Basic differences between a workers compensation claim and a work injury damages claim
Published 19 Dec 2016
One big misconception by injured workers is the belief that once the workers compensation insurer accepts liability in a workers compensation claim, that liability in a work injury damages claim is also accepted. A common question by clients with a work injury damages claim is “how can the insurer deny liability and have been paying me compensation for all these years”.
Without going into great depth, it can be explained quite easily in that workers compensation is a “no fault” scheme. On the other hand, in a work injury damages claim, a claimant is required to establish that the injury sustained resulted from the employer’s negligence.
The statutory entitlements under a workers compensation claim generally include the following:
- Payments of reasonable medical expenses incurred as a result of a work related injury. This would include entitlements for travel expenses and in restricted circumstances, a right for domestic assistance for a short period of time.
- Payments of weekly compensation payments during periods of incapacity. Weekly compensation is compensation to injured workers for loss of wages. Weekly compensation payments do not cover loses for superannuation
- Lump sum claim for impairment if the impairment rating is at 11% whole person impairment. (The threshold requirement does not apply to a select few exempt workers and these include police officers, paramedics, firefighters, workers in or around a coal mine and bush firefighters or emergency service volunteers.)
An injured worker may then pursue a work injury damages claim (generally known as common law negligent claims) if the impairment rating as referred to under point 3 above, reaches a threshold of 15% whole person impairment. The worker cannot pursue a work injury damages claim if the impairment rating is below 15% and this is a requirement of Section 151H of the Workers Compensation Act, 1987.
In a work injury damages claim, it needs to be established that the injury sustained resulted from the employer’s negligence. The only entitlement in a work injury damages claim is a claim for past and future economic loss. This includes past and future loss of wages and past and future loss of superannuation. It does not include damages (compensation) for impairment, pain and suffering, care or medical expenses.
As entitlements in a work injury damages claim are restricted to economic loss, it needs to be proven that as a result of the injury, the worker has suffered an incapacity. It has to be shown that as a result of the incapacity, the worker is unable to earn the same rate as they would have, had they not been injured.
In a workers compensation claim, the entitlements for injured workers are broader. As mentioned above these entitlements include rights for medical expenses, weekly compensation and a lump sum compensation if a threshold is achieved. Entitlements for workers compensation is available for an injured worker if employment was a substantial contributing factor or employment was the “main contributing factor” in relation to a disease injury.
An acceptance of liability in a workers compensation hence, does not translate to an acceptance of liability in a common law claim.
At Gerard Malouf & Partners we always investigate if there is a potential negligent claim if a workers compensation lump sum impairment claim has been agreed or determined to be at 15% whole person impairment or higher. We consider the merits of each potential work injury damages case individually and provide our respective clients with advice. We then give them the option to either proceed with a work injury damages claim or to elect not to. Most clients with potential work injury damages claims do take the option of pursuing this as it does attract a further amounts by way of a compensation payout.