Children's Hospital at Westmead v Golovodovski

[2006] NSWWCCPD 199

WORKERS COMPENSATION COMMISSION

DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR

CITATION:Children’s Hospital at Westmead v Golovodovski [2006] NSWWCCPD 199

APPELLANT:  Children’s Hospital at Westmead

RESPONDENT:  Nada Golovodovski

INSURER:GIO General Ltd

FILE NUMBER:  WCC 1475-05

DATE OF ARBITRATOR’S DECISION:          14 September 2005

DATE OF APPEAL DECISION:  24 August 2006

SUBJECT MATTER OF DECISION: Suitable employment: sections 40(2)(b), 40(3) and 43A(1) of the Workers Compensation Act 1987

PRESIDENTIAL MEMBER:  Acting Deputy President Robin Handley

HEARING:On the papers

REPRESENTATION:  Appellant: Phillips Fox, Lawyers

Respondent: Owen Hodge, Lawyers

ORDERS MADE ON APPEAL:  The decision of the Arbitrator is confirmed.

The Appellant, the Children’s Hospital at Westmead, is to pay the Respondent, Ms Golovodovski’s costs in this appeal.

BACKGROUND TO THE APPEAL

1. On 11 October 2005, the Children’s Hospital at Westmead (‘the Hospital’) sought leave in the Workers Compensation Commission (‘the Commission’) to bring an appeal against a decision of an arbitrator dated 14 September 2005. The Respondent to the appeal is Nada Golovodovski. The Hospital’s workers compensation insurer is GIO General Ltd (‘GIO’).

1. Ms Golovodovski was born in Macedonia on 1 March 1948 and is aged 58. On arrival in Australia in 1968, Ms Golovodovski worked as a machinist and assembly worker, with time out of the workforce while her children were young, before commencing employment as a ward and domestic assistant at the Hospital on 21 June 1993. On 6 November 2000, Ms Golovodovski injured her back and left leg while moving a sofa to mop behind and underneath it. After six months, she returned to work on a part-time basis, but her employment was terminated in May 2002 because there were no light duties available for her. GIO paid Ms Golovodovski weekly compensation until 6 August 2003, when it reduced this to $113.73, relying on a report of a rehabilitation counsellor, Vanessa Happ, dated 28 June 2003. On 9 July 2004, Ms Golovodovski lodged a claim for weekly compensation from August 2003 to date and continuing of $355.16 together with compensation for permanent impairment and pain and suffering.

1. On 1 February 2005, the Commission registered Ms Golovodovski’s ‘Application to Resolve a Dispute’ in respect of her claim for weekly compensation and for compensation for permanent impairment and pain and suffering. On 22 February 2005, GIO filed its ‘Reply’. The Arbitrator conducted a teleconference with the parties on 12 April 2005, following which he referred Ms Golovodovski to an Approved Medical Specialist (‘AMS’), Dr John Stephen, for assessment of permanent impairment. Dr Stephen examined Ms Golovodovski on 14 June 2005 and the Commission issued his Medical Assessment Certificate (‘MAC’) on 15 July 2005. Dr Stephen stated:

“Mrs Golovodovski has non-specific mechanical low lumbar back pain with occasional radiation into the groins [sic] and thighs. There is no evidence of any nerve root involvement. Mrs Golovodovski’s symptoms are partly on a work related and partly on a constitutional basis.”

1. Dr Stephen explained that Ms Golovodovski:

“has low lumbar degenerative change of fairly mild degree consistent with her age as clearly demonstrated in the MRI scan. This was asymptomatic prior to the incident of 6^th November 2000. Probably this incident served to accelerate symptoms that would have appeared anyway and there is probably some permanent aggravation of these symptoms ...

I consider her to have a 10% impairment of the back. In addition to this there is a 5% loss of useful function of the right leg at and above the knee and a 5% loss of useful function of the left leg at and above the knee, secondary to her back condition.

Of the above impairments and loss of useful functions, ½ are work related and ½ are constitutional in nature.”

1. Dr Stephen said Ms Golovodovski was partially unfit for work due to back pain. However, he said she is fit “for a variety of light to moderate work activities”. Dr Stephen referred to

the report by the rehabilitation counsellor, Ms Happ, dated 28 June 2003, in which she listed a variety of jobs that she said Ms Golovodovski was capable of performing, such as ticket collector, sewing machinist and hand packer. Dr Stephen said that, having looked at the detail of what was required, “Mrs Golovodovski is physically quite capable of coping with any of them”.

1. The Arbitrator conducted a further teleconference with the parties on 15 August 2005. On 13 September 2005, conciliation having proved unsuccessful, the Arbitrator conducted an arbitration hearing, at the conclusion of which he gave his decision orally in the terms set out below.

