ASP Ship Management Pty Ltd v Wood

[2007] FCAFC 142

FEDERAL COURT OF AUSTRALIA

ASP Ship Management Pty Ltd v Wood [2007] FCAFC 142

ADMINISTRATIVE LAW – appeal from a decision of the Administrative Appeals Tribunal – calculation of worker’s compensation payments – Tribunal applied improper construction of s 13(6) of the Seafarers Rehabilitation and Compensation Act 1992 (Cth) – determination of class precedes determination of percentage increase or decrease of normal weekly earnings – remuneration wrongly assigned paramountcy when determining class.

Administrative Appeals Tribunal Act 1976 (Cth) s 44
Safety, Rehabilitation and Compensation Act 1988 (Cth) s 8(9)
Seafarers Rehabilitation & Compensation Act 1992 (Cth) ss 4(4), 13

Wood v ASP Ship Management Pty Ltd [2007] FCA 459 affirmed
Wood v ASP Ship Management Pty Ltd [2006] AATA 577 set aside
Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389 cited
Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 considered
Comcare v Thompson (2000) 175 ALR 163 cited
Lawson and Stateships [2003] AATA 389 considered
Re O’Shea and Comcare (1998) 27 AAR 394 considered
Re Thompson v Comcare (2002) 69 ALD 762 considered

ASP SHIP MANAGEMENT PTY LTD v STEVEN SIDNEY WOOD
NSD 668 OF 2007

FRENCH, TAMBERLIN, RARES JJ
25 SEPTEMBER 2007
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 668 OF 2007

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	ASP SHIP MANAGEMENT PTY LTD Appellant
AND:	STEVEN SIDNEY WOOD Respondent

JUDGES:	FRENCH, TAMBERLIN, RARES JJ
DATE OF ORDER:	25 SEPTEMBER 2007
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.The appeal be dismissed.

2.The appellant pay the respondent’s costs.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 668 OF 2007

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	ASP SHIP MANAGEMENT PTY LTD Appellant
AND:	STEVEN SIDNEY WOOD Respondent

JUDGES:	FRENCH, TAMBERLIN, RARES JJ
DATE:	25 SEPTEMBER 2007
PLACE:	SYDNEY

REASONS FOR JUDGMENT

BACKGROUND

1. This is an appeal from a decision of a Judge of the Court which set aside a decision of the Administrative Appeals Tribunal (“the Tribunal”) concerning the construction and application of s 13 of the Seafarers Rehabilitation & Compensation Act 1992 (Cth) (“the Act”). 

2. The issue on appeal is whether the primary judge erred in finding that the Tribunal misdirected itself in construing s 13(6) of the Act, which required the Tribunal to ascertain whether Mr Wood belonged to a class of employees at the time of his injury and, if he did, whether the weekly amount payable to members of that class had been increased or reduced by operation of law or changes in certain industrial arrangements.

3. At the time of his injury in 1997, the respondent, Mr Steven Wood, worked on the ship “Australian Endeavour” as an assistant caterer, and was employed by the appellant, ASP Ship Management Pty Ltd (“ASP”).  The ship was engaged in coastal cargo trade, in what is known among seafarers as the ‘blue water segment’.  Its trade was not directed to gas and oil operations in the ‘offshore segment’.

4. Upon leaving his employment as a result of incapacity, Mr Wood received compensation payments from ASP. In October 2003, ASP refused Mr Wood’s application for an increase in his incapacity payments due to what he said was an increase in normal weekly earnings under s 13(6) of the Act. Mr Wood’s application under s 78 of the Act for review of that refusal was dismissed, and the Tribunal concluded that he should not receive an increase under s 13(6). On appeal to this court, the primary judge concluded that the Tribunal’s decision was in error (see Wood v ASP Ship Management Pty Ltd [2007] FCA 459). His Honour held at [33] that the Tribunal misdirected itself by treating the remuneration received by Mr Wood as an employee in the ‘blue water’ segment on the one hand and caterers engaged in the ‘offshore segment’ on the other hand as paramount to the determination of which class Mr Wood fell into for the purposes of s 13(6).

