Changes on the Way
With the recent election of the Labor government in Queensland, the repeal of the impairment threshold for access to common law claims arising out of workplace injuries seems imminent.
Changes to the WorkCover scheme, introduced in October 2013, meant that workers assessed with 5% impairment or less do not have access to claims for common law damages against their employers. Consequently, injured workers who do not meet the threshold are more likely to make direct claims against other parties, such as host employers, occupiers and contractors. Those parties in turn will inevitably seek indemnity and contribution from employers, where they have a right to sue under the contractual agreement between the parties.
The introduction of the threshold was intended to reduce common law claims for employers, thereby resulting in reduced workers’ compensation premiums. However, in practice, it has caused problems for employers in other areas.
Notably, in many instances, employers may be uninsured for claims by third parties because other insurance arrangements that employers have in place, such as public liability policies, may not respond to these claims.
The repeal of the impairment threshold will give back to workers the right to access common law damages against employers. This will likely reduce issues for employers regarding claims made under contract by third parties, and transfer the exposure back to WorkCover Queensland.
While the repeal of the threshold appears to be imminent, it remains to be seen whether the Labor government can or will remove the threshold retrospectively.
It is important for employers to ensure they understand their rights and obligations under the workers’ compensation regime, and are aware of how contractual agreements with third parties may impact on these rights and obligations, and what additional insurance arrangements may be required to adequately protect themselves against third party claims.