’ve actually had face-to-face communications
with our customers. In the past, it’s been
through scheme agents, there’s always been a third party there, and for us to just come
into the scheme and say that we know everybody
would be remiss of us. We absolutely need to
understand the inherent risks of businesses, we need to
have conversations with them, understand what it is that
you do day in and day out, and then if you do have an injury, understand what you’ve got in place to help you navigate that
injury and what support you need to promote recovery at work. For us, (clears throat)
that’s the first key thing. The other thing, and part of the reason why we made the changes we
made, was to provide a system that’s easy to navigate
and easy to understand. Even if it’s as simple
as turning an eight-page renewal document into a
four-page renewal document with a couple of nice graphics on there that show you’re performing,
what your premium’s doing, what your wages have done. We will move towards,
early next year, a portal where small employers can
go in and pretty much manage their workers’ compensation
without talking to us if they don’t want to. I think Spencer and Liz both
touched on the fact that for a lot of small employers, you pay your workers’
insurance because you have to, it’s a statutory class, but then you don’t need to talk to us for another 12 months
until you pay it again. So for us, it was
understanding that customers wanted to have a simple
online process if they can, and the key thing for
me around those 4,700 new businesses we’ve put in
place is about 80% of that has been done online. So again, we listen to our customers, and another good thing for
me is about 15 to 20% of that was actually done on weekends
or outside of business hours. So again, small employers,
they’ve got enough on their plate just managing their business
without having to deal with insurance or anything like that. So we’re listening to our
customers, we’re not there yet, nowhere near where we want to be as far as providing an insurance product that meets the needs of our customers. We’ll continue to reach out to peak bodies like the business chamber,
associations, industries, and have those conversations,
just so that we can get a better understanding
of what’s happening, and what impacts on you,
whether you’re a small employer, or a medium, or a large employer, and what we can do to support you. – I think-
– So- – Sorry, I think I’d just
support that and elaborate a little bit on what
Peter was saying about the explaining to employers
what it’s all about. – Yep. – I think that’s true from
an underwriting perspective, what am I actually buying? Because not all employers know what they’re actually buying. And also, post-incident,
the workers’ compensation legislation is really quite complex. So understanding what a
worker is entitled to, from either a workers’ or
an employer’s perspective is a pretty tricky thing. I’ve been knocking around for a few years and I’m still struggling
with it myself sometimes. (laughter) So I think that we probably have, we have a joint
responsibility, as the insurer and as the regulator, to actually try and unpack that as much as we can. And I know you’ve been
doing work on your website, we’ve done work on ours as
well, to actually try and cut through some of that
complication of the legislation and actually unpack for
workers and for employers what it’s all about and
what they’re buying, and what entitlements that
brings at the end of the day. – So it’s important, the
clarification process is important. – I think clarification is very important. It’s, as well as being a
statutory scheme, it’s compulsory. So let’s not- – There’s no getting around it. – Let’s not skirt around
it, it’s compulsory. – Yeah. – It is convoluted, the legislation, the two pieces of legislation,
and what I would like to see as well, is not only
assistance post-claim, but understanding who is covered and when they need to take out cover. Because a worker is not just
an employee who’s on wages, a worker includes particular
types of contractors, subcontractors, and
also working directors. So you can have a director who’s taken out key man insurance, and
yet, strictly speaking, should be, or should be
looking at whether or not they should have workers’
comp instead of that, so they think they’re covered, so I think education’s quite key, and I personally would like
to see a little bit more than just masses of information
stuck on a website. I think it needs to be
more helping employers along the way and understanding
what they have to do and when they have to do it. (gentle music) – Can the panel tell us
a little bit about how occupational rehabilitation
fits in with the scheme and whether or not
rehabilitation providers are being utilized as
much as they could be when it comes to supporting
the worker or employer? – I think in general terms, the use of rehabilitation providers
is on the increase within the New South Wales
scheme at the moment. Certainly the statistical
data supports that conclusion. I think that they’re
potentially a very useful resource within a case. So an insurer and an employer, an insurer will engage a rehab provider, essentially on behalf of
the employer, and really it’s their job to come in
and bring the stakeholders together and talk about, well,
what does work look like? What does a return to work look like? How do we take what the GP
is telling us in terms of what this worker has capacity to do and translate that into
some meaningful work for that individual with
their employer ideally, or with an alternative employer
if that’s not possible. – Sure. – And what are the things that are stopping that from happening? And how can we
circumnavigate those issues? It’s quite a, it’s probably more of an
art than a science I think, (Olivia laughs) and it’s really, it’s
just about cutting through and getting back to the basics
that we keep talking about. Which is keep talking, keep
the communication going. – And so, generally,
how do employers engage with the rehabilitation provider? Is that the role of the employer, or is that the role of the insurer? – As Spencer said, it’s
generally the insurer that will instigate that contact, and it can be a number
of reasons, it can be that the worker is struggling
to get back to work, the communication’s broken
down between the employer and the employee, the worker. The treating doctor’s probably
not where we want them to be in regards to the return to work process. So, generally it’s the insurer, but there’s other stakeholders
in the relationship that have relationships
