Action James NSW Pty Ltd v Al Khulaif

[2025] NSWPICMP 478

DETERMINATION OF APPEAL PANEL
CITATION:	Action James NSW Pty Ltd v Al Khulaif [2025] NSWPICMP 478
APPELLANT:	Action James NSW Pty Limited
RESPONDENT:	Fahad Al Khulaif
APPEAL PANEL
MEMBER:	John Wynyard
MEDICAL ASSESSOR:	Dr Douglas Andrews
MEDICAL ASSESSOR:	Dr Michael Hong
DATE OF DECISION:	2 July 2025
CATCHWORDS:	WORKERS COMPENSATION - Workplace Injury Management and Workers Compensation Act 1998; appeal of Medical Assessment Certificate (MAC); appeal by employer against 22% whole person impairment (WPI) assessment for psychological injury; whether Medical Assessor (MA) failed to distinguish between primary and secondary psychiatric injury; whether error made in assessing psychiatric impairment rating scale (PIRS) for all categories; MA failed to adopt the two-step approach mandated in Mercy Connect Limited v Kiely; re-examination requested; Appeal Panel found primary and secondary injuries so intermingled that separation not possible except for employability category where adjustment disorder arising from increased pain accounted for increase in employability; class 3 for travel category unexplained where worker travelled alone overseas for 40 days; ; Held – MAC revoked; Appeal Panel assessed 17% WPI.

BACKGROUND TO THE APPLICATION TO APPEAL

1. On 6 November 2024 Action James NSW Pty Limited, the appellant employer lodged an Application to Appeal Against the Decision of a Medical Assessor. The medical dispute was assessed by Dr Clayton Smith, a Medical Assessor, who issued a Medical Assessment Certificate (MAC) on 15 October 2024.

2. The appellant relies on the following grounds of appeal under s 327(3) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act):

   ·        the assessment was made on the basis of incorrect criteria, and

   ·        the MAC contains a demonstrable error.

3. The delegate is satisfied that, on the face of the application, at least one ground of appeal has been made out. The Appeal Panel has conducted a review of the original medical assessment but limited to the ground(s) of appeal on which the appeal is made.

4. Rule 128 of the Personal Injury Commission Rules 2021 (the PIC Rules) and Procedural Direction PIC7 - Appeals, reviews, reconsiderations and correction of obvious errors in medical disputes set out the practice and procedure in relation to the medical appeal process under s 328 of the 1998 Act. An Appeal Panel determines its own procedures in accordance with r 128(1) of the PIC Rules.

5. The assessment of permanent impairment is conducted in accordance with the SIRA NSW Workers Compensation Guidelines for the Evaluation of Permanent Impairment, 4^th ed
   1 March 2021 (the Guides) and the American Medical Association Guides to the Evaluation of Permanent Impairment, 5^th ed (AMA 5). “WPI” is reference to whole person impairment.

RELEVANT FACTUAL BACKGROUND

1. On 16 September 2024 an amended referral was made to the Medical Assessor seeking an assessment of WPI caused by a primary psychological injury that occurred on 6 April 2022.

2. Mr Al Khulaif (the respondent) was employed as a warehouse worker when on the date of injury 6 April 2022, he was standing on a lifter and the operator lifted him to a height of about 12 meters in order to obtain a box. As he pulled the box out it fell forward on his chest, (weighing approximately 60kg), causing him to fall back on the lifter and strike his head. The operator of the lifter saw the box fall and brought the lift down to ground level.

3. Mr Al Khulaif was transported by ambulance to Westmeath Hospital and he suffered injuries to his head, neck, lower back, left shoulder and right knee.

4. The injury led to chronic back pain and restricted mobility.

5. The Medical Assessor recorded[1]

   “When the box fell on him. he thought he would be crushed or pushed off the lifter onto the warehouse's concrete floor. He lost interest in things he used to enjoy and socially withdrew…..”

   [1] Appeal papers page 24.

PRELIMINARY REVIEW

1. The Appeal Panel conducted a preliminary review of the original medical assessment in the absence of the parties and in accordance with the Procedural Direction PIC7.

2. As a result of that preliminary review, the Appeal Panel determined that the worker should undergo a further medical examination because the issue of the separation of a primary psychological disorder from a primary psychological disorder required expert appraisal in person.

EVIDENCE

Documentary evidence

1. The Appeal Panel has before it all the documents that were sent to the Medical Assessor for the original medical assessment and has taken them into account in making this determination.

Further medical examination

1. Michael Hong of the Appeal Panel conducted an examination of the worker in May 2025 over three sessions and reported to the Appeal Panel.

Medical Assessment Certificate

1. The parts of the medical certificate given by the Medical Assessor that are relevant to the appeal are set out, where relevant, in the body of this decision.

SUBMISSIONS

1. Both parties made written submissions which have been considered by the Appeal Panel.

FINDINGS AND REASONS

1. The procedures on appeal are contained in s 328 of the 1998 Act. The appeal is to be by way of review of the original medical assessment but the review is limited to the grounds of appeal on which the appeal is made.

