No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers. —  s11A(1) , Workers Compensation Act 1987 .

1. No compensation is payable for permanent impairment that results from a secondary psychological injury.
2. In assessing the degree of permanent impairment that results from a physical injury or primary psychological injury, no regard is to be had to any impairment or symptoms resulting from a secondary psychological injury.
3. No compensation is payable for permanent impairment that results from a primary psychological injury unless the degree of permanent impairment resulting from the primary psychological injury is at least 15%.

NB: If more than one psychological injury arises out of the same incident,  s322 of the Workplace Injury Management and Workers Compensation Act 1998 requires the injuries to be assessed together as one injury to determine the degree of permanent impairment.

1. If a worker receives a primary psychological injury and a physical injury, arising out of the same incident, the worker is only entitled to receive compensation under this Division in respect of impairment resulting from one of those injuries, and for that purpose the following provisions apply:
   1. the degree of permanent impairment that results from the primary psychological injury is to be assessed separately from the degree of permanent impairment that results from the physical injury (despite s65(2))
   2. the worker is entitled to receive compensation under this division for impairment resulting from whichever injury results in the greater amount of compensation being payable to the worker under this Division (and is not entitled to receive compensation under this Division for impairment resulting from the other injury), and
   3. the question of which injury results in the greater amount of compensation is, in default of agreement, to be determined by the Commission.

NB: If there is more than one physical injury those injuries will still be assessed together as one injury under  s322 of the 1998 Act but separately from any psychological injury. Similarly, if there is more than one psychological injury, those psychological injuries will be assessed together as one injury, but separately from any physical injury —  s65A , 1987 Act .

There is no entitlement to compensation in respect of an injury to a worker if the injury is a mental injury caused wholly or predominately by any one or more of the following:

1. management action taken on reasonable grounds and in a reasonable manner by or on behalf of the worker’s employer, or
2. a decision of the worker’s employer, on reasonable grounds, to take, or not to take any management action, or
3. any expectation by the worker that any management action would, or would not, be taken or a decision made to take, or not to take, any management action, or
4. an application under s154 of the Local Government Act 2020 or proceedings as a result of that application, in relation to the conduct of a worker who is a Councillor within the meaning of Clause 15 Schedule 1 —  s40(1) , Workplace Injury Rehabilitation and Compensation Act 2013 

In  s40(7) , management action, in relation to a worker, includes, but is not limited to, any one or more of the following:

1. appraisal of the worker’s performance
2. counselling of the worker
3. suspension or stand-down of the worker’s employment
4. disciplinary action taken in respect of the worker’s employment
5. transfer of the worker’s employment
6. demotion, redeployment or retrenchment of the worker
7. dismissal of the worker
8. promotion of the worker
9. reclassification of the worker’s employment position
10. provision of leave of absence to the worker
11. provision to the worker of a benefit connected with the worker’s employment
12. training a worker in respect of the worker’s employment
13. investigation by the worker’s employer of any alleged misconduct:
    1. of the worker; or
    2. of any other person relating to the employer’s workforce in which the worker was involved or to which the worker was a witness; or
14. communication in connection with an action mentioned in any of the above paragraphs —  s40(7) 

An injury does not include a psychiatric or psychological disorder arising out of, or in the course of, any of the following circumstances:

1. reasonable management action taken in a reasonable way by the employer in connection with the worker’s employment
2. the worker’s expectation or perception of reasonable management action being taken against the worker, and
3. action by the Regulator or an insurer in connection with the worker’s application for compensation.

Reasonable management actions include action taken to transfer, demote, discipline, redeploy, retrench or dismiss the worker, a decision not to award or provide promotion, reclassification or transfer of, or leave of absence or benefit in connection with, the worker’s employment — s32(5).

