Latest case updates for self-insurers – March 2026

Stretton v CSR Building Products Limited & Anor (Appeal) [2026] VSC 91

The Supreme Court of Victoria has confirmed that the 'serious injury gateway' in section 326 of the Workplace Injury Rehabilitation and Compensation Act 2013 (Vic) (WIRC Act) only applies where a worker is, or may be, entitled to compensation under the WIRC Act itself.

Background 

Mr Stretton, a South Australian resident, was employed as a roof tiler by a South Australian employer. In May 2018, he was allegedly injured in the course of his employment when he fell from a roof while working on a residential construction site at Mount Duneed in Victoria, suffering serious physical injuries. 

The first defendant, CSR Building Products Limited, was the provider of roof tiling products and services. The second defendant, Sherridon Pty Ltd, was the principal contractor at the site. In March 2023, the Plaintiff commenced common law proceedings for damages in the Supreme Court of Victoria against these defendants.

Relevant to the 'state of connection' and gateway issue, it was accepted that:

• Mr Stretton had received statutory compensation under South Australia’s Return to Work Act 2014 (SA) (RWA);

• the substantive law governing his common law claim against the Defendants was Victorian law; and

• Mr Stretton had not accessed the Victorian 'serious injury gateway' under the WIRC Act and had no entitlement to compensation under that Act.

In December 2024, the defendants applied for summary judgment, arguing that because Mr Stretton had received compensation by way of payments under the RWA, he was required to establish he had sustained a serious injury prior to commencing proceedings against the defendants. 

The court ruled for the defendants, finding that Mr Stretton could not pursue his claim without first accessing the serious injury gateway in the WIRC Act. Mr Stretton appealed this decision.

Findings

The court allowed the appeal, firmly rejecting the 'any compensation anywhere' argument based on principles of statutory construction and the relevant history of the legislation. 

Key takeaways: 

The decision reinforces the long-standing position. A plaintiff must obtain a serious injury certificate to recover damages for injury arising out of Victorian employment, but a Plaintiff who was not engaged in Victorian employment when injured does not. 

The case also serves as a timely reminder that the ‘state of connection’ test in section 37 of the WIRC Act operates as a cascading test:

1. the state in which the worker ‘usually works’;
2. if no state is identified under (A), it is the state in which the worker is ‘usually based’;
3. if no state is identified under (B), it is the state in which the employer’s principal place of business in Australia is located.

Section 37(5) then provides that if no state can be identified under (A), (B) and (C):

‘a worker's employment is connected with this State if –

(a) the worker is in this State when the injury happens; and

(b) there is no place outside Australia under the legislation of which the worker may be entitled to compensation for the same matter.’

Local Government Association (City of Charles Sturt) v Vercoe & Return to Work Corporation of South Australia [2025] SAET 135 (8 December 2025)

Background

Ms Lauren Vercoe was an Asset Programmer employed by the City of Charles Sturt Council (with approval to work from home following the COVID-19 pandemic. 

On 19 September 2022, while working from home, Ms Vercoe was taking a coffee break, when she tripped over a metal pet fence. The fence had been temporarily erected to keep her colleague’s puppy that she was dog-sitting away from her pet rabbit (accident). 

Ms Vercoe sustained injuries to her right shoulder and right knee and made a workers’ compensation claim. The Local Government Association Workers Compensation Scheme (appellant) rejected liability of the claim on behalf of the Council.  

At first instance, the South Australian Employment Tribunal found that working from home formed part of contemporary employment practices, meaning Ms Vercoe’s home constituted her place of employment. Her Honour held the injury occurred during an authorised break and that an employer’s lack of knowledge of a hazard did not prevent it from being an employment‑related cause. 

Employment was found to be a significant contributing cause of the injuries, and Ms Vercoe was successful in her claim. 

The decision was appealed to the Full Bench of the Tribunal in April 2025, with ReturnToWorkSA intervening.  The issue on appeal was whether the tribunal erred in finding that Ms Vercoe’s employment was ‘a significant contributing cause’ of her injuries under s7(2)(a) of the Return to Work Act 2014 (SA). 