2. In Campbelltown City Council v Vegan [2006] NSWCA 284 the Court of Appeal held that the Appeal Panel is obliged to give reasons. Where there are disputes of fact it may be necessary to refer to evidence or other material on which findings are based, but the extent to which this is necessary will vary from case to case. Where more than one conclusion is open, it will be necessary to explain why one conclusion is preferred. On the other hand, the reasons need not be extensive or provide a detailed explanation of the criteria applied by the medical professionals in reaching a professional judgement.

THE MAC

1. The Medical Assessor acknowledged receipt of the Certificate of Determination issued by Member Peacock on listing the documents that were before him. In taking the history, the Medical Assessor noted:[2]

   “Daily tasks involving bending and lifting or prolonged standing or sitting had become painful and difficult. This reduced his productivity and ability to perform previously routine tasks. Persistent pain in his left shoulder limited his range of motion and strength with actions requiring overhead reaching, lifting or carrying objects. The injury to his right knee causes pain and instability…… [Mr Al Khulaif] was diagnosed with post-traumatic stress disorder. He attended a psychiatrist and was prescribed fluoxetine, which he has since ceased. His inability to conduct himself and manage his life and affairs as he did before the accident made him depressed and concerned for his future.”

   [2] Appeal papers page 24.

2. In discussing Mr Al Khulaif’s general health, the Medical Assessor noted:

   “Mr AL KHULAIF has ongoing pain in his back, neck and left shoulder, affecting his sleep and capacity to sit or travel. He has difficulty mobilising and reports that the main pain is in his back. This has been diagnosed as a chronic pain disorder. According to expert opinion, his physical injuries were anticipated to have resolved within six months after the injury….”

3. With regard to Mr Al Khulaif’s activities of daily living, the Medical Assessor said:

   “He has two brothers who occasionally visit the house, either alone or with their families and children, about once every one to two months. They usually come over for a meal, preparing a barbecue and staying for an hour or two. Sometimes, he might leave them sitting in the garden and go to the garage. He may sit and chat with them. He will visit his friends, or they may visit him. His son takes him to visit. He might catch up with friends every two months.”

4. In his summary, the Medical Assessor said at [7] of the MAC:

   “Mr Al Khulaif is a 37-year-old man who presents with chronic pain and psychological distress following a workplace injury. There are dissenting independent opinions, that of Dr Cipriani, who is of the opinion that Mr Al Khulaif’s symptoms were exaggerated, not credible and related to compensation-seeking and the opinion by Dr Cassimatis, who noted that his symptoms of post-traumatic stress disorder had resolved and were solely due to an adjustment disorder related to chronic pain. This was inconsistent with the medical evidence consistently recorded by his treating practitioners over the time since the injury that was consistent with symptoms of post-traumatic stress disorder, major depressive disorder, and chronic pain disorder. It was also inconsistent with the reported symptoms in my assessment and his mental state examination.

   He meets the DSM-5 criteria for post-traumatic stress disorder…..

   …..

   He presents with symptoms consistent with an adjustment disorder with a depressed mood secondary to his chronic pain, describing a depressed mood and loss of pleasure in previously enjoyed activities for most of the day for more days than not with insomnia, apathy, fatigue, changes in appetite, impaired concentration and depressive thoughts. This is a secondary psychological injury.

   ….

   In assessing whole person impairment, I have only considered the effects of the primary psychological injury, post traumatic stress disorder.”

5. At [10c] of the MAC, the Medical Assessor survey the evidence before him. He noted the reports of Dr Assad Saboor, relevantly that of 28 April 2023, about which he said:

   “…. I note that Dr Saboor provided a 20% deduction for a secondary psychological condition and that Dr Cassimatis noted [Mr Al Khulaif] had not reached maximum medical improvement and his symptoms no longer met the threshold for post-traumatic stress disorder.”

6. The Medical Assessor discussed the report of Dr Cassimatis and the psychologist Mr Cipriani, giving thorough and considered reasons as to why he disagreed with. He noted that Dr Cassimatis had found that there were not enough symptoms to enable a post-traumatic stress disorder to be diagnosed and that Mr Al Khulaif suffered a secondary psychological injury in the form of an adjustment disorder caused by the chronic impairments due to pain and disability. The Medical Assessor stated that the medical evidence from
   Mr Al Khulaif’s treating clinicians in contrast indicated that symptoms of post-traumatic stress disorder were ongoing.

7. Mr Cipriani had diagnosed an adjustment disorder and found there had been no post-traumatic stress disorder, that Mr Al Khulaif’s reported neck, left shoulder and lower back complaints were mostly related to litigation and compensation-seeking, and that he was fabricating cognitive deficits in a status exam. The Medical Assessor said:

   “… Dr [sic – Mr] Cipriani’s psychometric testing was inconsistent with the history of Mr Al Khulaif’s treating clinicians and may have been confounded by cultural, communication and language difficulties and a lack of effort from Mr Al Khulaif (a common finding in depressed patients).”

