Duhaime's Law Dictionary

Workers' Compensation Definition:

A public benefit scheme in which qualified workers who are injured in the workplace, receive compensation, commensurate with their degree of injury, regardless of fault.

In the 2009 edition of the C.E.D., the authors wrote:

"At common law, employers were entitled to rely on the defences of contributory negligence ... and assumption of risk (a doctrine holding that a worker who accepts a job understands the inherent risks in the work) to shield themselves from liability for injuries to their employees. The inherent unfairness in this power imbalance led to workers' compensation legislation, which is intended to relieve injured workers of the delay, cost and difficulty of suing an employer. Although employers fund the system through payroll assessments or premiums, they are shielded from the risk of paying damages in tort actions....

"The underlying philosophy of the workers' compensation scheme lies between tort concepts, on the one hand, and social welfare concepts, on the other. Ontario's most recent workers' compensation legislation moves away from strictly compensating workers for their injuries towards more of an insurance scheme for employers and their employees against workplace injuries."

In Jenkins v PEI, Justice McQuaid of the Prince Edward Island Supreme Court wrote this at ¶15-17:

"The primary object of (Workmen's Compensation Acts), broadly speaking, is to provide a mechanism whereby workmen, who fall within the ambit of the Act, and who are injured in the workplace, receive compensation, presumably commensurate with their degree of injury, regardless of fault, and, with respect to any such workman who is killed in the workplace, that their dependants receive such compensation as the Act provides. This latter also applies regardless of where fault may lie.

"The Legislature has also provided that, in return for such benefits as are guaranteed to the workman, or his dependant, any right of action which might otherwise arise out of the incident which occasioned injury or death is forfeited.

"This is not a government or funded scheme, but rather it is funded by industrial levy. It is not available to all who find employment in the workplace, but only to those who are employed in industry subject to levy."

In Dixon v Dixon, Manitoba County Court judge Ferg wrote this at ¶7:

"Workers' compensation is paid to partially replace lost wages due to injury on the job. It is not, as argued, insurance, nor is it damages, nor is it a settlement."

In Allainz Australia Workers Compensation, the Supreme Court of the Australian Capital Territory held, at ¶27:

"The phrase workers compensation has long been understood as referring to an entitlement to periodic payments to compensate an injured worker for medical expenses and/or loss of wages due to injury sustained during the course of the worker’s employment, irrespective of whether there has been any breach of duty by the employer. The concept is quite different from that of liability for common law damages obtained by a worker as a consequence of establishing that his injuries were attributable to negligence or breach of statutory duty on the part of the employer."


  • Allianz Australia Workers Compensation (NSW) Limited v PPG Industries Australia Pty Limited, 2004 ACTCA 28
  • Dixon v Dixon, 25 R.F.L. (2d) 266 (1981)
  • Jenkins v. Prince Edward Island, 31 D.L.R. (4th) 536 (1986)

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