Findings

The majority of the Full Bench accepted that s7(5)(b) and the definition of 'place of employment' meant the injuries arose out of or in the course of employment. However, they found that the tribunal had not properly addressed whether employment was ‘a significant contributing cause’ of the injuries. 

The majority held that applying of s7(2)(a) requires an evaluative assessment of all relevant facts, including:

• the nature and purpose of the hazard; 

• whether the hazard is truly characteristic of the employment, as distinct from ordinary domestic life; and 

• whether the activity during which the injury occurred involved any mixed private and work purposes. 

In finding that employment was not a significant contributing cause of Ms Vercoe’s injuries, the majority relied on: 

• the pet fence being a temporary, domestic structure erected for a purely private purpose (to protect the rabbit from the puppy);

• the fence not being peculiar to the employment, but a common domestic item; and

• evidence that the break may have had two purposes (having a coffee and checking on the puppy), which had not been properly considered in the causation analysis.

In the dissenting judgment, it was considered that the pet fence was a characteristic of the workplace at the time of the injury (even if temporary and privately installed), and that the trial judge had correctly applied the statutory test.

The matter was remitted to the trial judge for reconsideration with the majority’s reasons after hearing further submissions from the parties. 

Key takeaways

If an injury occurs at the worker’s home (accepted as the 'place of employment') during an authorised break, s7(5)(b) and the broad place‑of‑employment definition will generally satisfy the ‘course of employment’ requirement – but this does not automatically establish that employment is a significant contributing cause. A separate causation analysis is always required.

Where an injury arises from a domestic, temporary or private hazard in a home workplace (such as a pet fence), the tribunal will consider whether that feature is genuinely a characteristic of the employment or merely part of everyday home life. Structural features integral to the workplace (such as stairs, guard rails or machinery) are more likely to have a stronger employment connection than ad hoc domestic items. 

When considering working‑from‑home claims, employers and insurers should:

• identify what aspect of the employment is said to have contributed to the injury (for example, employer directions, work routines, workplace configuration);

• distinguish between hazards created or shaped by the employment and those arising from purely private domestic arrangements; and

• ensure working-from-home policies address safety expectations (including layout and trip hazards), and that approvals and safety communications are documented, as these may be central to future significant contributing cause disputes.

Recent amendments to the Workers Compensation Act 1951 (ACT) introduce a new payment scheme for families of deceased workers.

For employers and insurers, the changes impose strict timeframes and create practical challenges in managing liability and recovery. 

Background

The Workers Compensation Act 1951 (ACT) has recently been amended by the Workplace Legislation Amendment Bill 2025 (No 2) (ACT), inserting a new Part 4.9 ‘Payments to families of deceased workers’ taking effect from 1 January 2026. 

The new Part applies to family members of workers whose death arose out of, or in the course of, the worker’s employment. It allows a family member to make application under s84B, to an employer within three months of the death. 

Following receipt of the application, the employer must pay an indexed amount of $10,000 for a domestic partner or $5000 for any other family member. The employer must provide the application to its workers compensation insurer within 48 hours. The insurer must then make payment within seven days of the employer receiving the application. In practice, this leaves the insurer with only five calendar days to receive the application and make payment.

The Explanatory Statement released by the ACT Government along with the Bill states that the  purpose of the provision is to address the problem that the ‘compensation process can become delayed and complicated where there are multiple financial dependants and a court-based process is needed.’ The statement goes on to say that the s84B provision is to ‘acknowledge and recognise the immediate impact a work-related death has on a deceased worker’s household finances and has been identified as a gap in the current statutory compensation framework…’

The definition of a ‘family member’ is set out in s84B(5) and is broad. It includes a domestic partner, child, step-child, parent, step-parent or any other person prescribed in the regulations who had lived with the worker in the six months prior to his or her death. 

What’s in the reforms

A payment made under the new Part 4.9 is not an admission of liability by the employer or insurer over the death of the worker. However, it is also not recoverable if the death is ultimately found not be accepted as having been work related or otherwise covered by the Act. 

