Injured workers left high and dry by icare’s excruciating slow pace

In the case of icare, it has begun its renewal with a new chair, CEO and senior executives, and promises to change its way. But in the end, it will be judged by what it does, not what it says.

Like a number of organisations battling underpayment issues, icare needs to own the problem and do a better job of compensating underpaid injured workers.

When franchise giant 7-Eleven had underpayment issues in 2015, it set up a compensation scheme that was independently run, properly resourced to review claims, and included a calculator on its website to give a running tally of the number of people and the amount of compensation it had paid. This helped rebuild its reputation.

In contrast, icare’s handling of the underpayment issue is underwhelming.

The potential number of injured workers that are impacted by the error is 240,000. Of those, icare originally estimated 52,000 injured workers had been underpaid up to $80 million. It then revised down these numbers to as little as $5 million. At March, it estimates it is 23,000 workers that may have been potentially impacted with compensation up to $20 million. But the reality is icare doesn’t actually know.

Its remediation program is opaque, inadequately resourced and clearly slow to move.

As PwC noted in its report, the “errors” in workers’ compensation payments were identified in March 2019, flagged as high risk in October that year but not reported to the regulator until February 2020, in breach of reporting obligations to self-report within five business days. It took another 10 months to invite injured workers who received weekly workers’ compensation payments between 2012 and 2018 to come forward if they believed they had been underpaid their weekly entitlements by their insurer.

In a statement, icare said it had assessed 4000 injured workers’ files and two thirds did not have enough information to be reviewed properly.

This is similar to earlier documents that reveal it had assessed 3000 injured workers’ files, two thirds of which didn’t have enough information and of the remaining 1000, almost one third were incorrect and 15 per cent had been identified as being underpaid.

“To date we’ve established that 56 injured workers have been underpaid in addition to 30 who have been overpaid. Further we’ve repaid 24 injured workers a total of $260,000 as a result of the remediation process,” the new CEO Richard Harding said in a statement.

But instead of putting more resources into opening more files or committing to writing to the 240,000 injured workers that might be affected, icare has effectively put the onus on injured workers to “come forward,” which has resulted in roughly 50 inquiries.

In December 2020 shadow minister for finance Daniel Mookhey asked the new icare chairman John Roberston in Parliament why icare hadn’t written to affected parties to make sure they were aware of the potential underpayment issue.

Robertson’s response: “I was concerned about a letter arriving in the mail for somebody who might well have moved on from a terrible experience with workers’ compensation … I was conscious of not opening up a wound that may well have healed.”

Robertson’s decision wasn’t based on any independent advice, not medical advice or any other advice.

Given the response to the current media awareness advertising campaign to get workers to come forward it is fair to say it is failing.

‘icare’s culture was so warped that no one saw the obvious injustice of handing out massive executive bonuses but failing to repay underpaid injured workers.’

Daniel Mookhey, NSW shadow finance minister

“We’ve been actively assessing thousands of files to ensure we can correct any identified underpayments to injured workers. However, the current legislative requirements make remediation a difficult and lengthy process,” Harding said.

“The legalisation dictates that employers and injured workers need to provide the exact figures dating back 52 weeks prior to the injury – including detail such as sick leave, leave without pay, secondments, higher duties, overtime and more – but many employers and workers simply don’t have this information.”

In other words injured workers are being asked to provide information that the insurance agents should have included in the file at the time of the original assessment.

As one well-placed source said, “how it is possible that scheme agents have been allowed to screw this up so bad to the point that two thirds of the files icare has opened never had sufficient information to make the initial determination. Where was the quality assurance over those seven years?”

But as Harding and the board prepare for a grilling in NSW Parliament on Monday, they might start reconsidering their options. For Mookhey’s part, he’s fired up, “icare’s culture was so warped that no one saw the obvious injustice of handing out massive executive bonuses but failing to repay underpaid injured workers.”