The Commonwealth public service must change if the costs of its workers' compensation claims are to be reined in, says the author of a major review of the system.
Peter Hanks, QC, says bureaucrats on compensation for psychological injuries are coming back to work five times slower than those physically hurt on the job and that workplace culture is to blame for many of the mental stress claims.
The $1.2 billion Comcare scheme lost more than $500 million in the 2011-12 financial year with psychological claims - many of them related to allegations of bullying and harassment - increasing and injured workers taking longer to come back to work.
Mr Hanks and former defence department boss Allan Hawke have reviewed Comcare's legislative framework and made 147 recommendations to effectively rewrite the Safety Rehabilitation and Compensation Act.
The senior Melbourne barrister said the growth in psychological injuries and the expense of managing them was a major factor for the scheme.
''They are very expensive,'' Mr Hanks said.
''The duration of the payments is something like a year, compared to what we call physical injuries, where the duration is more like 10 weeks.''
Mr Hanks, whose review was handed to Workplace Relations Minister Bill Shorten in February, said mental stress injuries were much more complex than physical cases.
''They are more intractable than physical injuries, which are a bit easier to fix up,'' Mr Hanks said.
''With psychological injuries, the precise cause of the injury is often obscure and the type of intervention that might work might be controversial and different specialists might have quite different views about what might work.''
Mr Hanks said that public sector management needed to improve to stem the rising tide of psychological injuries caused by workplace conflict.
''I think this is a major reflection on the quality of management,'' the barrister said.
''It's interesting that the Comcare scheme has a very high proportion of psychological injuries and that's because they have a low proportion of physical injuries.
''The risk factors of working in an office, which is the typical employee, do not include the same volume of physical injury. It's not as if they're out there swinging shovels and axes.
''They're interacting with people and it's those interactions that sometimes trigger psychological problems and I think that probably reflects deficient management and that the culture of the workplace isn't as healthy as it should be,'' he said.
Canberra lawyer Angus Bucknell of the Australian Lawyers Alliance urged the government to take up Mr Hanks' recommendation of time limits for claims to be considered, and welcomed the idea in the review of no-fault, short-term ''provisional liability'' designed to avoid costly legal action.
''Part of the problem has been addressed by the Hanks review in that there is [currently] no time limit on Comcare to determine a claim for compensation,'' Mr Bucknell said.
''From the time a claim is made to the time Comcare make a determination, it might be two or three months and in one case up to 18 months.
''In my experience, the longer a psychological injury goes on for, the harder it is to recover.
''They seem to develop a life of their own.''