It is foreseeable that payments may be made where the death is, due to a state of connection or other issue, not covered by the provisions of the Act. Where an insurer has concerns about liability or exemptions to the Act, investigations should commence concurrently but cannot delay compliance with the strict timeframes enforced by Part 4.9. This means that s84B is effectively a ‘no fault, without prejudice’ scheme.

Section 84C states that the payment is recoverable if the person claiming was not entitled to the payment. However, no process or limitation period is prescribed for this to occur. The current legislative framework does not allow insurers to recover payments made ‘by mistake’, and it seems that in reality, the prospect of recovering money from an individual who was never entitled to the payment is virtually non-existent.

The wording of the new Part 4.9 implies a written application is required, but it is unclear whether this equates to a simple written request made by a family member to the employer, or whether it needs to be in some other prescribed form. Given the beneficial nature of the legislation, we anticipate that the intention is simply that a written request will be sufficient under s84B, with no minimum documentation requirement. It is likely that this means some applications will be received before a death certificate is issued and there is an obligation on both the employer and insurer to act quickly upon receipt.

The new sections set out in Part 4.9 raise considerable uncertainty as to their application and expose insurers to the real risk of making payments to persons who are not entitled, which may ultimately not be recoverable.

Key takeaways

While the new provisions are intended to provide timely financial support to families, they introduce practical and legal uncertainty for employers and insurers.

Strict timeframes mean insurers may have only a limited window to assess and process payments. The broad definition of ‘family member’ increases the likelihood of payments being made in uncertain circumstances.

Although payments are not an admission of liability, they are generally not recoverable later if a claim is later denied, and recovery options remain unclear.

Insurers and employers should ensure processes are in place to respond quickly while progressing liability investigations in parallel. 

Van Der Wolf v Guardian Interlock Systems Australia Pty Ltd & Ors [2025] VSC 788

The Supreme Court of Victoria has clarified the role of Medical Panels in assessing injury, confirming that panels may undertake medical causation analysis when determining whether a compensable injury exist, without straying into impermissible findings on legal causation or fault. 

Background

Mr Van Der Wolf claimed that during an incident on 1 September 2017, a siren from an interlock device fitted to his car sounded, causing him to suffer noise-induced hearing loss as and a psychiatric injury. 

Mr Van Der Wolf alleged that he was exposed to the siren for 4-5 minutes, although device data suggested the alarm sounded for 45 seconds.

He commenced proceedings in the County Court against the Guardian Interlock Systems Australia Pty Ltd, the manufacturer or supplier of the interlock device.

In May 2023, pursuant to section 28LEW(I) of the Wrongs Act 1958 (Vic), Guardian Interlock Systems Australia referred the following questions to the medical panel:

• does the Mr Van De Wolf’s degree of impairment resulting from the physical injury (being hearing loss) satisfy the threshold level?
• does Mr Van De Wolf’s degree of impairment resulting from the psychiatric or psychological injury satisfy the threshold level?

The medical panel determined that it was unlikely the incident exposed Mr Van De Wolf to potentially damaging noise and, therefore, unlikely to have caused any hearing loss. Given the medical panel had not identified a compensable physical injury, they concluded Mr Van De Wolf had no impairment to assess in accordance with the American Medical Association Guides to the Evaluation of Permanent Impairment (4^th edition). 

Mr Van De Wolf commenced judicial review proceedings in respect of the medical panel opinion, arguing that the panel had impermissibly engaged in a causation analysis by examining factual matters such as the actual decibels volume of the alcohol interlock device and the duration of the siren. He contended the panel should have assumed the injuries as alleged and confined its role to assessing impairment. 

Mr Van De Wolf sought an order to set aside the panel’s determination and remit the medical question for determination by a different panel.

The Guardian Interlock Systems Australia argued that the panel’s consideration of the device data was necessary to determine whether a potentially compensable injury existed, and that the panel had not made findings on legal causation but instead concluded the hearing loss was constitutional in origin.

Findings

The court rejected Mr Van De Wolf’s ground of review and dismissed the proceeding, on the basis that:

• the panel correctly answered the question as to whether Mr Van De Wolf suffered from noise induced hearing loss and considered whether he actually suffered that injury, They concluded that the hearing loss was constitutional;
• the panel did not decide on legal causation or fault; and
• there was no jurisdictional error of law. 

