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Employer Liability for COVID-19 Vaccine Side Effects

  • COVID-19
  • Published 14.09.2021

Key Takeaways

As more employers encourage or mandate employees to have a COVID-19 vaccine, they should be aware of the potential workers compensation liability for any side effects suffered by staff that result in an incapacity for work and/or the need for treatment.

Any claims for COVID-19 side effects require assessment on their own facts to determine whether the particular side effects suffered by an employee constitute an injury within the meaning of the Workers Compensation Act 1987 (the Act).

In some good news for employers, icare NSW has announced that it will exclude COVID-19 claims, including claims for vaccination side effects, from the individual claims experience of Nominal Insurer policy holders.

The Federal Government has also recently announced a No-Fault COVID-19 Vaccination Indemnity Scheme. The scheme will cover the costs of injuries above $5,000 due to a proven adverse reaction to a COVID-19 vaccination. From 6 September 2021, any Australian who suffers injury and loss of income due to their COVID-19 vaccination can register their intent to make a claim.

Relevant Legislation and Case Law

Is a vaccine side-effect an ‘injury’?

The definition of injury can be found in s4 of the Act and means ‘personal injury’ arising out of or in the course of employment and includes a ‘disease injury’.

Castro v State Transit Authority (NSW 2000) (Castro) provides a useful review of the authorities and makes it clear that what is required to constitute ‘injury’ is a ‘sudden or identifiable pathological change’. In Castro, the Court found that a temporary physiological change in the body’s functioning (atrial fibrillation: irregular rhythm of the heart), without pathological change, did not constitute ‘injury’.

The Australian Government Department of Health website ( lists some common Covid-19 vaccine side effects. The website indicates that most side effects last no more than a couple of days and that recovery without any further problems can be expected.

In most cases, any COVID-19 vaccination side effects suffered will be minor and temporary. Any claim for workers compensation relating to vaccine side effects requires assessment on its own facts and evidence to determine whether or not vaccine side effects constitute an ‘injury’. Matters requiring consideration include such things as the type and duration of symptoms.

Liability Considerations for Vaccine Side Effects 

For an injury to arise out of employment there must be a causal connection between the employment and the injury.

In the recent case of Usher v Coffs Harbour City Council (NSWPIC 2021) the Personal Injury Commission (PIC) considered a claim for medical expenses and weekly benefits following a flu injection the worker received. The injection was arranged and paid for by the worker’s employer.

In that case, the flu injection was administered to the worker whilst she remained seated in her vehicle at a pop-up drive-through location. The worker’s injection was inserted between the worker’s shoulder and her neck. She subsequently suffered severe pain in her arm. The PIC accepted that the worker suffered adhesive capsulitis following the injection. It was held that she had suffered injury both arising from employment and in course of employment and that work was a substantial contributing factor to the injury.

In considering the employer’s liability for the worker’s injury, the PIC made the following findings:

  • The employer had a practical interest in avoiding absenteeism by providing the flu injections..
  • The employer had encouraged the worker to attend the nominated venue and to present her arm through her open car window so the injection could be given by a nurse.
  • There is a sound basis for concluding that the injury arose out of the course of employment because the employer’s actions in organising the place and circumstances of the vaccination were a substantial and material contributing factor to the vaccination injury caused to the worker.
  • The course of employment extends beyond a worker’s normal hours and place of work to ‘the natural incidents connected with the class of work’. If a worker ‘is doing something which is part of or is incidental to his service’, he is in the course of his employment: Whittingham v Commissioner of Railways (WA 1931).
  • Even if the vaccination had taken place outside work hours, the PIC could be satisfied that the worker was doing something that she was reasonably required, expected or authorised to do in order to carry out her duties.

Although in Usher’s case the injection occurred within the worker’s paid hours of employment, the findings make it clear that where an employer encourages, induces or arranges the vaccination of their employees, the course of employment will extend to circumstances where the vaccination takes place outside the worker’s normal hours of work.


While insurers need to assess each claim for vaccination side effects on its facts, it is likely that a COVID-19 vaccine injury will be covered by workers compensation in circumstances where an employer encouraged, induced or took steps to arrange for employees to be vaccinated. This will be the case whether or not the vaccination is obtained during an employee’s ordinary hours of work.

The welcome news for employers is that icare NSW will exclude COVID-19 claims, including claims for vaccination side effects, from the individual claims experience of Nominal Insurer policy holders. Also, and separately to the workers compensation system, the Federal Government will meet the costs of injuries above $5,000 due to a proven adverse reaction to a COVID-19 vaccination suffered by any Australian.