THE DECISION UNDER REVIEW

1. The Certificate of Determination, dated 14 September 2005, records the Arbitrator’s orders as follows:

“1. That the Respondent pay the Applicant weekly compensation at the rate of $269.20 from 16 September 2003 to date under section 40 of the Workers Compensation Act 1987. Such payments are to continue in accordance with the Act and the Respondent is entitled to credit for the weekly payments of $113.73 it has paid since 16 September 2003.
2. That the Respondent pay the Applicant as lump-sum compensation under section 66 of the Workers Compensation Act 1987 the sum of $3,000.00 in respect of a 5% permanent impairment of the Applicant’s neck arising out of an injury on 6 November 2000.
3. That the Respondent pay the Applicant as lump-sum compensation under section 66 of the Workers Compensation Act 1987 the sum of $1,875.00 in respect of a 2.5% permanent loss of efficient use of the Applicant’s right leg at or above the knee arising out of an injury on 6 November 2000.
4. That the Respondent pay the Applicant as lump-sum compensation under section 66 of the Workers Compensation Act 1987 the sum of $1,875.00 in respect of a 2.5% permanent loss of efficient use of the Applicant’s left leg at or above the knee arising out of an injury on 6 November 2000.
5. That the Respondent pay the Applicant’s costs as agreed or assessed.”

1. In his Statement of Reasons for Decision given orally at the conclusion of the hearing, the Arbitrator noted the following agreed facts:

   • Ms Golovodovski suffered an injury on 6 November 2000 as a result of which she is partially incapacitated for work,
   • she last worked for the Hospital in May 2002, since when she has had no employment,
   • her probable weekly earnings but for the injury had she continued in the same employment are $583.80 (section 40(2)(a)),
   • she has no dependants, and
   • the Hospital has been making voluntary weekly payments of $113.73 since 16 September 2003.

2. The Arbitrator discussed the medical evidence, placing reliance, in particular, on the opinion expressed by the AMS, Dr Stephen, who found Ms Golovodovski was partially incapacitated for work because of back pain that is partly constitutional and partly work-related. However, Dr Stephen found her to be physically capable of undertaking a variety of light to moderate

work activities. The Arbitrator accepted that Ms Golovodovski is therefore capable of full-time work.

1. The Arbitrator, having discussed Ms Golovodovski’s work experience, found her local labour market to be the greater Sydney area. He found she has reasonable spoken English skills but a limited capacity in written English. She had applied for a variety of unskilled work without success and the Arbitrator found it unlikely that she would be able to obtain such work on a full-time basis. He found Ms Golovodovski should be able to obtain such work for 20 hours a week but that it was likely to be on a casual basis (transcript page 27). The Arbitrator used the hourly rate of $15.73 for a casual machinist identified by the rehabilitation counsellor, Ms Happ, in determining that Ms Golovodovski would be able to earn $314.60 per week for a 20 hour week in some suitable employment (section 40(2)(b)). By deducting $314.60 from $583.80, the Arbitrator arrived at a figure of $269.20 (section 40(2)), and then decided not to exercise the discretion in section 40(1), but to make an award in favour of Ms Golovodovski for this amount.

1. The Arbitrator declined to accept a submission from GIO’s representative with reference to sections 40(3), 43A and ‘suitable employment’, that none of the factors identified by the Arbitrator were used by him to discount Ms Golovodovski’s ability to earn on a full-time basis (transcript page 35).

ISSUE IN DISPUTE

1. The issue in dispute in the appeal identified by GIO is whether the Arbitrator erred in the manner in which he calculated and assessed weekly payments pursuant to section 40 of the 1987 Act. The parties’ submissions on this issue are discussed below.

ON THE PAPERS REVIEW

1. Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) states:

“(6)     If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”

1. I have had regard to Practice Directions Numbers 1 and 6, the documents before me, and the submissions by the parties. GIO submits that the matter can be decided ‘on the papers’, while Ms Golovodovski’s solicitors submit the matter involves complex issues of fact and law and wish to make further oral submissions. However, I can see no need for oral submissions given detailed written submissions from both parties and a transcript of the hearing. I am therefore satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.

1. Neither party sought to adduce fresh evidence.

LEAVE

1. Before proceeding to deal with an appeal, the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act. The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998

Act. With regard to section 352(2), I am satisfied that the compensation at issue, namely the ongoing weekly compensation claimed by Ms Golovodovski, exceeds $5,000 and constitutes 100% of the amount in dispute. I therefore grant leave to appeal.