8. The Medical Assessor’s Table 11.8: PIRS Rating Form was as follows:

Psychiatric diagnoses	1. Post-traumatic stress disorder	2. Adjustment disorder with depressed mood
Psychiatric treatment	Antidepressants and psychotherapy
Is impairment permanent?	Yes

PIRS Category	Class	Reason for Decision
Self-Care and personal hygiene	2 Mild Impairment	Mr Al Khulaif partly neglects his self-care and personal hygiene due to a lack of motivation. He rarely showers. Family members support him, and he does not contribute to the housework or cooking, but this is partly caused by cultural factors and the impact of his physical injuries. He could maintain a minimum level of hygiene and nutrition independently when considering the effects of the primary psychological injury.
Social and recreational activities	3 Moderate Impairment	Mr Al Khulaif his immediate family. He attends social venues rarely. He is apprehensive and hypervigilant outside the home. He is quiet, withdrawn, and difficult to engage with, even when socialising at home. He can leave his place of residence if accompanied by a support person. He rarely leaves the house alone.
Travel	3 Moderate Impairment	Due to excessive anxiety, Mr Al Khulaif cannot travel from his residence without a support person. He travelled to Iraq some time ago, and he required considerable assistance to Mr Al Khulaife the trip.
Social functioning	2 Mild Impairment	Mr Al Khulaif has enduring relationships with his immediate family strained by his depressive state and changes in his demeanour. He has lost friends.
Concentration, persistence and pace	3 Moderate Impairment	Mr Al Khulaif cannot concentrate for more than 15 minutes without losing concentration or fatiguing. He avoids intellectually demanding activities.
Employability	5	Mr Al Khulaif is incapacitated and unable to work at all.

SUBMISSIONS

1. The appellant employer submitted firstly that the Medical Assessor had fallen into error by failing to consider whether any portion of the assessed impairment was a result of secondary psychological injury, and by failing to give adequate reasons “as to why this is not possible to determine.”

2. We were referred to the opinion of Dr Saboor, the expert retained by Mr Al Khulaif, who had made an adjustment of 5% WPI to account for impairment from secondary psychological injury. Dr Cassimatis, the respondent’s expert, had found that Mr Al Khulaif suffered a primary psychological injury, but that it had resolved so that Mr Al Khulaif was now suffering only a secondary psychological injury. There was further evidence from Mr Cipriani, psychologist, who thought, after finding Mr Al Khulaif impossible to diagnose, that he had one stage suffered an adjustment disorder which was secondary to his physical injury.

3. The appellate employer referred to a number of findings by the Medical Assessor, acknowledging that the Medical Assessor had diagnosed a secondary psychological condition, and commented throughout his MAC on the impact this condition had on
   Mr Al Khulaif’s daily functioning, with respect to all the PIRS categories. However, the Medical Assessor had not provided an assessment of the secondary psychological condition, nor had he explained why he found it not possible to do so.

4. Mercy Connect Ltd v Kiely[3] was cited for authority that an assessment involving s 65A(2) of the Workers Compensation Act 1987 (1987 Act) was subject to a two-step procedure. We were also referred to ETM Projects Pty Ltd v Gregorgiou[4] in support of a submission that the Medical Assessor had not given reasons why the entanglement of the primary and secondary psychological condition had meant that the two-step approach could not be adopted, if that had been his intent, we assume the submission to read.

   [3] [2018] NSWSC 1421.

   [4] [2024] NSWPICMP 45.

5. The second ground concerned every category of the Psychiatric Impairment Rating Scale (PIRS). The appellant employer submitted firstly that the Medical Assessor had made demonstrable errors and/or applied incorrect criteria. Secondly, the appellant employer referred to Vegan as authority for the proposition that if a Medical Assessor failed to correctly apply the criteria in the Guides, he would have applied incorrect criteria.

6. The PIRS Rating Form is set out above, and in view of Mr Al Khulaif’s re-examination, a fresh PIRS was constructed. We apprehend that the challenge to the class ratings for each category were primarily related to the appellant employer’s first ground – that many of the behavioural consequences listed by the Medical Assessor were as a result of his secondary psychological condition, and could be separated out of the consequences of the primary post-traumatic disorder.

7. The submission as to the category of travel additionally referred to Mr Al Khulaif’s ability to travel overseas by himself when he went to Iraq for 40 days due to a family illness. The classification for each other category was challenged on the basis that the Medical Assessor “ought to have given” lower classifications on the appellant employer’s interpretation of the evidence.

Respondent worker

1. Mr Al Khulaif submitted that the Medical Assessor had adequately addressed the question of the secondary psychological condition. He included his diagnosis of an adjustment disorder in the Table 11.8 Rating Form.

2. The Medical Assessor had specifically considered the effect of the secondary psychological condition in discussing the category of self-care and personal hygiene, Mr Al Khulaif said.

3. Mr Al Khulaif submitted that the decision in Kiely should be distinguished because the terms of the referral in that case invited the Medical Assessor to exclude any impairment caused by any secondary psychological condition, in contrast to the above notation.

