Sometimes, in the State of New South Wales, workers compensation law overlaps with Federal workplace and employment law and human rights legislation. This sometimes occurs when an employee is subject to unlawful workplace behaviour and that behaviour causes them to suffer a psychological or psychiatric injury.
In addition to lodging their claim for workers compensation benefits with iCare NSW, sometimes workers will also contact the Fair Work Ombudsman or the Australian Human Rights Commission for advice about their employment situation. They then proceed to lodge a claim for compensation.
Injured workers should be aware that by accepting any offer of ‘settlement’ and signing any “Deed of Release” in relation to a an employment law claim or Australian Human Rights Commission claim could potentially extinguish their workers compensation rights. The risk for the injured worker is that they resolve their potential workers compensation claim against the employer for a substantially lesser amount than what their workers compensation entitlements are worth overall.
If a worker receives ‘damages’ from their employer, then they may be barred from pursuing their workers compensation entitlements, including compensation for past and future wage losses, pursuant to s151A of the Workers Compensation Act 1987. Section 151A specifically provides that where damages have already been recovered, an injured worker is prohibited from recovering further compensation.
Section 149 of the Workers Compensation Act 1987 (NSW) defines ‘damages’ as any form of monetary compensation and/or any amount paid under a compromise or settlement of a claim for ‘damages’ whether or not legal proceedings have been instituted.
The decisions in Super IP Pty Ltd v Mijatovic  NSWWCCPD 33 and Adams v Fletcher International Exports Pty Ltd  NSWCA 238 provide guidance on the issue. Both cases held that any payment received from an employer may be considered a payment of ‘damages in respect of injury’.
In Adams, the Court of Appeal held that a payment was made to the former employee in respect of an injury and that such payment in respect of the injury constituted damages. Mr Adams was prevented from pursuing a workers compensation claim because he accepted a damages settlement as part of his Industrial Relations Commission claim.
In Super IP, the worker suffered a psychological injury which she claimed was due to bullying and harassment in the course of her employment. The worker lodged a complaint with the Australian Human Rights Commission alleging discrimination and victimisation. That complaint was resolved for a payment of $8,700 and she executed of a Deed of Release. The deed detailed the psychological injury and the specific events which gave rise to the injury in the Recitals. The worker subsequently brought a claim for permanent impairment compensation in respect of a psychological injury relying on the same circumstances. The employer claimed that pursuant to the deed, the worker had recovered damages in respect of the psychological injury. The Commission found that the injured worker recovered a sum of money for ‘psychological injury’ through the Human Rights Commission and that such payment was considered ‘damages in respect of her injury’. Ms Mijatovic was subsequently prevented from recovering workers compensation and work injury damages because the payment she received was considered damages.
The more recent case Neuroscience Research Australia v de Rome  NSWWCCPD 13 further examined Adams and Super IP. In de Rome, the Deputy President found that a recovery of damages in respect of an injury will extinguish workers compensation rights.
The lesson provided by these cases is that injured workers need to be extremely careful when pursuing employment law matters and human rights claims. If the workers compensation insurer can show that a monetary sum was paid to an injured worker, and that sum is considered damages in respect of injury, then you may have resolved your workers compensation claim for far less than what you are entitled to.
It is always best to seek expert advice from an experienced Lawyer. Call Harris Lieberman on 02 6051 5100 to discuss your situation with our experienced Personal Injury lawyers prior to accepting any ‘settlement’ offered to you.