The Darker Side of Workers’ Compensation in Australia

In the past few years, WorkCover fraud complaints in Australia have risen by 15 per cent, with a number of employees allegedly using their time off work to earn extra income from a second job.

injured employees


Remember the outrage back in 2015, when The Canberra Times revealed that Australian Liberal Party members were allegedly rorting the system? Not every case of workers’ comp fraud is quite as high profile as this one, but that doesn’t mean there isn’t a dirty underground of employees taking businesses and insurance companies for a profitable ride.


In Australia, employee WorkCover fraud is rampant and under-reported, much to the dismay of the parties that have to carry the cost of WorkCover fraud. Higher insurance premiums and large pay-outs put a considerable financial burden on the businesses and insurance providers affected, which is why steps need to be taken to reduce the prevalence of false workers’ comp claims This is especially important in workplaces that don’t typically have the resources to detect acts of fraud, like small businesses.


What is Workers’ Compensation?


Workers’ Compensation is an employee benefit that’s overseen by the Fair Work Ombudsman. It’s considered “a form of insurance payment to employees if they are injured at work or become sick due to their work.”


Employees receiving WorkCover payments typically receive:


  • Wages while they’re not fit to work; and
  • Medical expenses and rehabilitation costs


This is a national scheme that requires employers in every state or territory to have appropriate workers’ compensation cover, which protects both the employer and the employee in the event a claim is made.


What is Workcover Fraud?


Workcover fraud is when a person dishonestly obtains a payment or other benefit under their relevant state or territories’ Workers Compensation and Rehabilitation Act.


This could include making false claims for small injuries with one-off payments, or larger claims for benefits that extend over longer periods of time.


Some examples of workers’ comp fraud include:


  • Making a claim for an injury that doesn’t exist or one that occurred outside of the workplace
  • Exaggerating the extent of an injury
  • Earning a second wage while on income maintenance without declaring it (the same goes for people receiving Centrelink payments while they’re on income maintenance, without declaring the payments)
  • Fraudulently altering their medical certificates
  • Falsifying information when making a compensation claim


Employees that are found guilty of WorkCover fraud can face a criminal conviction, fines and will have to repay any benefits they received but weren’t entitled to.


What Can You do if You Suspect an Employee is Being Dodgy?


If you’ve noticed any of the following behaviours, your employee might not be being completely honest with you:


  • They didn’t report their injury or illness straight away
  • Their alleged injury happened immediately after a weekend, public holiday or a period of annual or sick leave
  • The employee is vague on the circumstances that led to, and the details of their injury
  • Their story is inconsistent or certain facts don’t add up
  • Their injury occurred immediately before retirement or pre-booked annual leave
  • The employee has suffered severe injuries from what seems to be a relatively minor incident
  • No one witnessed the incident
  • The employee is having financial hardships at home
  • The employee has previously rejected claims
  • The injury sustained relates to a pre-existing injury or illness
  • Contacting the employee who is on WorkCover leave is difficult
  • The employee has missed scheduled medical appointments
  • The employer has received reports of the employee engaging in activities that their injury should prevent them from doing


If you suspect one of your employees has fraudulently obtained workers’ compensation, the first thing you should do is contact your state or territories’ WorkCover authority.


For further investigation into the matter, and to assist WorkCover with determining whether or not your employee’s claim is dishonest, contact the team at In Depth Investigations or learn more here.

We can assist you with a private investigation in Perth, providing evidence that either supports or disproves the employee’s claim.