Work injury damages

If you have a work injury which resulted from your employer’s negligence, you may sue for modified common law damages in certain circumstances. These are known as ‘work injury damages’ claims.

‘Damages’ is the term used to describe a sum of money that may be awarded to compensate for the loss, harm or injury suffered.

In NSW most workers are limited to claiming past loss of earnings and future loss of earning capacity only, and that is why they are referred to as modified damages.

A work injury damages settlement cancels all further entitlements to workers compensation benefits (including weekly payments, and medical, hospital and rehabilitation expenses, regarding that injury).

The amount of weekly payments that have already been paid to the worker must be repaid out of the settlement amount.

The amount of damages can also be reduced if the worker's own negligence contributed to the injury.


To claim work injury damages, this criteria must be met:

  • the work injury must be the result of the negligence from the employer
  • you must have at least 15 per cent permanent impairment (assessed by a specialist trained in the use of the evaluation of permanent impairment guidelines), and this has been accepted by the insurer or determined by the Workers Compensation Commission
  • you must have received all statutory lump sum entitlements for permanent impairment to which you are entitled before a work injury damages claim can be settled

Lodgement process

Court proceedings can only start at least six months after the injury is reported to the employer, but must be started within three years of the date of injury, unless you (the worker) have leave of the Court.

Before you can start mediation or court proceedings for work injury damages, you must serve a pre-filing statement setting out the particulars of the claim, and the evidence you will rely on to establish or support the claim on your employer or the insurer.

In most cases, the claim must be referred for mediation in the Workers Compensation Commission (WCC) before starting court proceedings.

The WCC will attempt to mediate and reach settlement through discussion with all parties.

If an agreement cannot be reached, work injury damages claims are most commonly heard in the District Court.

Legal advice and costs

You should first seek independent legal advice before beginning a work injury damages claim

If you are unsure of how to locate a suitable legal representative, you can contact:

It’s common for work injury damages matters to settle 'inclusive of costs'.

In practical terms, this means that you enter into an individual costs agreement with you solicitor (most work injury damages matters in NSW do proceed on this basis), then legal costs are deducted from the worker's settlement amount.

If a work injury damages claim is not successful, you can continue to receive workers compensation under the statutory scheme but you are likely to be liable for court costs incurred during the work injury damages claim.

Further information

Read the guidelines for claiming workers compensation for more information.


Sometimes there can be disputes about compensation.  If there’s a dispute, there’s help available. Our workers compensation disputes section has more information on how we can help.