Appendix 1
Payments Outside Scope of Statutory Entitlements
Policy v11.0
Summary
Objective
Payments outside the scope of statutory entitlements are payments made by ACC to manage potential liabilities under Crown Entities
Act 2004, Section 17. These payments were previously referred to as ‘wrongful action’ or ‘ex-gratia’ payments.
This page provides information on:
• criteria required for a client to be paid outside ‘the scope of statutory entitlement’
• what defines a serious service failure
• what defines a financial loss
• what defines a non financial loss
• how we compensate the client
Please note that privacy breaches are not addressed through this process. All enquiries around privacy breaches and potential
compensation must be addressed through the Privacy Team.
For information on payments for backdated weekly compensation, go to 'Backdated Weekly Compensation' process group folder
under: Claims Management> Manage Client Payments > Operational Policies > Weekly Compensation > in Promapp.
If we consider issuing a decision to decline weekly compensation after a review/appeal or a settlement has indicated that weekly
compensation should be paid, then this case must be referred to the Weekly Compensation Panel to:
• check that the decision made to decline was robust
• recommend whether a payment outside the scope of statutory entitlement should be considered (if appropriate).
Owner
Expert
Policy
1.0 Criteria for payments outside the scope of statutory entitlements
a For a payment to be made outside the scope of statutory entitlements, the following criteria must be met:
• ACC committed a serious service failure, and
• the client experienced a measurable financial loss because of ACC’s actions, or
• the client experienced a non-financial loss because of ACC's actions.
If you receive a payment request that can’t be resolved through statutory entitlement, and ACC runs the risk of court action due
to the service failure, you should prepare a submission.
2.0 Serious service failure
a Service failures can occur when:
• a client’s entitled to a payment, but for some reason this wasn’t identified early enough
• the client isn’t entitled to a payment but we’ve incorrectly advised them they are.
Both of these scenarios could result in a loss for the client. If they request payment from what they see as a service failure, we
first need to see if this can be resolved through statutory entitlements.
See AC Act 2001, Section 69
A serious service failure requires more than a simple omission or delay. It requires ACC to have fallen well below reasonable
service standards. The following criteria normally should be met when considering if a serious service failure has occurred:
• there’s serious failure by ACC to do so something that was a legislative requirement or an error in the way something was
done
• the failure falls outside the scope of a normal rectifiable human error (serious error is negligent and risks putting ACC under
threat of law liability).
3.0 Measurable financial loss
a If a serious service failure occurs a client may be eligible for a payment outside the scope of statutory entitlement if they either
experienced a measurable financial loss and they can demonstrate the loss that was caused by the serious service failure.
ACC > Claims Management > Manage Claims > Operational Policies > Managing Claims at ACC > Claim management > Payments Outside Scope of Statutory Entitlements
Policy
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Appendix 1
b A financial loss could include:
• income that could have been earned from a rightful entitlement that’s been delayed due to ACC’s inaction, payment of inter-
est on late payment of weekly compensation does not apply
• additional costs incurred by the client whilst trying to get their entitlement
• incorrect advice provided by ACC that resulted in a financial commitment for the client
• ACC committing to pay for something with no entitlement.
4.0 Non-financial loss
a A client may also be eligible for a payment outside the scope of statutory entitlements if they experience a non-financial loss
and they can demonstrate the loss was caused by the serious service failure.
b A non-financial loss could include:
a. stress, distress, anxiety experienced by the client due to the serious service failure
b. significant inconvenience to the client
c. damage to the client's reputation
d. other effects
5.0 Specific claim examples
NOTE Example: Unlawful suspension of independence allowance
In Stewart (337/2004), the District Court found that ACC couldn’t suspend entitlement to the independence allowance
on medical grounds without going through the statutory independence allowance reassessment process.
QBE stopped paying the client’s independence allowance entitlement in 2005 without going through the proper
process. This alone constituted a serious error. However, there was also the issue about whether or not this decision
should have been made in the first place. There was a wealth of medical information supporting the client’s on-going
incapacity being related to the original covered injury. However, his entitlements were suspended on the basis of a file
review.
The case met the criteria in relation to serious error despite the decision having originally been made by a private in-
surer. Once QBE files were handed back to ACC, the Corporation was obliged to notify the insurer of any liabilities
within 20 days of becoming aware of them. As that timeframe had passed ACC was now liable for any payment out-
side the scope of statutory entitlements due.
In regards to the quantifiable loss this was calculated on the basis of the interest from the date of suspension of the
independence allowance to the date it was reinstated.
NOTE Example: Rest home costs incurred
The client fractured her hip 2004. This year she returned to hospital for removal of rods. Prior to her discharge a
needs assessment was completed. The assessor recommended 7 hours home help and 10 hours attendant care
assistance per week.
Instead of returning home, the client was discharged to a rest home. A short time later, ACC was advised that the
client had died. ACC advised the client’s daughter, that ACC would pay the rest home costs.
It had since been determined that there was no injury-related need for rest home care. However, ACC had given a
clear undertaking to the family that ACC would meet this cost.