   LEGISLATION

5. The outcome of this appeal turns on s 13(6) of the Act, which is concerned with the adjustment of payments to injured employees. The section, as it stood at the time of the Tribunal hearing, provides:

   ‘(6)If the amount per week payable to employees in a class to which the employee belonged when the injury happened is later increased or reduced as a result of:

   (a)     the operation of a law of the Commonwealth, or of a State or Territory; or

   (b)     the making, alteration or operation of an award, determination or certified agreement, or the doing of any other act or thing under such a law;

   the normal weekly earnings of the employee before the injury, as worked out under the preceding subsections, must be increased or reduced by the same percentage as that by which that amount per week was so increased or reduced, as the case may be.’ (Emphasis added.)

6. Section 4(4) clarifies that the Act continues to apply to Mr Wood despite the fact that he has left ASP’s employ since it became liable to him.

   TRIBUNAL REASONS

7. At the time of his injury, the remuneration of Mr Wood was regulated by the Maritime Industry Modern Ships Award 1989 (“the Award”), which did not apply to catering assistant positions in the ‘offshore segment’.  In its reasons for decision, the Tribunal noted that several changes would have affected Mr Wood’s employment, had he not been injured and continued working as a catering assistant.  These changes included the rationalisation of the position of catering assistant on cargo vessels; the discarding of those positions by ASP; and the shift from payment under an award to payment under an enterprise agreement.  The Tribunal considered that the nature of any changes subsequent to the injury was an important factor in identifying the continuity of a class to which Mr Wood belonged at the time of his injury. 

8. The Tribunal concluded at [38] that the changes in the industry’s structure subsequent to Mr Wood’s injury had a significant impact on the continuity of the class to which Mr Wood belonged at the time of his injury, and was such as to destroy the continuity of that class in the ‘blue water segment’.  Although the Tribunal at [33] noted evidence that some of the catering assistants working in ASP’s cargo fleet at the time of restructure had moved to the ‘offshore segment’, it did not consider that there was sufficient evidence to conclude that there was continuity of the class.  In particular, the Tribunal decided at [34] that there was no evidence before it of the continuity of the classifications of ‘chief caterers’ on cargo vessels or vessels in the ‘blue water segment’ generally.  It considered that any link on the evidence between the class of which Mr Wood was part and other positions in the ‘offshore segment’ required an unacceptable straining of the notion of ‘class’. 

9. Importantly, the Tribunal rejected a submission that the class should be identified simply as ‘catering assistants’.  It decided at [35] that such a classification would “ignore the central feature of remuneration … and, while it would identify a class whose continuation is beyond doubt, it would render impossible the task of identifying a percentage increase” as required by s 13(6) of the Act.

10. Accordingly, the Tribunal rejected the broader classification of ‘catering assistants’ and decided to identify the narrow class to which Mr Wood belonged by confining it to the terms of the Award.  This narrow class was determined by reference to the “identifiable common determinant of remuneration” based on the Award specifications as to the size of vessel, its crew size and its engagement in the ‘blue water segment’.

11. The Tribunal therefore concluded at [37] that the class to which Mr Wood belonged when the injury happened was the class of “Catering Assistants working on vessels of over 39,000 tonnes with a crew of more than 18”. Having regard to the evidence before it, the Tribunal concluded there was no continuity of this narrow class and therefore the calculation provided for by s 13(6) of the Act could not be performed. As a consequence, the adjustment sought by Mr Wood was refused.

    REASONS OF THE PRIMARY JUDGE

12. The primary judge considered that the Tribunal adopted an erroneous approach in identifying the class of employees to which Mr Wood belonged.  His Honour considered that while the construction of the statute was a question of law for the Court, the question whether the class continued to exist was a question of fact which only the Tribunal could decide. 

13. His Honour noted at [26] that the object of s 13(6) of the Act is

    ‘… to ensure that relativity is maintained between the compensation payments received by an incapacitated employee and the amount of salary payable to employees doing the same sort of work as the injured employee was doing at the time of his injury.’ 

    His Honour observed at [28] that the purpose of s 13(6) (and of s 13(5)) of the Act is to provide for adjustment of the compensation payable to an injured employee, so that his or her salary does not remain static despite the normal weekly earnings of those employees in his or her class changing. In light of this purpose, his Honour concluded that s 13(6) must be given a broad interpretation.