with rehab providers that might recommend it. So whether it’s the insurance broker, some employers retain rehab providers to do the return to work process for them. – Sure. – So it provides that level of
support that they don’t have, at a cost, but it provides the
detail around suitable duties or how they might manage
a particular situation for that particular
claim or injured worker. So primarily it’s the
insurer, but certainly there’s no reason why an employer can’t open dialogue with a rehab provider and/or their insurance
broker if they use a broker. – So Liz, what sort of
support do you think employers would like to receive
as part of this process from insurance through to rehabilitation and then eventually, and hopefully, the outcome of returning back to work? – Well, I think it depends on
the profile of the employer. So if the employer hasn’t had
any claims or many claims, then I think it’s more of an
awareness education piece, and it’s, what do I do? How do I do it? When do I have to it by? Who do I talk to? – Who do I speak to? – So it’s really basic stuff. – Yup. – Very simple, straightforward. If they understand the
process, from go to whoa, and what’s required of them
and when they need to do it and how to do it, that is the very minimal level of support. Then I guess the next level
is, once you’ve got the claim, you’ve go the administrative
side of things and managing the claim, so employers, what is the effect that this claim has on the employer’s workplace? So you’re one person down,
who’s going to cover that? You don’t just ring up a labor
hire agency and pull them in, they might not be able to afford that. – Yup. – So what’s the effect of
that claim on that workplace? As well as the physical labor,
and as I touched on before, getting those who are
able-bodied to cover off on that type of work,
you’ve also got the morale. There’s a fair bit of a
morale aspect involved from the employer’s perspective
in keeping the whole team happy and things going along quite well. – Especially in a small business where- – Especially, yes, definitely. And the admin side of things. I’ve heard that even though, well, with the weekly, the calculation of the weekly payments is an absolute nightmare. First, the calculation
of it, and then secondly, having it fit into their
own payroll system, it often means that employers
have to create their own manual system for their
workers on workers’ comp, and have that totally outside
their normal payroll system. And then there are some
employers who’ve told me that it’s just too hard
to sort out for now, so they just keep paying
the normal amount of wage, and then they work it out later
and then ask for a refund. But not all employers can do that, not all employers have
the cash flow to do that. So it’s very much the practical hands-on, how do the employers actually figure out what to do in amongst their normal
business activities? (gentle music) – I think there are also other
supports that are available, and at risk of preempting a
future question, (laughter) that address some of the
issues that you raise. So for example, we have
vocational rehab programs which SIRA provides and
insurers can access. And they cover a range
of different scenarios, and probably the most
pertinent one to this audience is our return to work
assist for micro employers. So this is talking about when
an employer has five or fewer employees, and you have an injury and the employer is absent from work. If they have some capacity
to come back in to work, but not capacity to fulfill
their pre-injury duties, then what micro assist
does is it says, well, the insurer can continue
to pay the weekly benefits, the wages for that person
whilst they come back into the working environment. Which means that the small
employer is not disadvantaged so that they can actually
go to an external contractor and get somebody else in to fulfill the substantive
part of that role. So it’s almost allowing
the worker to come back on a supernumerary basis, which is good for the worker, getting out of the house, getting back into the working environment
is fundamentally good for you. And it builds that capacity
and it builds that capability, whilst at the same time not
disadvantaging the employer. There are other things that
the vocation rehab programs can do as well, such as work trial. So where a worker has some
capacity, but there’s no suitable duties within their
employer, then they can go to a host employer, and
that host employer, again, doesn’t pay their wages, but
helps to build their capacity and their capability
whilst they’re recovering, and then they can return to
their pre-injury employer. We have a job cover placement program, which financially incentivizes employers to take on a worker
with a previous injury. So there’s a financial incentive there for the employer to take that on. And then there are a range of more bespoke solutions such as retraining
for the worker to enable them to pick up new skills,
workplace modifications, so things like, we’ve paid in the past for modifications to a, I was
gonna say pickup truck, that’s English, to a utility truck, and put a sort of a
crane-type device on the back so that would enable the
worker to fulfill their role. And if you get creative and you can use some of these things, and again, this is
really where the insurer can add some value for
the employer and say, these things are available,
let’s talk to you about them. And my advice to employers
would be always to come back to the insurer and
say, what else can you do? – Yup. – What else can you do? What else can you do? And actually promote those
conversations as well. – Because there are resources it seems. – There are resources available, yeah. – Yeah. (gentle music) I think probably small businesses’
perspective on workers’ compensation is that it
is a one-size-fits-all, and I think what we’ve got
out of this conversation today that it can be a collaborative process and there are supports in place, and readily accessible, and
there’s a lot of information there to support very specific cases as well as quite generic ones as well, so- – The other thing that
employers can do is, obviously they can visit our websites, or they can call 13 10 50,
which is our call center line and there’s information
available so you can actually speak to a real person and
say, I’ve got a question about whether I need to buy
insurance, or I’ve got a problem with my claim, or
whatever the case may be. So there is always a
resource there as well. (gentle music)

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