With COVID-19 outbreaks continuing to disrupt life around the country, maximising the vaccination rate has become a national priority. Reaching the vaccination rate of 80% in Australia is now in our sights, raising questions about the best way to navigate a safe and sustainable return to the workplace.
The issue of whether employers should mandate vaccinations is receiving considerable attention around the world. Multinational companies such as Google and Facebook have introduced a compulsory vaccination policy for staff. This move has been closely followed by Australian companies such as Qantas and SPC, with others indicating they will follow suit.
As businesses seek to understand their risk exposures, we explain how COVID-19 claims and liabilities are currently being viewed and summarise key considerations for employers as they navigate this next phase.
LATEST GUIDELINES ON MANDATING VACCINATIONS
In Australia, four tiers have been set out by The Fair Work Ombudsman (FWO) to help businesses assess where it might be "lawful and reasonable" to mandate COVID-19 vaccinations in their workplaces. The tiers range from Tier 1, where workers are exposed to the most risk and therefore it may be reasonable to enforce vaccinations, through to Tier 4, where the risk of transmission or infection is likely to be lower.
Tier 1 work — employees are required to interact with high-risk people (e.g., border control, hotel quarantine)
Tier 2 work — employees are required to interact with vulnerable people (e.g., health care or aged care workers)
Tier 3 work — employees are required to interact with the public in the course of their employment duties (e.g., retail workers at essential stores)
Tier 4 work — employees have minimal face-to-face interaction with others.
A workplace may have employees performing work in different tiers, which might change over time. With no test cases currently available to show the tier system in action, these guidelines raise the question of what steps are considered “reasonably practicable” for employers to help keep staff safe. At the time of publication, this decision sits with employers.
NO FAULT COVID-19 INDEMNITY SCHEME
Having consulted with the medical, healthcare, business, and insurance sectors, the Federal Government has released the details of the national no fault COVID-19 Vaccine Claim Scheme (the Scheme). The Scheme will provide Australians with efficient access to compensation for COVID-19 claims related to the administration of a Therapeutic Goods Administration (TGA) approved COVID-19 vaccine delivered through a Commonwealth Government approved program, irrespective of where that vaccination occurs.
From 6 September 2021, Australians who suffer injury and loss of income due to receiving the COVID-19 vaccine can register their intent to claim from the COVID-19 vaccine claims scheme webpage. The Scheme will be backdated to February 2021.
The Scheme will cover the costs of injuries exceeding $5,000 caused by a proven adverse reaction* to a COVID-19 vaccination. Independent experts will assess the claims, and compensation paid based on the recommendations. Compensation payments under the Scheme will be fully funded by the Commonwealth.
Australians who receive a COVID-19 vaccination and experience an adverse reaction are encouraged to report it to their doctor who can provide the information to the TGA.
COVID-19 VACCINES & WORKERS’ COMPENSATION
Separate to the COVID-19 Vaccine Claim Scheme, in some circumstances, an adverse reaction to the COVID-19 vaccine may be covered under workers’ compensation. To be covered, the insurer will need to be satisfied that:
the vaccine injury arose out of, or in the course of the worker's employment; and
the worker's employment was a substantial contributing factor to the vaccine injury or was the main contributing factor for a disease, injury; or
in the case of heart attack or stroke injury, the nature of the employment was a relevant factor in increasing the risk of the injury (see below).
While each claim needs to be assessed on the relevant facts and evidence, several issues may increase the likelihood that a vaccine injury is covered under workers’ compensation, including whether an employer:
took steps to arrange for its employees to receive a COVID-19 vaccine
encouraged or induced its employees to receive the vaccination to obtain benefits for its business
permitted or directed employees to have a COVID-19 vaccination during ordinary working hours; or
provided instructions to employees relating to the administration of the vaccine.
Workers’ compensation outcomes will always be subject to the individual merits of the claim, however, the key factor determining liability is the relationship between the workplace and how an injury arose out of or in the course of employment. Therefore, the role of the employer is important when considering the exposures presented by COVID-19 vaccinations and how this can be determined to be in the course of employment. The link between a vaccine injury and the worker's employment is easier to establish where a worker is influenced by their employer's requirement to receive the vaccine or is subject to a Government Public Health Order. In these circumstances, there is a greater likelihood of the vaccine injury being covered under workers’ compensation. When lodging a claim, employers and workers will need to provide information on the link between their employment and the serious adverse reaction to the vaccine.
If a vaccine injury is a "heart attack injury" or "stroke injury", the worker is also required to establish that the nature of their employment significantly contributed to the injury. In practice, this may require the worker to satisfy additional requirements. For example, the worker may need to provide evidence they opted for a particular vaccine brand due to their employment.
IMPACTS TO PREMIUM IF A WORKER MAKES A COVID-19-RELATED CLAIM
In NSW, icare has confirmed it will exclude COVID-19 claims and COVID-19 vaccination claims from the individual claims experience, meaning it will absorb the costs of the claim without passing on premium impact to the policyholder. This will protect any individual employer or industry from disproportionate premium increases due to COVID-19. This is a continuation of the Job Keeper exemption during 2020 where regulators supported the exclusion of these payments per the declaration of rateable remuneration. Whether the remaining State regulators follow icare’s lead is yet to be seen, however, Honan is liaising with our regulatory contacts to understand their position.
Businesses are encouraged to report any COVID-19 outbreaks directly to the relevant State or Territory regulator (e.g., WorkSafe Victoria, SIRA, etc.) and consider an employee who has tested positive to COVID-19 as having a reportable injury.
These issues remain a complicated area of discussion in the business community and the situation is evolving each day. We encourage businesses to seek legal advice based on their individual circumstances where appropriate before proceeding.
Protecting cash flow, guarding against late and/or non-payments from customers, and securing your company’s own creditworthiness is critical to business sustainability. This article looks at two key ways you can limit your liquidity risks: credit reports and trade credit insurance.
Honan Insurance Group Pty Ltd (Australian Financial Services Licence no. 246749, ABN67 005 372 396) is an insurance broker acting as agent for insureds and intending insureds. Honan is not an insurer. The information on this website has been prepared without taking into account your objectives, financial situation or needs. Any advice provided on this website is general advice only. Before making a decision to purchase an insurance policy, please read the relevant Product Disclosure Statement to make sure the policy is right for you. Insurance cover is subject to policy terms and conditions including policy limits and exclusions.
From time to time, Honan may act under a binder arrangement with an insurer. When this happens, Honan is authorised by the insurer to issue certain insurance policies on the insurer’s behalf. When Honan does this it acts as the agent for the insurer and not for any insured person. We will let you know when we are acting under a binder. You can view the Product Disclosure Statements for the insurance policies we issue under a binder arrangement here. A copy of the Target Market Determination for each policy is also available on this website.
Copyright 2022 Honan Insurance Group Pty Ltd ABN: 67 005 372 396. All rights reserved.