SUBMISSIONS

1. GIO submits that the Arbitrator, having found Ms Golovodovski was capable of full-time work, should have found she was capable of working full-time as a ticket collector, sewing machinist, hand packer or machinist. This would have resulted in an award pursuant to section 40 of $113.73 per week or less. None of the matters set out in section 43A referred to by the Arbitrator were relevant in assessing suitable employment in Ms Golovodovski’s case. Having found she was capable of full-time work, the Arbitrator erred by finding she was unlikely to obtain full-time work (transcript page 27):

“Whether or not the worker is likely to ‘obtain’ the duties she has been found to be ‘capable’ of performing on a full-time basis is not a relevant consideration when making a determination pursuant to section 40(2)(b).”

1. GIO submits the evidence is overwhelmingly in support of a finding that Ms Golovodovski has at all times since 6 August 2003 been capable of performing the duties of a ticket collector, sewing machinist, hand packer or machinist. The Arbitrator found this to be the case by adopting the opinion of the AMS who had, in turn, endorsed the views of Ms Happ. In these circumstances, the Arbitrator should have adopted Ms Happ’s wage figures in respect of those positions. If he had done so:

“the worker’s ability to earn should have been assessed at $470.07 (being the average wages of a ticket collector or sewing machinist) or any of the individual full-time wages payable for a ticket collector, sewing machinist hand packer or machinist.

The mathematical difference between the worker’s probable earnings and ability to earn should therefore have been $113.73 or less.”

1. GIO said it also relied on the oral submissions made by its representative, Mr Saul, at the arbitration hearing, who submitted, amongst other things, that it is an error of law to discount Ms Golovodovski’s capacity to work to 20 hours a week on the basis that she is unlikely to obtain full-time employment.

1. Ms Golovodovski’s solicitors submit the Arbitrator correctly followed the NSW Court of Appeal’s reasoning in Mitchell v Central West Health Service (1997) 14 NSWCCR 526 (‘Mitchell’) in determining Ms Golovodovski’s section 40 entitlements, and in awarding an adequate and fair amount.

1. While conceding that the Arbitrator concluded that Ms Golovodovski, in terms of medical fitness, is capable of full-time work, they submitted “this is subject to the restrictions placed on the worker by the treating Doctors”. They contend it is implicit in the Arbitrator’s determination that he considered factors such as Ms Golovodovski’s age, spoken and written English, work experience and length of time seeking employment, along with restrictions placed on her by her treating doctors and partial capacity for work, in determining the type of work suitable for her and its accessibility in the labour market.

1. Ms Golovodovski’s solicitors referred to Deputy President Fleming’s decision in Snow Confectionary Pty Ltd v Askin [2004] NSW WCC PD 56 (‘Snow’), at paragraph 25, where she said:

“However, physical capability alone does not make that work ‘suitable employment’ within the meaning of section 43A of the 1987 Act. The Arbitrator expressly had regard to Ms Askin’s limited English skills, her limited work experience, and the fact that she is restricted in the amount of lifting she can do in any employment. Her only employment experience has involved manual labour within a factory (paragraph 28 of the Reasons). Ms Askin has unsuccessfully applied for many jobs during the period of her unemployment, most notably over the last six months. The Appellant Employer does not dispute this. I am satisfied that the Arbitrator relied upon these facts to find that, although Ms Askin had a theoretical ability to earn $549.32 in this type of employment, she was, in fact, earning, and able to earn, $Nil because there was no such employment available in the labour market that was reasonably accessible to her. Ms Askin therefore has no real ability to earn in the labour market reasonably accessible to her.”

1. Ms Golovodovski’s solicitors submit that:

“It was perfectly appropriate for the Arbitrator to find, on the basis of the worker’s unsuccessful attempts to find work, that full time selected duties was not available in the labour market reasonably accessible to the worker, but that ‘a mix of some of those types of work ...twenty hours a week ... likely to be casual work’ would be available.”

Relying on Burke J in Mangion v Vissy Board Pty Ltd (1992) 8 NSWCCR 175, at 180, they contended that availability of work was a relevant consideration.

1. Finally, Ms Golovodovski’s solicitors submit that the Arbitrator’s decision should be read as a whole and should not be “construed minutely and finely with an eye keenly attuned to the perception of error”: Mayne Health Group t/as Nepean Private Hospital v Sandford [2002] NSW WCC PD 6 (‘Mayne Health’), at paragraph 47.

EVIDENCE, DISCUSSION AND FINDINGS

1. There is no dispute that Ms Golovodovski is partially incapacitated for work and her solicitors do not appear to challenge the Arbitrator’s finding that she is capable of selected full-time work subject to restrictions. GIO submits that having found Ms Golovodovski was capable of working full-time as a ticket collector, sewing machinist, hand packer or machinist, none of the matters set out in section 43A referred to by the Arbitrator were relevant in assessing suitable employment. Thus, having found she was capable of full-time work, the Arbitrator erred by finding she was unlikely to obtain such work.