4. Gregorgiou was also distinguishable, as the Medical Assessor in that case failed to distinguish between a primary and secondary psychological condition, it was submitted. In the present case the Medical Assessor had referred to the secondary condition, but attributed all the impairment to the primary psychological injury. Mr Al Khulaif submitted that the Medical Assessor was aware that other medical opinion was that an adjustment should be made for the effects of a secondary condition, and he explained why no adjustment was applicable.

5. Submissions were made regarding the survey of the six PIRS categories, and, as noted above, Dr Hong has reassessed the class ratings.

DISCUSSION

1. Section 65A of the 1987 Act provides:

   “(1)    No compensation is payable under this Division in respect of permanent impairment that results from a secondary psychological injury.

   (2)     In assessing the degree of permanent impairment that results from a physical injury or primary psychological injury, no regard is to be had to any impairment or symptoms resulting from a secondary psychological injury.

   (3)     No compensation is payable under this Division in respect of permanent impairment that results from a primary psychological injury unless the degree of permanent impairment resulting from the primary psychological injury is at least 15%.

   Note : If more than one psychological injury arises out of the same incident, section 322 of the 1998 Act requires the injuries to be assessed together as one injury to determine the degree of permanent impairment.

   (4)     If a worker receives a primary psychological injury and a physical injury, arising out of the same incident, the worker is only entitled to receive compensation under this Division in respect of impairment resulting from one of those injuries, and for that purpose the following provisions apply-

   (a) the degree of permanent impairment that results from the primary psychological injury is to be assessed separately from the degree of permanent impairment that results from the physical injury (despite section 65 (2)),

   (b) the worker is entitled to receive compensation under this Division for impairment resulting from whichever injury results in the greater amount of compensation being payable to the worker under this Division (and is not entitled to receive compensation under this Division for impairment resulting from the other injury),

   (c) the question of which injury results in the greater amount of compensation is, in default of agreement, to be determined by the Commission.

   Note : If there is more than one physical injury those injuries will still be assessed together as one injury under section 322 of the 1998 Act, but separately from any psychological injury. Similarly, if there is more than one psychological injury those psychological injures will be assessed together as one injury, but separately from any physical injury.

   (5)     In this section-
   ‘primary psychological injury’ means a psychological injury that is not a secondary psychological injury.
   ‘psychological injury’ includes psychiatric injury.
   ‘secondary psychological injury’ means a psychological injury to the extent that it arises as a consequence of, or secondary to, a physical injury.”

1. Chapter 1.22 of the Guides provides:

   “A primary psychiatric condition is distinguished from a secondary psychiatric or psychological condition, which arises as a consequence of, or secondary to, another work related condition (eg depression associated with a back injury). No permanent impairment assessment is to be made of secondary psychiatric and psychological impairments. As referenced in paragraph 1.19, impairments arising from primary psychological and psychiatric injuries are to be assessed separately from the degree of impairment that results from physical injuries arising out of the same incident. The results of the two assessments cannot be combined.”

The PIRS

1. The PIRS is established as the rating system for assessing psychiatric/psychological impairment, by virtue of Chapter 11 of the Guides. Chapter 11 sets out six categories of behaviour to be considered, each being divided into five classes, ranging in seriousness from 1 to 5. Class 1 relates to a situation where there is no psychological deficit, or a minor deficit attributable to the normal variation in the general population. Class 5 pertains to a person who is totally impaired.

2. Chapter 11.12[5] provides:

   “Impairment in each area is rated using class descriptors. Classes range from 1 to 5, in accordance with severity. The standard form must be used when scoring the PIRS. The examples of activities are examples only. The assessing psychiatrist should take account of the person’s cultural background. Consider activities that are usual for the person’s age, sex and cultural norms.”

   [5] Guides 55.

3. The Medical Assessor is required to classify each category, and to apply the resulting scores as set out in Chapter 11.[6]

   [6] See 11.15-11.21 at Guides p 65 and Table 11.7 at Guides p 66.

4. The assessment of psychiatric disorder has been considered in a number of cases. In Ferguson v State of New South Wales[7] Campbell J was concerned the case where the Medical Appeal Panel had revoked the MAC on the basis that the finding by the Approved Medical Specialist (AMS) had been glaringly improbable. His Honour found that the Appeal Panel had fallen into jurisdictional error. He said at [23]:

   “By reference to NSW Police Force v Daniel Wark [2012] NSWWCCMA 36, the Appeal Panel directed itself that in questions of classification under the PIRS:

   ‘… the pre-eminence of the clinical observations cannot be underrated. The judgment as to the significance or otherwise of the matters raised in the consultation is very much a matter for assessment by the clinician with the responsibility of conducting his/her enquiries with the applicant face to face’.

   24.   The Appeal Panel accepted that intervention was only justified: if the categorisation was glaringly improbable; if it could be demonstrated that the AMS was unaware of significant factual matters; if a clear misunderstanding could be demonstrated; or if an unsupportable reasoning process could be made out. I understood that all of these matters were regarded by the Appeal Panel as interpretations of the statutory grounds of applying incorrect criteria or demonstrable error. One takes from this that the Appeal Panel understood that more than a mere difference of opinion on a subject about which reasonable minds may differ is required to establish error in the statutory sense.

