Learn about workplace injury insurance in Australia

Foreword

In 2013 in Australia, Mr. E suffered from spinal cord compression due to a cervical herniated disc. As a result, he had to undergo cervical spine surgery. Prior to the incident, between 2012 to 2019 he had worked as a plasterer and a carpenter. Mr. E believed that his previous job interfered with the extension of his neck which has caused the cervical disc herniation. Hence, in 2018 Mr. E commenced proceedings against his past employer, claiming his injury resulted from his job. This then raises the following questions: Can Mr. E’s injury be classified as a workplace injury and if so, can he receive compensation for it? Before revealing the answer, we must first understand what WorkCover insurance is, and to who it applies.

 

WorkCover insurance

In Victoria, workplace injury insurance is compulsory for employers. Almost every Victorian employer must purchase workplace injury insurance that covers their employees so that in the case of a workplace accident, employees can be compensated readily. However, employers must note that general business insurance is not inclusive of WorkCover. It is a common misconception of our clients that workplace injury insurance is included, but in actual fact, it is not.

Generally speaking, if an employer employs any workers in Victoria, they must register for WorkCover through an appointed agent. In addition, even if you don’t have employees, you must purchase WorkCover for any apprentices or interns regardless of their salaries.

In Victoria, employers are not required to register for WorkCover under the following circumstances:

1. If you have no apprentices and pay (or are liable to pay) less than $7,500 per financial year in salaries, or,
2. If you are a sole trader, an individual in a partnership, or an individual trustee of a trust, and do not employ others, or,
3. If your company only has one business client that you do all the contract work for.

 

Premium calculations

After learning about WorkCover, we can now find out how much WorkCover costs.

As an employer, the amount that must be paid to employees is not a fixed amount. Insurance fees will change depending on each company’s revenue, industry, etc. The average premium rate in the 2021/22 financial year was 1.272% of Australia’s taxable revenue. According to the 2021/22 financial year report, the current government’s minimum premium is $225 (not inclusive of GST) per person every financial year.

As per the Victorian State Government Report, premium rates are calculated by taking the larger value of the following two⁴:

(a) Insurance fees = initial premium – benefit-free amount, and

(b) The minimum rate

You can also use the WorkCover calculator linked below to calculate your insurance fees for the current financial year:

https://www.worksafe.vic.gov.au/calculate-how-much-your-workcover-insurance-premium-will-cost-year

 

Coverage Scope

Now that we have gained a basic understanding of WorkCover and its fees, we can return to the case in the foreword. Although the court found that Mr. E was not harmed directly at work, they stated that if Mr. E – with the support of medical documents –could prove that his job is what mostly contributed to his injuries, then the court would rule a workplace injury.

That is, regardless of the severity of an injury, if it is in relation to your work, you will be able to claim WorkCover. Even if the harm is not directly caused in the process of your work, if you can provide evidence that your job is what largely led to your injury, then you can also be compensated accordingly. Moreover, whether you can be compensated has nothing to do with the company or the employee’s ‘fault’. Regardless of whether the harm was suffered by way of an accident by an employee or due to other reasons, as long as it is associated with your work, you can receive compensation.

Next, we will be examining what employees can qualify for WorkCover. Apart from company employees and apprentices or interns, contractors that satisfy one condition are also included under WorkCover. In the link below, you can find out more about whether contractors are required to buy WorkCover: https://www.worksafe.vic.gov.au/contractors-and-workers-guideline

 

Compensation

As employees, apart from medical bills, what other aspects can be covered by WorkCover?

WorkCover can compensate for unemployment, as well as rehabilitation fees. It also includes legal fees, and in cases where serious injuries result in semi-permanent disability, a lump-sum payment can be made. If workplace injuries result in severe illnesses or death, family members will also be compensated; if your injury or illness can be considered “serious” and is a result of your workplace’s negligence, WorkCover can bring a claim against the employer demanding further compensation. In this case, if Mr. E can successfully prove that his illness is mostly due to his work, he will be able to be compensated not only for his surgery but also for his legal fees and rehabilitation fees.

 

Summary

We hope that after reading this article, you have gained a deeper understanding of the laws surrounding Victorian WorkCover. If you encounter any legal issues concerning workplace injury, you are welcome to consult our experienced lawyers, we have professional workplace lawyers, employment lawyers, etc. in Glen Waverley, Melbourne.