1. Reference was made by both parties to the approach to be adopted in determining a worker’s entitlement to weekly compensation under section 40 of the 1987 Act prescribed by the NSW Court of Appeal in Mitchell. Relevantly, at 530, the Court said that step 2 requires the Commission:

“2. To determine ‘the average weekly amount that the worker is earning or would be able to earn in some suitable employment from time to time after the injury’ (section 40(2)(b)). Section 40(3) provides the determination of this amount is subject to the following:

‘(a) the determination is to be based on the worker’s ability to earn in the general labour market reasonably accessible to the worker,
(b) the determination is to be made having regard to suitable employment for the worker within the meaning of section 43A.’”

1. Section 43A states:

“(1) For the purposes of sections 38, 38A and 40:

suitable employment, in relation to a worker, means employment in work for which the worker is suited, having regard to the following:

(a) the nature of the worker’s incapacity and pre-injury employment,

(b) the worker’s age, education, skills and work experience,

(c) the worker’s place of residence,

(d) the details given in the medical certificate supplied by the worker,

(e) the provisions of any injury management plan for the worker,

(f) any suitable employment for which the worker has received rehabilitation training,

(g) the length of time the worker has been seeking suitable employment,

(h) any other relevant circumstances.”

1. As Ms Golovodovski’s solicitors have correctly pointed out, relying on what Deputy President Fleming said in Snow, quoted above, physical capacity to perform particular work alone does not make that work ‘suitable employment’ within the meaning of section 43A: regard must also be had to the other factors referred to in section 43A(1). Having determined what constitutes suitable employment for the worker (section 40(3)(b)), the Commission must then determine the average weekly amount that the worker would be able to earn in that suitable employment from time to time (section 40(2)(b)) subject to the worker’s ability to earn in the general labour market reasonably accessible to the worker (section 40(3)(a)).

1. In summary, the steps required to be followed are as follows:

(1) determine the worker’s physical capacity for employment,
(2) determine what constitutes ‘suitable employment’ for the worker having regard to the factors listed in section 43A(1) (section 40(3)(b)),
(3) determine the average weekly amount that the worker would be able to earn in such suitable employment from time to time (section 40(2)(b)),
(4) adjust this as appropriate to take account of the worker’s ability to earn in the general labour market reasonably accessible to the worker (section 40(3)(a)).

1. In my view, the Arbitrator did follow the appropriate steps in this case, although, given that he gave an oral decision, his reasons may not have been as studied as might otherwise have been the case. With regard to step 1, while there was no dispute that Ms Golovodovski was partially incapacitated for work, the Arbitrator found, nevertheless, that she was physically capable of undertaking lighter work, subject to the restrictions identified by her treating doctors, on a full-time basis. He then (step 2) considered relevant section 43A(1) factors such as age, English skills, work experience, place of residence, and the job seeking she had undertaken and in which she had been unsuccessful (transcript pages 26-27).

1. The Arbitrator concluded that Ms Golovodovski was unlikely to be able to obtain full-time work of the type of which she was capable, those types of work often being of a casual nature. In my view, it was appropriate for the Arbitrator to make had such a finding on the basis of Ms Golovodovski’s evidence and with the benefit of Ms Happ’s report identifying the employment outlook for the three job matches (ticket collector, sewing machinist and hand packer) as only “fair” and demand for these positions as being “unstable” and falling. The Arbitrator found that Ms Golovodovski should be able to obtain 20 hours a week of such casual work. Thus, although the Arbitrator did not explain it as clearly as he might have done, this was his finding of what constituted ‘suitable employment’ – 20 hours a week of light work, of the kind of work (it would appear) Ms Golovodovski had been looking for and of the kind suggested by the rehabilitation counsellor, Ms Happ.

1. Turning to step 3, the Arbitrator determined the amount Ms Golovodovski should be able to earn in such suitable employment for 20 hours per week, choosing the hourly rate identified by Ms Happ for a casual machinist. Finally, with regard to step 4, the Arbitrator identified the general labour market reasonably accessible to Ms Golovodovski as being “the greater Sydney area” (transcript page 27).

1. Thus, in my view, although the Arbitrator could have more clearly addressed the required steps in making his decision, he did make the requisite findings and I am not satisfied that he made any error of law in so doing. Given my comments on the clarity of the Arbitrator’s reasons, it might be argued that his statement of reasons was inadequate. While I acknowledge there were some inadequacies in the Arbitrator’s statement of reasons, in my view they were not so serious as to amount to an error of law and they did not affect the Arbitrator’s having fairly and lawfully determined the application: Mayne Health at paragraph 48.

DECISION

1. The decision of the Arbitrator is confirmed.

COSTS

1. The Appellant, the Children’s Hospital at Westmead, is to pay the Respondent, Ms Golovodovski’s costs in this appeal.

Robin Handley

Acting Deputy President  

24 August 2006

I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF ROBIN HANDLEY, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

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