   25. The Appeal Panel also, with respect, correctly recorded that in accordance with Chapter 11.12 of the Guides ‘the assessment is to be made upon the behavioural consequences of psychiatric disorder, and that each category within the PIRS evaluates a particular area of functional impairment’: Appeal Panel reasons at [37]. The descriptors, or examples, describing each class of impairment in the various categories are ‘examples only’: see Jenkins v Ambulance Service of New South Wales[8]. The Appeal Panel said ‘they provide a guide which can be consulted as a general indicator of the level of behaviour that might generally be expected’: Appeal Panel reasons at [37].”

   [7] [2017] NSWSC 887.

   [8] [2015] NSWSC 633.

5. In Glenn William Parker v Select Civil Pty Ltd,[9] another case regarding assessment of psychiatric disorder, Harrison AsJ cited [23] of Ferguson with approval at [65]. Her Honour said at [66]:

   “In relation to Classes of PIRS there has to be more than a difference of opinion on a subject about which reasonable minds may differ to establish error in the statutory sense. (Ferguson [24])…..”

   [9] [2018] NSWSC 140.

6. In Jenkins Garling J said at [73]:

   “It was a matter for the clinical judgment of the AMS to determine whether the impairment with respect to employability was at the moderate level, as he did, or at some other level. But, in seeking judicial review, a mere disagreement about the level of impairment is not sufficient to demonstrate error of a kind susceptible to judicial review.”

7. It is accordingly necessary for the Appeal Panel to be satisfied that the assessment by the AMS in this category was erroneous in one of the following ways (to use the reference by Campbell J in):

   (a)    if the categorisation was glaringly improbable;

   (b)    if it could be demonstrated that the AMS was unaware of significant factual matters;

   (c)    if a clear misunderstanding could be demonstrated; or

   (d)    if an unsupportable reasoning process could be made out.

8. In Lancaster v Foxtel Management[10] Basten AJ noted at [88]-[89] that these four considerations, although not inaccurate, were not a statement of legal principles, and that care should be taken in applying the explanation in place of s 327(3) and s 328(2).

   [10] [2022] NSWSC 929.

9. The referral to the Medical Assessor was issued following directions given by Member Jane Peacock on 13 August 2024.[11] The consent orders and notations were directed to be provided to the Medical Assessor and were duly included in the referral.[12] The notation read:

   “Notations

   A. It is noted that the parties agree that the applicant has suffered a primary psychological injury and a secondary psychological condition. However, the parties do not agree on whether any impairment results from the secondary psychological condition. The parties agree and acknowledge that the question of the degree of permanent impairment, if any, resulting from the primary psychological injury and the secondary psychological condition is a matter for the Medical [Assessor].”

   [11] Appeal papers page 34.

   [12] Appeal papers page 33.

10. There is force in the submission by Mr Al Khulaif that the Medical Assessor has complied with that notation. He has acknowledged the secondary psychological condition, and expressly stated that he had only considered the effects of the primary psychological injury.

11. The issue raised in Kiely, and relied on by the appellant employer, is that it appears that the Medical Assessor failed to make the two-step approach in terms, or explain why that approach was not available. In Gregorgiou the argument was set out by the Appeal Panel at [16(m)]:

    “(m)   Her Honour Harrison AsJ in obiter dicta propounded in Mercy Connect Limited v Kiely [2018] NSWSC 1421 a two-step process by which a Medical Assessor could abide the mandate of s 65A(2) to have no regard to impairment or symptoms from a secondary psychological injury. The first step is to assess the overall degree of permanent impairment of a worker in accordance with clauses 11.11 and 11.12 of the Guidelines. The second step is to assess separately the worker’s permanent impairment due to the secondary psychological injury by reference to the same clauses and then deduct the latter from the former. The Medical Assessor failed to follow this process and in doing so has made a demonstrable error.”

12. The Appeal Panel in Gregorgiou declined to accept that submission. At [45] it said:

    “45.   In Mercy Connect Ltd v Kiely [2018] NSWSC 1421 (Keily No 2) Harrison AsJ in obiter dicta set out a two step process by which a Medical Assessor could apply the provisions of s 65A(2) of the 1987 Act to have no regard to impairment or symptoms from a secondary psychological injury. Her Honour said:

    ‘96. The statutory scheme comprising of the WIM Act and the Workers Compensation Act creates a two-step approach in assessing the degree of WPI for a psychological injury. The assessor must first calculate the entire degree of psychological injury in line with the PIRS categories. The secondary psychological injury must then be assessed and deducted in accordance with s 65A of the Workers Compensation Act, leaving the primary psychological injury remaining.

    97. This two-step process accords with the referral of the Workers Compensation Commission on 24 October 2016. This referral provided for the AMS to assess the degree of WPI arising out of the primary psychological injury sustained by Ms Kiely as a result of the incident, excluding ‘any impairment or symptoms arising from or attributable to, the secondary psychological condition’.”

