Employees oftentimes have some misconceptions about workers compensation, and how they may be entitled to receive it. Many employees think that in order to obtain workers compensation, their employer has to be negligent in leading to their injury. This is not the case, and in fact it is a merging of two distinct concepts that envelop a similar field of law. To help clients better understand the law, it is important to clarify the differences and examine the relationship between workers compensation and work injury damages.

Workers Compensation

Workers Compensation provides limited compensation to workers who suffer injury or work related disease in the course of employment, without the need for the employee to prove that their employer was negligent. Recoverable compensation will not be reduced if the employee is contributorily negligent, except in circumstances where the worker is injured as a result of their own serious and wilful misconduct or intentional self-inflicted injury.

As there is no negligence component to a workers compensation claim, workers compensation payments are often more modest than common law damages. Workers may receive damages in the form of weekly payments, medical expenses, and/or lump sum compensation if they are assessed as over the whole person impairment threshold.

The Workers Compensation Act 1987 (NSW), requires that a threshold be met in order to be entitled to lump sum payment. An approved medical specialist must assess the worker seeking compensation as having greater than 10% whole person impairment for a physical injury or 15% or greater for a psychological injury.

Work Injury Damages

After a worker has been down the workers compensation route, and it is found that their whole person impairment is 15% or greater, they then become eligible to claim work injury damages, if they can prove that their injury was a result of their employer’s negligence.

Under common law, an employer may be liable for an injury sustained by an employee, if it is established the employer:

  1. Had a duty of care.
  2. That duty of care was breached.
  3. The injury caused the employee a loss as a result.
  4. The employee sustained an injury as a result of that breach.

If negligence is satisfied, an injured worker is eligible to obtain a larger amount of lump sum damages, as opposed to workers compensation. An injured worker may be entitled to past economic loss and future economic loss up until the age of retirement. It is worthy to note however, that successfully resolving a claim for work injury damages brings an end to the workers entitlement to workers compensation benefits.


By comparing both workers compensation and work injury damages, it is clear to see there are some distinct differences between the two. Although there is a relationship between the two, with workers compensation possibly leading into work injury damages, due to the no fault component, workers compensation is more readily available to workers injured during the course of their employment, while work injury damages can provide a greater amount of compensation for workers who have suffered more severe injuries and can establish negligence.

If you are an employee that has been injured in the course of your employment, you may be entitled to compensation. For more information, and to arrange a free, no-obligation assessment of your claim, please contact Stacks Goudkamp on 1800 25 1800, or alternatively, make an online enquiry.

Written by Michael Greene.

Michael Greene is a paralegal to Cali Baldwin and Sian Louise-Perez. Michael works on a variety of different compensation matters, including workers compensation claimswork injury damages claims, and motor vehicle accident claims.