Statement on Work Injury Compensation Act (WICA)
4 July 2022
In 2019, Singapore’s Work Injury Compensation Act (WICA)* was replaced entirely. Instead of the Ministry of Manpower (MOM), insurers now process WICA claims, including determining the validity of injured workers’ claims. The resulting conflict of interest could undermine WICA’s fitness for protecting injured workers, in terms of both principle and practicality.
Conflict of interest
Under WICA 2019, insurers not only calculate amounts payable to injured workers. Insurers also investigate whether workers’ injuries are validly work-related in the first place. Currently, we observe that insurers depend primarily on employers for information about workers’ injuries.
Insurers appear to lack capacity to fulfil professional investigation protocols and standards. We have observed an insurer take a formal investigation statement from a worker whose employer denied his injury, but the insurer relied on that employer’s staff to interpret.
Reducing the number of compensable claims is in the insurers’ interest. Employers, too, have an interest in minimising claims, due to premium differentiation, and maintaining their safety record.
Unlike most personal injury insurance, WICA insurance contracts are not between insurer and injured victim. Rather, the insurers’ relationship is with the employers who are treated as their customers. Insurers lack market incentive to uphold workers’ WICA rights, or be accountable to workers. The fulfilment of insurers’ new WICA 2019 responsibilities thus requires robust enforcement of concrete standards.
Standards and oversight mechanisms unclear
However, the substantive standards for claims investigations and processing remain unclear. Equally unclear is how insurers are held accountable to these standards, if at all.
WICA 2019’s Regulations contain no substantive performance standards, investigation or processing protocols, nor accountability mechanisms such as audits or penalties. MOM’s licensing conditions refer to an insurers’ manual, but it is not publicised. Its legal weight and enforceability is also unclear. Consequently, workers subjected to unjust practices, such as unfair investigations, would face difficulty in highlighting concerns and objections about such procedural injustices.
Injured workers and their families have a right to the highest standards of claim investigation and processing. Furthermore, WICA is not just an insurance policy. It is a statutory mechanism for distributing industrial risk ― away from those least able to protect themselves. Its administration affects public policy, via workplace safety data and actuarial costing. WICA investigations must therefore be objective. Only public authorities, empowered and accountable under law, can and must uphold these standards, with an ethos of public service and transparency, rather than profit.
HOME proposes that determining WICA claims’ validity should be MOM’s role, rather than left to insurers. Once the claims’ validity is established, processing can be delegated to insurers.
WICA claims processing should be held to substantive, binding and publicly available standards, backed by robust accountability mechanisms to proactively detect and responsively redress breaches. Procedures must align with not only fundamental principles of fairness, but also concrete best practice.
Information accessibility
In getting updates about their own case, many injured workers find that the insurers’ response is generally to defer to the employers to gatekeep information, even if NGOs query on workers’ behalf. Insurers lack trained translators to serve migrant workers, who are often brushed off.
Workers have received the insurer-issued Notice of Computation (NOC) ― i.e., their compensation determination ― without translation, or the underlying medical report. Some only receive the NOC after the objection period expires. This hamstrings their right to object to, or even understand, the NOC.
Workers have a right to meaningfully access information about their claims. Insurers should operate direct hotlines, online or SMS status update facilities for injured workers, resourced in appropriate languages.
WICA exists to compensate injured workers and, more broadly, to allocate industrial risks. To achieve these aims, its execution must be firmly anchored and accountable to the public sphere, particularly to the workers who invoke its protections.
*To read HOME’s comments when the Work Injury Compensation Bill was first introduced, see here.
Photo: The Straits Times