13. The appellant employer, as noted, challenged every category in the PIRS. It’s submissions with regard to each of the categories appear to have been predicated on the assumption that the Medical Assessor had failed to make the above distinction in preparing the Table 11.8 PIRS Rating Form. The Appeal Panel in Gregorgiou decided that the two-step process was applicable where (at [47]):

    “[T]here can be a disentanglement of the impairment and symptoms a worker suffers due to a secondary psychological injury from the impairment and symptoms a worker suffers due to the primary psychological injury.”

14. The Appeal Panel held that whilst it was possible to disentangle the two injuries with regard to employability, the other PIRS categories could not be disentangled.

15. This problem was considered by Basten AJ in Matheson v Baptistcare NSW & ACT[13] who said at [65]:

    “Applying the s 65A disregard

    62.   The claimant submitted that the lack of reasons reflected a failure to undertake the calculation in accordance with the Guidelines in assessing the current degree of permanent impairment attributable to the primary psychological injury. Taking the secondary injury into account, it was submitted, could not be abstracted from the assessment of the primary injury. Yet, the appeal panel did not undertake that exercise because it did not carry out the process mandated by the Guidelines in assessing the primary injury. …”

    [13] [2025] NSWSC 213.

16. We have noted the Medical assessor did not provide sufficient explanation and did not apply the two-step method, and this constitutes error. We have however considered the appellant employer’s submissions regarding each category in the PIRS. An examination of the submissions do not take its argument beyond the scope of a mere disagreement about which reasonable minds might differ, save for the categories of travel and employability, as will be seen.

17. Accordingly, Dr Michael Hong of the Appeal Panel re-examined Mr Al Khulaif on 5 May 2025. His report follows:

    “1.    HISTORY RELATING TO THE INJURY

    ·        Brief history after MAC:

    The Personal Injury Commission determined Mr Al Khalaf has a work injury with the date of injury 15 October 2024.

    Mr Al Khalaf reported an accident at work on 6 April 2022 and said he was moving boxes on a lifter, and fell backwards. He reported a loss of consciousness for 10 minutes and his colleagues told him later about the accident, and an ambulance took him to the hospital. He remained there for 2 days. There were no surgical treatments after the accident, and he took analgesic medications, and engaged in physiotherapy.

    He reported having developed physical injuries and pain as a result of the accident, affecting his neck, back, and shoulder. The worst problem is his back now, and there is no plan for a change in physical treatment. His walking tolerance is 20 minutes, he said his lifting capacity is limited, he cannot carry a bag of groceries, due to his back pain. He can carry a 2-litre milk carton with his right but not left hand.

    He said he was scared, and worried he would die immediately after the accident. He still worries he would fall and suffer further injuries. He began psychological and psychiatric treatment, he thinks within a few weeks after the accident, or not long after. There was no significant depression initially.

    After the accident, Mr Al Khulaif has not worked at all. He said his GP certified no work capacity initially, and then only a few hours per week. I noted his Certificates of capacity recorded 3 hours a day in April 2023, and then 4 hours a day 2 days per week in January 2024 and March 2024.

    However, by April 2024, he was certified with no work capacity. He said he was worse, his depression became a major problem at that time.

    He had significant pain immediately after the accident, and after 6 months, he said his pain was worse, but he does not know. He has not had other accidents since the accident. He realized his physical injuries had stabilized and would not get better, and his depression became a major problem.

    I asked Mr Al Khulaif about his vision, he said it was fine now, or only occasional problems and are not severe.

    I asked him about Dr Lieu, pain specialist, he said he saw many people, and does not know the name. He said he has a pain specialist in Parramatta now.

    He did some English study after the accident, as a part of his rehabilitation, only 1 hour, 2 days per week for a month. He said he was tense and agitated and could not continue. People asked why he was upset in class.

    Before the accident, he drank 1-2 times per month, in small amounts. Since the accident, he drinks more, around 4 times per week, ½ bottle (a bottle is 700ml) whiskey or 6 beers.

    ·        Present treatment:

    In terms of treatment, Mr Al Khalaf said his treatment has not changed after Dr Clayton Smith’s assessment.

    Mr Al Khulaif takes:

    • Amitriptyline 25 mg morning and night

    • Celecoxib 200 mg daily

    • Tramadol as needed for pain

    • Sertraline 50 mg.

    He consulted a psychologist a few months ago, but the name could not be recalled, he said the psychologist was in Parramatta.

    He does not have a psychiatrist and his GP prescribed his medications now.

    ·        Present symptoms:

    Mr Al Khulaif has chronic anxiety and depressive symptoms, and this has not changed significantly in the past 12 months or since his work capacity was downgraded. He has had further medication changes but he has not improved.

    He is still having sleep problems but he does not know why, and said he sleeps during the day. Sleeping pills did not help him. He feels tired as he does not sleep well.

    His weight increased in 2025, he thinks by a couple of kilograms, and again he is not sure why, he said perhaps he said because he does not do much physically. Before the accident, he enjoyed sports but cannot do it now.

    He reported having major problems with his concentration and memory, even with his doctors’ names. He is often frustrated and gets upset. He described passive suicidal ideation without any plan.

