A landmark case has resulted in a former manager at Twin Willows Hotel ordered to repay Laundy Hotels $50K workers compensation plus interest after being sprung simultaneously working at another pub.
Only a few months after being hired as a venue manager at the Laundy’s HQ pub in Bass Hill, in 2022, Jonalee Magtoto Kopko submitted a claim for psychological injury and went on leave.
According to a recent Personal Injury Commission (PIC) judgment, around October 2022, during Kopko’s sabbatical, the Laundys learned the woman had been seen working at Fairfield’s Cambridge Tavern.
A witness statement submitted to the PIC detailed Arthur Laundy relaying how he became “suspicious” after hearing Kopko was employed at another pub while supposedly unable to work. Twin Willows applied to have the worker repay what amounted to tens of thousands of dollars.
“Workers’ compensation is an essential service,” says Danielle Richardson, Laundy Hotels director and daughter to Arthur.
“However, in this instance you have an individual who has blatantly misused the system, and when we became aware of her working whilst claiming she was unfit we were determined to pursue this case as these instances are putting strain on a system that is meant to support those who are truly struggling.”
In a landmark decision, said to be the first of its kind, the PIC ordered Kopko to refund Hospitality Industry Insurance (HII), which paid the claim, $50K – within 60 days.
“Mr Laundy explained that he was made aware by patrons of the hotel that the respondent had been seen performing duties at the Cambridge Tavern at Fairfield,” the decision said.
Kopko failed to repay the money in the allotted time. Interest on the principal means she now owes more than $64K.
HII CEO Angus McCullagh noted that the workers compensation system exists to support people who genuinely cannot work, aiming to help them recover from injury and return to work. HII did not clarify if any of the money has been repaid to date.
The extraordinary decision has been welcomed by the AHA, with NSW deputy CEO Sean Morrissey suggesting the repayment order set a strong precedent and goes some way to combat the potential prevalence of this kind of rort, which he says costs employers “millions of dollars”.
The Minns government has warned of the escalation of psychological injury claims, which, without reform, it fears have the potential to overload the workers compensation system.
It is not viable for employers to investigate and enforce that workers on compensation are not working elsewhere, but some have asked why the Tax Office (ATO) was unable to detect and flag a person on Centrelink payments for incapacity also paying income tax.
In March NSW Treasurer Daniel Mookhey pledged to overhaul the system, closing loopholes that facilitated some psychological injury claims, citing skyrocketing assertions of burnout, workplace bullying and stress.
Mookhey says the prevalence is costing the economy billions of dollars annually and becoming ‘unsustainable’, and that without productive change the process is in danger of collapse.
The Cambridge Tavern confirmed Kopko no longer works at the hotel, having been dismissed for performance around the same time as the fraudulent discovery.
