Preliminary

1.1 This is an interim report of the New South Wales Law Reform Commission in response to a request made in March, 1983, by the Attorney General, the Hon. D.P. Landa, LL.B., M.L.C., to consider the following Bills, which were presented to Parliament on 2 December, 1982, by the then Attorney General, the Honourable F.J. Walker, Q.C., M.P.:

• Compensation Court Bill, 1982.
• Workers' Compensation (Amendment) Bill, 1982.
• Workers' Compensation (Brucellosis) Amendment Bill, 1982.
• Sporting Injuries Insurance (Workers' Compensation) Amendment Bill, 1982.
• Miscellaneous Acts (Workers' Compensation) Amendment Bill, 1982.

1.2 In this State, provision is made for workers' compensation by the Workers' Compensation Act, 1926. This Act prescribes the benefits to be paid by employers for work-related injuries and disease, and provides for compulsory insurance or regulated self-insurance by employers. The Act confers on the Workers' Compensation Commission of New South Wales, a body consisting of judges, the function of determining questions arising under the Act, including disputed claims for compensation. The Commission is also given certain administrative functions, including the licensing and supervision of insurers and self-insurers, the regulation of insurance premiums, and the administration of certain ancillary arrangements such as the Bush Fire Fighters' Insurance Scheme and the Uninsured Liability Scheme. In broad terms, the proposed legislation abolishes the Workers' Compensation Commission and confers the previous judicial functions of the Commission on a new court to be called the Compensation Court of New South Wales. A Board to be called the State Compensation Board is constituted to assume the administrative functions of the Commission. In addition, a number of important changes are proposed in the Organisation and operation of the Compensation Court compared with the present Organisation and operation of the Workers' Compensation Commission in its judicial capacity. Important changes are also proposed in relation to the administrative functions to be transferred from the Commission to the State Compensation Board.

1.3 In this report the following abbreviations will be used:

"The Act" means the Workers' Compensation Act, 1926.

"The Commission" means the Workers' Compensation Commission constituted under the Act.

"The Court Bill" means the Compensation Court Bill, 1982, tabled in Parliament on 2 December, 1982.

"The Amendment Bill" means the Workers' Compensation (Amendment) Bill, 1982, tabled in Parliament on 2 December, 1982.

"The court" means the Compensation Court proposed by the Court Bill.

"The Board" means the State Compensation Board proposed by the Amendment Bill.

The Scope of this Report

1.4 The scope of this report is limited by the circumstances in which we have been asked to make it. We currently have a reference to inquire into, report on and make recommendations concerning the extent to which, the circumstances in which and the means by which compensation should be payable in respect of death or personal injury. The reference requires us to consider, inter alia, whether the principles and practices relating to compensation for death or personal injury under the workers' compensation legislation should be modified and, if so, in what way. We shall in due course report in relation to compensation for work-related injuries and disease. The report will include an examination of existing procedures for determination of disputed claims for compensation, and any recommendations for reform of those procedures which we consider appropriate.

1.5 The Bills were not drafted in response to any recommendation which we have made in relation to work-related injuries and disease. The amendments proposed by the Bills assume the continuance, in broad terms, of the present arrangements for workers' compensation in this State, including private insurance or self-insurance by employers, the licensing of a large number of insurers, and the determination of disputes under a traditional judicial system including the adversary process. These assumptions and other fundamental features of the present legislation may or may not be accepted by us when we come to make recommendations in relation to compensation for work-related injuries. For example, we have, in relation to a possible Transport Accidents Compensation Scheme developed a concept, provisional at this stage, for the creation of a new transport accidents compensation authority, and the determination of claims by a non-adversary administrative process, subject to provision for judicial review. It may be that the approach we have suggested in relation to transport accidents will be applicable in some measure to disputed claims for compensation for work-related injuries and disease. Indeed, it is possible that more sweeping changes to compensation arrangements might be recommended. We do not therefore regard this report as pre-empting a fundamental examination of the present arrangements for compensation for work-related injuries. Rather, it is the function of this report to identify and consider specific policy questions raised by the Bills on an assumption that the basic approach to workers' compensation remains, for the time being at least, intact.

