On June 30 The Full Court of the Supreme Court of Western Australia handed down a decision that removes any doubt that companies using the services of labour hire workers can rely upon the Hewitt v Benale Pty Ltd decision in the event a labour hire worker is injured and sues for common law damages.
Hewitt v Benale established that deemed employers under section 175 of the Workers’ Compensation and Rehabilitation Act can avail themselves of the restrictions on common law damages under part IV Division 2 of the Act in defending claims for common law damages.
In Marsden v Unimin Australia (there was also a companion case Price v Resolute Resources Ltd that dealt with identical issues), the plaintiff was severely injured while operating a mixing machine at the defendant’s business premises.
The defendant was contracted with Integrated Workforce, the plaintiff’s employer, for the supply of the plaintiff’s labour. The plaintiff sued the defendant for common law damages. The trial judge found the defendant was negligent.
However, the trial judge dismissed the action because, applying Hewitt v Benale, section 175 of the act deemed the defendant to be an employer of the plaintiff so the provisions of Part IV Division 2 of the act applied (the plaintiff had not obtained a requisite degree of disability determination from WorkCover against the defendant).
By a two to one majority, the Full Court dismissed the plaintiff’s appeal against the trial judge’s decision. It accepted Hewitt v Benale was correctly decided and identified the issue as being whether, in the words of section 175, the defendant contracted with Integrated Workforce for the execution of any work by or under the defendant.
The Full Court found the arrangement described in the evidence was a contract for the execution of work under a contract and fell within section 175 of the act.
The execution of the work was under the contractor because Integrated Workforce contracted with the defendant to execute the work by its employees at the direction of the defendant and the plaintiff was employed by Integrated Workforce to do that work.
The Full Court found that, although the plaintiff took day to day directions from the defendant, he was carrying out the work on behalf of Integrated Workforce, his employer.
The contract with the defendant was for the supply of labour. The work carried out under that contract was one and the same as the work carried out by the plaintiff under the contractor, even though it would also be correct to describe the work as being carried out under the principal.
The Marsden decision closes the door on the argument by labour hire workers that labour hire contracts do not come within the scope of section 175 of the act. It is a victory for companies engaging labour hire workers and their insurers, and will make it more difficult for labour hire workers to claim common law damages in the event they are injured in the course of their duties.
Kerry Woods, senior associate
9288 6902