What WorkSafe will pay for
The WorkSafe Agent (the Agent) can pay the reasonable costs of modifications to a car that is reasonably required as a result of a work-related injury or illness to enable the worker to drive or to be transported safely.
Where the worker's car cannot be modified or the worker does not have access to a car, the Agent can contribute a reasonable amount to the purchase cost of a suitable car selected by the Agent.
Before commencing any modifications to a car, it is a legislative requirement that the worker obtain prior written approval from the Agent for the payment of the reasonable costs of modifying the car or, if the car is not capable of being modified, prior written approval for the reasonable amount that the Agent will contribute to the purchase cost of a suitable car.
The worker is also required to sign a Capital Service Agreement (CSA) if the payment or contribution towards a car is more than $10,000.
For the Agent to consider contributing to the cost of modifying or purchasing a car that the worker intends to drive themself, the worker must have:
- a medical clearance to drive and have been cleared by VicRoads to drive
- a current and valid driver's license and be legally able to drive (i.e. must not be disqualified or suspended from driving)
In this policy:
- Adaptive equipment refers to accessories or driving devices installed in a car to cater for drivers and passengers with disabilities.
- Car modifications refer to making alterations which affect the structural integrity of a car, the internal design, occupant seating and restraints etc. to cater for drivers and passengers with disabilities.
- Changeover car refers to the situation where the current or existing car needs to be replaced or changed over because of the work-related injury or illness needs.
- Projected life expectancy of a car refers to the useful life of a car and is determined after taking into account the car's maintenance and service history, its condition and safety, the number of kilometres travelled and its age.
- Market value refers to the estimated re-sale value of a used car according to the RedBook website. Redbook provides car pricing information.
- Capital items in a Capital Service Agreement (CSA) refers to any items of equipment or assets, including motor cars, which have been purchased partly or wholly by the Agent.
When is modification of a car required?
It may be necessary to install adaptive equipment or modify a car to meet the worker's specific requirements and physical capabilities as a result of a work-related injury or illness.
Who is involved in determining the worker's transport and car needs?
In consultation with the Agent, an occupational therapist qualified in driver assessment and training will evaluate the worker's transport and car needs by using the WorkSafe's Transport Needs Assessment form and the Car Needs and Modifications Assessment form. These forms provide an assessment of the worker's specific work-related injury or illness transport and car needs.
Capital Service Agreement
When does the worker need to sign a capital service agreement?
The worker or their representative is required to sign a Capital Service Agreement when the cost of the modifications or the contribution by the Agent to the purchase cost of a car exceeds $10,000. The Capital Service Agreement covers:
- subsequent ownership
- changes of ownership
- the frequency of modifications
- maintenance of the car's adaptations or modifications
- ongoing car costs such as comprehensive car insurance and registration
Contributing to the cost of a car
How can assistance be provided to the worker who does not have access to a car that can be modified or the existing car is not suitable for modification?
The Agent can make a reasonable contribution to assist the worker to purchase a second-hand or new car selected by the Agent that is suitable for modification. The worker is eligible if they:
- have a significant long-term physical, sensory or cognitive disability
- have difficulty in accessing services in the community as a driver or passenger because of the work-related injury or illness
- provide a written explanation from the occupational therapist and automotive engineer on why the existing car is not suitable for modification
The Agent can assist the worker to purchase another car selected by the Agent when a suitable second-hand car cannot be sourced or the option to modify a second-hand car is not cost-effective or the most appropriate choice. It is considered reasonable that when the car the worker had use of at time of the work-related injury or illness was:
- more than 4-years-old, the amount of the contribution will be equivalent to the purchase cost of a 4-year-old car, or
- less than 4-years-old, the amount of the contribution will be equivalent to the purchase cost of a car of the equivalent age
- for example, if the worker had use of a 2003 model car and wanted to purchase a 2007 model car, the amount of the contribution towards the purchase cost will be based on the equivalent cost of a 2003 replacement car
The reasonable amount of the contribution is determined by considering the following factors:
- if the worker still uses the car used at the time of the work-related injury or illness, the market value of that car today
- if the car is no longer used by the worker, the market value of the car at the time of the work-related injury or illness
- how often the worker was using a car at the time of the work-related injury or illness
- how often the worker is likely to use a car in the future
- the market value of any other car the worker uses
In determining the market value of a car owned or used by the worker, the Agent can also use:
- the amount of any pay-out from a comprehensive motor car insurer or the market value of the car according to the RedBook website
- the market value of a car used by the worker such as their partner's car if the worker did not own a car at time of the work-related injury or illness
- the amount the dealership or private buyer pays for the car (applicable if the worker sells the existing car in order to purchase a second-hand or new car for modification)
- the market value of the existing car (applicable if the worker retains the existing car and purchases a secondhand or new car for modification)
Once the above factors have been considered, the Agent will deduct from the purchase cost of the car an amount to represent the market value of the car owned or used by the worker. The balance that remains represents the reasonable amount of the Agent's contribution.
