Damages disputes
Some work injury damages claims may result in court proceedings if mediation is unsuccessful. However, mediation is a mandatory step before a worker can commence court proceedings.
Workers compensation disputes
Disputes are assigned to the most appropriate dispute resolution pathway.
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Lodgment
- Lodgment
- Mediation
- Further information
Lodgment
Applications for mediation of a dispute through the damages disputes pathway, and responses to applications, must be lodged with the Commission.
When to lodge an application
In a work injury damages claim (also known as a modified common law damages claim), the worker needs to establish that their injury resulted from the employer’s negligence (for example, not providing a safe working environment).
The worker can only pursue a work injury damages claim if they have sustained injuries resulting in at least 15% permanent impairment to their body (as assessed by a trained permanent impairment assessor) and the assessment of permanent impairment has been accepted by the insurer or determined by the Commission. A worker must also have received all statutory lump sum entitlements for permanent impairment to which they are entitled. This must occur before a claim for work injury damages can be settled.
Most damages payments to workers in NSW are limited to past loss of earnings and future loss of earning capacity. The amount of damages payable can be reduced if the worker’s own negligence contributed to their injury.
There are certain procedural requirements that a worker must satisfy before an application for mediation can be lodged with the Commission:
- The worker must first submit a work injury damages claim on the employer or their employer’s workers compensation insurer.
- If the worker is not satisfied with the insurer’s decision about their claim, or the insurer fails to make a decision in relation to their claim, the worker must serve a prefiling statement before lodging an application for mediation with the Commission.
Applications for mediation are lodged by a worker or their legal representative on their behalf. The worker is called the claimant, and the employer responding to the application is called the defendant.
The Commission cannot mediate in all work injury damages disputes because the law requires some classes of workers to seek assistance with their claims from other agencies responsible for their administration. These classes of workers include coal miners, volunteer rescue workers, and workers who suffer specified dust-related conditions.
How to lodge an application
Lodging an application for mediation to resolve work injury damages claim (Form 11C) is the first step for the worker to apply to have a dispute mediated by the Commission. Most workers are legally represented, with the application being lodged by the legal representative on their behalf. The application can only be lodged through the Commission’s online lodgment portal. More information about lodgment methods is available on our lodge a dispute page.
The mediation conference will generally be booked within four weeks of the defendant lodging a response. Claimants must ensure they are available to participate in the mediation conference within eight weeks of lodgment of the application.
The claimant must attach all relevant information to the application.
The claimant must serve a sealed copy of the application on the defendant within seven days of the application being registered by the Commission. All information attached to the application must also be provided to the defendant. This early exchange of relevant information assists with discussions to help resolve the dispute.
How to respond to an application
The next step in the lodgment process is for the defendant to respond to the application by lodging a response to the application for mediation (Form 11D). Most defendants are legally represented and the response is lodged by the legal representative on their behalf. The response can only be lodged through the Commission’s online lodgment portal. More information about lodgment methods is available on our lodge a dispute page.
The mediation application will proceed even if the defendant chooses not to respond or does not respond in the required time, which is 21 days from date of registration of the application.
All information relevant to the dispute which is not attached to the application must be attached to the response and provided to the claimant.
How long does resolving a dispute take
The time taken to resolve a dispute depends on:
- the issues in dispute
- the standard of preparation by the parties
- the willingness of parties to genuinely attempt resolution
The Commission aims to resolve disputes as quickly as possible and will encourage the parties to resolve their dispute at the earliest opportunity.
Mediation
Parties to work injury damages disputes participate in mediation in the Commission before any court proceedings can be commenced.
The mediation process
All parties involved in a dispute about a work injury damages claim must participate in mediation in the Commission, except in the following cases:
- Mediation is not a mandatory step for the worker if the insurer hasn’t met their obligation to respond within 42 days after being served the pre-filing statement.
- An employer may be excused from participating in mediation if the employer wholly disputes liability in respect of the claim.
The Commission’s staff will contact the parties to agree on a suitable date for mediation, to take place within 28 days. A mediator will then be assigned to the mediation.
The Commission’s mediation services are free to all parties.
One of our panel of nationally accredited mediator will use their best endeavours to bring the worker, employer and the insurer to agreement.
The mediator does not decide the outcome of a work injury damages dispute or provide advice. The mediator’s role is to facilitate discussion between the parties so they can attempt to reach an agreement. In most cases, the Commission’s mediation process is successful in resolving work injury damages disputes.
If the parties fail to reach agreement, the Commission will issue a Certificate of Mediation Outcome. The certificate will certify the final offers made by the parties in mediation. The worker may then commence court proceedings .
Court proceedings for work injury damages must begin within three years of the injury date, unless the court allows commencement after that period. The period of three years excludes time taken to undertake certain requirements (for example, Commission proceedings to resolve a dispute regarding the degree of permanent impairment). The three-year restriction also does not apply while a pre-filing statement that has been served by the worker on the employer or employer’s insurer remains current.
Other disputes regarding work injury damages claims
Further information on other issues dealt with by the Commission that relate to work injury damages claims is available on our other applications page.
This includes information on:
- threshold disputes for damages
- defective pre-filing statements
- access to information and premises
- striking out a pre-filing statement.
Resources
Further information
Entitlements to compensation and other payments, and liability for legal costs, will depend on how the work injury damages dispute is resolved.
Entitlement to ongoing workers compensation or other payments
Once a work injury damages claim is settled, or the court makes an award of damages, entitlements to workers compensation cease. Payments already made may also have to be repaid . Other entitlements, such as Centrelink payments, may be affected by a damages payment. Workers should contact a lawyer for advice regarding ceasing entitlement to payments, reimbursements and exclusion periods.
If a worker decides not to pursue a work injury damages claim, or if a claim is unsuccessful, the worker will continue to be entitled to ongoing workers compensation payments, subject to any limitations under workers compensation legislation. The worker should contact the insurer to discuss their eligibility for ongoing benefits.
Legal costs and settlements at mediation
If a work injury damages claim resolves at mediation, the settlement amount will either include legal costs or legal costs will be paid in addition to the settlement amount. If a settlement includes legal costs, it means the costs will be deducted from the settlement amount.