In brief: The New South Wales Supreme Court has confirmed in Ward v Endeavour Coal Pty Ltd that where a host employer assumes full practical control of a labour hire worker, vicarious liability for that worker’s negligence transfers to the host employer – not the labour hire company. Perhaps of even more significance, the decision also confirms that an employer’s non-delegable duty of care is strict: a breach arises automatically where a worker fails to take reasonable care, regardless of whether the employer was personally at fault. The case has significant practical implications for public liability insurers, host employers, and labour hire operators managing risk in Australian industrial settings.
The labour hire model is deeply embedded in Australian industrial settings. Businesses routinely supplement their workforce with contractors and labour hire employees. In recent years, there has been an increasing willingness of the courts to find that in cases involving injury negligently caused by a labour hire employee, there has been a transfer of employment to the host employer such that the host employer rather than the actual employer has been held vicariously liable for the employee’s negligence. Such cases also often involve an interplay between the doctrines of vicarious liability and non-delegable duty of care.
This was the case in the recent decision of Ward v Endeavour Coal Pty Ltd1 where the court considered whether the employment of a labour hire employee who caused injury to the plaintiff had been transferred on a pro hac vice (‘for this occasion’) basis to the mine operator, and whether the plaintiff’s employer (also the mine operator) could avoid vicarious liability in the absence of any wrongdoing on its part. This decision offers important practical guidance for insurers, host employers and labour hire operators alike.
The Background
On 20 May 2021, the plaintiff, Jason Ward, sustained a severe crush injury to his left arm while working underground at Appin Colliery (the Mine). At the time, he was travelling as a front-seat passenger in a Specialised Mining Vehicle (SMV) driven by Adam Carroll (the labour hire employee), a mechanical fitter supplied to the Mine by the third defendant, WorkPac Mining Pty Limited (WorkPac), a labour hire company. The second defendant, Illawarra Coal Holdings Pty Limited (Illawarra Coal), was the plaintiff’s employer and the occupier and operator of the Mine.
As Carroll (the labour hire employee) drove the SMV along the main underground thoroughfare and turned left into a narrow passage known as “20 cut-through”, the vehicle passed close to a piece of fixed equipment called a “salter” that had been stored in the cut-through. At least part of the plaintiff’s left elbow was protruding outside the cabin of the SMV at the moment of transit and struck the outer flange of the salter. The injury was catastrophic: the plaintiff suffered extensive bone and soft tissue loss around the elbow, transection of the ulnar nerve, fusion of the elbow, loss of wrist movement, and developed chronic regional pain syndrome, rendering him unfit for his former work as a mechanical tradesperson.
Liability Issues
Among other issues to be determined, the main liability issues at trial were:2
- Whether the plaintiff’s injury was caused by a failure to take care on the part of Carroll (the labour hire employee).
- If so, and having regard to the non-delegable duty of care of employers and an employer’s vicarious liability of its employees, which defendant was responsible for the conduct of Carroll.
- Were either of the defendants otherwise negligent, irrespective of any casual negligence on the part of Carroll?
Did Carroll Fail to Take Reasonable Care?
With respect to the first issue, the Court concluded that Carroll had misjudged the situation and was driving too close to the edge of the salter, and that there were a number of steps Carroll could have taken to avoid the incident, including stopping to inspect the area to ensure there was sufficient space, or approaching the salter more slowly.3
Accordingly, the Court found that the injury to the plaintiff was caused by the failure of Carroll to take reasonable care.
What Is a Non-Delegable Duty and When Does It Apply?
