Courts to decide two appeals by Comcare

Another landmark public sector compensation claim will be heard by the full bench of the Federal Court in Canberra on Tuesday, with the definition of ''permanent impairment'' on the line.

Federal workplace insurer Comcare will go to the High Court in Canberra on Wednesday in an attempt to overturn an award of compensation to a Canberra public servant who was injured during a sex session in a motel room while on a work trip.

The woman, whose name has been suppressed by the courts, was in the NSW town of Nowra for work in November 2007 when she met a local man and returned to her motel room with him for what was described as ''vigorous'' sex.

During their tryst, a light fitting was pulled from the wall above the bed, inflicting injuries to the woman's mouth and nose.

The High Court judges will be asked to decide if the woman was covered by her workplace insurer even if she was injured while having sex - a non-work-related activity.

On Tuesday the full bench of the Federal Court will hear an appeal by Comcare against a decision that branded its permanent impairment guidelines "a nonsense".

The case stems from a compensation claim by former Canberra firefighter Wayne Lilley, who was forced to stop working in 2005 and was diagnosed as having compartment syndrome, resulting in pain in both his legs.

Comcare rejected his claim for permanent disablement, saying Mr Lilley did not meet the 10 per cent "impairment criteria''.

After the insurer's decision was upheld in the Administrative Appeals Tribunal, the former fireman took his fight to the Federal Court, where Comcare's guidelines and its medical expert were savaged by Justice Steven Rares.

"The criterion is self-evidently not reflective of any measure of impairment and is a nonsense," the judge wrote in his decision.

Specialist workplace compensation lawyer Geoff Wilson, of Maurice Blackburn Lawyers, said both court cases would be keenly watched.

"It is rare in the Comcare workers compensation landscape for significant questions of law to be escalated before the courts," he said.

"The Comcare legislation is set to change and we are working to ensure that injured workers do not lose out."

The Comcare scheme, which is underwritten by taxpayers, is in serious financial strife.

Last year, it recorded a loss - for the first time - of half a billion dollars.

It also has outstanding claims estimated at more than $2.6 billion, of which a third is unfunded.

Comcare directly insures 218,000 Commonwealth and ACT government workers.

It also ''licenses'' or underpins the self-insurance schemes operated by 29 private sector companies and which cover another 164,000 employees.

The bill for injured public sector workers, including pay-outs, medical expenses and legal costs, grew to $322 million last year.