Another NSW RFS question. This time I’m asked if I am
… aware if the volunteer firefighters are covered for any death benefits automatically under their Act? My research suggests they should be receiving $750k each but can’t verify.
Compensation for NSW volunteer firefighters is governed by the Workers Compensation (Bush Fire, Emergency and Rescue Services) Act 1987 (NSW). That Act says (at s 10):
A fire fighter who has received an injury (and in the case of the death of the fire fighter, the fire fighter’s dependants) shall be entitled to receive compensation as follows:
(a) where death results from the injury–the compensation payments prescribed by paragraphs (a) and (b) of section 25 (1) of the Principal Act…
The ‘Principal Act’ is the Workers Compensation Act 1987 (NSW). Sections 25(1)(a) and (b) of the Principal Act says:
If death results from an injury, the amount of compensation payable by the employer under this Act shall be–
(a) the amount of $750,000 (the “lump sum death benefit”), which is to be apportioned among any dependants who are wholly or partly dependent for support on the worker or (if there are no such dependants) paid to the worker’s legal personal representative, and
(b) in addition, an amount of $66.60 per week in respect of–
(i) each dependent child of the worker under the age of 16 years, and
(ii) each dependent child of the worker being a student over the age of 16 years but under the age of 21 years.
The amount in s 25 is an ‘adjustable amount’ (Workers Compensation Act 1987 (NSW) s 79 ‘Definitions’) which means it is adjusted twice a year to take into account changing rates of pay (s 80). According to the State Insurance Regulatory Authority (SIRA) the current value of the lump sum death benefit is $816,850 (SIRA, Workers compensation benefits guide (October 2019) p. 60).
The estate of a volunteer firefighter killed in the course of his or her duties should receive a lump sum payment of $816,850.
After writing this post my original correspondent wrote to say:
Excellent thank you, that’s roughly where my research had got me, $750k I think. The interesting thing is that FRNSW firefighters are only entitled to a figure equating to around $400k as a lump sum under their death and disability scheme and they pay for the policy amidst various claims that the scheme is running out of money…
This is confusing two things. First there is workers compensation. Workers compensation is a statutory insurance scheme that applies to all workers in NSW. Section 9 of the Workers Compensation Act 1987 (NSW) says (emphasis added):
A worker who has received an injury (and, in the case of the death of the worker, his or her dependants) shall receive compensation from the worker’s employer in accordance with this Act.
An employer is required to have insurance to ensure that there are funds available to meet the obligations under the Act (s 155).
The obligation to pay a lump sum on the death of an employee (or, by virtue of the Workers Compensation (Bush Fire, Emergency and Rescue Services) Act 1987 (NSW) to a volunteer firefighter) is not means tested. For many people the current lump sum ($816,850) may be more than they can imagine. For others it will be far less than what they might have earned over their expected working life. People take out extra insurance to provide death benefits and loss of income insurance in the event of disability. For many, this type of insurance is provided as part of their superannuation.
The Crown Employees (NSW Fire Brigades Firefighting Staff Death and Disability) Award 2017 is part of the terms and conditions of a firefighter employed by Fire and Rescue NSW. This award provides for death benefits calculated by reference to the employees age at the time of death, ranging from $0 for a fighter aged 67 and over, and $399 353 for a firefighter aged under 60. Benefits are payable whether the death occurs on or off duty (see Crown Employees (NSW Fire Brigades Firefighting Staff Death and Disability) Superannuation Fund Product Disclosure Statement Permanent Firefighters (24 September 2019) and Crown Employees (NSW Fire Brigades Firefighting Staff Death and Disability) Superannuation Fund Product Disclosure Statement Retained Firefighters (24 September 2019)).
Critically, as cl 7 of the Crown Employees (NSW Fire Brigades Firefighting Staff Death and Disability) Award 2017 says
The benefits conferred upon firefighters by this Award shall be in addition to those benefits otherwise payable under the FSS Scheme, the SASS scheme and/or the Workers Compensation Act 1987 and Workplace Injury Management and Workers Compensation Act 1998, as varied from time to time.
In other words it is not the case that volunteer firefighters with the rural fire service come under one ‘scheme’ that pays $816,850 but FRNSW firefighters are only entitled to ‘a figure equating to around $400k as a lump sum under their death and disability scheme’. Rather a firefighter who is employed by FRNSW who is killed on duty would be entitled to the lump sum under the Workers Compensation Act 1987 plus any entitlement under the NSW Fire Brigades Firefighting Staff Death and Disability) Superannuation Fund. Workers compensation of course only applies if the death was due to work, the superannuation fund will pay out for ‘off duty’ death as well.