14. His Honour considered at [31] that the Tribunal must have regard to the context in which, and the conditions under which, the work was performed by the injured employee and the continuing class.  His Honour considered that, in this case, the Tribunal had failed to undertake the necessary inquiry as to whether the work performed by the caterers on the vessels in the ‘offshore segment’, and the context in which and conditions under which that work was performed, was sufficiently similar to the circumstances in which Mr Wood worked as a catering assistant in the ‘blue water segment’ prior to his incapacity.  Accordingly, his Honour held at [33] that the Tribunal misdirected itself by treating the remuneration received by caterers as determinative of the issue.  While remuneration is relevant and important in determining the class, it was wrongly given paramountcy by the Tribunal.  When the Tribunal held that identifying a percentage increase was impossible, it misapprehended its task.  The Tribunal’s conclusion that there was no continuing class of employee of which Mr Wood had been a member at the time of his injury therefore involved an error of law.  His Honour allowed the appeal, set aside the decision of the Tribunal, remitted the matter to the Tribunal and ordered ASP to pay Mr Wood’s costs of appeal to the Court.

    REASONS ON APPEAL

15. The question of class continuity had been considered in earlier cases determined by the Tribunal.  Several are referred to in the reasons of the Tribunal.  The first case was Re O’Shea and Comcare (1998) 27 AAR 394, where the Tribunal concluded at 403-404 that there was no “discontinuity” between the duties and conditions of service applicable to a ‘steward’ under the Cape Class Vessels Award 1990 and a ‘catering attendant’ under the Maritime Industry (Australian Maritime Safety Authority) Enterprise Agreement 1993, and that the relevant class of employees of which the applicant was a member at the time of injury had not ceased to exist.  The Tribunal noted that the expression “class of employees” denoted a different concept to that denoted by the words “designation”, “position” or “classification”, because these expressions indicate that the conditions were subject to alterations in the work place without there necessarily being any change in the nature of the work.  The Tribunal accepted that the purpose of the relevant provision was to maintain the level of normal weekly earnings, and that this was the reason why the more general phrase of “class of employees” was used.

16. The Tribunal in its reasons for decision in O’Shea 27 AAR at 404 also considered the similarity between the working hours under the award and the agreement, the range of duties performed, the work load and skill levels. It considered, on comparison, that the differences between these matters were not sufficient to alter the “class of employees” to which the applicant belonged at the time of injury.

17. Throughout the decision in O’Shea 27 AAR 394, the Tribunal emphasised and considered with some particularity the nature of the employment and duties to be performed. The Tribunal at 405 adverted to the need for a careful evaluation of the facts in each particular case in order to determine whether there had been a discontinuity.

18. The Tribunal in the present case also referred to the decision in Re Thompson and Comcare (2002) 69 ALD 762, which concerned a provision similar to s 13(6), namely s 8(9) of the Safety, Rehabilitation and Compensation Act 1988 (Cth). In Thompson 69 ALD at 770-772, the Tribunal said regarding the determination of class:

    ‘Returning to the particular word “class” with which I am concerned, its context provided by s 8 is one of normal weekly earnings and so of remuneration. It would follow that the common interests of those comprising the “class of employees of which the employee was a member at the date of the injury” must be those who had a common interest in the amount of remuneration paid to them. The particular features that identify such persons may change over the years. So, for example, there may be instances in which persons with such a common interest may be identified by the type of work that they perform, the qualifications that they hold, the category or level of position that they hold or any combination of these or other features. It is imperative, though, that the regard is had to the features that identified those who had a common interest in remuneration at the relevant time. The relevant time is the date of the injury. That may lead to some practical difficulties in that the structure of the Commonwealth Public Service has changed over time and many functions have been out sourced. For all that, it is not an impossible task. …

    Section 8(9) does not permit a change of class. What it requires is the class to be identified, as I have done, and then to determine whether there has been a percentage variation in the minimum amount payable in respect of employees included in that class. So long as there are employees who still come within the class, it does not matter that Mr Thompson’s particular position in the public service no longer exists or that there are no longer standard salary scales for members of the public service.’ (Emphasis added.)

19. Both O’Shea 27 AAR 394 and Thompson 69 ALD 762 demonstrate the importance of identifying and considering the particular conditions of employment and the nature of the work in order to determine the appropriate class. The decision in Thompson 69 ALD 762 was applied by Hotop DP in Lawson and Stateships [2003] AATA 389, where there is a detailed analysis of the working conditions and duties attaching to a position in the relevant class. In making his determination, the Deputy President said at [36] and [39].

