On 9 May 2025, the NSW Government released an Exposure Draft alongside an Explanatory Note for proposed changes to the Workers Compensation Act 1987. There were also significant proposed changes to the evidentiary process affecting the ability of parties to use independent medico-legal evidence.
In issue
- This article details the Government’s proposal and addresses the ripple effect on other areas of personal injury litigation, particularly in the area of compulsory third party claims (CTP), which is also subject to regulation by the NSW State Insurance Regulatory Authority (SIRA).
- Among the most discussed were the changes relating to psychological injuries in the workplace and the threshold needed to access work injury damages. These have been covered in detail elsewhere and are not discussed here.
The proposed change to the use of medico-legal evidence
The Government’s draft Workers Compensation Legislation Amendment Bill 2025 includes a proposed section 153G, which states as follows:
153G Who must carry out permanent impairment assessment
A principal assessment must be made by an assessor or assessors—
- included on the SIRA register of permanent impairment assessors, and
- either—
- agreed by the insurer and worker, or
- if the insurer and worker are unable to agree on the assessor or assessors within a period specified in the Workers Compensation Guidelines—appointed by the Authority.
This proposal essentially restricts parties to either agreeing to obtain a joint medical opinion or allowing the Personal Injury Commission (PIC) to choose an independent assessor to conduct a ‘principal assessment’ of impairment.
A principal assessment will result in the parties receiving a ‘principal assessment certificate’, as per the proposed section 153M. Where a medical dispute still exists, however, a referral may still be made to the PIC for a ‘dispute assessment’.
Whilst the process of obtaining joint evidence currently exists in the scheme, the proposed changes will remove the ability for parties to obtain their own separately instructed medico-legal opinions.
At this stage, there is no information on what selection process would be used by the PIC to choose an independent assessor where there is a disagreement between the parties. Looking to a previous SIRA Publication Note as applied in the CTP scheme, 'Guidance to Joint Medical or Other Health-Related Assessments in the CTP Scheme', parties are currently able to request that SIRA 'randomly select a suitably qualified health practitioner from its list of health practitioners authorised to give evidence'. It is noted that any appropriately qualified practitioner on this list may be selected, including those previously nominated by either party.
Implications for you
The PIC is an independent NSW administrative tribunal which decides disputes arising in claims under the NSW workers’ compensation and CTP insurance schemes. Although the disputes are currently treated in separate streams for each scheme, there may be a trend to consolidate processes. For example, claims management for both schemes were consolidated within a single platform, the PIC Pathways Portal, in June 2024.
Accordingly, we anticipate that the proposed medico-legal reforms to the workers compensation scheme may be applied in future proposals to amend the CTP scheme. The expected justification is that such changes promote the efficient and cost-effective resolution of claims, consistent with the overarching objectives of both statutory schemes.
As it currently operates, each party routinely invests in independent medico-legal reports, providing evidentiary support to their own arguments. If the medical dispute continues, the parties can apply to the PIC for the dispute to have medical assessment by a PIC appointed Assessor. Should this process be curtailed, parties may be compelled to adopt a more collaborative approach—either by reaching agreement on a jointly instructed expe rt or accept the uncertainty of a default appointment by the PIC.
Ultimately, if these changes are implemented across both schemes, they stand to significantly alter the landscape for a range of stakeholders, including claimants, insurers, independent medical experts, and legal practitioners.
Pros and Cons
At the end of the day, the objectives of the PIC are to 'resolve the real issues in proceedings justly, quickly, cost effectively and with as little formality as possible….'. These changes certainly achieve some of these objectives, given they reduce the costs and time involved in addressing medical disputes. The justice of not being able to use medico-legal opinion (unless jointly instructed) is open to argument.
On balance, the following arguably are key advantages and disadvantages of the proposed amendments to the use of medico-legal evidence:
| Advantages | Disadvantages |
|
|
What's next?
The proposed reforms to the Workers Compensation Act 1987, concerning the use of independent medico-legal evidence, represents a marked shift from the current practice. We can expect this also to be applied to the CTP scheme. It is true that these changes aim to promote efficiency and reduce the cost burden on the system. They also signal a departure from party-led evidentiary processes toward a more centralised model of expert assessment.
What next? Could this signal the beginning of the end for the traditional medico-legal evidentiary model? It is conceivable that future reforms may further limit or even eliminate the use by parties of medico-legal evidence, with matters proceeding directly to the PIC for determination of dispute assessment based upon treatment records (e.g. source evidence limited to 500 pages of treatment records). This trajectory aligns with the Commission’s broader objective of streamlining processes and reducing procedural delays.
Is it in the interest of justice? For example, a treating opinion given in the context of the immediate clinical history may be limited in value when compared to a medico-legal opinion instructed with deeper relevant contextual background, resulting in a different conclusion. Perhaps the thrust of the reform focused on speed and less cost is achieved at the expense of justice? If we cannot afford justice within these schemes, perhaps we need completely new schemes that better deliver cost effective and timely justice for the parties.
Workers Compensation Legislation Amendment Bill 2025
