Certificates of capacity and earnings for WorkCover

When a worker is injured and is claiming weekly payments from WorkCover, they must provide a certificate of capacity, and on that certificate there is a declaration section where the worker is required to sign. This sets out whether they have performed any paid or voluntary work during the period of the certificate.

In the past, this was an easy question to answer.

It was clear whether someone was working, as if they were, they would be receiving payments to their bank account (or cash) for performing that work.

Now, there are many forms of nontraditional work with the arrival of gig work and online selling, for example. This can create grey areas where it may not be clear if someone would be considered to be working.

This page looks at what the certificate of capacity requires you to say, what may be considered work, how WorkCover can determine whether someone is working, and what if you don’t complete the declaration accurately.

As we always say – this article provides general information only and you should not take action on your own matter based only on information provided here. The consequences in these matters can be very serious – you should seek help advice before taking further steps if you believe there may be issues with the way you have completed the declaration.

The certificate and declaration

The standard WorkCover certificate of capacity is a document that requires input from both your treating practitioner and yourself.

It is not enough for someone to say that my doctor completed the certificate and any errors are their responsibility.

The certificate requires the worker address following question:

At any time since the last Certificate of Capacity was provided, have you engaged in: – voluntary work, or – any form of employment or in self-employment for which you have received or been entitled to receive payment in money or otherwise?

If the answer is no, then nothing more needs to be done by the worker in relation to this question.

However if the answer to this question is yes, you are then asked to ”provide details of any voluntary work, employment or self-employment you have engaged in (other than with your pre-injury employer as part of your return to work)”

You are required to declare that the “details I have given on this certificate are true and correct” and that you “understand that it is an offence under the legislation to provide false or misleading information”.

The certificate very clearly puts the responsibility on the worker to honestly consider and answer this question.

What is considered to be work?

WorkCover are going to look at the nature of the activities the worker is engaging in rather than what the worker, an accountant or other party might say the activity is classified as.

Work is going to include gig economy jobs, cash-in-hand work, work performed from home, online sales or business and anything else that involves the worker performing activities that could result in payment.

If you’ve held shares in Telstra for 10 years and get a regular dividend payment, that wont be considered work, but if you are trading shares regularly from home it might be considered work.

There are plenty of grey areas. Let’s say you like woodwork and do it as a hobby from your shed at home.

At some point you make a table and decide to sell it to someone you know for $50 cash as a one-off.

Is that going to be considered work for the purposes of your WorkCover certificates?

Probably not.

What if you start selling your work regularly, start attending a Sunday market or set up a Facebook shop? As the old saying goes, if it looks like a business, smells like a business and walks like a business, it is probably a business – even if it doesn’t make much money.

What information might I need to provide about any earnings I have that aren’t from the injury employer?

In cases where someone returns to work with a new employer it will simply be a matter of providing payslips from that employer to the insurer.

When a non-traditional form of employment, or self-employment is involved, WorkCover may request things like:

• Business Activity Statements, financial statements, reports and profit and loss statements for the business, or if not available, documentation evidencing the takings and expenses of the business for the period.
• Documents, such as bank statements, detailing any distribution or profit paid to the worker or anyone else from the business, or from the trust relevant to the business.
• Documents regarding any loans in relation to the business and the repayment of these loans during the period.

Self-employment can be difficult to assess for both WorkCover insurers and workers where it is not clear if the business is turning a profit after expenses.

Even if you believe your business is not making a profit, you should seek legal advice if you have not been declaring the self-employment on your certificate.

What can be the outcome of making a declaration to WorkCover on a certificate that isn’t accurate?

The law that governs the WorkCover scheme says “the Authority or a self-insurer may terminate or alter weekly payments on the ground that the worker has returned to any work whether as a self employed person or in employment”.

Usually, this clause is used to alter someone’s weekly payment entitlement when they return to part time work in a different role.

For example, you were receiving $1000 per week in weekly payments and then six months later commenced working part time earning $200 per week.

That $200 a week would reduce your $1000 per week weekly payment, as you have current weekly earnings.

However, the section can also be used when WorkCover believes that the worker has provided false or misleading information and has been earning money and not declaring it. This could result in a worker’s payments being entirely terminated, when they may only have been reduced according to what the new earnings were.

The more severe outcomes in this situation are (1) WorkCover requires you to pay back some or all of your weekly payments, or (2) they commence a criminal prosecution against the worker which could result in financial penalties, jail time or other correctional orders. The course of action that WorkCover will decide to take may in part be decided on the scale of the error, the conduct of the worker and the length of time the inappropriate declarations were being made.

For example, someone that mistakenly doesn’t declare immediately their first week of earnings in a new job, but starts providing their earnings from the second weeks onwards and notifies the insurer of the error probably has little to worry about. On the other hand, if a worker is simply hiding large amounts of alternative earnings to gain a financial benefit from WorkCover, they can expect WorkCover to take the matter very seriously.

Conclusion

The worker needs to be an active participant in the preparation and signing of the WorkCover certificate of capacity.

It is not enough to say that the doctor completed the form.

If you have been working either voluntarily or in paid employment, then it is important that you declare it both in the certificate and by reporting it to your WorkCover insurer.

WorkCover has powers to investigate someone in relation to their entitlement to weekly payments.

If you believe that you may have made an error in completing some of your certificates, your first step should be to seek legal advice.