    ‘In the Tribunal’s opinion the “class” of employees to which the applicant belonged at the time of his injury in July 1991 is appropriately described as that of cook/seaman within the wider class of the crew of the number and composition manning small ships, [within the meaning of the relevant award], which operated in the coastal shipping trade off the north-west coast of Australia. It is not appropriate, in the Tribunal’s opinion, to define that class more narrowly so as to confine it to employees employed by the respondent alone because the essential character of the class of employees is determined by the nature of their employment, their working conditions, remuneration and other entitlements, not by the identity of their employer (which may, of course, change from time to time). …

    On the basis of the evidence before it the Tribunal finds that, because the number, composition and work duties of those employees are the same as in the cases of the crew members employed on board the MV Sina, the “Roberta Jull class” vessels and the “Jon Sanders class” vessels, they comprise the same class of employees as that to which the crew members … employed on those vessels also belonged … namely, the crew of the number and composition manning small ships … which operated in the coastal shipping trade off the north-west coast of Australia.’ (Emphasis added.)

20. In reaching a conclusion as to the appropriate class, it should be kept in mind that there may be a stage where in undertaking the necessary exercise of comparison it can be seen that the differences in duties, conditions, qualifications, remuneration and service are so extensive as to travel beyond the description of a particular “class”.  In those cases, a different “class” has manifested itself.  However, that point has not been reached in the present case: cf the observations of Finn J in Comcare v Thompson (2000) 100 FCR 375 at 384.

21. Section 13(6) of the Act does not express any specific criteria or relative importance of considerations which prescribe the way in which a class of employee must be selected or any indication that the class must be a narrow one. The reference to “a” class rather than “the” class points to a range of possible classes at different levels of generality. In order to determine the appropriate class and its relevant characteristics, regard must be had to the context and purpose of the provision, which in this case is to ensure that relativity is preserved between the compensation paid and the varying levels of remuneration over the post-injury period. The legislation is beneficial in nature, which, as noted by the primary judge, suggests a broader and more liberal interpretation than might otherwise be the case. Accordingly, it is in our view incorrect in the present case to select as the “class of employees” only those employees covered by a relevant industrial award on the basis that remuneration could not otherwise be ascertained.

22. The phrase “a class to which the employee belonged” is used in the particular statutory context of the Act, requiring determination of remuneration in relation to the operation of State and federal laws, awards, agreements and determinations.  The question of the meaning of the expression is not one of fact when determining which class is appropriate, but one of law.  It is settled principle that the question whether a phrase or word in a statute is to be given its ordinary meaning or some other technical meaning is a question of law: Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287. In the present case, ascertaining the meaning of the statutory expression “a class to which the employee belongs” is a question of law because the expression is used in a particular statutory context by reference to which the meaning must be derived. The expression is not used in its ordinary lay sense as determined by daily usage: cf Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389 at 397.

23. It is important to contrast the differences in wording between s 13(5) and s 13(6) of the Act. The former refers to the actual employee entitled to compensation and the operation of an award, determination, certified agreement or contract of employment in the hypothetical situation that the employee continued his or her employment.

24. There are three categories of employee defined in s 4(1) of the Act whose normal weekly earnings are respectively defined in s 13(1), (2) and (3).

25. Mr Wood, as a seafarer, had his normal weekly earnings calculated under s 13(1).  That section identifies his contract of employment as the point of reference to ascertain his normal weekly earnings.  It uses a different point of reference from those identified for employees whose normal weekly earnings are referred to in s 13(2) and (3).  Respectively, s 13(1), (2), (3) and (4) refer to:

    ·an amount that would have been payable weekly to a seafarer by way of salary under the contract of employment that applied to him or her before the injury;

    ·an amount that would have been payable weekly to a trainee by way of salary under the award, determination or certified agreement that would have applied if he or she finished training;

    ·an amount specified in a certified agreement prescribed for an employee attending a Seafarers Engagement Centre; and

    ·an amount that would have been payable weekly to any other type of employee under the contract of employment that applied to him or her before the injury.

1. The reference point in s 13(1) and (4) for normal weekly earnings of employees who are seafarers or not otherwise identified in s 13(2) and (3) is the employee’s actual contract of employment immediately before the injury.  In contrast, s 13(2) creates an hypothesis of a trainee’s future entitlement to normal weekly earnings from the one of three possible sources which would have applied to him or her when the trainee finished training.  Section 13(3) uses only one of those generic sources, namely a certified agreement for a person who attends a Seafarers Engagement Centre.  Thus, both s 13(2) and (3) create hypothetical entitlements to normal weekly earnings as their frame of reference.