The  Guidelines for Evaluation of Permanent Impairment are used to assess the degree of permanent impairment

Treatment of stress for compensation purposes: Compensation is not payable for diseases caused by stress if the stress wholly or predominately arises from the worker’s dismissal, retrenchment, demotion, discipline, transfer or redeployment, or the worker’s not being promoted, reclassified, transferred or granted leave of absence or any other benefit in relation to employment or a worker’s expectation of a matter or decision unless it is considered to be unreasonable or harsh on the part of the employer —  s5(4) , Workers’ Compensation and Injury Management Act 1981 

Treatment of secondary conditions in assessing impairment: Secondary conditions are not included for the purposes of assessing impairment for common law, specialised retraining programs of payments of additional medical expenses. ‘Secondary condition’ means a condition, whether psychological, psychiatric, or sexual, that, although it may result from the injury or injuries concerned, arises as a secondary, or less direct, consequence of that injury or those injuries.

In the case of psychiatric injury, it must arise out of or in the course of employment and the employment must be the significant contributing cause of the injury. The injury must not arise wholly or predominantly from any action of decision designated under s  7(4) , which includes:

1. reasonable action taken in a reasonable manner by an employer to transfer, demote, discipline or counsel a worker or to bring about the cessation of a worker’s employment;
2. on reasonable grounds, not to award or provide a promotion, transfer or benefit in connection with a worker’s employment;
3. reasonable administrative action taken in a reasonable manner by an employer in connection with a worker’s employment;
4. reasonable action taken in a reasonable manner under the Act affecting the worker —  s7 , Return to Work Act 2014 

In the case of physical injury - 35% WPI to be regarded as seriously injured for the purposes of the Return to Work Act 2014 . 

In the case of psychiatric injury - 30% WPI to be regarding as seriously injured for the purposes of the Return to Work Act 2014 .

Compensation is not payable in respect of a disease which is an illness of the mind or a disorder of the mind and which arises substantially from:

1. reasonable action taken in a reasonable manner by an employer to transfer, demote, discipline or counsel a worker or to bring about the cessation of a worker’s employment;
2. a decision of an employer, based on reasonable grounds, not to award or provide a promotion, transfer or benefit in connection with a worker’s employment;
3. reasonable administrative action taken in a reasonable manner by an employer in connection with a worker’s employment;
4. the failure of an employer to take action of a type referred to above in relation to a worker in connection with the worker’s employment if there are reasonable grounds for not taking that action; or
5. reasonable action taken by an employer under this Act in a reasonable manner affecting a worker —  s25(1A) , Workers Rehabilitation and Compensation Act 1988 

Compensation is not payable in respect of an injury (being a disease) if the injury is:

• due to reasonable administrative action taken in a reasonable manner in respect of the employee’s employment  s5A(1) — a non- exclusive list of what might be taken to be ‘reasonable administrative action’ is included at  s5A(2) 
• intentionally self-inflicted —  s14(2) 
• a disease, or an aggravation of a disease, which the employee had made a wilful and false representation that he or she did not  suffer , or had not previously suffered, for purposes connected with their employment or proposed employment by the Commonwealth or a licensed corporation —  s7(7),   Safety, Rehabilitation and Compensation Act 1988.

Compensation is not payable in respect of an injury (being a disease) if the injury is:

• due to reasonable disciplinary action or failure by the employee to obtain a promotion, transfer or benefit in connection with their employment —  s3 
• intentionally self-inflicted —  s26(2) 
• a disease, or an aggravation of a disease, which the employee made a wilful and false representation that he or she did not suffer, or had not previously suffered from that disease, for the purposes connected with their employment —  s10(7) , Seafarers Rehabilitation and Compensation Act 1992.

Military Rehabilitation and Compensation Act 2004 (MRCA) — Psychological injuries are not treated any differently than other injuries or diseases

Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988 (DRCA) — Psychological injuries are not treated any differently than other injuries or diseases

MRCA  s69 

Initial compensation — 10 impairment points (IP)

DRCA

10% Whole person impairment (WPI)  s24 

MRCA

Additional compensation — 5 IPs

As per Chapter 4 ‘Emotional and Behavioural’, GARP M 

DRCA

Comcare Guide Edition 2.1, Part 2, Chapter 5