Cavanagh J then discussed the principle of non-delegable duty at length, and considered a number of decisions, including the High Court’s recent decision in AA v The Trustees of the Roman Catholic Church for the Diocese of Maitland-Newcastle, which concerned institutional sexual abuse. In that decision, it was accepted that a non-delegable duty of care may be breached by the intentional conduct of a delegate to the duty holder, even if the conduct in question is criminal in nature.4
For present purposes though, Cavanagh J considered that the relevant question was whether a party which owes a non-delegable duty of care may be liable to the person to whom the duty is owed absent any fault at all on its own part.5
In AA, Gordon J stated:6
Where a duty-holder is liable for the breach of a non-delegable duty by reason of the conduct of a delegate, there is no requirement that the duty-holder themselves acted negligently. In that sense, the duty-holder’s liability is strict. (author’s emphasis)
Gageler CJ, Jagot and Beech-Jones JJ, in their joint judgement, similarly stated:
Although a non-delegable duty may result in liability being imposed on the duty-holder without personal fault on the part of the duty-holder, the non-delegable duty-holder cannot be liable for breach of a non-delegable duty unless either the duty-holder personally or the delegate has defaulted in the taking of reasonable care in respect of the person to whom the duty is owed. (author’s emphasis)
In adopting the reasoning of the plurality in AA, Cavanagh J observed that a non-delegable duty is not strict liability (requiring no negligence at all) but it is more stringent than an ordinary duty of care. His Honour held that a duty holder subject to a non-delegable obligation must ensure that its delegate exercises reasonable care. It cannot discharge that duty merely by taking reasonable care to ensure that its delegate exercises reasonable care.7
Accordingly, because Carroll failed to exercise reasonable care, the plaintiff’s employer, Illawarra Coal, necessarily failed to ensure he did so, and was therefore in breach of its non-delegable duty.
When Does Vicarious Liability Transfer to a Host Employer?
- the worker’s contract of employment;
- the inter-company services contract; and
- the evidence of how the work was actually performed and controlled.
His Honour found that each factor pointed decisively towards a transfer of control to Illawarra Coal.
Carroll’s contract of employment with WorkPac expressly stated that Illawarra Coal would be responsible for day-to-day supervision, work allocation, safety procedures and site-specific instructions. The services contract between WorkPac and Illawarra Coal divided responsibilities in identical terms: WorkPac’s role was administrative (supplying bodies, managing payroll, administering leave), while Illawarra Coal was required to provide site-specific inductions, safety training, equipment, first aid, and day-to-day performance direction. And at the operational level, WorkPac did not train Carroll on how to drive an SMV underground, did not instruct him on the rules governing cut-through navigation, did not direct which tasks he was assigned to on any given shift, and had no right to tell him how to drive. All of that came from Illawarra Coal. Carroll also gave evidence that WorkPac provided no training or supervision for daily tasks, and that this came entirely from the host.
The consequence of all this was Illawarra Coal had become Carroll’s employer pro hac vice, and that it was vicariously liable for Carroll’s negligent driving, not WorkPac. As a result, the claim against WorkPac was dismissed.
Key Takeaways for Insurers and Corporate Insureds
There are a number of relationships giving rise to non-delegable duties that have been acknowledged by the common law of Australia, including: employer and employee; school authority and pupil; hospital and patient; and adjoining owners of land.11
AA concerned the relationship of school authority and pupil. Ward extended AA to the relationship of employer and employee, and, in doing so, arguably reinstated the principle established by the High Court in Kondis v State Transport Authority12, which Ward also considered.
The decision in Ward (along with the decision in AA) is therefore significant as it supports the proposition that an employer’s non-delegable duty is strict in so far as it does not require any fault on the part of the duty holder. Prior to AA and Ward, there had been several decisions, including at the appellate court level13, in which a non-delegable duty was found not to have been breached in the absence of a failure to take reasonable care on the part of the duty holder. These decisions appear to have ‘drifted’ from the principle established in Kondis.
While imposing this strict form of liability on the employer might seem unfair, as explained by Deane J in Kondis, the employer can seek protection under the terms of the contract with the delegate:
The employer “may bargain with the contractor that he shall perform the duty, and stipulate for an indemnity from him if it is not performed but he cannot thereby relieve himself from liability to those injured by the failure to perform it”14
Ward does not, however, provide any guidance on apportionment of liability in circumstances where the party in control of the system of work is a different party to the plaintiff’s employer; in Ward those parties were one in the same, so the issue of apportionment did not arise. A complication arises in that, typically when assessing the apportionment of liability between joint tortfeasors, one of the considerations is the respective degrees of departure from the standard or care expected of the tortfeasors. However, in circumstances where the breach of a strict liability does not involve a breach of a duty of care, the question is whether the delegate’s degree of departure from the standard of care expected is imposed on the employer when assessing its share of the liability. The problem arises when the delegate is the other tortfeasor.
Ward is also a timely reminder that the question of who bears legal responsibility for the negligent actions of an employee in a labour hire context depends not on commercial convenience, but on the granular factual inquiry of who actually controlled the manner in which the relevant work was done.
