Psychological claims

It is common for Workcover to deny workers compensation claims for psychological conditions like stress, anxiety and depression. For example, if you have suffered a psychological injury such as burn out or stress due to an increase in workload, missing out on a promotion or being stood down, you may not necessarily have an accepted Workcover claim. In fact, due to a recent change in the law, after 31st March 2024, claims for psychological injury caused by stress or burnout arising from your usual work activities are no longer compensable, other than for provisional payments of medical expenses for a period of 13 weeks. Usual work activities include the typical demands of your job, workload pressure and interpersonal interactions.

In addition, an insurer will rely on the actions of the employer being “reasonable management actions” to deny the claim. What is considered “reasonable” can vary depending on the unique circumstances of each case. However, the actions may be viewed as unreasonable if you can demonstrate they were discriminatory, unfair or excessive.

Our lawyers are able to advise you on the merits of challenging a rejected claim for psychological injury. This usually involves issuing proceedings in the Magistrates Court. We often obtain settlements for our clients who have had their psychological injury claim rejected by Workcover.

If you have a pre-existing condition or unrelated psychological conditions, to receive workers compensation, your work must be found to be the “predominate cause”. That is, you must show that your employment was the strongest or largest contributing factor. This also applies where you may have suffered a reoccurrence, aggravation, acceleration, exacerbation or deterioration of any pre-existing injury or disease.

It is usual for the insurance company to try to scrutinize your life and look to blame other events that may have caused stress or emotions such as:

1. Grief
2. Divorce or family troubles
3. Financial troubles
4. History of mental illness (even if decades ago)
5. Past or current drug use
6. Criminal history
7. Other health issues

However, regardless of your past history or other life events, if the cause of your ongoing psychological problem is predominately work related events, you may still have grounds for a workers compensation claim.

If you have suffered a physical work related injury and then go on to develop a psychological injury, for example depression, you can apply to workcover to fund medical treatment.

You won’t be able to receive any impairment benefit for psychiatric injury even if they are compensable as a consequence of a physical injury unless the psychological injury is a primary injury (more on that below).

Any psychological injury caused as a result of your physical injury can be included in an assessment of damages.

If your psychological injury is caused by traumatic events, even if those traumatic events are usual or typically expected to occur in your line of work (for example a paramedic or police officer) then you may have an entitlement to compensation. Traumatic events may involve exposure to or actual physical, abuse or the threat of or actual physical harm. If you are a front line worker and have suffered a psychological injury we recommend that you contact our lawyers before lodging a Workcover claim.

Possibly. There are conditions imposed by Victorian workers compensation laws so that before you can recover any money for pain and suffering or for past and future economic loss as a lump sum, you must prove that your injuries are “serious”. Our lawyers can provide advice as to whether your psychological injury is likely to meet this test. This assessment can only be made when your injury has stabilized and it is a good idea to discuss this with your doctor, psychologist or psychiatrist before meeting with our lawyers.
You also must prove that your employer was negligent. There is no simple “one size fits all” answer to the question of negligence. Our lawyers are experts in assessing whether you have grounds to pursue a lump sum claim against your employer in negligence.
Every case is context specific such as:

1. The type of work you do
2. The type of bullying and harassment or traumatic event
3. Whether there are witnesses in support
4. What knowledge your employer had about your injury or ability to perform your work
5. Whether the conduct of your employer was reasonable
6. What system or supervision the employer had in place

We will look to pursue a common law claim against your employer where you have suffered psychological injury arising from your workplace in circumstances where there is harassment, bullying and / or a traumatic event.

Even with the best efforts and the best intentions, returning to work, especially with the same employer responsible for your psychological injury can be tough, and sometimes impossible.

Our clients have described having panic attacks, sweaty palms, breathlessness, nightmares, insomnia and traumatic flashbacks at even the thought of going back to the workplace. So what next?
Under the Victorian workers compensation law, weekly payments can be paid for up to 130 weeks provided you have an ongoing incapacity for employment. After 130 weeks the test changes so that in order for weekly payments to continue you will need to show that you have no current work capacity, which is likely to continue indefinitely. This includes an incapacity for any employment, not just the employment you had with your employer at the time you were injured. Due to a recent change in the law, after 31st March 2024 you will also need to show that you have suffered a permanent impairment in excess of 20%. This is a very high threshold and means that it is difficult test to meet. For more information visit our impairment benefits web page.

Other than long term weekly payments, which are subject to the above tests, the only other options under Workcover are for a no fault impairment benefit or a claim in negligence.

Impairment
This is a no fault benefit and can be pursued as a lump sum claim if you have a work related psychological injury that has left you with a permanent impairment.

To be eligible to receive an impairment benefit for psychiatric injury you must show that you have suffered a 30% whole person impairment.

So what is a 30% whole person impairment? An independent psychiatrist will assess you with reference to the table for the evaluation of psychiatric impairment. To be in the range of 25% to 50% whole person impairment you will need to be assessed as having at least a moderate to severe impairment to your mental functions across various areas such as intelligence, thinking, perception, judgement, mood and behavior.

In assessing the degree of impairment there is no allowance for any psychological injury arising as a consequence of or secondary to a physical injury.
The amount of compensation for psychiatric impairment where you have a 30% whole person impairment is $100,500. This amount increases for every whole person impairment in excess of 30%.

Negligence
This area of law is complex and emerging, and our firm is proud to be pushing the status quo having gained a reputation and track record for obtaining results in negligence claims against employers for psychologically injured workers. The maximum amount for pain and suffering damages in Victoria is $741,000.

Sometimes it can take a long time to identify that you have suffered a psychological injury. It is not unheard of for clients to come to us many years after the actual events.

You have six years to bring a claim in negligence against your employer. However, even if you are outside of this time you may still be able to make an application for an extension of time. However you need to seek advice quickly.

Under the Victorian workers compensation law, weekly payments can be paid for up to 130 weeks provided you have an ongoing incapacity for employment. After 130 weeks the test changes so that in order for weekly payments to continue you will need to show that you have no current work capacity, which is likely to continue indefinitely. This includes an incapacity for any employment, not just the employment you had with your employer at the time you were injured.

Due to a recent change in the law, after 31st March 2024 you will also need to show that you have suffered a permanent impairment in excess of 20%. This is a very high threshold and means that it is difficult test to meet. For more information go to our impairment benefits web page. You may however be entitled to bring a lump sum claim.