The court stated that if the panel were to have undertaken an impairment assessment, then such an approach would have failed to comply with the statutory provisions and authorities. 

Key takeaways

• Panels may reject the existence of a claimed injury: a panel can conclude that a claimant does not suffer the specific injury alleged if it considers, on medical grounds, that the condition is caused by constitutional or unrelated causes.
• Medical causation analysis is permissible: panels may analyse whether symptoms are consistent with the alleged mechanism of injury in order to identify a potentially compensable injury. This kind of medical causation reasoning does not amount to an impermissible determination of legal causation or fault.
• No obligation to assess impairment of non-existent injuries: if a panel finds the claimant does not suffer the injury alleged, it is not required to perform an impairment assessment simply because an impairment exists from another cause. 

Banskota v Eldercare Inc [2026] SAET 13

Background

Ms Sonam Banskota was employed as a personal care worker with Eldercare for nine years and had an unblemished employment record. 

In 2023, Eldercare commenced a disciplinary process alleging she failed to follow a clinical care plan (CCP) for a resident. Ms Banskota requested access to CCTV footage and the relevant CCP documents, but Eldercare refused for privacy reasons. Two psychiatrists, Dr Moffatt and Dr Begg reviewed Ms Banskota and agreed that the 2023 disciplinary process caused her to become anxious. 

In 2024, Eldercare initiated a second disciplinary process relating to further alleged CCP breaches and an incident involving another resident. Again, Eldercare refused to provide CCTV footage and made several allegations based on incorrect factual assumptions or misinterpretations of care plan requirements. 

Following these processes, Ms Banskota developed an adjustment disorder with anxiety, ceased work in March 2024, and was dismissed on 12 April 2024. She made a workers compensation claim under the Return to Work Act 2014 (SA). Eldercare rejected the claim on the basis that her injury arose from reasonable administrative action under s 7(4) of the Act.

The issue for the trial judge to determine was whether Ms Banskota’s psychiatric injury arose wholly or predominantly from reasonable administrative action, in relation to performance management or dismissal and whether it was undertaken in a reasonable manner, within the meaning of s 7(4). 

Findings

The tribunal held that Eldercare’s 2023 disciplinary process was unreasonable and undertaken in an unreasonable manner. Further, it was held that the outcome was predetermined, procedural fairness was denied, and critical evidence (CCTV and CCP documents) was withheld.  The issuing of a first and final warning was disproportionate given her unblemished service and did not comply with Eldercare’s Managing Misconduct and Disciplinary Procedure. 

The tribunal also held that the 2024 disciplinary process and subsequent dismissal were unreasonable and was undertaken in an unreasonable manner: Eldercare again withheld CCTV footage, relied on flawed and selective allegations, failed to consider exculpatory evidence, and did not provide documents necessary to allow for Ms Banskota to respond properly. The dismissal was also based on the flawed 2023 warning. 

Accordingly, the court found that the injury did not arise from reasonable administrative action undertaken in a reasonable manner. Eldercare’s rejection of the claim was set aside. Ms Banskota’s psychiatric injury was accepted as compensable, and she was awarded weekly payments, medical expenses, interest and costs. 

Key takeaways

For action to qualify as ‘reasonable administrative action’ under s 7(4), both the decision and the manner of undertaking it must be reasonable. Disciplinary processes that are predetermined, procedurally unfair, or reliant on selective or withheld evidence will not meet this test. 

Employers must provide employees with access to critical evidence (eg CCTV footage and CCPs) where allegations depend on it. Failure to do so increases the risk of a finding of unreasonableness. Heavy‑handed or biased investigations will not satisfy the statutory exclusion under s 7(4).

The New South Wales (NSW) Government has flagged significant reform to the workers compensation framework in response to the growing volume, cost and complexity of psychological injury claims.

For employers and self-insurers, the proposed changes signal a fundamental shift in how these claims will be assess, managed and funded.

