Managing the Financial Squeeze: Dealing with Hardship After a Work Injury
Losing your employment due to a workplace injury is a double blow—not only are you managing physical or psychological recovery, but you are also facing the immediate stress of a shrinking bank account. If your WorkCover weekly payments have ceased or your employment has been terminated, taking proactive steps is essential to staying afloat.
1. Tap into Superannuation Supports
Most Australians don’t realise their superannuation is more than just a retirement fund.
- Income Protection: Check if your super includes Income Protection Insurance (or Salary Continuance Insurance or something similar). This can provide payments of 70% or more of your gross income for a period of two (2) years or until you return to work, whichever is the sooner.
- TPD: Check if your super includes Total and Permanent Disability (TPD) Insurance. This can provide a significant lump sum if you can’t return to any work for which you are qualified through education, training or experience.
- Early Release on Grounds of Hardship: In extreme cases, you may apply to access a portion of your super early. This is usually restricted to meeting unpaid mortgage payments or essential medical costs.
2. Notify Your Creditors Immediately
Don’t wait until you miss a payment. Banks and utility providers have Financial Hardship Teams employed to help where they can.
- Mortgage/Rent: You can often request a “repayment holiday” or a temporary switch to interest-only payments.
- Utilities: Ask for a “hardship stay” on your electricity or phone bill to prevent service disconnection.
3. Transition to Centrelink
If WorkCover payments stop and you are not able to return to work, you should apply for Centrelink benefits immediately. Whether it is JobSeeker (with a medical exemption) or the Disability Support Pension (DSP), these payments take time to process. Secure your “intent to claim” date as soon as possible.
4. Review Your “Notice of Assessment”
If you were injured, you may be entitled to a Lump Sum Compensation offer from WorkCover. While this can provide a short term financial buffer, always seek legal advice before accepting, as it may impact your ability to sue for common law damages or to claim Centrelink in the future.
5. Access Free Financial Counselling You don’t have to figure this out alone. The National Debt Helpline (1800 007 007) offers free, confidential advice from professional financial counsellors who can help you negotiate with banks and create a survival budget.