How is a suitable car selected?
In selecting a car that is suitable for modification, the Agent takes into account the information in the Transport and Car Needs form completed by the occupational therapist in consultation with the automotive engineer and the services of a car broker. See also the TAC's howsafeisyourcar website and the Car Information Package (VIP) at VicRoads.
Ongoing car costs
Once a car is modified, who is responsible for the car's maintenance and repairs?
The Agent's liability is limited to maintaining and repairing the car's adaptive equipment or modifications due to normal wear and tear.
The Agent has no liability for:
- maintenance and repairs that all car owners are expected to undertake on their cars in order to keep them in safe working order
- repairs that form part of the equipment supplier's or car modifier's warranty
- any loss or damage that does not arise from normal wear and tear to the adaptive equipment or modification
The owner should contact their comprehensive motor car property insurer for any loss, theft or damage claims.
Is there any occasion when the Agent will consider replacing rather than repairing adaptive equipment installed in a car?
The Agent can replace rather than repair adaptive equipment installed in a car, when:
- it is not cost-effective to repair the equipment
- the projected life expectancy of the equipment has expired and the recommendation is for new equipment from the occupational therapist/automotive engineer, or
- the equipment no longer meets the worker's needs because of a change in the worker's medical condition
Once a car is adapted or modified who owns it?
Although the Agent can pay for reasonable modifications or contribute a reasonable amount to assist the worker to purchase a suitable car to be modified, the Agent does not own the car. Depending on the worker's particular circumstances, the owner of the car is either the worker, the immediate family member or the employer (subject also to leasing arrangements the worker may enter into).
Who is responsible for the car's day-to-day running costs, registration and comprehensive insurance?
The owner of the car is responsible for the car's running costs and ensuring the car is registered and comprehensively insured at all times. However, the Agent can make a reasonable contribution to additional the insurance costs where the modifications to the car result in an increased insurance premium. In this case, the Agent can pay the difference in cost between pre and post modification insurance for that type of vehicle.
Is there a certification process for modifications?
Substantial modifications need approval and certification from a Car Assessment Signatory Scheme (VASS) assessor who inspects the modifications to ensure the car complies with design and safety standards. For further information see Road Safety/Car Safety - 'VASS approval certificates for modified, imported, and individually constructed cars' at VicRoads.
Modifications to a partner's or employer's car
If the worker does not own a car, can the Agent consider paying for modifications to the partner or employer's car?
Modifications can be made to a car which the worker does not own but uses, when the owner agrees in writing:
- to the modifications
- to allow the worker the use of the car on a long-term basis to access services in the community or for work
The owner is also required to submit proof that they own the car.
Note: Should the owner wish to convert the car back to its standard configuration, the Agent will not pay where the modifications are major and the changes needed are to the main structures of the car. However, if the conversion is only for the removal of the adaptive equipment or the modifications are minor, the Agent can consider reimbursing the reasonable costs of removal to the owner.
Modifications to more than one car
Can the Agent pay for modifications to more than one car if reasonably required?
Minor or adaptive modifications to more than one car can be considered where the worker reasonably requires this to enable them to return to work, e.g. the use of a steering wheel spinner knob for the worker's car as well as the employer's work van or truck.
Transferring modifications to a replacement car
If the worker has received payment for minor adaptive modifications and later purchases a replacement car, can the Agent pay to have the modifications transferred to the replacement car?
The worker may choose to trade-in their existing car to purchase another car because:
- the projected life expectancy of the car has been reached, or
- it is more cost-effective to purchase a replacement car rather than to repair the existing car
In the above circumstances, the Agent can consider paying the reasonable costs of transferring the adaptive equipment installed in the original car to the replacement car.
Contributing to the purchase of a subsequent changeover car.
