Amendments to WCRA leave Byrne in play
The Workers’ Compensation and Rehabilitation (National Injury Insurance Scheme) Amendment Bill 2016 passed with amendment on 31 August 2016.
As we previously reported, the majority of the Bill addresses the prescription of no-fault services for the benefit of catastrophically injured workers, forming part of the suite of Federal and State Disability benefits reform currently underway, and about to roll out with the commencement of the NDIS (federally) and the NIIS (with respect to no fault benefits for persons catastrophically injured in motor vehicle accidents, in Queensland). Those sections of the Bill passed.
Importantly for principals and subcontractors, the Bill had also proposed to reverse the Supreme Court decision in Byrne v People Resourcing Qld Pty Ltd by amending the Workers’ Compensation and Rehabilitation Act 2003 to clarify that WorkCover will not insure employers in respect of their contractual promises to pick up non-employers’ (principal contractors, host employers, etc.) legal liability for damages.
The Parliamentary Committee Report (Report No. 17, 55th Parliament) tabled on 19 August 2016, relevantly recommended that consideration be given to extending the option of participation in the WorkCover scheme to principal contractors and host employers. A lack of consultation regarding the proposed ‘Byrne amendments’ was acknowledged by the Committee, and echoed in the debate before Parliament on Second Reading of the Bill, too.
Ultimately the Bill passed last night with (at least parts of) the Byrne amendments removed, after a narrow majority of the Parliament voted to remove a section of the Bill that sought to introduce a new subsection to the definition to ‘damages’ insured by WorkCover under the WCRA. Importantly, the proposed amendments to section 10 of the WCRA (which were intended to limit the scope of WorkCover’s indemnity to employers) have not passed. The scope of WorkCover’s coverage to employers, remains in play.
However, the remaining Byrne amendments, including the new s.236B to the WCRA (pertaining to the liability of contributors and the enforceability of agreements between co-tortfeasors where WorkCover is involved) and the retrospectivity provision, were passed. It remains to be seen whether those changes will signify a reversal of Byrne in the absence of the amendment to s.10 of the WCRA, and whether and in what circumstances indemnities by employers in favour of non-employers will be void.
It seems likely that more judicial ink will be spilled yet, interpreting the amendments and clarifying the issue.
The Bill has been changed to reflect the amendments voted on by Parliament, and received Royal Assent today.