KEY POINTS:
ACC is demanding meat company Affco pay a $1 million debt over an employee who was shot while on a work break or says it will take legal action.
ACC and Affco became involved in a long-running battle after Joel Storey, 23, was left paralysed from the waist down from what appeared to be a gang shooting in the carpark of Affco's Wairoa plant in April 2003.
State-owned workplace insurer ACC said the incident came under the umbrella of a workplace accident and billed the company for $1 million in compensation.
But Affco staunchly opposed the ruling, saying the shooting was beyond any employer responsibility and could not be classified as a workplace accident.
ACC had withdrawn from mediation with Affco because it had become clear a "mutually satisfactory outcome was unlikely", ACC levy and scheme management general manager Dr Keith McLea said.
The corporation had sent a letter to Affco demanding payment. If the money was not paid, legal action would follow, Dr McLea said.
"This issue is bigger than just Affco," he said.
"If Affco does not meet the costs of the claim...then all other employers will pay for this claim as it will be funded out of the employers account. That would not be a fair outcome."
Affco had entered an agreement with ACC in 2000 that explicitly stated it would be responsible for any injury occurring on its premises, whether or not it was at fault, he said.
"In return Affco paid reduced ACC levies.
"The agreement also allowed for certain high cost claims to be handed back to ACC, with Affco being liable to pay the first $1 million, much like an excess on a common insurance policy."
It was clear to ACC the injury was a work injury under the legislation and Affco was liable for costs up to the $1 million cap, Dr McLea said.
Similar cases have cost up to $10m across their lifetimes.
- NZPA
