Davies and Comcare - [2000] AATA 513

DECISIONS AND REASONS FOR DECISIONS [2000] AATA 513

ADMINISTRATIVE APPEALS TRIBUNAL ) No. Q1998/880

) No. Q1999/434

GENERAL ADMINISTRATIVE DIVISION )

Re ADRIAN DAVIES
Applicant

And COMCARE
Respondent

DECISIONS

Tribunal Mr K L Beddoe (Senior Member)

Date27 June 2000
PlaceBrisbane

Decision The decisions under review are affirmed.

(Sgd) K L Beddoe
Decision No. 513/2000 Senior Member
CATCHWORDS
COMPENSATION : Incapacity payments – Incapacity for work – Permanent incapacity to work – Degree of permanent impairment – Loss of function – Calculation of normal weekly earnings – Calculation of overtime – Normal weekly hours of overtime

Safety, Rehabilitation and Compensation Act 1988 – s4(1), s8(1), s8(2), s8(10), s8(10)(a), s9, s19, s19(3)(e), ss24(1), (2), (5), (6), (7)

Bortolazzo v Comcare (1997) 25 AAR 290
Comcare v Amorebieta (1996) 66 FCR 83
McDermott v Owners of SS "Tintoretto" [1911] AC 35
Wilson v Wilsons Tileworks (1960) 104 CLR 328

27 June 2000 REASONS FOR DECISIONS

Mr K L Beddoe (Senior Member)