2. Both s 13(5) and (6) apply to each of the four different situations of employment in s 13(1), (2), (3) and (4).  Section 13(5) does so by referring to the increase in the amount actually payable, or, if the employee is no longer employed, which would have been payable, if there is an increase because of the operation of an award, determination, certified agreement or contract of employment.  The increase in s 13(5) comes about because the employee reaches a particular age (s 13(5)(a)), completes period of service (s 13(5)(b)), or receives an incremental increase in salary in a range of salary that applies to him or her (s 13(5)(c)).  If such an increase in the amount payable per week occurs under s 13(5), the pre-injury normal weekly earnings of that employee, identified in accordance with whichever of s 13(1), (2), (3) or (4) applies to him or her, must be increased by the same percentage.  Accordingly, if the person is entitled to have his or her normal weekly earnings assessed under s 13(1), s 13(5) requires a comparison with the amount payable under the contract of employment and the increased sum which would be payable by reference to that contract in each of the three circumstances identified in s 13(5)(a)-(c).

3. Unlike ss 13(1), (2), (3), (4) and (5), s 13(6) of the Act is concerned with employees in a class to which the individual belongs whose initial normal weekly earnings have been identified. This is Mr Wood’s position. Section 13(6) does not mention a contract of employment, which is the concept used in s 13(1) and (4), but rather recognises three new means of increasing or reducing amounts payable per week to employees in the class. These three means are:

   ·the operation of a law or an act done under it;

   ·the making of a new award, determination or certified agreement; and

   ·the alteration of an existing award, determination or certified agreement.

   It is important that these three mechanisms for changing the amount payable rely on variations to existing industrial arrangements of general application to employees, such as an award. That is in contrast to the recognition in s 13(1) and (4) that the actual employment relationship can be governed not only by such general arrangements (awards, determinations or certified agreements) but also by individual contracts of employment. Because s 13(6) uses the concept of an employee belonging to a class of employees it must accommodate whatever actual relationship governed the employee and employer under s 13(1), (2), (3) or (4), including relationships which were outside awards, determinations or certified agreements.

4. If the Tribunal in this case was correct to find that the class is inextricably tied to and identified by the amount of its remuneration, then a single individual who had a contract of employment of the kind within s 13(1) or (4) which provided for a different remuneration to others who did the same work could never be in a class within s 13(6). Yet, s 13(6) operates on ‘the normal weekly earnings of the employee before the injury, worked out under the preceding subsections’ (emphasis added). That is, Parliament has required adjustments for each of the employees who are entitled to compensation based on earnings ascertained under s 13(1), (2), (3), (4) or (5). That entails that such persons are not to be excluded from the calculation which s 13(6) requires be made to ascertain the applicable increase or reduction.

5. The Tribunal at [37] selected the class into which Mr Wood fell as catering assistants working on vessels of 39,000 tonnes or more with a crew of more than 18 covered by the Award.  It did so because it found that remuneration was a common identifiable determinant and it adopted what Forgie DP had said in Thompson 69 ALD 762. A catering assistant who worked on a 38,900 tonne vessel with 18 crew would perform the same work but be outside the Tribunal’s class. If an award later reclassified the position of catering assistant to include both those on the 39,000 and 38,900 tonne vessels at a common, but increased, rate of pay (in lieu of their previously different rates), the principle used by the Tribunal to identify the class would result in a conclusion that the class would no longer exist because of the newly cognate remuneration structure. This would be so even though the work performed by catering assistants on each vessel was identical before and after the reclassification of their remuneration structure.

6. Importantly, s 13(5) deals with an increase in the amount payable per week because of the operation of the provisions actually governing the person’s employment in three events, namely the attainment of a particular age, the completion of a particular period of service or the increase in salary. In contrast, s 13(6) refers to employees in a class to which the employee belonged having the amount per week payable to them increased or reduced as a result of the operation of a law, thereby involving not just the operation of an award, determination or certified agreement but also the making or alteration of those relationships. In other words, s 13(6) contemplates that following the event which gave rise to the employee’s entitlement to compensation, a new or changed law or award, determination or certified agreement will affect the class of employees to which the employee belonged at the time of his or her injury.

