Guideline – Where do I insure my worker if they work overseas?
If you employ a worker who works for you both overseas and in Queensland, you may need to have workers' compensation insurance for that worker.
There are two scenarios to consider when determining if you need cover:
- You need to cover a worker who works overseas, if their principal place of employment is Queensland; and
- You do not need to cover a worker who works in Queensland, if Queensland is not their principal place of employment.
The principal place of employment is determined under Section 115 of the Workers’ Compensation and Rehabilitation Act 2003 and is determined differently to cross-border arrangements.
The purpose of this guideline is to outline the test to assist you to decide the principal place of employment for your worker.
What is the test and how does it operate?
The test is made up of two steps which need to be considered in order. It is important that you always start with step 1. After that, it is only necessary to consider the next step if the previous step does not decide your worker's principal place of employment.
Where does your worker usually work?
Where is your principal place of business located?
Step 1 – Where does your worker usually work?
your worker usually works within a single country
that country is your worker's principal place of employment because the worker usually works in that country
step 1 does not decide the principal place of employment
you need to consider step 2
You should consider the following factors and examples in deciding where your worker usually works:
- The terms of any contract of employment between you and the worker.
- Where your worker actually performs work rather than where the work is required to be performed.
- Your worker's history of employment with you over the previous 12 months (if applicable) and the proposed future working arrangements between you and your worker.
- The location or locations in which your worker works in a habitual or regular manner. Your worker's principal place of employment is not simply the country where your worker spends the majority or greatest proportion of their working time for you.
You are not required to take into account any temporary working arrangement of six months or less that may arise under the contract between you and your worker.
Example 1: Worker usually works in a single country
Kirsty works in Queensland, however travels to Singapore for 5 weeks as part of a work conference. She will return to Queensland after the conference is complete.
In this case, Kirsty spends the majority of her working arrangement in Queensland and under step 1 her principal place of employment is Queensland, Australia.
Example 2: Worker usually works in a single country
Melissa is contracted to work overseas for 1 year. She has worked with her employer in Queensland for a number of years. At the end of the contract, she will return to her employment in Queensland.
In this case, the contract is longer than 6 months however:
- Melissa has a significant work history with the employer in Queensland; and
- The intention is for Melissa to return to work in Queensland; and
- The contract is for a relatively short and defined period.
Under step 1, Melissa’s principal place of employment is Queensland, Australia.
Example 3: Worker usually works in a single country
Hiroshi works as a salesperson for Large Electronic Company Ltd which is based in Osaka, Japan. The company sets up an account with a Queensland company and Hiroshi is required to travel to Queensland for 3 days to meet the customer. When Hiroshi is travelling from his hotel to the customer’s premises he is injured in a car accident.
In this case, Hiroshi normally works in Japan and was only in Queensland for 3 days and under step 1, his principal place of employment is Japan. He would not be entitled to compensation in Queensland.
Example 4: Worker usually works in more than one country
Adam is a miner from Queensland who is contracted to Mines ‘R’ Us Limited. Mines ‘R’ Us Limited owns mines in 7 different countries (including Australia) and Adam is sent to all of them throughout the year. There is no one country that Adam works in more than the others as the work fluctuates depending on the level of demand.
In this case, we are unable to determine Adam’s principal place of employment under step 1 and step 2 must be considered.
Example 5: Worker usually works in more than one country
Wolfgang lives in Germany and is paid by Labour Hire Pty Ltd, who have their head office in Brisbane, to work on shipping vessels in Norway, America and Spain. Wolfgang is flown from Germany to one of the respective countries and boards the vessel from that country. He works for approximately the same amount of time in each country.
In this case, as Wolfgang works the same amount of time in each country, we are unable to determine his principal place of employment under step 1 and step 2 must be considered.
Step 2 – Where is your principal place of business located?
You only need to consider this step if step 1 does not identify a single country in which your worker usually works.
step 1 does not decide the principal place of employment for your worker
that country in which your principal place of business is located is your worker's principal place of employment
You should consider the following factors and example in deciding your principal place of business:
- Your principal place of business is the most important or main place where you conduct the main part or majority of your business.
- The address registered on the Australian Business Register in connection with your Australian Business Number (ABN).
- If you are not registered for an ABN, the State registered on the Australian Securities and Investments Commission's National Names Index, as being the jurisdiction in which your business or trade is carried out.
- If you are not registered for an ABN or on the National Names Index, your business mailing address.
Following on from Example 4, Mines ‘R’ Us Limited is based in Texas, USA.
In this case, the employer’s principal place of business is the USA. Therefore Adam’s principal place of employment is not Queensland.
Following on from Example 5, Labour Hire Pty Ltd has their head office in Brisbane and the registered address with ASIC and on their ABN is in Queensland.
In this case, the employer's principal place of business is Queensland.
- Last updated
- 14 June 2019