Background

The current NSW workers compensation framework has proven increasingly ill-suited to the modern workplace, particularly in its management of psychological injuries. 

Over the past two decades, psychological injury claims have risen significantly, at a pace the legislature has struggled to adequately address, with volumes doubling since 2012. These claims now account for approximately 12 per cent of all claims yet represent around 38 per cent of total scheme costs. Average claim costs are nearly five times higher than those for physical injuries.

Return-to-work outcomes further highlight the challenge. Only 64 per cent of workers with psychological injuries return to work within 104 weeks, compared to approximately 95 per cent for all other injuries. This disparity underscores the complexity and longevity of psychological injury claims within the scheme.

Against this backdrop, the NSW Government has acknowledged that, without reform, the scheme risks becoming unsustainable – potentially requiring substantial Treasury support and significant increases in employer premiums. 

As a result, the government has determined that permanent structural changes are necessary. Substantial amendments to the Workers Compensation Act 1987 are expected to commence on 1 July 2026. 

Proposed reforms

The proposed reforms introduce significant changes across liability, causation and entitlement for psychological injury claims. 

A key reform is the introduction of a more stringent test for primary liability in psychological injury claims. Compensable injuries will need to arise from a defined ‘relevant event’, such as: 

• bullying,
• excessive work demands,
• racial or sexual harassment, and
• vicarious trauma.

Any dispute regarding the existence of a ’relevant event’ arising from conduct as opposed to a trauma, will fall within the exclusive jurisdiction of the Industrial Relations Commission.

The amendments will also impose a stricter causation requirement, mandating a real and direct connection between the relevant event and the worker’s employment, with employment required to be the main contributing factor to the injury.

Significant changes to entitlements are also proposed. Workers with primary psychological injuries will: 

• Need to meet a 21 per cent whole person impairment (WPI) threshold to access weekly compensation beyond 130 weeks.  
• Lose access to medical and related treatment expenses one year after weekly benefits end, unless the worker meets the 21 per cent threshold (and will remain subject to a ’reasonable and necessary’ test).

Thresholds to enliven claims for work injury damages will also increase progressively:

• from 15 per cent to at least 25 per cent WPI by 1 July 2026;
• to more than 26 per cent WPI by 1 July 2027; and
• to at least 28 per cent WPI by 1 July 2029.

Key takeaways

While these amendments are expected to significantly reshape the scheme, their practical operation remains uncertain pending the development of supporting regulations and guidelines. It is anticipated the regulations and guidelines will be released, potentially for consultation in the first instance, by late April 2026.

Insurers and scheme participants should anticipate substantial impacts across liability determinations, injury management practices and return-to-work obligations as the reforms take effect. 

Bakhit v Hartley Healy Pty Ltd [2025] QSC 352

The Supreme Court has clarified how broadly settlement deeds can operate in the workers compensation context, particularly where common law damages claims are involved.

This decision highlights the importance of carefully drafting release provisions and understanding the distinction between statutory benefits and common law rights. 

Background

Mr Hamde Bakhit was employed by Hartley Healy Pty Ltd, a law firm, between 2013 and 2015 and again between 2015 and 2016. 

During her second period of employment (2015 to 2016), she alleged she suffered a psychological injury as a result of ongoing sexual harassment by a colleague. She claimed this constituted negligence and breach of contract by the defendant firm. 

Ms Bakhit lodged and later withdrew, a workers compensation claim arising from the alleged sexual harassment. She then complained to the then Australian Human Rights Commission based on the same sexual harassment allegations.

The parties resolved the complaint, and a Deed of Settlement was executed in 2017: which included: 

• a release of 'all claims' connected with the allegations, the complaint and Ms Bahkit’s Employment;

• a carve out exception for 'any claim for statutory benefits under the Workers’ Compensation and Rehabilitation Act 2003 (Qld) (WCRA) or for unpaid superannuation'; and 

• a bar to proceedings and indemnity clause allowing the deed to be pleaded as a bar and requiring an indemnity for costs if proceedings were brought.

A few years later, Ms Bahkit re-initiated her workers’ compensation claim under the WCRA for a psychological injury arising from the alleged sexual harassment. The claim was accepted and she pursued a common law claim for damages. 