7. The purpose of s 13(6) is to ensure that a person entitled to compensation because he or she has been injured while in employment regulated by the Act should maintain a level of compensation on par with what is paid later to persons who did similar work at the time the injury was sustained. It is not the purpose of s 13(6) to index amounts of compensation to take account of inflation because s 23 of the Act does this (see the definition of ‘relevant amount’ in s 23(1) and the compensation obligations to which it relates).

8. A contrast to the position in the preceding provisions of s 13 is provided in s 13(6). It recognises that changed circumstances may lead to the situation where it is not possible to rely upon the previously existing relationship between the actual employee and the actual employer. An alteration of an existing award, determination or certified agreement necessarily changes the relationship between the employer and employee concerned, as does the making of such an industrial arrangement after the time of an injury. This is so even if the injured employee had a contract of employment. Because s 13(6) refers to a class of employees and to the possibility that a completely new award or an altered award may apply to them, it is erroneous to confine consideration to a class whose members can only be those who meet the description of having common remuneration under the provisions of an unaltered award at the time of the injury. Rather, s 13(6) identifies those who were in a particular relationship with employers at the time at which the employee was injured, defining them as a class, and then traces through changes to generic criteria for fixing like persons’ normal weekly earnings. That is why s 13(6) refers to the making of new awards, determinations or certified agreements, or the alteration or operation of existing ones. In this, the section seeks to provide a broad means of reference from which normal weekly earnings of the injured employee can be adjusted, having regard to movements within that sector of the industry to which his or her contemporary comparators belonged.

9. When it treated remuneration received by the employee concerned as the identifying feature or primary determinant of the class, the Tribunal unduly confined its consideration of the matters which the Act required in selecting the class. Section 13(6) required the Tribunal also to consider the work which the employee did at the time of the injury and to see whether others did similar work which could be used as a yardstick to identify, at a time later than that of the injury, what similar employees now do and the variety of industrial arrangements (awards, determinations or certified agreements) which now provide remuneration for that work.

10. There is no reason in principle why all three generic industrial arrangements referred to in s 13(6)(b) may not be in place at the one time in relation to a variety of employees performing similar work but in differing industrial environments (such as the ‘blue water segment’ and ‘offshore segment’) which provide different rates of remuneration. If an injured employee is qualified or able to be employed in one or more of those industrial environments, and the old position held by the employee at the time of injury no longer exists (or the award determination or certified agreement has been abolished or is no longer in force), then s 13(6) places the person in a class of employees. The section then requires the employer liable for compensation, or the Tribunal, to increase or reduce the normal weekly earnings by identifying a hypothetical amount against which to calculate an increase or decrease, if no more precise comparator is available.

11. Another question of law raised in this appeal is whether the Tribunal failed to perform its task by not properly addressing the statutory question as to the proper class. The Notice of Appeal, therefore, raises questions of law not only concerning the construction and operation of s 13(6) of the Act, but also concerning whether the Tribunal failed to perform its task as required by s 13(6), properly construed. We do not accept the submission that this appeal raises no question of law as required by s 44 of the Administrative Appeals Tribunal Act 1976 (Cth).

12. In the present case, the Tribunal accepted at [35] that one possible class was that of “catering assistants”, and that the continuation of this class in the ‘offshore segment’ was beyond doubt. However, this description of the class was rejected by the Tribunal because it considered that it would render impossible the task of identifying a percentage increase for the purposes of s 13(6). On the other hand, the Tribunal considered that it was possible to identify a percentage increase if the narrower class, based on criteria in the Award, was selected.

13. The language of s 13(6) requires a determination of ‘class’ and then, once this has been determined, a calculation of the appropriate percentage increase. What the Tribunal did in this case was to select the narrow class because it could not otherwise quantify the amount of remuneration. In terms of s 13(6), the percentage increase is a matter to be determined after the class has been selected in the light of a careful consideration of the similarities and differences between the position held by the employee at the time of the injury, and the class which is said to be continuing after the injury.  The Tribunal failed to properly address this task and did not consider and make findings on the evidence to justify its determination of the narrow class.  The Tribunal did not compare relevant features between the categories of catering assistants in the ‘blue water segment’ and ‘offshore segment’.  Relevant matters for consideration and comparison include the nature of the work, specific duties, working conditions, hours of work, remuneration, promotion, accommodation and holidays.  Only when such a comparison is conducted will a decision maker be able to determine, for example, whether the differences are sufficiently great to give rise to a “discontinuity” in the classification.  As a consequence of its erroneous approach, the Tribunal did not carry out this exercise.