NOTE Example: Reimbursement for duplicate prescription receipt if ACC loses original
A client has sent their application for reimbursement of prescription fees to their case manager. In turn, the case man-
ager has sent the application to the processing centre.
However, after three weeks of not hearing back from ACC the client contacts the case manager, who discovers the
application cannot be found.
The client now has to submit a new application. When they go to the pharmacy to get a duplicate of their original re-
ceipt the pharmacy charges them a fee for the duplicate.
This fee is not a prescription cost, but a cost incurred by the client due to ACC having lost the original application. ACC
will then reimburse for the prescription fee as well as the costs of obtaining the duplicated receipt.
ACC > Claims Management > Manage Claims > Operational Policies > Managing Claims at ACC > Claim management > Payments Outside Scope of Statutory Entitlements
Policy
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Appendix 1
NOTE Example: Non-economic loss experienced due t incorrect suspension of weekly compensation a significant
period of time
A client had an accident in March 1999, ACC provided entitlements up until 2002 when no further medical certificates
were received.
The client contacted ACC in 2004 advising they had been unable to work since 2002 and ACC investigated whether
they were incapacitated. As a result, ACC confirmed weekly compensation should be reinstated from 2002, advising
the client’s advocate they would need to provide medical certificates to cover that period. The claim was subsequently
closed due to no medical certificates being produced.
The client contacted ACC in 2017 asking for weekly compensation from the date of the accident. ACC’s Technical
Specialist noted that despite incapacity being established in 2004, the focus was on obtaining backdated medical
certificates rather than obtaining earnings details and paying the arrears the client was entitled to. This constituted a
serious service failure, and a back payment of weekly compensation and interest was made.
Further quantifiable losses due to the serious service failure were not able to be provided, but the client’s mother pro-
vided a letter stating it, “was beyond her ability to estimate the financial loss” and “The failure deprived him of his
lawful entitlements for thirteen years, causing significant and complex economic and non-economic harm to him and
his family”.
6.0 The submission
a If you identify a case where it appears there has been a serious service failure resulting in a loss to the client, a submission for
‘payment outside the scope of statutory entitlements’ should be prepared.
The submission needs to include:
• amount the client is seeking
• details surrounding the claim
• alleged errors ACC made
• quantified losses incurred by the client if the loss is financial, and/or
• details of the non-financial impact on the client
Once the submission is prepared, and the amount sought is over $2,000, the submission is referred onto a Resolution Spe-
cialist for their consideration. Email the submission to [email address]. Resolution Services will assess the the
payment outside the scope of statutory entitlements criteria have been met and decide on the appropriate compensation for
the serious service failure.
For amounts under $2,000 the submission is referred to the Client Service Leader for approval.
The Resolution Specialist will make a recommendation for amounts over $2,000, then work with senior staff and Legal Ser-
vices to gain approval for the request. If the request is not approved they will let you know and work with you to draft a letter to
the client.
Framework for determining POSSE compensation for non-financial loss
Delegations framework - sharepoint
7.0 Making the payment
a Once written approval has been given, you need to:
1) Create a letter to the client advising them of the decision, noting that as it is a decision outside the scope of statutory entitle-
ments, review rights do not apply (seek guidance from Resolution Services if required). Email the letter to the client if that is
the preferred contact method. If posting create a NGCM Send letter task for admin.
2) Create a Purchase Order using the following details:
• Client or representative
• Entitlement code WA02
• Amount to be entered as directed by Client Service Leader/Resolution Specialist (In Unit Price field). See (b) and (c) for who
can authorise the purchase order and send them an approval task.
3) Generate a Make MFP Payment task using the same details above and transfer the task to the Hamilton SC- Claimant
Reimbursement queue
4) Check a week later to make sure the payment has been received by the client and if not, follow up
b If the amount payable is less than $2,000 the Client Service Leader can authorise the purchase order
c If the amount payable is between &2,000 and $5,000 the Senior Resolution Specialist or Senior Review Specialist can autho-
rise the purchase order
d If the amount payable is over $5,000 the Principal Advisor, DCE Office Service Delivery can authorise the purchase order
ACC > Claims Management > Manage Claims > Operational Policies > Managing Claims at ACC > Claim management > Payments Outside Scope of Statutory Entitlements
Policy
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Appendix 1
Framework for determining POSSE compensation for non-financial loss
Step
Considerations
Action
Decision
1.
Determine if a serious
Collect all relevant information to the complaint:
Assess the information. Advise the Principal
Has there
service failure has
•
If the referral lacks information/detail go back to the person/team that referred the request and ask for
Advisor, DCE Office, Service Delivery if it is
Proceed – if a serious
Stop – if a serious
been a
occurred?
clarification.
suspected no serious service failure has occurred.
service failure has
service failure has not
serious
•
If unsure around some of ACC’s policies or processes and how these are applicable to the client’s situation seek
They will make decision.
occurred
occurred
service
advice from a subject matter expert, e.g. a Technical Specialist.
failure?
