Employer’s negligence no bar to recovery

Michael Lamproglou | August 2012 | Employers Liability

A recent decision by the NSW Supreme Court confirms that an employer may recover compensation paid to an injured worker from a third party, despite a finding that the employer’s negligence also contributed to the worker’s injuries.

Who does this impact?

Insurers, employers, claims managers and insurance brokers.

What action should be taken?

If a worker sues his employer and a third party, then section 151Z(1)(d) should be relied upon by bringing separate recovery proceedings against the negligent third party so as to ensure that:

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Employer’s negligence no bar to recovery

1. The worker is not permitted to double dip (by retaining compensation paid and also recovering damages); and 2. Interest is claimed in addition to the recovery amount being sought.

The Decision On 23 April 2012, Justice Davies awarded damages to Branislav (Bill) Milich for injuries sustained in the course of his employment as a labour hire employee with Canterbury City Council: Milich v The Council of the City of Canterbury [2012] NSWSC 59.

Subsequently, on 31 July 2012, His Honour determined that the employer was entitled to be indemnified by Canterbury Council pursuant section 151Z(1)(d) of the Workers Compensation Act, notwithstanding that the employer was found to have breached the duty care that it owed to the worker: Milich v The Council of the City of Canterbury (No. 2) [2012] NSWSC 450.

Facts Branislav (Bill) Milich was employed by Ready Workforce Pty Ltd, a labour hire company, and from late November 2003 to the middle of 2005 was lent on hire to Canterbury City Council to work as an offsider on garbage trucks.

Milich claimed that he had injured his lumbar spine in a discrete incident on 20 February 2005, when he was

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required to lift a cast iron bathtub.

The Council disputed whether this incident had in fact occurred and, if it did, whether it was responsible for the problems associated with the worker’s lumbar spine.

Milich also claimed in the alternative that he had injured his upper back, shoulders and neck area by reason of the nature of the work that he performed with the Council.

The garbage trucks that Milich worked on required him to lift rubbish into the compactor at the back of the truck and were not fitted with lifting arms.

Findings

reduced by 25% to take account of the culpability of the employer for his injuries in accordance with section 151Z(2)(c) of the Workers Compensation Act.

The Effect Employers have a right to seek a recovery under section 151Z(1)(d) “… whether or not the employer is itself a tortfeasor who has caused the injury to the worker”.

This view is supported by a number of provisions in Part 5 of the Workers Compensation Act (dealing with common law remedies) which confirm that a worker is not entitled to double dip - sections 151A(1), s 151Z(1)(a), (b), (c), (e) and (e)(i).

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Employer’s negligence no bar to recovery Michael Lamproglou | August 2012

In his decision, Justice Davies found: >> There was no discrete injury suffered by Milich in February 2005. >> The injuries to his lumbar spine were not caused by his employment with the Council. >> Only the injuries to the worker’s neck/ shoulders and upper back were attributable to the negligence of the defendants. >> The permanent impairment suffered by the worker as a result of the injuries caused by his employment with the Council was less than 15% WPI. >> The employer had no liability to pay damages by reason of section 151H of the Workers Compensation Act 1987 (below 15% WPI threshold).

For more information, please contact: Michael Lamproglou Partner T: 02 8257 5723 M: 0417 433 215 michael.lamproglou@turkslegal.com.au

>> Liability was apportioned “… 25% against the employer and 75% against the Council”. >> The employer’s negligence was a failure to properly train and instruct Milich on how to safely lift and carry out physical work in circumstances where it was aware of the work being carried out by its employees with the Council. >> There was no contributory negligence on the part of the worker for lifting heavy items which he should have left for mechanical lifting, especially given that the defendants had provided inadequate training, instruction and supervision to him about his duties. >> The damages that the worker was entitled to recover against the Council would be

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