The proposed New South Wales Workers Compensation Amendment Bill 2025 aims to reduce the percentage of workers suffering from psychological injury as a result of work who can be compensated to less than 5%. This is based on an increase in the Whole Person Impairment rating from 15 to 31 as measured on the Psychiatric Impairment Rating Scale (PIRS). The PIRS was derived from guidelines developed by the American Medical Association and was introduced at the request of the New South Wales Motor Accidents Authority in 1999. It was intended to be comparable to the system of physical impairment ratings with a similar impairment of about 10% threshold for compensable, Whole Person Impairments. However, despite promises by the government to provide funds to validate the PIRS, these were not provided and no validity study has ever been conducted.
When assessing the range of psychological impairment, the PIRS focuses on six scales of function which are scored from Class 1 (no deficit) to Class 5 (totally impaired). The scales used are:
(1) Self-Care and Personal Hygiene.
(2) Social and recreational activities.
(3) Travel.
(4) Social functioning (relationships).
(5) Concentration Persistence and Pace.
(6) Employment.
These scores are then compiled and, through a conversion table, a “percentage impairment” is derived. However, this score is not actually a percentage figure and the difference between a PIRS score of 15 and 30 is not 15% in terms of the number of people who obtain these scores. It is much higher. The explanatory notes for the PIRS scoring explain this by referring to the median scores on each scale and percentage impairment. Each score represents a range of impairment from 1%-3% in Class 1 to 11-30% in Class 3 and 61-100% in Class 5. The higher the total PIRS score the fewer number of people in each Class.
Further, although there is good agreement between the groups on the valuation of classes 1 and 2 there is a loss of discriminative ability for classes 3, 4 and 5 and the level of impairment measured by the PIRS is undervalued.
Simply changing the threshold of Psychological Injury to a PIRS score above 30 as is proposed in the amendment bill will result in thousands of individuals who are genuinely injured being denied compensation for psychological injuries caused at work. Based on our combined experience of over 40 years with PIRS a Whole Person Impairment score of 31 on the PIRS is only found in some 5% of the most damaged individuals diagnosed with psychopathology arising from work related issues. Injured workers with PIRS scores between 10 and 30 are significantly impaired and deserve to be compensated.
Finally, the involvement of the State Insurance Regulatory Authority authorises practitioners to administer the PIRS in compensation matters in NSW. This provides fertile ground for bias to develop in the proposed legislation.
The proposed legislation is a disaster waiting to happen.
Professor Ian Coyle, Psychologist
Professor Philip Morris AM, Psychiatrist
Professor Patrick Keyzer, Lawyer