14. This error by the Tribunal is itself sufficient to dispose of the appellant’s appeal.  However, there are other matters to be noted in relation to the Tribunal’s reasons.

15. The first matter concerns the nature of seafarers’ activities, which are divided into the ‘blue water segment’ and ‘offshore segment’. The fact that there was some evidence before the Tribunal that seafarers operated in two areas did not mandate a conclusion that there could not be a continuing class of ‘catering assistants’ in the present case. In other words, it did not mean that regard could not be had to the features of the position of ‘catering assistant’ in the ‘offshore segment’ when fixing a class or calculating the relative increase or decrease in remuneration to an injured seafarer in the ‘blue water segment’. There is nothing in the language of s 13(6) of the Act which requires such an approach. Indeed, the Tribunal found that it was ‘beyond doubt’ such a class continued to exist but reasoned that it should not be used for the purposes of s 13(6) because to do so “would ignore the central feature of remuneration” and make the Tribunal’s task of identifying a percentage increase impossible.  However, in this case, if the Tribunal concluded after careful consideration that there was a continuity of class, then the appropriate percentage adjustment would be a matter of evidence.

16. A second matter concerns the primacy which the Tribunal gave to the role of remuneration when selecting a class.  The Tribunal’s reasons indicate at [10]-[11], [13] and [35]-[36] that it treated remuneration as the central or primary consideration.  It is true that remuneration is relevant in the selection of a class because the determination is ultimately for the purpose of adjusting remuneration during the post-injury period.  Moreover, the level of remuneration in relation to the work of a catering assistant may reflect the degree of skill, qualifications, importance and working conditions, and these matters bear on the determination of the class to which an employee belongs.  In this way, when determining the class, remuneration and other relevant factors may overlap to some extent.

17. By way of example, a markedly higher rate of pay for chefs may reflect significant differences in levels of skill, experience or reputation.  The higher pay may even be so extreme as to suggest the existence of a different class.  Nevertheless, it may be that on investigation and comparison of the circumstances of their employment a great difference in remuneration is not attributable to those work related factors, but rather to extraneous factors, such as better bargaining ability by their representatives.  For this reason, it is necessary to carry out the factual investigation and make the comparison between the relevant features of the positions.

18. While remuneration will generally be a matter to take into account in all cases, it is not correct to proceed on the basis that remuneration will always be the central or determinative consideration in ascertaining a class.  On a fair reading of the Tribunal’s reasons in this case, it can be seen that it has determined the question of class of employees by wrongly assigning centrality, primacy or paramountcy to one consideration, namely remuneration, for which there is no basis in the language of s 13 of the Act.

19. For these reasons we find that the narrow focus by the Tribunal on a perceived inability to fix a percentage increase distracted it from properly determining the question of class by an analysis of the respective duties and other characteristics of the position in the ‘blue water segment’ and the features and duties of a ‘catering assistant’ in the ‘offshore segment’.  The Tribunal accepted that there was a continuing, albeit broad, class of ‘catering assistants’, but notwithstanding this and on the basis of an unwarranted assumption that it would be impossible to fix a figure, the Tribunal selected the narrower class.  It is difficult to see why, having accepted the class of “catering assistants” and having acknowledged that it continued in the ‘offshore segment’, the Tribunal proceeded to decide that it was not able to apply a percentage figure to Mr Wood’s position in the ‘blue water segment’.

20. Accordingly we consider that the Tribunal erred in law.  The decision and reasoning of the primary judge is correct and this appeal is dismissed with costs.

I certify that the preceding forty-five (45) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices French, Tamberlin and Rares.

Associate:

Dated:        25 September 2007

Counsel for the Appellant:	Mr P Hanks QC and Mr J Lenczner
Solicitor for the Appellant:	Holman Fenwick & Willan
Counsel for the Respondent:	Mr L King SC and Mr H Halligan
Solicitor for the Respondent:	W. G. McNally & Co.
Date of Hearing:	13 August 2007
Date of Judgment:	25 September 2007