Ms Bahkit then commenced proceedings in the Supreme Court against Hartley Healy, who brought an application seeking to rely upon the deed as a defence. 

The court was required to determine whether, by reason of the deed: 

• the plaintiff had released and discharged the defendant from liability for the proceeding and was barred from doing so; and 

• if so, whether she was liable to indemnify the defendant for its legal costs on a full solicitor client basis.

Findings

The court held that: 

• Ms Bahkit’s common law claim for damages was not 'claims for statutory benefits' and therefore fell within the broad release in clause 7.1 of the deed; and 

• as a result, clause 9.1 operated as a bar to the proceeding, and clause 9.2 obliged Ms Bahkit’s to indemnify Hartley Healy’s legal costs on a full solicitor client basis.

In interpreting the deed, the court applied standard contractual construction principles for releases, construing the deed objectively by reference to what a reasonable person with the background known to both parties, would understand from the language used in the deed. 

Ms Bahkit accepted that, apart from the carve out, her workers’ compensation common law claim for damages was a 'claim' connected with the 'allegations' of the ‘complaint’ and her ‘employment’. On that basis, clause 7.1 would cover and release her common law cause of action unless it fell within the carve out for 'statutory benefits under the WCR Act'. 

Ms Bahkit also argued that section 110 of the WCRA prevents a person from relinquishing an entitlement to compensation and that any agreement to do so has no force or effect. She further argued that, when read with section 119 of the WCRA (which brings compensation to an end when a damages claim is settled), the phrase ‘statutory benefits’ must include the damages claim. Otherwise, she would be deprived of her entitlement to compensation, which clearly was intended to be avoided by the parties. 

A central issue was what was meant by 'statutory benefits under the WCR Act'. The court emphasised the clear differences in the WCRA between:  

• 'compensation' is defined in section 9 as ‘monetary amounts payable under the Act (Chapters 3, 4 and 4A) for a worker’s injury – weekly benefits, treatment and rehabilitation costs, and lump sums for permanent impairment’;

• 'damages' is defined in section 10 as ‘amounts payable for injury in circumstances creating, independently of the Act, a legal liability to pay damages – that is, common law negligence or contract damages, though access to those damages is regulated by Chapter 5’. 

With these distinctions in mind, it was determined only ‘compensation’ under section 9 of the WCRA, being the no-fault benefits created and payable under the Act fit the description of 'statutory benefits under the WCR Act'. Common law damages claims, while regulated by the WCRA, arise independently of the Act and are not themselves statutory benefits. 

The court also accepted that section 237 of the WCRA operates as a gateway, limiting who may seek damages but does not create a right to damages; it restricts the ability to pursue pre-existing common law liabilities. A statutory restriction on access to court is not, in ordinary terms, a 'benefit', nor a 'statutory benefit'. 

In considering section 110 of the WCRA, the court confirmed it applies to only statutory compensation. Parties are therefore free to contract out of and settle common law damages claims under the WCRA as they would any other claims for damages.

Having reached that conclusion, the court did not feel obliged to determine the general submissions made about sections 110 and 119, having determined that a worker always retained a liberty to resolve their separate legal entitlement to damages. It was not relevant that the effect of the deed deprived the Ms Bahkit of her ongoing entitlement to compensation.

The court also provided a clear warning: ‘as with much of the WCR Act, a worker ought to seek legal advice to ensure that they understand the proper workings of the WCR Act’. The fact that the worker’s entitlement to compensation may also have been extinguished under section 119, concurrent with their right to damages, was a matter which they should have sought advice on.

Key takeaways

This case is an important reminder for parties that:

• the recitals and subject matter of a deed are important, and can cover claims arising from similar facts, but of broader scope, than the immediate context of the deed; 

• if the parties wish to keep any common law claims alive, and there is a general release, clear and explicit intention must appear within the deed; and

• it may be the case there are some circumstances where the mandatory costs provisions in Chapter 5, Part 12, Divisions 2 and 3 do not apply to the resolution of improperly commenced proceedings.