​Return to Work blowout narrowly averted

Public news

With the cost of doing business rising on a number of fronts, the last thing business owners would want to hear is that their Return to Work premiums would be subject to an avoidable blowout. Fortunately, South Australian Parliament this week voted to reform the Return to Work scheme and thereby limit increases to average premium rates to more modest levels.

Even if you don’t follow workplace law closely, the Summerfield case has caused great concern within the South Australian business community due to a High Court decision rejecting Return To Work SA’s appeal against a decision in the case of injured truck driver Shane Summerfield, who was left permanently injured after a 2016 workplace accident.

Summerfield was granted additional compensation for complications from his original injuries, including an ongoing limp and back pain, which was set to have major implications for the financial sustainability of the Return to Work Scheme and ultimately lead to premium blowouts of around 30%.

In response to the Summerfield case and concerns from the Motor Trade Association (MTA) and other industry associations representing the South Australian business community, the State Labor Government introduced a Bill to parliament which aimed to directly address the consequences of the Summerfield case, by limiting claims for multiple impairments arising from the same injury.

However, the Bill received significant backlash from unions and Labor withdrew this in favour of a new Bill which would absorb the financial consequences of the Summerfield decision, while attempting to balance these cost pressures by:

  • Increasing the ‘seriously injured’ threshold for physical injuries from 30% to 35% whole person impairment
  • Giving ‘seriously injured’ workers the choice to receive a single lump-sum payment instead of weekly payments until retirement age.

The government’s modelling underpinning the compromised deal promised that average premium rates would rise from 1.8% in 2022/23 to 1.9% in 2023/24 or a 5.6% rise in real terms – a far better outcome than a rise to average premium rates of 2.2% or a 22.2% rise in real terms had the implications of Summerfield been left unchecked.

Although the original Bill was the best outcome for businesses, the MTA, together with other industry associations, called on the Parliament to support the compromised Bill in the interests of avoiding a full-scale blowout in premium rates, particularly given automotive trades sit above average premium rates.

If you would like to know more about what Return to Work means for your business, please contact our Workplace Relations team on 8291 2000 or at wr@mtasant.com.au.