Researchers said one number stood out as “concerning” after projecting what the next 180 days will look like once offices return to normal.
Insurers are gearing up to fork out hundreds of millions of dollars in Covid-19 workers’ compensation claims as employees return to the office.
A total of nearly $2 billion is expected to be lost over the next year through a combination of workers’ comp claims and medical expenses the government will have to wear because of hospital admissions.
A new report by Australian actuarial and consulting firm Finity, released earlier this week, has projected that around 100,000 workers will be infected with Covid-19 across the country once states ease restrictions at the 70 per cent vaccine milestone.
Of those 100,000 infected people, around 10,000 will be hospitalised, nearly 1000 will be admitted to an intensive care ward and 550 people will die — with unvaccinated staff members accounting for the majority of those numbers.
Each death will cost a company about $1 million if the virus was caught at the workplace.
And none of that takes into account the effects of “long Covid” where symptoms persist weeks, months and sometimes more than a year later.
Around 12,000 Aussie employees will be working at a reduced capacity for seven months due to long-term side effects of the coronavirus while a further 6000 won’t be able to work at all in that time.
Aaron Cutter, a director at Finity and the report’s lead author, told news.com.au: “we should be concerned about the sheer number of claims”.
But that’s not all — it’s going to cause a huge divide in the workplace, depending on where you catch Covid-19, Mr Cutter warned.
Those who catch Covid-19 through their work will get a payout but those who are infected elsewhere aren’t entitled to a single dollar in compensation.
“If it’s caught from a husband, wife, kids or whatever then there’s no workers’ compensation claim,” Mr Cutter explained.
“That then leads to the incentive. There is an incentive for people to attempt to prove that they caught Covid in the workplace and at least try it on.”
In coming months, people might try to prove they caught the virus at work, or at the very least blame unsafe work practices so they can get adequate compensation.
If they caught the virus somewhere else, they would have to eat into their sick leave, and then either use up unpaid leave or have no choice but to quit the job altogether.
“Like any other illness, if you suffered a heart attack or a stroke or whatever, there would be an element to sick leave until the position was obviously not able to be filled by yourself,” Mr Cutter said.
“There could well be some detrimental effects due to the cases not caught in the workplace forcing people out of the workforce.”
On the other hand, if someone is put out of work because of long Covid but caught the disease through their job, they could receive a large chunk of their wage through worker’s compensation.
Using $1400 as an amount of weekly compensation (80 per cent of an Australian’s average weekly earnings), insurers will be handing out between $1 million and $8 million a week “depending on how high the numbers of long Covid get to”, the reported noted.
That’s $440 million paid out over 12 months.
However, for those who contract the disease outside of work, they won’t be entitled to any of that.
“The most uncertainty is long Covid,” Mr Cutter explained.
“We just don’t know how many people will be affected with long term symptoms post four weeks and post 12 weeks.
“We don’t know the impact of the vaccine on this. We don’t know how long these people are off work. It could be three months, six months, 12 months or it could be longer.”
The workers’ compensation claims related to Covid-19 is not an issue in NSW, with the government announcing halfway through last year that any Covid infection would be assumed to have been caught at work.
That means employees in NSW doesn’t have to worry about being eligible for a worker’s compensation claim as they are automatically if they catch Covid.
Western Australia also has a more limited framework in this presumptive legislation that covers healthcare workers only.
Mr Cutter has urged other jurisdictions to consider the same legislation.
“All of the other states and territories will need to make a legal determination,” he said.
“’Was this caught in the course of my employment and was my employer negligent in my work health and safety?’ — that’s going to be tricky to prove and disprove that someone has or hasn’t caught Covid at work.”
$2 billion lost
Around $550 million will be handed out to cover the deaths of 550 workers while $440 million will also be paid to eligible workers experiencing long Covid.
Another $1 billion will be lost from the economy because of the cost of caring for someone in hospital.
“If we assume that the average length of stay is 10 days (in hospital) and that every day in hospital costs $10,000 irrespective of ICU or ward, the 10,000 hospitalisations from Covid-19 positive workers equates to a national cost of $1 billion,” the report stated.
All up, that’s a total of basically $2 billion considering the other costs.
The numbers explained
An estimated 7.2 million vaccinated Australians are returning to work across the country.
Of those, there will be 42,000 Covid-19 infections, 700 hospitalisations, 100 ICU admissions and 50 deaths in the first 180 days after reopening.
On top of that, 38,000 will fully recover, 2700 will have reduced work in seven months’ time and 1300 will not be able to work at all for seven months.
The numbers were even more stark for the unvaccinated community of Australian workers.
An estimated 1.8 million workers are unvaccinated and of those, 63,500 will be infected with the virus, 9000 will be hospitalised, 700 put in ICU wards and 500 will die.
As for long Covid, 8900 anti-vaxxers will have reduced work in the next seven months while an extra 4400 won’t be able to work at all.
That’s not even the worst case scenario.
Those numbers are based around the Doherty Institute’s prediction of 246,339 Covid cases over a 180 day period after opening up at 70 per cent vaccinated.
Doherty’s “more pessimistic scenario” would see 914,000 Covid cases over that same period of time — which would be roughly four times as many cases and deaths among the population, including workers.
However, it’s not all bad news; “The first 45 days is where the peak is looking likely to be,” according to Mr Cutter.
“This isn’t a long term increased cost forever. It’s a hump that we will get through. In 2023 things will go back to normal. It’s a short-term effect.”