WorkCover WA devotes significant resources to regulating employers’ compliance with their obligations under the Workers’ Compensation and Injury Management Act 1981 (the Act).

This section provides an overview of your obligations as an employer and the investigation and enforcement activities WorkCover WA undertakes to ensure these obligations are met.

Legal responsiblity Penalty for non-compliance 
Maintain a current workers’ compensation insurance policy covering all workers
  • Fines of up to $5,000 per worker
  • An amount equal to any avoided insurance premium payable over the previous five years
  • Separate and further offences for every week you remain uninsured after the date of conviction
Lodge workers’ compensation claims with your insurer within 5 working days of receiving it from your worker $1,000 penalty
Have an Injury Management System in place $2,000 penalty
Prepare a Return to Work Plan for workers who are injured at work $2,000 penalty
Make weekly payments to your injured worker as directed by your insurer once the claim is accepted $2,000 penalty per late payment
Some employers may attempt to engage in ‘avoidance arrangements’ to try to avoid their liabilities under the Workers’ Compensation and Injury Management Act 1981 (the Act). That is, they may ask individuals to incorporate (set up their own company) as a condition of getting a contract for work. Employers commit an offence by engaging in these arrangements.

Worker previously employed 

WOE Engineering enters into a new contract with a welder who was previously employed under a contract of service by the company to weld steel roofing frames.

Under the new arrangement, the welder provides substantially similar services as they did when working for WOE Engineering, but provides those services on behalf of a separate company as a director or employee, working principally for WOE Engineering. The work done is also directly part of the business of WOE Engineering – that is, metal fabrication.

If an injury occurs, WOE Engineering will be liable to pay the welder compensation and meet any return to work obligations.

Worker not previously employed

Morrissey Cleaners calls for tenders from incorporated companies to provide cleaning services to its clients. Morrissey Cleaners intimates that it is not responsible for workers’ compensation under the contractual arrangement for any company winning the tender for the contract.

An applicant, Mr Treeney, forms a company named PB Pty Ltd, registers himself as the director and PB Pty Ltd wins the contract. While the contract is in effect, Mr Treeney does work principally for Morrissey Cleaners – work that is directly a part of the business of Morrissey Cleaners – that is, industrial cleaning.

If an injury occurs, Morrissey Cleaners will be liable to pay Mr Treeney’s compensation and meet any return to work obligations.

Fines and penalties 

Costs for engaging in an avoidance arrangement could include:

  • the employer being liable to pay workers’ compensation entitlements in accordance with the Act and meet return to work obligations if a worker is injured while working for an employer under an avoidance arrangement
  • a fine of $5000 for employers who allow workers to do work for them under an avoidance arrangement
  • a $2000 penalty may be applied to employers (or insurers) who receive money or indemnity from a worker (or the worker’s company) in respect of any compensation liability the employer has to pay.
WorkCover WA provides resources to help employers understand their obligations. Information is available under the Employers tab on the home page on the WorkCover WA website and you can also refer to:

WorkCover WA inspectors conduct investigations into potential breaches of the Workers’ Compensation and Injury Management Act 1981 (the Act). This includes contacting employers and requesting the production of documents, including records of remuneration, Certificates of Currency or trust deeds.

If WorkCover WA has reason to believe an employer has not met legal requirements, an inspector will investigate as per their authorised functions under under section 175B(1) of the Act.

They will provide written or verbal notice to the employer being investigated and must clearly state the power or powers being exercised and for what purpose which include:

  • Entering, inspecting and examining any place where it is suspected workers may be employed or books, accounts, documents or records required to be inspected may be held
  • Conducting investigations as necessary to ascertain whether there has been compliance with the Act
  • Interviewing any person who the inspector has reasonable grounds to believe is able to provide information that may be able to assist the inspector to perform a function under the Act
  • Requiring people to verify statements by signing a statutory declaration form
  • Requiring auditor certification of remuneration paid to workers
  • Requiring any person to state their name and address
  • Requiring an employer or any of their workers to provide assistance

Not responding and/or not providing documents when requested may lead to penalties.

See cost of non-compliance below.

Breaches of the Act are liable to a letter of caution, infringement notice or criminal prosecution.

Letter of caution

Letters of caution serve as formal warnings to employers and advise that the current offence will be taken into account in determining the response to future non-compliance.

Where an employer has previously received a letter of caution and further non-compliance is detected, an infringement notice will be issued or prosecution will be commenced.

Infringement notice

Infringement notices are issued with a modified penalty as specified in WorkCover WA regulations. A modified penalty is a penalty which is not imposed by a court. Paying a modified penalty is not an admission of guilt for the purposes of any proceedings, whether civil or criminal.

If an employer receives an infringement notice, they may:

  • Apply to WorkCover WA for limited extensions of time to pay (there is no option to pay by instalments)
  • Elect to have the matter dealt with in court
  • Request the infringement be withdrawn if there is information that demonstrates a breach did not occur.

Prosecution

If an employer does not hold the required insurance cover it can be prosecuted through the Magistrates Court and penalised up to $5,000 for each worker employed. Additionally, an amount equal to the total of any avoided insurance premium payments which would have been payable during the period of 5 years before the conviction may also be payable. Corporations, as defined by the Corporations Act, may be subject to greater penalties.

WorkCover WA’s prosecutorial discretion is guided by the Statement of Prosecution Policy and Guidelines issued by the Director of Public Prosecutions (DPP) and published in the Western Australian Government Gazette on 3 June 2005.

Go to: Statement of Prosecution Policy and Guidelines.

Legal advice

The information provided above should not be viewed as a substitute for legal advice regarding employer duties and obligations under the Workers’ Compensation and injury Management Act 1981. Employers are encouraged to seek legal advice if they become subject to investigation and enforcement action.

Learn more about the penalties for non-compliance by viewing the prosecutions against non-compliant scheme participants.

Go to Prosecution results.