By a decision (No. 12097) dated 8 August 1997 this Tribunal decided to set aside decisions of the respondent to cease liability for compensation including medical expenses. The matter was remitted to the respondent with the following directions:
(a)(no longer relevant);
(b)(no longer relevant); and
(c)that in calculating the applicant's entitlement to compensation, the respondent is to apply paragraph (e) of section 19(3) of the Safety Rehabilitation and Compensation Act 1988 ("the Act") and to make the necessary adjustments accordingly.
The respondent subsequently decided that the applicant's entitlement to compensation should be adjusted to a total amount of $1,309.26 (Q1998/880). No adjustment was made for those weeks where the applicant's actual earnings exceeded 95% of normal weekly earnings. The overtime component of normal weekly earnings was determined as follows:
(a)from 2 July 1994 to 3 October 1995 at 10 hours overtime per week; and
(b)from 4 October 1995 to 30 April 1996 at 8.5 hours overtime per week.
The applicant says that normal weekly earnings should be calculated on the basis of 15 hours overtime per week.
Section 19 of the Safety Rehabilitation and Compensation Act 1988 ("the Act") provides for the calculation of compensation for injuries resulting from incapacity. The respondent is liable to pay compensation for each week in which the employee is incapacitated, (after 45 weeks) of an amount that when added to the amount that he was able to earn during the week in suitable employment results in an amount equal to 95% of his normal weekly earnings where he is employed for more than 75% but less than 100% of his normal weekly hours of work (s.19(3)(e) of the Act).
Normal weekly hours is defined in section 4(1) of the Act to mean the average number of hours (including hours of overtime) worked in each week by the employee in his employment during the relevant period. The relevant period is the period calculated under section 9 (s.4(1) of the Act).
Section 8(10) provides, in effect, that the calculated amount of normal weekly earnings based on pre-injury earnings shall be reduced by the amount of the excess where those calculated normal weekly earnings exceed the amount per week of the earnings that the employee would receive if he was not incapacitated for work.
A second issue before the Tribunal (Q1999/434) is whether the applicant has an entitlement to compensation for permanent impairment in accordance with section 24 of the Act. For the purpose of determining whether an impairment is permanent the Tribunal is required to consider the criteria set out in sub-section 24(2).
The degree of permanent impairment of the employee resulting from an injury is to be determined under the provisions of the Guide to the Assessment of the Degree of Permanent Impairment and expressed as a percentage. Where it is determined that the degree of permanent impairment of the employee is less than 10% an amount of compensation is not payable (ss.24(5), (6), (7)).
At the hearing Mr Rangiah appeared for the applicant and Miss Ford appeared for the respondent. The documents lodged in the Tribunal pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 were before the Tribunal as the T documents and further documents were tendered and marked as exhibits. Oral evidence was given by the applicant, Dr White and Dr Gilpin, both Orthopaedic Surgeons.
I make the following findings of fact. The applicant first injured his right shoulder while employed by Australian Airlines in 1984 and injured it again in 1988 with further episodes of aggravation to 1992.
On 8 July 1992 the applicant injured his right shoulder again while lifting heavy baggage in his employment at Australian Airlines (T3). He was off work for three months.
The applicant continued to experience shoulder pain while in the course of employment and on the advice of Dr Patel he was employed on modified duties and did not work overtime because of the shoulder injury. He returned to full duties after seeing Dr Gilpin in April 1996 and ceased working for Qantas in September 1997.
The applicant says and I accept, that certain manual activities including domestic duties brings on pain symptoms in his right shoulder. He does not say however that he is prevented or unable to perform functions such as using tools and washing his car. He does say, and again I accept, that he can no longer paint his house. I am unclear however whether his right shoulder is the only factor causing him not to be able to cope with painting the house.
Document T16 is a detailed statement made by the applicant on or about 4 July 1995 (date received by the respondent). In that statement the applicant claimed limited capacity to paint his house although he employed a contractor to clean and sand down prior to painting. He said he was unable to re-roof the house although he had the tools and expertise to do so. When cross-examined by Miss Ford about these claims I formed the opinion that the applicant was evasive in his response to questions. It is for that reason that I formed the view that it is likely other factors besides the pain and restricted movement in the right shoulder made some domestic functions no longer possible or more difficult.
Exhibit B is a statement by the applicant dated 1 November 1999. Much of the statement is argumentative or refers to material which is not before the Tribunal, but it is clear that the applicant claims that he would have elected to do more overtime, mostly at a lower level than his position as customer services supervisor, except that he chose not to because of his shoulder. That he chose not to elect for overtime was based on medical advice. The applicant performed overtime when this was required for operational reasons but did not elect to do additional overtime. This is to be contrasted with the period prior to the injury when the applicant was doing so much overtime, at his request, that a complaint was made by the union. He did not explain the basis for the union's complaint. It is clear, on the applicant's own evidence that he had previously been working overtime by choice at a level that exceeded that of workplace colleagues and that he was motivated to work overtime because of family responsibilities which were no longer relevant by 1994. He did however have a continuing motivation to accumulate wealth apparently with a view to retirement.
Exhibits C & D are statements by two employees of Qantas that satisfy me that the applicant had the choice to work additional overtime during the relevant period. Such overtime could be up to 20 hours per week and I so find. It is not entirely clear as to whether the upper limit is in addition to operational overtime but in the light of the statements I have inferred that it is.
The Medical Evidence
Exhibit E is a copy of a medical report by Dr White, Orthopaedic Surgeon dated 24 February 1999 and addressed to the applicant's solicitors. After setting out a history which is consistent with the evidence, Dr White was of the opinion that the applicant suffered from a right rotator cuff lesion consistent with the history given. After surgery there was a limitation of movement of the shoulder, a mild degree of supraspinatus muscle wasting and complaints of pain associated with activities involving elevation of the arm at or above the shoulder height. He did not expect the condition to improve and assessed whole person impairment at 10 under Table 9.1 with no assessable impairment under Table 9.4.
Exhibit F is a supplementary report by Dr White dated 1 November 1999 made following a further examination of the applicant. The applicant described pain in the right shoulder depending on the activity undertaken. In particular forking and raking when gardening were said to significantly aggravate the applicant's discomfort. Dr White confirmed his earlier opinion. In oral evidence Dr White confirmed moderate restriction in range of movement in the right shoulder. He conceded he had not used the more scientific tests used by Dr Gilpan but said the applicant had been unable to replicate left shoulder movement with the right shoulder therefore there was loss of range of movement. In cross-examination Dr White said that he had not detected crepitus.
Document T5 includes a report by Dr Patel, General Practitioner, which is undated but was an exhibit before the Tribunal in 1997. Dr Patel's report is essentially a history taken from clinical notes commencing in 1984. It concludes that the applicant has remained pain free since October 1995.
Document T5 also includes a copy of a report by Dr Gillett, Orthopaedic Surgeon dated 17 May 1996 and addressed to the applicant's then solicitors. The report is detailed and draws a clear causative link between the shoulder condition and incidents in the course of the applicant's employment. That causative link is described as follows:
"…relates to the aging process and the repetitive multiple injuries and aggravations that have occurred in his work practices."

