The South Australian Government's new Return to Work Bill 2014, allowing access to common law damages for the first time since 1992, represents a swinging back of the "tort law reform" pendulum.

In the late 1990s and in the early part of the next decade, governments around Australia made changes to compensation schemes spurred on by rising insurance premiums and cost blow-outs.

In 2002 federal, state and territory governments appointed a "Panel of Eminent Persons" to review the law of negligence, known as the Ipp Review. Following that review, every Australian jurisdiction enacted significant tort law reforms to implement its recommendations.

Perhaps because of this, the proposed SA changes have attracted national attention.

On 6 August 2014 the South Australian Government tabled the Return to Work Bill 2014 and the South Australian Employment Tribunal Bill 2014 in Parliament. These two Bills provide the framework for the State Government's 'most significant reform of compensation law in more than 25 years'.

Along with a renewed commitment to a "return to work focus", the new Return to Work Bill also makes provision (for the first time since 1992) for employees to take common law action against their employers for negligently caused injuries. It should be noted, however, that the Bill tightly prescribes this right and it is by no means open to all workers.

When will an award of damages be made?

The Bill provides that an employer is not liable for an award of damages regarding the injury or death of a worker unless:

  • the injury was caused by the negligence or other tort (including breach of statutory duty) of the worker's employer (and in the case of psychiatric injury, such negligence was the primary cause of the injury), or
  • the injury constitutes motor vehicle damages.

Additionally:

  • the injury must have resulted in a successful claim for compensation
  • must have resulted in either death or a permanent impairment to the worker of at least 30%. The impairment rating will be determined according to yet to be released Guidelines and in assessing impairment the physical impairment and psychological impairments must be assessed separately. The 30% threshold is not met unless either the physical impairment is at least 30% or the psychiatric impairment is at least 30%. This appears to constitute a high threshold, and
  • an award of damages will not be made to a director of an employing company.

When can a worker commence a common law proceeding

A worker cannot commence proceedings against their employer until they have undergone a permanent impairment assessment under Part 2 Division 5. Necessarily this will require that their injuries have stabilised (section 22(7)) and is likely to occur well into the worker's WorkCover claim.

What damages may be awarded

Damages to a seriously injured worker will not be awarded against the employer for costs of treatment, care or support services (Section 73(2)(a)), but only damages for economic loss (section 73(2)(c)).

Any money already paid by the Corporation as compensation will be recovered from the award.

A worker must choose either an award for future economic loss or redemption of liability for weekly payments. There is limited entitlement to interest on awards, and contributory negligence and apportionment principles may apply.

Who are the parties to the action?

A common law action must be brought by the worker in the name of the employer, not the Corporation. However the Corporation is entitled to conduct all proceedings for the employer (except for self-insured employers) and settle the claim as they see fit.

Section 135(3)(b) provides that damages will be paid from the Compensation Fund by the Corporation in their role as the employer's insurer. Damages paid on behalf of an employer will affect their premiums.

Comparison of provisions in other states

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