To enable access to legal representation in matters before the South Australian Employment Tribunal, the Return to Work Act 2014 (SA) (the Act) allows parties such as workers and registered employers to seek their reasonable representation costs from the relevant compensating authority (ie, either Return to Work SA or a self-insured employer).
However, that entitlement is not absolute. As set out in section 106(3) of the Act, if a party has acted unreasonably in bringing proceedings, or “has acted frivolously or vexatiously in bringing or in relation to the conduct of proceedings”, the Tribunal can decline to make an order for costs in that party’s favour or reduce the amount of costs to which they would have been entitled otherwise.
In the recent decision of Al-Shareeda v Return to Work Corporation of South Australia and Mitcon Formwork Pty Ltd (No 2) [2025] SAET 7, Her Honour Deputy President Judge Kelly, declined to make an order for costs in favour of the worker.
Her Honour referred to her earlier decision which confirmed the rejection of the worker’s claim, on the basis she was not satisfied that the worker sustained an injury at work.
In those proceedings, Her Honour found that:
… at various times the Applicant has lied, deliberately omitted parts of his medical history to suit current circumstances, embellished or changed his version of events and presented such implausible explanations of discrepancies that his evidence lacks credit. He has no direct corroboration of events he says happened at work such that I find his evidence as to a fall at work to be fabricated.
Her Honour went on to say that the worker had “deliberately attempted to deceive the Tribunal” which caused her to come to the conclusion that it was “hard to see how this behaviour could be anything other than unreasonable within the meaning of s 106(3)” because “the Applicant knew about the lack of evidence from the outset and could be in no doubt as to his difficulties in proving his case once the trial commenced”.
She noted such circumstances can be distinguished from a worker who “genuinely held a belief as to a state of fact which, if correct, would support the claim in the proceedings”, and pursuing a hopeless case can be distinguished from pursuing a case which has some flaws but is not completely without merit. The worker in this case, given he was making assertions he knew to be untrue, could not be said to have a “genuinely held belief” in those assertions.
For these reasons, Her Honour declined to make an order requiring the Compensating Authority to pay the worker’s costs.
Her Honour stopped short of ordering that the worker pay the entirety of the Compensating Authority’s costs, though, given his difficult financial circumstances, and because he claimed that he had not been put on notice at any stage by the Compensating Authority about the potential of an adverse costs order.
However, in an attempt to deter other workers from engaging in such “fraudulent conduct” in the future, Her Honour ordered that the worker pay 50% of the Compensating Authority’s costs.
Whilst there are clearly cases where a worker has a flawed but meritorious argument, this case serves as a timely reminder that the Tribunal is willing to make adverse costs orders against workers where there are findings of fraudulent conduct.