For the labour hire company whose worker caused the injury, the pro hac vice doctrine offers a genuine avenue to avoid vicarious liability, but only in circumstances where the host has assumed full practical control of the work performed by the employee. For the host employer, Ward confirms that no amount of contractual engineering will insulate it from the transfer of vicarious liability where it controls both the worksite and the workforce. It does, however, provide some insulation in circumstances where a labour hire company might seek to deny liability on the basis it has not breached its duty of care. Whether this results in a different outcome though is another matter.
In so far as vicarious liability is concerned, public liability insurers and corporate insureds on both sides of these arrangements would be well advised to treat this decision as a framework for risk assessment and early investigation strategy in any claim where injury is caused by a labour hire worker. The same also applies where an employer’s non-delegable duty is involved, as this continues to be the subject of some confusion.
FAQs
Find quick answers to common questions about this topic.
What is the pro hac vice doctrine in Australian employment law?
The pro hac vice doctrine – Latin for “for this occasion” – is a principle under which a labour hire worker’s employment may be treated as having temporarily transferred to the host employer for the purpose of determining legal liability. Where a host employer assumes complete or substantially complete control over the worker, courts may find that the host, rather than the labour hire company, is vicariously liable for the worker’s negligence.
Can a host employer be held vicariously liable for the negligence of a labour hire worker?
Yes. Where a court finds that control of a labour hire worker has transferred to the host employer – assessed by reference to the worker’s employment contract, the services agreement between the companies, and the practical reality of how the work was directed – vicarious liability will attach to the host employer. Ward v Endeavour Coal Pty Ltd confirms this principle and dismissed the claim against the labour hire company, WorkPac, on this basis.
What is the difference between non-delegable duty and vicarious liability?
In an employment context, vicarious liability arises where an employer is held responsible for the tortious acts of its employee. A non-delegable duty in an employment context is a duty owed by an employer to an employee which is a more stringent obligation than an ordinary duty of care: the duty holder must ensure that its delegate exercises reasonable care, and cannot discharge this duty merely by taking reasonable care in the selection or supervision of the delegate. In Ward, Illawarra Coal was found liable on both grounds – as the pro hac vice employer (vicarious liability) and as the plaintiff’s employer subject to a non-delegable duty.
How does a court determine whether control has transferred to a host employer?
What does Ward v Endeavour Coal mean for public liability insurers?
The decision provides a practical framework for risk assessment and early investigation strategy in labour hire injury claims. Insurers should focus early investigations on who actually controlled the relevant work – including training, task allocation, safety procedures, and site supervision – rather than relying solely on contractual labels. The decision also confirms that the strict nature of an employer’s non-delegable duty can be applied to the public liability insurer’s (and corporate insured’s) advantage when pursuing contribution against employers and their statutory insurers.
1 [2026] NSWSC 557
2 Ibid at [8].
3 Ibid at [82].
4 Ward v Endeavour Coal Pty Ltd [2026] NSWSC 557 at [108]. In this regard, AA departed from the earlier High Court decision in State of New South Wales v Lepore [2003] HCA 4; (2003) 212 CLR 511, in which the High Court held that the non-delegable duty owed by school authorities to pupils did not extend to make the authority liable for deliberate criminal conduct engaged in by a teacher against a pupil.
5 Ibid at [108]
6 AA v The Trustees of the Roman Catholic Church for the Diocese of Maitland-Newcastle [2026] HCA 2 at [274]. Gordon J agreed with the orders proposed by Gageler CJ, Jagot and Beech-Jones JJ, who were part of the majority in a 5-2 split decision.
7 Ward v Endeavour Coal Pty Ltd [2026] NSWSC 557 at [126]
8 Latin phrase meaning ‘for this occasion’.
9 [2016] WASCA 90.
10 [2007] NSWCA 231.
11 In relation to work threatening support or common walls.
12 (1984) 154 CLR 672; [1984] HCA 61.
13 For example, Jurox Pty Ltd v Fullick [2016] NSWCA 180 and Synergy Scaffolding Services v Alelaimat [2023] NSWCA 213, to name but a few.
14 Kondis v State Transport Authority (1984) 154 CLR 672; [1984] HCA 61 at [2] per Dean J.
15 Mt Owen Pty Ltd v Parkes [2023] NSWCA 77.
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The material contained in this publication is in the nature of general comment only, and neither purports nor is intended to be advice on any particular matter. No reader should act on the basis of any matter contained in this publication without considering, and if necessary, taking appropriate professional advice upon their own particular circumstances.