Can the Agent contribute to the purchase cost of a change-over car having contributed to the purchase cost of the current modified car?
The Agent can consider contributing to the purchase cost of a second car that requires major modifications. The cost of replacing a car that had minor modifications would be considered a normal expense that the worker would have been required to pay regardless of their work-related injury or illness.
In order to consider a request for contribution towards the purchase cost of a change-over car, the following factors are taken into account:
- an assessment of the re-sale value of the existing car or the amount received for the car once it is disposed of
- whether the reason for requesting a replacement car results from a significant change in the worker's medical condition which makes the existing car not suitable, e.g. the worker is required to take medical equipment with him/her whilst travelling and this cannot be accommodated in the current car
- determining the changing needs of the worker due to their age, living arrangements and expected level of disability at present and in the future
- the extent of the costs already contributed by the Agent to the purchase and modification of the other car
- whether the worker has properly maintained the existing car in good working order (this is a condition of the initial contribution towards the purchase cost of a suitable car)
- whether the projected life expectancy of the car had been reached before a request to contribute to the purchase cost of a change-over car
- whether a qualified automotive engineer considers it is appropriate to replace rather than to repair the worker's existing car after reviewing the car's maintenance and service history and its condition and safety
- the proportion of time the car is used for the worker's purposes and the proportion of time the same car is used by other family members for their purposes
Note: It is not considered reasonable to pay for modifications to a change-over car which are commercially available features of a car, e.g. modifications such as automatic transmission or electric windows, where the modifications that are commercially available features or the worker's car already had or has this feature.
Minor and major modifications:
What type of modifications can the Agent consider paying for?
The Agent can pay for a range of modifications from minor adaptive changes to major modifications depending on (see Table 1):
- the nature of the work-related injury or illness
- whether the functional limitations are temporary or permanent
- whether the proposed changes are for a driver or a passenger
- the advice obtained from the occupational therapist and/or the automotive engineer
Concessions and exemptions
Are there any concessions or exemptions the worker can claim?
The worker may be eligible for a concession or exemption because they need the use of a modified car. Refer below for this information:
- Car purchase GST free - A disabled employee is eligible to purchase a car GST-free up to the value of the Australian Taxation Office's (ATO) car limit amount, if the person has been issued with a Permanent Disability.
- Certificate from Health for Industry LTD (HIF) - For further information see 'GST and cars purchased by eligible people with disabilities' at ATO.
- Concession on registration fees - A holder of a Centrelink Pension Concession card is eligible for a concession on his/her car registration and the TAC charge; and a Health Care card holder is eligible for a concession on registration only. For further information see Registration - 'Car registration concessions' at VicRoads. Additionally, a private use car with major conversions for wheelchair access used to convey an incapacitated person who is seriously impaired attracts a nil registration fee. This only applies if the car is owned by the injured worker. See also Registration Fees for fees and Registration - 'Fee calculators' to calculate the amount of the fees that will be payable on the car that is to be registered at VicRoads.
- Exemption from stamp duty fees - Cars designed or modified to carry a person whose mobility is seriously impaired and which has wheelchair access and is registered in the name of the person or the parent or legal guardian of a disabled minor is exempt from stamp duty fees. For further information, see Registration - 'Motor car duty' at VicRoads. See also Taxes and Duties - 'Motor car duty, exemptions and persons with a physical disability' at State Revenue Office (SRO).
In relation to car modifications what won't the Agent pay for?
The Agent will not pay for:
- the full purchase cost of a car
- modifications to a car that will not be approved by VicRoads for registration purposes
- costs to convert a car back to its standard configuration once major modifications have been made
- modifications to a car for a person other than the worker or that will not be used by the worker
- modifications to a car for a pre-existent medical condition
- modifications that provide no functional benefit
- modifications that do not comply with the relevant State, Territory or Federal Car Standards/Regulations and the Car Standard - Australian Design Rules (ATR's)
- ongoing costs associated with keeping a car on the road such as registration, comprehensive insurance and running costs
- modifications to a car outside of the Commonwealth of Australia
- repairs to adaptive equipment or modifications that are subject to the equipment supplier's warranty or car modifier's warranty or the car's insurance policy
Table 1: Type of Modifications
Note: This policy is a guideline issued by WorkSafe Victoria under Victorian workers compensation legislation in respect of the reasonable costs of services, and services for which approval should be sought from the WorkSafe Agent or self-insurer (as the case may be) before the services are provided.