In a blog post on the 18th November, Aurenda commented on the unintended consequences of workers’ compensation amendments and said we would keep you updated.
Below is an update posted by GIO
“Amendments to the Workers’ Compensation and Injury Management Act 1981 (the Act) implemented in October 2011 inadvertently created legal uncertainty as to an employer’s common law insurance obligation for people who are deemed their workers in some circumstances.
Since the matter was first raised WorkCover WA has been actively working towards a sustainable solution with key stakeholders, including GIO.
As a result of these discussions, both an interim and long-term solution is required.
An interim solution has already been implemented by way of changes to the standard employer indemnity policy. The revised policy wording incorporates feedback from insurers, including GIO, through the Insurance Council of Australia.
The long term solution will be implemented by way of an amendment bill. This bill will be brought to Parliament early in 2012 and will clarify the workers’ compensation common law insurance obligations of employers and insurers in Western Australia.
In order to restore certainty the proposed amendments will:
- Make clear that the requirement to insure a worker for common law damages does not include a person who is the employer’s worker only because of section 175 or section 175AA of the Act (deemed employers under the Act).
- Preserve the indemnity in public liability policies for deemed employers from 1 October 2011 to ensure those policies respond to common law actions against deemed employers.
- Enable regulations to set a specified or minimum limit of indemnity for common law liabilities arising from a single event, and other standard conditions and exclusions.
To avoid any doubt about the legal status of insurance arrangements, the amendments will apply retrospectively from 1 October 2011.”