How the Workers Comp Act Works
Work injury damages in NSW are governed primarily by the Workers Compensation Act 1987 (NSW).
The Act provides that a claimant who has suffered at least 15% permanent whole person impairment (or has died) due to the negligence of his or her employer can recover damages. The Act also restricts the type of damages that can be claimed to past and future economic loss. There is no right to entitlements for pain and suffering, domestic assistance, treatment expenses or other traditional common law damages.
This applies to all claims made after 27 November 2001, regardless of the date of injury, though death claims are often exempt from some of these restrictions.
The first step in any work injury damages claim (WIDC) is to establish whether a WIDC is actually the most beneficial type of claim. Work injury damages are provided in lump sum calculated by adding the injured worker’s past loss of earnings and the future loss of earning capacity. However the legislation bars access to all other types of workers compensation benefits that the worker would otherwise have access to, including weekly payments, medical, hospital and rehabilitation expenses. If the worker’s condition has not fully stabilised or may require further surgery it is often better to wait before lodging the WIDC.
When the worker decides to pursue their WIDC they must first serve their claim on the insurer or the employer, identifying details of economic loss claimed and negligence or other tort of the employer.
After serving all relevant particulars the insurer has to either accept liability and make a reasonable offer of settlement or dispute liability within two months. If they deny liability then the worker lodges a pre-filing statement which outlines all of the particulars that they wish to rely on. The worker must have been assessed as being over the 15% whole person impairment or the insurer accepts that the threshold has been reached.
The insurer then has 28 days to reply to the pre-filing statement accepting or denying liability. If after 42 days the insurer hasn’t replied, the worker can commence court proceedings. Alternatively (and far more commonly), the insurer denies liability and the matter goes to compulsory mediation with the Workers Compensation Commission.
If no agreement can be reached in mediation then the parties must make final offers of settlement. If these offers still fail to settle the matter the worker can then start proceedings in the relevant court.
If you, your family or friends wish to enquire about a similar circumstance, please email us on our "Ask Us a Question" feature or call (02) 4228 8288 to speak to one of our specialist family lawyers.