Can I claim an economic loss if I get paid cash in hand

Jonathan Coyle
Tony Chow

Many people in Australia perform work for “Cash-in-Hand” (CIH) or part cash in hand. There are many reasons for this, but it is usually at the request of the employer where the primary benefit is to avoid tax and avoid superannuation obligations. But when a person is involved in an accident it becomes difficult to prove employment and economic loss as the primary documents relied upon by insurers are usually payslips, bank statements and tax records.

The majority of people who work CIH have language and cultural barriers to work, and some have visa issues. As with all matters, each person’s personal circumstances need to be considered on their own merits. However, by way of example, a recent motor vehicle accident claim prosecuted by Longton Legal exemplifies the need for tough and tenacious lawyers who will not give up.

In the matter of YSH, he was seriously injured in a motor vehicle accident on 30 September 2021. The injuries prevented YSH from looking for work. YSH is a Chinese National in Australia on a bridging visa. He had lived in Australia for 5 years.

Due to his limited mastery of English, he was only able to find work in the hospitality industry. He worked for a Chinese restaurant chain. When he initially started working for the restaurant he was not declared as an employee but was paid with money transfers for about 4 months. Thereafter he was paid CIH. He continued to work until about March 2021 because of reductions in staff numbers due to a downturn of business caused by COVID-19 lockdowns.

YSH had been unemployed for about 6 months prior to his motor vehicle accident. The insurer initially determined that he was not a worker. YSH sought assistance from 3 law firms, each of which gave the following advice:

  1.  You were not employed at the time of the motor vehicle accident
  2. You had not been employed for the six months prior to the accident
  3. There is no evidence of employment in the 2 years before the accident
  4. Based on the lack of evidence the insurer’s decision to decline you weekly benefits is correct

It was not until YSH came to Longton Legal that he received advice that he can still be declared an earner. Although YSH did not have primary records supporting his claim for weekly benefits, he did have 10 weeks of SMS messages instructing him to attend different restaurants for work. A statutory declaration was drawn for YSH and a co-worker. Despite lengthy submissions, the insurer’s internal review panel maintained their decision that YSH was not an earner and therefore not entitled to weekly benefits.

Longton Legal immediately prepared and submitted a dispute to be resolved by the Personal Injury Commission. Following lengthy submissions from both parties, the Personal injury Commission found in favour of YSH in determining that he was an earner and therefore entitled to weekly benefits. The amount of weekly benefits was referred back to the insurer to calculate. The Assessor also provided an order for legal costs.

This case is an example of how important it is to choose the right lawyer; a tenacious lawyer; Choose LONGTON LEGAL.

*Disclaimer: This is intended as general information only and not to be construed as legal advice. The above information is subject to changes over time. You should always seek professional advice before taking any course of action.*

Key Contact

Jonathan Coyle
Founding Partner
Tony Chow
Partner

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Another successful medical negligence claim for a couple
Another successful medical negligence claim for a couple