As the labour hire trend continues, the issue of apportionment between employers and non employers in personal injury claims is significant for insurers.
Of particular interest are cases in which the employer’s role has been minimised.
HWL Ebsworth’s Joanna Apostolopoulos has acted in two recent cases of that nature.
In Avopiling v Bosevski  NSWCA 146 the Plaintiff was injured in the course of his employment with Professional Contracting Pty Ltd while working on a site operated by Avopiling Pty Ltd. The plaintiff sued Avopiling but not his employer. Avopiling alleged that any liability against it ought be reduced under s 151Z(2) of the Workers Compensation Act 1987 (NSW) (WCA) by reason of the employer’s negligence.
Two employees of Avopiling were erecting a mast on a pile driving rig when an auxiliary cable broke under ‘extreme tension’ and caused the Plaintiff to be struck by falling objects that had been attached to the cable. At first instance the employer escaped liability. The employer’s liability was an issue revisited on appeal.
The Court of Appeal confirmed that the onus was on Avopiling to establish that the employer was negligent. This included identifying the risk of harm to which the plaintiff was exposed by the employer’s negligence. On consideration of the evidence, the Court of Appeal upheld the decision of the trial judge on the basis that it was not demonstrated by Avopiling that the employer knew, or had any reason to know, of the risk of harm to the Plaintiff.
Similarly, in Kabic v Workers Compensation Nominal Insurer (No 3)  NSWSC 1281 the plaintiff, an unskilled labourer, was injured in the course of his employment while placed with Calcono Pty Ltd, a formwork contractor. The plaintiff alleges he fell from a raised platform which was wet as a consequence of the rain making the form ply slippery. It was submitted by the plaintiff that in order to discharge its duty of care, his employer ought to have attended the work site or made enquires as to the working conditions on the site. This was rejected by his Honour. In this case Button J found that while the labour hire company was the actual employer, Calcono was the “de facto employer, in terms of actually and directly controlling the conditions in which the plaintiff worked.” Relevant factors taken into account included:
- That the plaintiff’s supervisor was employed by the host employer, Calcono;
- That there was no evidence to suggest that the employer was aware that the site was unsafe;
- That the employer’s actions or inactions did not contribute to the accident in any way; and
- That the accident was not caused by an ongoing defect in the system of work but rather the impact of rain on the day.
The decisions in Avopiling and Kabic are consistent with the earlier decision in Shoalhaven City Council v Humphries  NSWCA 390. In that case, the plaintiff was injured in the course of his employment with Campbell Page Labour Hire. He was lifting a large concrete manhole cover whilst placed with the Council.
The plaintiff was under the supervision of an employee of the Council. He had not been trained for the specific task of lifting the manhole, but had been trained by the employer, for working in confined spaces. The plaintiff commenced proceedings against the Council in the District Court of New South Wales. The primary judge found for the plaintiff and damages were awarded.
His Honour determined that the Council had failed:
- To ensure that the plaintiff was properly trained; and
- To carry out a risk assessment before the plaintiff attempted to move the manhole cover.
In a further blow, the Council’s damages were not reduced under s 151Z(2) as the Court found that there was no evidence to suggest that the employer knew or ought to have known that the plaintiff would be performing heavy lifting tasks exposing him to a risk of harm. The employer’s non-delegable duty to ensure the plaintiff’s system of work was safe was limited in scope to the tasks within the actual or implied knowledge of the employer.
The trial judge’s decision on liability was upheld. The case also provides useful commentary on the role of the employer and factors affecting apportionment.
The Court commented that, “a positive obligation lay” with the employer to “inquire or investigate whether the Council was providing a safe system of work”. The Court noted the Council did not call evidence as to what the employer actually did.
That said, the Court of Appeal considered the system of work and determined that there were appropriate systems in place in respect of manual handling.
As a matter of causation, in this case the Court of Appeal found that the injury was caused by a casual act of negligence in failing to identify the weight of the manhole cover.
The actual and practical onus of proof
In Avopiling and Humphries the plaintiff had not sued the employer. As such, the onus was on the third party to prove the employer was liable justifying a deduction under s 151Z(2).
However, is it any different when a plaintiff names the employer as a defendant?
A consequence of the variation between the damages recoverable from an employer (under the WCA) and the damages recoverable from a non-employer (under the Civil Liability Act 2002 (NSW)), is that in the usual course it is in the plaintiff’s and the employer’s interests for the employer’s liability to be minimised. As a result, it usually falls to the non-employer to prove the case against the employer even in circumstances where the employer is a named defendant. These cases are a reminder that the burden of proof can sometimes be difficult to discharge.
When the pendulum swings the other way
The above cases fall at one end of the spectrum, by comparison, Anna Kay was not so fortunate when she was before Adamson J who found her employer 75% liable ( NSWSC 744). In that case, the plaintiff was injured while trying to connect an aircraft to ground power. The plaintiff had to lift the connector 26 cms above her head height to insert it into the socket. The plaintiff’s evidence was that the plug was hard and heavy to insert. The Court found this was a consequence of the configuration of the ground power unit following maintenance by Alltrack GSE Pty Ltd (Alltrack) the maintenance subcontractor to United group Infrastructure Pty Ltd (UGL). It was believed that the defect in the configuration would have been visible had the plaintiff been inserting it at eye level rather than above head height. The need to lift the connector could have been alleviated by a ladder.
The plaintiff did not join the employer and was precluded from doing so because she did not meet the required thresholds. She ultimately proceeded against UGL and Alltrack. That said, the employer’s notional liability was relevant to determine if any damages award ought be discounted under s 151Z(2) of the WCA.
In respect of the employer’s liability, the Court said:
- The question is what a reasonable person in the employer’s position would have done to take precautions against the risk of harm;
- There was no evidence that the burden of providing a ladder or other such device would have been too onerous; and
- It is not enough to leave it to employees to identify and report risks.
Again the injury in this case was caused by a casual act of negligence, being the way the ground power unit was configured by Alltrack when it was last maintained before the incident. However, in this case the court found that the system the plaintiff was working under was generally unsafe as the plaintiff was required to work above head height. This system contributed to her injury and, the Court found, could have been easily rectified.
Judgment was entered against Alltrack albeit reduced by 75% pursuant to s 151Z(2) to account for the employer’s notional liability. A consequence of this deduction was that despite her significant injuries, the plaintiff’s damages were reduced to $171,575.35. Significantly, this was less than what she had received in workers compensation benefits. In a further blow, in her subsequent decision on costs ( NSWSC 1023), Adamson J pointed out that while the plaintiff was “successful” her victory was pyrrhic and by bringing proceedings she had put herself in a worse position as her workers compensation entitlements had ceased on the entering of judgment.
Her Honour ordered that each party bear her or its own costs as between the plaintiff and Alltrack and ordered Alltrack to pay UGL’s costs.
This case acts as a risk warning to plaintiff’s considering bringing an action against a third party in circumstances where:
- The threshold requirements are not met for bringing a claim against the employer as well;
- The employer has a significant notional liability;
- The plaintiff has received workers compensation benefits which could outweigh any favourable judgment; and
- The plaintiff’s entitlements under workers compensation may be more valuable than an award under the CLA.
This article was written by Rebecca Hosking, Partner and Edward Basha, Paralegal.
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