20Principal liable to pay compensation to workers employed by contractors in certain cases

20 Principal liable to pay compensation to workers employed by contractors in certain cases

20 Principal liable to pay compensation to workers employed by contractors in certain cases

(cf former s 6 (3))

(1) If any person (in this section referred to as the principal) in the course of or for the purposes of the person’s trade or business, contracts with any other person (in this section referred to as the contractor) for the execution by or under the contractor of the whole or any part of any work undertaken by the principal, the principal is, if the contractor does not have a policy of insurance or is not a self-insurer at the time a worker employed in the execution of the work receives an injury, liable to pay any compensation under this Act which the principal would have been liable to pay if that worker had been immediately employed by the principal.

(2) If compensation is claimed from or proceedings are taken against the principal in respect of any such injury, then, in the application of this Act, reference to the principal shall be substituted for reference to the employer, except that the amount of compensation shall be calculated with reference to the earnings of the worker under the employer by whom the worker is immediately employed.

(3) Notwithstanding subsection (1), where the contract relates to threshing, chaff-cutting, ploughing or other agricultural work, and the contractor provides and uses machinery driven by mechanical power for the purposes of that work, the contractor (and no other person) shall be liable under this Act to pay compensation to any worker employed by the contractor on that work.

(4) If the principal is liable to pay compensation under this section, the principal is entitled to be indemnified by any person who would have been liable to pay compensation to the worker independently of this section, and all questions as to the right to and amount of any such indemnity shall in default of agreement be determined by the Commission.

(5) Nothing in this section shall be construed as preventing a worker recovering compensation under this Act from the contractor instead of the principal.

(6) This section does not apply in any case where the injury occurred elsewhere than on, in or about premises on which the principal has undertaken to execute the work or which otherwise are under the principal’s control or management, but nothing in the foregoing affects the liability of the contractor under any other provision of this Act.