Bee v The Workcover Corporation

[1994] HCATrans 235

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Adelaide No A37 of 1993

B e t w e e n -

MICHAEL JOHN BEE

Applicant

and

THE WORKCOVER CORPORATION

Respondent

Application for special leave

to appeal

DEANE J
DAWSON J

GAUDRON J

TRANSCRIPT OF PROCEEDINGS

Bee 11/3/94

FROM ADELAIDE BY VIDEO LINK TO CANBERRA

ON FRIDAY, 11 MARCH 1994, AT 12.47 PM

Copyright in ·the High Court of Australia

MS M.E. SHAW:	May it please the Court, I appear for the applicant with my learned friend, MR M.W. SAIES.
(instructed by Palios Meegan & Nicholson)
MR K.R. McCARTHY, QC:	May it please the Court, I appear

with my learned friend, MS K.S. SCHULZ, for the

respondent. (instructed by Phillips Fox)

DEANE J: Yes, Ms Shaw?

MS SHAW:  The special leave question in this case is

concerned with the interpretation of

section 36(2)(bb) of the Workers' Compensation and

Rehabilitation Act 1986.

It is the applicant's submission that the

judgment of the Full Court in the present case has

resulted in uncertainty in this area of the law

because it appears to be in conflict with the
policy of our Full Court in the cases of

Francese v City of Adelaide, (1989) 51 SASR 522 and

with our Full Court in Broken Hill Associated

Smelters v Gray, (1993) 169 LSJS 297.

The Full Court in the present case have

.adopted what might be called an actuality test

approach to the determination of a reduction of

overtime pursuant to section 36(2)(bb). That is,

the Corporation need only establish that at the
time of its application an employee working for the

former employer would have either lost his job or

not had overtime. It need not take into account,

for example, or establish that the subjective

intentions of the worker may have been to do

overtime or that overtime may have been available

on the open market to the worker despite the

position of this particular employer.

It is submitted that in Francese's case

His Honour Chief Justice King pointed out that what

is being assessed under section 4, the assessment

of earnings which are inclusive of overtime, is

what the worker could have or would have earned in

the future but for his disability. In that respect

the actual earnings that he had received in the

past, whether by way of overtime or income, were
but a factor in the determination as to what he

would receive in the future but were not decisive.

In the other Full Court decision of

Broken Hill Associated Smelters v Gray, the

Full Court was required to deal with the specific

submission by the appellant exempt employer that an

actuality test ought to be applied in determining

the amount of overtime that ought to be included in

the calculation under section 4(2), that is, that

Bee 2 11/3/94

the entitlement to overtime should be calculated

pursuant to the way that the assessment for

entitlement was arrived at under section 4(8).	The
process for overtime could perhaps be described

as: it is necessary for an employee to establish

under section 4(8) the entitlement but then the

assessment of the amount is carried out under

section 4(2).

When the assessment of the amount was

considered in Broken Hill Associated Smelters v

Gray, the court took the view that that assessment

was not constrained by section 4(8) and in the
specific case of Gray, the employee was arguing
that despite the fact that his overtime in the past

had been limited because of a commitment to

studies, his subjective intentions in the future

were that he would be doing more overtime because

he would not have that commitment to study. The

exempt employer on the other hand argued that what

should be decisive was what he actually earned as

overtime. His Honour Justice Legoe, in dealing

with an interpretation of section 4(2), said that

the criteria in 4(b)(i) and (ii) were merely

possible formulae by which one could determine the

potential for his earnings in the future. One of

:those criteria from the point of view of our

submission which was critical is that the assessor

is entitled to take into account what work was

being performed in the industry g~nerally; that is,

what another worker may have earned in the same

class of employment as the worker who was seeking

overtime.

His Honour Justice Legoe rejected the

actuality test sought to be applied by the exempt

employer and decided that the tribunal was correct

to assess the overtime on the basis of the workers'

subjective intentions. He relied on the policy

that His Honour the Chief Justice had formulated or

expressed in Francese's case. It is our submission

that the special leave point that arises here is

that the existence of Gray's case and Francese's	case and Bee's case has this result: that a worker
might establish his entitlement to overtime under
section 4(8).

When it comes to the assessment of the amount

of overtime that he is likely to be paid in the

future, he might rely on either his subjective

intentions or he might rely on what another

employee in the industry would attain, or would

get.	He may not rely on his position with his
actual employer.	However, when the Corporation

seeks to reduce under section 36(2)(bb) it can rely

on different criteria to what was used to establish

the overtime in the first place. That is, if you

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like, the day after the worker has established his
entitlement under 4(8), had his assessment under

section 4(2) determined theoretically, the

Corporation could apply to reduce based on an

actuality test that the position either did not

exist at the date of the application or there was

no overtime in that position.

It is our submission that it is for that

reason that this question ought to be determined or
resolved by this Court because of the potential for

resulting unfairness to a worker.

DAWSON J: But there is a difference in wording between

section 4(8) and section 36(2)(bb), is there not?

MS SHAW: That is so.

DAWSON J:  And section 36(2)(bb) speaks of:

if the worker had continued in the work in

which he or she was last employed before

becoming incapacitated -

whereas se~Lion 4(8) speaks of:

·continued to ;.mrk mrertime in accordance with

the established pattern -

I just pointed that out to you, it is not

necessarily conclusive one way or the other.

MS SHAW:  Yes. Your Honour, section 36(2)(bb) came in as an

amendment and it appears that the wording is really

not consistent with any other expression elsewhere in the Act. In our submission it is ambiguous and

therefore what must be considered is the - - -

DAWSON J:  It is just that the words "the work in which he

or she was last employed" do lend some support to

the view that was expressed by the Full Court.

MS SHAW:  In a literal sense, perhaps, but the balance of

the section is directed towards again looking to

the future, that is, what the worker would have

earned if he had continued, that is, he would not

have continued to work overtime, or his overtime

would have changed.	So again, it is a futuristic
approach.

DAWSON J: Yes, I follow that argument.

MS SHAW:  Yes. And if one goes to the rider to

section 36(2):

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(and any reduction made on the basis of this

subsection must be consistent with

section 35).

We say that supports our submission, too, because

section 35 is the provision which authorizes the

payment by way of income maintenance; that is, a

payment to compensate the worker, in effect, for

the loss of his ability to sell his labour on the

open market rather than merely to compensate him

for the loss of his employment with that particular

employer. We say that it is only this

interpretation that is contended for by the

applicant that is consistent with the policy of

this legislation, which was directed towards

setting up a relationship between a worker and a

corporation, with an emphasis upon the

rehabilitation of the worker to return to the

labour market, as such, rather than necessarily

back to the individual employer.

So it is the applicant's submission that there

is an ambiguity in relation to the expression "the

work", that the actuality test applied by the court

is inconsistent with the policy of the legislation

and it specifically raises an inconsistency, we

say, with the operation of all of these sections,
in view of the interpretation that has been applied
to section 4(2) by the Court in Gray's case. If

the Court pleases.

DEANE J:  The Court need not trouble you, Mr McCarthy.

Notwithstanding the submissions of Ms Shaw,

36 of the Workers

the Court is not persuaded that the decision of the construction of section

Rehabilitation and Compensation Act 1986 (S.A.) is

attended by sufficient doubt to warrant a grant of
special leave to appeal. Accordingly, the

application for special leave is refused.

MR McCARTHY:  May it please the Court, I apply for an order

for costs.

DEANE J:	Ms Shaw?
MS SHAW:	There is nothing I can say to that.
DEANE J:	The application is refused with costs.

AT 12.59 PM THE MATTER WAS ADJOURNED SINE DIE

Bee 11/3/94