·        Details of any previous or subsequent accidents, injuries or condition:

Mr Al Khulaif does not have a past psychiatric history.

There is no subsequent psychological injury identified.

·        Social activities/ADL:

Mr Al Khulaif is 38, living with his wife and six children, aged between 3 and 18.

In terms of usual recreational activities, Mr Al Khulaif likes going to the gym, sporting activities, soccer with his friends, and socializing and barbecues with his friends.

He said his social circle has reduced and only maintains contact with a couple of people, and said he mainly has contact with his siblings. His brothers visit him sometimes. He has 2 brothers and no other family in Australia. He has gone to barbecue at his brothers' home, but this is rare, only once in 2025. The relationship is fine with his brothers. He does not go out to restaurants or entertainment venues. He rarely has contact with any friends.

He can read Arabic well but has no focus on reading books and does not read books now because of difficulties with concentration, even though reading was a passion in the past. Previously, he read novels and the Koran.

He does not fast during Ramadan anymore.

He went to the mosque previously and not now. He stays at home most of the time and said he does not do much. He scrolls on his mobile phone and watches TV. He watches soccer on his phone and does not use the internet or browse.

In terms of trips away, Mr Al Khalaf reported going to Iraq and saw his father before he passed away, and said he only went once since the accident, around 12 months ago, and before that, the last trip was 2013. I discussed his file seemed to suggest trips overseas in 2023 and 2024, and he said it is wrong, he only went away once. He went on his own, and was in Iraq 40 days.

He said he is scared to drive on his own, and worries and has panic attack-like symptoms, and thinks something would hit his car. He can drive 20 minutes and if someone is with him, he can drive longer. He said he always thinks about the subject accident.

Mr Al Khulaif showers once a week without prompting, occasionally more, but said he needs assistance, as he has dizziness in showers. He can have dizziness anywhere and anytime. He eats one or two meals a day only, and does not need prompting. He said he does not have an appetite to eat.

He has been married 2006, and said the relationship is not good because he does not like to talk much. There has been no separation or domestic violence. He said before the accident the marital relationship was okay. He used to help at home but not now.

He walks to the local park sometimes, by himself or his son and only goes there briefly. He spends time with the children but does not do anything else outside with them.

2.     FINDINGS ON PHYSICAL EXAMINATION

I assessed Mr Al Khulaif three times, the last time in person with Mr Abdulloah Khuder as the third interpreter.

Mr Al Kulaif walked slowly, and wore a hood over his head. He had a full beard. A small tattoo was visible on his hand. He engaged well with the assessment process. There was no psychomotor slowing or abnormal movements. He maintained certain positions and shifted his posture to accommodate his pain during the assessment. He was moderately restricted in his affect range and reactivity. He spoke spontaneously and gestured regularly. He was not thought disordered.

At the end of the assessment, I asked for further information that may be relevant and he discussed his whole life changed, at home and with his social life.

3.     SUMMARY

·        summary of injuries and diagnoses:

Mr Al Khulaif has not suffered from previous psychosis disorder or substance use problem.

He reported that after the workplace accident in 2022, he developed trauma symptoms, and drank excessive alcohol, consistent with an Alcohol use disorder. His symptoms, after the initial shock, are consistent with PTSD and Alcohol use disorder, and this is a primary psychological injury.

A few months after the accident, his pain became worse and he developed severe depression. After that, his work capacity was downgraded from 8 hours a week to no work capacity. This is consistent with him having developed an Adjustment disorder, which is a secondary psychological injury arising from his increased pain, which accounted for the subsequent increased impairment in his employability.

Mr Al Khulaif has had regular treatment. His treatment has now stabilised and therefore the injury is permanent.

In terms of the WPI assessment, my assessment is largely the same as the Medical Assessor, which is not surprising given that Mr Al Khulaif has remained in a steady state. However, in terms of travel, I rated a 2 instead of a 3 and I noted that even the Medical Assessor had recorded that he did go overseas some time ago and that he goes out on his own sometimes. In my assessment, Mr Al Khulaif reported that when he made the trip by himself but felt he needed physical assistance. He is not free from all impairment from a psychological perspective, and describes anxiety and cannot drive longer than 20 minutes and that is consistent with 2.

In terms of his overall current employability, I assessed 5 as he has no work capacity as a result of his psychological injury now.

As noted in the reasons, Dr Assad Saboor has assessed him twice, and in 2023 he provided WPI. However, he made a deduction for secondary psychological injury by a fractional deduction from the 15% WPI assessed, which is not the proper methodology.

Dr Cassimaitis had assessed and reported that Mr Al Khulaif's primary injury had resolved and he only had a secondary injury. This opinion cannot be supported because there is no evidence Mr Al Khulaif’s subsequent secondary psychological injury has rendered the primary injury in remission or superseded it, and my view is both injuries remain to the present day.

·        consistency of presentation

I noted Mr Cipriani raised concerns regarding the consistency of his cognitive difficulties. Based on my assessment, and noting his ongoing Alcohol use disorder, I do not believe there is any inconsistency in his described capacity and the available history on file. I noted the other assessors also found his concentration, persistence and pace to be poor.”