1.6 The Bills are the culmination of deliberations recorded in a series of documents with which we have been supplied, being Items 1-16 in the Schedule to this report. When the Bills were tabled in Parliament on 2 December 1982, the then Attorney General, the Honourable F.J. Walker, Q.C., M.P., stated in the second reading speech that the opportunity would be given for comment before the legislation proceeded further.¹ We have received documents from various persons and organisations, being Items 18-35 inclusive in the Schedule to this report, which we refer to as submissions although that term is not apt in all cases. The submissions show that in many respects the amendments proposed are not contentious but that serious objection is taken by commentators to some aspects of the proposed legislation.

1.7 Having regard to these considerations we perceive thescope of this report as follows.

• First, we are to assume the continuance of the present arrangements for workers' compensation in all those respects which are not the subject of amendments proposed by the Bills, and we are to do so without prejudice to our reference to inquire into and report generally in relation to compensation for work-related injuries and disease.
• Secondly, we are to identify the policy questions arising out of the proposed amendments by reference to the submissions and our assessment of such other aspects of the Bills as raise issues worthy of comment.
• Thirdly, we are to review each such policy question and recommend what the Bills should or should not provide in answer to each such question. After giving a resume of the Bills we will specify the relevant policy questions.

The Court Bill

1.8 The Court Bill creates the Compensation Court of New South Wales. It provides for the appointment of a Chief Judge and of judges of the court and prescribes their qualifications for appointment. Provision is made for the appointment of a lower tier of judicial officers, called commissioners, who may have qualifications other than legal qualifications. Provision is also made for the appointment of a registrar and assistant registrars. The court is given jurisdiction to determine all matters and questions arising under the Act and provision is made for the exercise of that jurisdiction by the judges, commissioners and registrars. Proceedings before commissioners are to be as informal as practicable. Parties may be represented before commissioners by advocates who are not qualified to practise law, or by a solicitor. Special provision is made in relation to pre-hearing conferences and for reference to arbitration. There is an appeal from the court to the Supreme Court on a question of law or in relation to the admission or rejection of evidence. There is also an appeal from a commissioner or registrar exercising the judicial functions of the court to a judge of the court on questions of fact and law but with limited provision for calling further evidence. A Rule Committee is constituted on which the judges, the commissioners and the legal profession are to be represented.

The Amendment Bill

1.9 The Amendment Bill constitutes the State Compensation Board which is to assume the present administrative functions of the Commission. The Board is to consist of four members, one of whom is to be the Chief Executive Officer of the Board. The remaining three members are to be part-time members, intended to be representative of workers, employers and insurers respectively. Apart from the transfer of the major administrative functions of the Commission to the Board, special provision is made for the Board to act in relation to the vocational re-education and rehabilitation of disabled workers and in relation to the settlement of disputed claims for compensation by a conciliation process.

Related Bills

1.10 The Workers' Compensation (Brucellosis) Amendment Bill and the Sporting Injuries Insurance (Workers' Compensation) Amendment Bill also serve to transfer to the Board certain administrative functions previously exercised by the Commission. The Miscellaneous Acts (Workers' Compensation) Amendment Bill makes necessary consequential amendments.

The Policy Questions

1.11 The policy questions which we identify as raised by the proposed legislation are set out below. They will be reviewed in turn.

• Should there be a separation of the present judicial and administrative functions of the Commission?
• What should be the qualifications for appointment as a judge of the court?
• Should there be a lower tier of judicial officers such as commissioners and, if so, what limits, if any, should there be as to their jurisdiction?
• What should be the qualifications for appointment to a lower tier of judicial officers, such as commissioners?
• Should proceedings before commissioners be informal?
• Should legally unqualified advocates be permitted to appear before commissioners?
• What rights of appeal should there be from commissioners?
• What should be the functions of registrars of the court?
• What provision should be made for pre-trial procedures?
• What should be the rule-making power of the court?
• What provision should be made for interest on unpaid compensation?
• What should be the composition of the Board?
• Are the amended provisions in relation to licensing of insurers and self-insurers satisfactory?

FOOTNOTES

1. Schedule: Item 17.