Skip to content

  • Home
  • COVID-19 Guide
  • COVID-19 AV library
  • Client results
  • Expertise
  • News & Insights
  • People
  • Our DNA
  • Inclusion and Diversity
  • Join us
  • Contact Us
Home / NEWS & INSIGHTS / Insight / Workers’ Compensation Indemnity Claims – Bill before parliament to reverse decision in Byrne v People Resourcing (Qld) Pty Ltd
Insight 21 June 2016

Workers’ Compensation Indemnity Claims – Bill before parliament to reverse decision in Byrne v People Resourcing (Qld) Pty Ltd

WHO SHOULD READ THIS
  • Managers responsible for workers’ compensation and/or claims
THINGS YOU NEED TO KNOW
  • Proposed legislative amendments before the Queensland Parliament will allow WorkCover Queensland to avoid honouring contractual indemnities agreed to by employers in favour of third parties
WHAT YOU NEED TO DO
  • Managers need to review any current contractual arrangements and consider whether their public liability insurance policy covers any gaps created by these new amendments

On 14 June 2016, the Queensland Government introduced the Workers’ Compensation and Rehabilitation (National Injury Insurance Scheme) Amendment Bill 2016 (Bill) to parliament.

While the main objective of this Bill is the introduction of the National Injury Insurance Scheme to Queensland, the Bill also proposes to amend the existing definition of ‘damages’ in the current Workers Compensation and Rehabilitation Act 2003 (Qld). This will see a reduction in WorkCover’s responsibility to pay damages to an injured employee where a contractual indemnity exists between an employer and a wrongdoing contracting party.

The proposed amendment to the definition of ‘damages’ will restrict the amount payable by WorkCover when the following circumstances exist:

  • an employee is injured in the course of their employment
  • the injured employee brings a common law claim against his or her employer
  • a third party is wholly or partially liable for the injuries sustained by the employee, and
  • the contractual arrangements between the employer and the third party were such that the employer agreed to indemnify the third party for the third party’s negligence. In other words, the employer contractually agreed with the third party to cover any negligence on the part of the third party in causing the employee’s injury.

The decision in Byrne v People Resourcing (Qld) Pty Ltd & Anor [2014] QSC 269, pronounced that WorkCover was required to honour the contractual indemnity between the employer and the third party.

The proposed amendment will allow WorkCover to avoid honouring any contractual indemnity in favour of any contracting third party who causes injury to the employee of the employer.

Essentially this will mean that an employer who enters into a contractual indemnity with a third party will have to pay any damages pursuant to the contractual indemnity to the injured worker on their own.

The Bill also proposes a provision to allow WorkCover to bring a contribution claim against a third party, even though the contractual indemnity between the employer and the third party exists. In this situation, any contractual indemnity between the employer and the third party is void to the extent of any contribution claim made against the third party by WorkCover. This additional provision is relevant only in situations where the injured worker has brought a claim against his or her employer only, and not directly against the third party.

Both amendments will have a significant impact on employers and third parties to workers’ compensation claims. We also note that if the Bill is passed, it will apply retrospectively to all claims in progress if at the time of commencement, settlement for damages has not been agreed or a court has not started hearing a proceeding for the claim.

The amendments serve as a timely reminder to employers to ensure their public insurance policies are updated to provide the necessary cover for these new potential liabilities. It would also be beneficial to try and resolve any current matters where there is a third party contractual indemnity that WorkCover would (prior to the new amendments) be required to cover the employer for.

This publication covers legal and technical issues in a general way. It is not designed to express opinions on specific cases. It is intended for information purposes only and should not be regarded as legal advice. Further advice should be obtained before taking action on any issue dealt with in this publication.

About the authors

  • Brad Russell

    Partner
  • James Lynagh

    Senior Associate

In other news

McR strengthens the Construction and Infrastructure team in Brisbane

McCullough Robertson strengthens its National Construction and Infrastructure team with key Partner hire in Brisbane

27 January 2021News

New Industrial Relations Laws – What it means for you

22 December 2020Insight

Payment Times Reporting Scheme

21 December 2020Insight

Australian Government proposes new broadcaster’s licence and forced investment quotas in Media Reform Green Paper

14 December 2020Insight

VIEW ALL NEWS & INSIGHTS

BRISBANE

Level 11, 66 Eagle Street
Brisbane QLD 4000
GPO Box 1855
Brisbane QLD 4001
Tel +61 7 3233 8888
Fax +61 7 3229 9949

 

GET IN TOUCH

Contact form

We handle your personal information in accordance with our privacy policy.

sydney

Level 32, MLC Centre
19 Martin Place
Sydney NSW 2000
GPO Box 462
Sydney NSW 2001

Tel +61 2 8241 5600
Fax +61 2 8241 5699

 

GET IN TOUCH

Contact form


We handle your personal information in accordance with our privacy policy.

melbourne

Level 27, 101 Collins Street
Melbourne VIC 3000
GPO Box 2924
Melbourne VIC 3001

Tel +61 3 9067 3100
Fax +61 3 9067 3199

 

GET IN TOUCH

Contact form

We handle your personal information in accordance with our privacy policy.

follow us

CLIENT LOGIN

newcastle

Level 2, 16 Telford Street
Newcastle NSW 2300
PO Box 394
Newcastle NSW 2300

Tel +61 2 4914 6900
Fax +61 2 4914 6999

 

GET IN TOUCH

Contact form


We handle your personal information in accordance with our privacy policy.

canberra

Level 9, 2 Phillip Law Street
Canberra ACT 2601

Tel +61 2 6243 3699
Fax +61 2 8241 5699

 

GET IN TOUCH

Contact form


We handle your personal information in accordance with our privacy policy.

© 2017 McCullough Robertson. Site map Disclaimer Privacy Policy Credit Reporting Policy

X