1. The Appeal Panel adopts Dr Hong’s report. Applying the methodology required by s 65A of the 1987 Act, and of Chapter 1.22 of the Guides we are satisfied that with the exception of the categories of travel and employability, the primary and secondary psychological conditions are so intermingled that separating out their effect on each category is not possible. In Ausgrid Management Pty Ltd v Fisk[14] the Appeal Panel said at [45]:

   “…The requirement of s 65A(2) is to disregard the symptoms and impairment from the respondent’s secondary psychological injury. …[T]hat does not require the Appeal Panel or a Medical Assessor to disregard those impairments and symptoms if they also result from the primary psychological injury. …. The sub-section cannot be interpreted to disregard whatever impairment and symptoms a worker has that result from a primary psychological injury even though they may also result from a secondary psychological injury.”

   [14] [2023] NSWPICMP 237.

2. Applying the two-step approach, the primary psychological injury, being the post-traumatic stress disorder, is responsible for the behavioural consequences for all categories except employability. In that regard, before the secondary psychological injury, the adjustment disorder, Mr Al Khulaif had limited work capacity, four hours a day two days per week, less than 20 hours per fortnight. This is consistent with a class 4 employability rating. He developed a secondary psychological injury and became totally incapacitated for work, thus warranting a class 5 rating. In applying the second step of the two-step method, the impairment from his secondary psychological injury is first assessed, then disregarded and set aside. Therefore, his employability is 4.

3. The assessment of a class 3 rating for the category of travel we adjust on the basis that the Medical Assessor did not adequately explain how Mr Al Khulaif’s ability to travel overseas on his own justified a class 3 rating, as explained by Dr Hong.

4. The assessment of Mr Al Khulaif’s entitlement is thus:

PIRS Category	Class	Reason for Decision
Self-care and personal hygiene	2	Mr Al Khalaf's self-care has declined. He told me he eats without prompting, and gained weight slowly. He showers once a week or more, without prompting. He buys food sometimes.
Social and recreational activities	3	He rarely attends recreational activities but he needs a support person and prompting. He had one barbeque in 2025 with his family, and he returned to Iraq to visit his father more than a year ago. He enjoys watching soccer on his phone.
Travel	2	Mr Al Khalaf has anxiety driving and cannot drive more than 20 minutes on his own. He can drive longer with a companion to help his anxiety. He can go overseas alone.
Social functioning	2	Mr Al Khalaf's relationship with his wife and children, and family has deteriorated. He has a couple of friends but does not see them.
Concentration, persistence and pace	3	Mr Al Khalaf described having poor concentration. He used to read books, and this has stopped because of concentration difficulties.
Employability	4	Mr Al Khalaf has not worked since the subject injury and his anxieties, cognitive difficulties and poor stress tolerance impact on his capacity to work. He has very limited psychological work capacity, consistent with the certified capacity of less than 20 hours per fortnight, a rating of 4. He deteriorated after he developed a secondary psychological injury, and has no work capacity at the time of Dr Hong’s assessment. This is consistent with employability 5 and 5 is assessed as step one of the two-step method. After applying step 2, the Panel adjusted Employability to 4.

1. This converts pursuant to Chapter 11.13 – 11.20 as follows:

   Score  Median class

2 2 2 3 3 4 =3

Aggregate Score Impairment   Total %

2 +2 +2 +3 +3 +4 16        17

1. We note that further documents were lodged by Mr Al Khulaif on 19 March 2025, to which the appellant employer consented on 18 March 2025. The further documents were a certificate of capacity dated 21 February 2025, and the clinical notes of the Workers Doctors. Although the admission was consented to, we note that no application was made pursuant to s 328(3) of the 1998 Act, which contains procedural requirements which have not been complied with. In any event, the documents did not have any relevance to the issues before us.

2. For these reasons, the Appeal Panel has determined that the MAC issued on 15 October 2024 should be revoked, and a new MAC should be issued. The new certificate is attached to this statement of reasons.

WORKERS COMPENSATION DIVISION

APPEAL PANEL

MEDICAL ASSESSMENT CERTIFICATE

Injuries received after 1 January 2002

Matter number:	W23781/24
Applicant:	Action James NSW Pty Limited
Respondent:	Fahad Al Khulaif

This Certificate is issued pursuant to s 328(5) of the Workplace Injury Management and Workers Compensation Act1998.

The Appeal Panel revokes the Medical Assessment Certificate of Medical Assessor Clayton Smith and issues this new Medical Assessment Certificate as to the matters set out in the table below:

Table - whole person impairment (WPI)

Body Part or system	Date of Injury	Chapter, page and paragraph number in NSW workers compensation guidelines	Chapter, page, paragraph, figure and table numbers in AMA 5 Guides	% WPI	Proportion of permanent impairment due to pre-existing injury, abnormality or condition	Sub-total/s % WPI (after any deductions in column 6)
Primary psychological	6/4/2022	Chapter 11, page 54	N/A	17	nil	17
Total % WPI (the Combined Table values of all sub-totals)					17%