No Worker, No Case: Important PIC Decision On Jurisdictional Powers – Key Lessons From ASF Australia Pty Ltd v Icare Workers Insurance [2025] NSWPIC 604

In the financial year ended June 2024 SafeWork Australia reported nationwide there were over 30,209 workers compensation claims lodged by construction workers.

Construction sites often complicate common law negligence claims, with various entities present on the same work site, all with varying roles and depending on the circumstances of the injury, contrasting proportions of liability.

In NSW the usual course for such matters is for injured workers to lodge a workers compensation claim, and assuming initial liability is accepted the workers compensation insurer of the worker's employer pays compensation pursuant to the Workers Compensation Act 1987 ('1987 Act') and the Workplace Injury Management and Workers Compensation Act 1998 ('WIM Act').

It is important for scheme agents and their legal advisors to consider whether the injured worker fits within the statutory definition of 'worker' or 'deemed worker' as per the relevant legalisation, prior to acceptance of liability.

But what happens if the insurer disputes liability on the basis the injured worker did not fit within the scope of the 'worker' or 'deemed worker' definitions, yet the employer seeks indemnity from the workers compensation insurer on the basis it does not agree with the insurer's decision to dispute liability. Can this issue be determined by the Personal Injury Commission ('PIC')?

Member John Harris was tasked with determining these very issues in ASF Australia Pty Ltd v icare Workers Insurance [2025] NSWPIC 604.

Key Findings

• Jurisdiction Limits: The Personal Injury Commission (PIC) cannot make determinations about worker status or compensation unless the injured worker is actively pursuing a workers compensation claim and is a party to the proceedings.
• Worker's Choice: An employer cannot force a worker to pursue workers compensation benefits through the PIC if the worker has chosen to pursue common law damages in the court in which the damages claim is brought instead.
• Appropriate Forum: When disputes arise between employers and insurers regarding indemnity and worker status where the worker has chosen to pursue common law damages rather than workers compensation benefits, these matters must be resolved by the court in which the damages claim is brought (not the PIC).

The Case

In respect of the background to the claim, Mr Fahda suffered a maxillary fracture on 3 March 2023 at a building site, and he underwent surgical treatment. Mr Fahda made a claim against ASF for compensation entitlements under the 1987 Act. By notice dated 15 May 2023 icare denied Mr Fahda's claim pursuant to s 78 of the 1998 Act. The denial included a defence Mr Fahda was not a worker or deemed worker engaged by ASF at the time of the injury.

Prior to the subject PIC proceedings, Mr Fahda had commenced proceedings in the Supreme Court against the head contractor on the site where the injury occurred, J Squared Projects Pty Ltd (J Squared) and ASF, seeking common law damages arising from the injury. The legal representatives of ASF wrote to the insurer seeking confirmation icare would conduct the defence of the Supreme Court Proceedings on its behalf.

ASF commenced PIC proceedings against the workers compensation nominal insurer and its scheme agent icare/EML, seeking various orders and a finding the injured worker was a 'worker' or 'deemed worker'. In these proceedings, it was made clear Mr Fahda had not been paid any workers compensation benefits, and he had not brought PIC proceedings seeking to challenge the dispute regarding his entitlement to workers compensation benefits.

The insurer sought dismissal of the proceedings pursuant to section 54 of the PIC Act, submitting they were frivolous, vexatious, misconceived or lacking in substance.

Via written submissions, ASF conceded the PIC did not have the power to make a declaration in the absence of making an order for compensation. Relying on an earlier decision of Member Harris, ASF submitted the PIC could make a section 60 order (and potentially a section 33 order) "after determining status and compensability, even in circumstances that the worker has not himself litigated the matter, provided the parties are before the commission". Thus ASF requested a liability determination on at least payment of section 60 expenses, submitting there was a dispute between the employer and the insurer, either party could refer the dispute to the Commission, and the dispute fell within the exclusive jurisdiction of the PIC provided in section 105 of the WIM Act to hear and determine all matters arising under the workers compensation legislation.

The Decision

In his decision, Member Harris noted Mr Fahda had not pursued a claim in the PIC for workers compensation entitlements against the employer/insurer. "The filing of his action in the Supreme Court, in circumstances where there has been no attempt to satisfy the various statutory pre-conditions for commencing proceedings against an employer, shows that Mr Fahda has no present intention of pursuing any workers compensation entitlements."

Member Harris accepted an order for medical expenses under s 60 of the 1987 Act would be sufficient to provide a gateway for making ancillary findings. Those findings would necessarily include whether Mr Fahda was a worker/deemed worker. However, an order for any type of compensation could not be made in the absence of Mr Fahda being added as a party to the proceedings, because compensation could not be ordered unless the order was made in favour of the worker. Accordingly, the matter could not proceed in the absence of Mr Fahda.

As Mr Fahda was clearly not intending to seek workers compensation benefits, the Member did not accept any proceedings between the insurer and the employer were "in connection with a claim for compensation", because the worker could not be forced to pursue a claim for compensation entitlements.

The Member concluded this left ASF to defend the damages claim on at least the basis Mr Fahda was a worker/deemed worker engaged by ASF at the relevant time, and whether ASF was entitled to indemnification from the insurer was a matter for the Supreme Court.

Member Harris dismissed the proceedings pursuant to section 54 of the PIC Act finding the proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.