Mind Over Matter: A Case for Reforming New Zealand's Accident Compensation Law Concerning Work-Related Psychological Injury

• Author: Jack Whittam
• Position: LLB, University of Canterbury. Solicitor at Lane Neave
• Pages: 109-132

MIND OVER MATTER: A CASE FOR

REFORMING NEW ZEALAND’S ACCIDENT

COMPENSATION LAW CONCERNING

WORK-RELATED PSYCHOLOGICAL INJURY



Abstract

Workers in post-ind ustrial soc ieties increa singly occupy j obs with greater r isks of

psychologic al injury than physical ha rm. At the same time, a grow ing body of research is

recognising th e untenabili ty of treating psy chological in jury with less i mportance th an

physical har m. In response , Australia’s worke rs’ compensati on law has evolv ed to serve

this changing l andscape by ao rding comprehe nsive cover t o victims of work- related

psychologic al injury. Con versely, New Zealand’s acc ident compen sation law oer s

limited cover t o such victims – largely re maining an ignorant a nachronism of yester year.

For victims of wo rk-related psych ological injury in New Zealand , the repercussions

of this dispar ity are signif‌i cant. Barred c laimants are a ble to seek compen sation under

employment la w or tort, but su ch avenues are frau ght with obstacles . As a result, succ essful

claims are seld om achieved. es e victims then oft en have no choice but to re sort to WINZ

benef‌its – a welfare s ystem evidenced to render vic tims less likely to return to work a nd

more likely to face increased poverty and worsening health.

Soliciting g uidance from Au stralian legi slation, thi s article arg ues for the reform

of accident com pensation la w in New Zealand to more li berally compen sate for work-

related psychological injury.

Keywords: Employment relat ions, accident compens ation law, work-related

psychological injury, wellbeing.

I. Introduction

Over the las t centur y, legal and psych ological d iscourse h as increa singly

recogni sed the unte nabilit y of treati ng psycholog ical inju ry wit h less import ance

* LLB, Uni versity of Ca nterbur y. Solicitor at L ane Neave. Wit h sincere t hanks t o Professor A nnick

Masselot for her gu idance and cons tant enthusia sm, as well as Profe ssor Stephen Todd for his

review an d helpful comment s.

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than physical injury.1 As Coppin s mainta ins, “a psychi atric condit ion may be equal ly,

if not more, dis abling tha n a physical injur y”.2 At the same time, work forces in post-

industr ial societ ies have become increasing ly comprised of work that is pri mari ly

cognit ive in natu re, rather th an manu al. As t he type of work ha s change d, so too

have the assoc iated employment r isks. A s a result, New Z ealan d and Aust ralia n

workers today a re at far gre ater risk of ps ychological i njury t han ever. Yet while

Austra lia boas ts comprehensi ve compensation l aw that has evol ved to recogn ise

this cha nging land scape, law in New Zea land fails to a ord victims of ps ychological

injury c omprehensive cover. It is for th is reason t hat the OECD descr ibes New

Zeala nd and Austra lia’s compensation law a s creating an “ inequitable d ivide” in the

way it treat s victims of work-related ps ychological injur y.3

In order to pur sue compensation , barred Ne w Zeala nd claima nts must t hen

claim ag ainst thei r employer under employment law or tort . However, such avenues

are fraug ht with obstacl es, meaning succe ssful claim s are seldom achieved.4 W here

a victim of wor k-related psycholog ical injury is u nable to successful ly claim under

compensation l aw or again st their employer, they w ill often h ave no option but to rely

on social wel fare. Yet overwhel ming ev idence shows vict ims on WINZ benef‌its a re

less likely t o return to work a nd more likely t o face increased p overty and worse ning

health.5 Therefore , it is clear the li mitations of cu rrent accident compens ation law in

New Zeala nd have signif‌ica nt repercussions on those e xcluded.

Seeking gu idance fr om Austra lian le gislation , this a rticle seek s to determ ine

whether accident comp ensation law i n New Zeala nd should be reforme d to more

liberal ly compensate for work-related ps ychological injur y.

To answer th is question , the ar ticle f‌irst ident if‌ies the def‌i nition of work-

related psychol ogical ha rm under New Ze aland a nd Austr alia n law. Next, the

article d iscusses how a s tark i ncrease in work-relat ed psychologic al inju ries can

be attri buted to the evolvi ng composition of post-i ndustrial work forces. The article

then compare s and contra sts accident comp ensation law i n New Zeala nd and

Austra lia, before s ystemat ically a nalysi ng how New Zea land law tr eats vict ims of

work-related psycholog ical inju ry. While t he comprehensive nat ure of Aust rali a’s

workers’ compensat ion law means l ittle rele vant case l aw actua lly exis ts, thi s

analy sis will use Au stralia’s cod if‌ied compensation sc hemes as a touchstone a gainst

which New Zea land’s compensat ion law can be assessed. The a rticle then anal yses

1 Ian Soosa y and Rob R Kydd “Mental He alth Law in Ne w Zealand” (201 6) 13 BJPSYCH 43 at 45.

2 El izabeth Coppin s “Psychiatri c Injury in Employ ment” (LLB (Hons) Di ssertation, Un iversity of

Auckla nd, 1997) at 411 .

3 OECD Mental Health and Work: New Zealand Mental Health and Work (OECD Publishin g, Paris,

2018) at 16.

4 Attorney- General v Gilbert [2002] 2 NZLR 34 2 at 359.

5 Susan McA llis ter and other s “Do dieren t types of f‌i nancia l support af ter ill ness or inju ry aect

socio- econom ic outcomes? A natura l experiment in Ne w Zealand” (2013) 85 Soc Sc i Med 93 at

100.