In what way has the client
What are the characteristics of the non-financial harm experienced?
Collate the information the client has provided on
Stop – if:
been impacted (stress,
•
Has the failure damaged the client’s relationships?
the impact/harm experienced due to the serious
Proceed – if:
•
the client does
distress, inconvenience,
•
Has the failure impacted on the client’s mental health?
service failure.
•
there is a
not
anxiety, damage to
•
How much effort has the client exerted in attempting to rectify the failure?
detailed account
demonstrate
reputation, or other
•
Has the client had to seek help through other means when ACC should have been providing support?
of the nature of
the non-
effects)?
•
Has the failure exacerbated the effects of the client’s injury?
the non-financial
financial
•
How many aspects of the client’s life have been impacted by the failure?
impact
impacts
•
Consider the circumstances unique to the client and whether the effects of the failure are more significant to
•
there is a
•
other factors
them than people in a different situation?
detailed account
seem most
of the affect this
likely to have
Was the serious service
The POSSE payment is to compensate for the impact caused by serious service failure when statutory entitlements cannot
Disentangle the impacts caused by the serious
2.
has had on the
caused the
failure a material cause of
rectify the situation, other factors are outside the scope of POSSE.
service failure and other sources impacting on the
Impact of
client
harm
the non-financial loss, or is
client.
failure on the
•
it is reasonable
•
it is not
it reasonable to think
Consider the holistic factors at play that could reasonably lead to the client’s feeling of harm. Then attempt to isolate the
client
to consider the
proportionate
other factors were the
impact the serious service failure could have reasonably had.
serious service
to think the
predominant cause?
failure caused
claimed
In some situations, the underlying cause of the non-financial impact may not be the serious service failure, but the failure
the harm
impact could
exacerbates the harm. In this situation compensation must only be to the exacerbation of the effect.
•
people in
have been
Would most people be
Consider all the characteristics of the non-financial harm experienced, the longevity of the impact, and the specific context
Assess whether the non-financial harm is
comparable
caused by the
impacted in a similar way
unique to the client.
proportionate to the serious service failure.
situations would
failure.
by the serious service
likely be affected
failure?
Would the disclosed non-financial impact affect most people, in a comparable situation to the client, in a similar way?
Advise the Principal Advisor, DCE Office, Service
in a similar way.
Apologise for the serious
Delivery if compensation is not deemed necessary,
service failure, but no
the Principal Advisor will make decision.
compensation required.
The longevity of the
The information initially collected when assessing the request for a POSSE will contain information on the longevity of the
The length of the impact should be fairly easy to
impact – how long has
impact.
find out by examining the information the client
passed since the failure?
has provided.
The scale of the impact –
Examine the characteristics of the non-financial harm and consider the scale of the harm the client has experienced.
Assess the severity of the impact on the client.
how severe has the impact
of the failure been?
3.
Factors
Will the failure have a
Consider the impacts to date, but also whether the failure has caused harm that will continue into the future, and whether
Assess whether the harm caused by the failure will
Consider – these factors
informing
lasting impact on the
the POSSE payment is going to rectify the impact on the client completely. If the payment (regardless of how much) will
still impact on the client, even post compensation
contribute to the
N/A
compensatio
client?
not resolve the issue it indicates the severity of the impact is very high.
payment.
compensation amount.
n amount
Is the nature of the failure
Consider the nature of the failure:
Assess the nature of the failure and whether this
particularly egregious in its
•
Was it a systemic failure of ACC’s processes?
should have an impact on the amount of
nature?
•
Was it human error, and if so, how many times was the error done?
compensation.
•
Was there malintent from ACC staff?
•
Was there a breach of legislation?
How much compensation
Consider previous POSSE settlements for non-financial loss:
Refer to previous POSSE compensation payments
was awarded in similar
•
Examine how much compensation has been given for other cases to provide context.
for non-financial loss.
4.
cases?
•
If there are similar characteristics between cases use this to inform the amount of compensation for the client.
Decision – decide on
Decision on
amount of compensation,
compensatio
How should the client be
The following should be considered as a general guide for compensating a client:
Determine how the client should be compensated.
get this approved by
N/A
n
compensated?
•
Small sum of compensation (up to $500) – minor distress/inconvenience.
delegation holder, inform
•
Medium sum of compensation ($500 to $2000) – considerable distress/inconvenience.
client.
•
Large sum of compensation (over $2000) – substantial distress/inconvenience.
Appendix 1
Framework for determining POSSE compensation for non-financial loss
Do others share a similar
Consider other perspectives of what a reasonable amount of compensation is:
Consult with a senior colleague on the proposed
view on the amount of
•
Speak with senior colleagues on the amount of compensation they think appropriate.
amount of compensation, gain approval from
compensation?
•
Gain approval from delegation holder on the amount determined.
delegation holder, consult with the client if
•
If possible, the client should be consulted on the amount of compensation proposed. If the client is not happy
possible/appropriate.
with the initial offer the amount can be negotiated if appropriate.
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