Dr Gillett assessed a 5% permanent loss of function.

Dr Gillett's opinion is confirmed by a short report by Dr Gilpin, Orthopaedic Surgeon, dated 1 June 1993 and addressed to Dr Patel (T9/61). Dr Gilpin found symptoms "due to intrinsic cuff degeneration rather than any mechanical component". In a detailed report to the respondent dated 6 June 1995 Dr Gilpin noted that there were still symptoms but they had occurred more in relation to home activities than work activities (T4).
In a further report to the respondent dated 3 August 1995, Dr Gilpin confirmed his earlier opinion (T4). He did not consider that the continuing employment was specifically contributing to the condition but acknowledged that normal daily use of the shoulder could contribute to aggravation of the shoulder condition. Another report dated 26 September 1996 addressed to the respondent's solicitor did not depart from the previous reports (T5).
Exhibit 2 is a medico-legal report by Dr Gilpin dated 16 August 1999 and addressed to the respondent's solicitor. Dr Gilpin sets out the history of treatment by him. Dr Gilpin reported that the applicant was last seen for treatment on 30 January 1996 when he said he had total relief from symptoms at that point in time and was discharged from Dr Gilpin's care. Dr Gilpin found a 5% loss of function in the right upper arm with no likelihood of improvement. The loss of function is caused by abnormalities in abduction and forward flexion. In his oral evidence Dr Gilpin explained that the loss of function varied because of variations, from time to time, in the loss of movement. There is however no evidence of muscle wasting. In the context of the overall movements of the shoulder the restrictions in movement were minor.
Contentions
The applicant submits that there is a 10% whole person impairment relying on the evidence of Dr White. This is because the applicant cannot lift objects above shoulder level without experiencing discomfort and because of stiffness in the shoulder. The loss of movement is greater than minimal.
On the basis that the applicant performed 583.7 hours of overtime in 1991/92 the correct amount to be taken into account for the purposes of section 8(10) of the Act is 12.4 hours per week. That assumes, which is correct, a 47 weeks normal working year.
The respondent's case is that it is unlikely that the applicant would have worked more overtime than has been allowed for in the decision under review. In that regard the respondent does not differentiate between overtime because of operational requirements and voluntary overtime.
The respondent also says that the impairment of the shoulder is minimal because there is only minimal limitation of movement and pain is not a relevant factor for the purposes of Table 9.1. In so far as there is disagreement in the medical evidence the evidence of Dr Gilpin, the treating surgeon, is much more thorough and should be preferred.
Consideration
The calculation of normal weekly earnings includes an additional amount calculated in relation to the relevant period under the formula "NH x OR". "NH" is the average number of hours of overtime worked in each week by the employee in his employment during the relevant period and "OR" is the employee's average hourly rate of overtime pay during the relevant period. The relevant period is determined by section 9 of the Act. As determined in decision number 12097 the relevant period is the two weeks period before that date of injury of the applicant i.e. the two weeks prior to 2 July 1994.
I am satisfied that the prima facie position would be that the calculation of normal weekly earnings under sections 8(1) and 8(2) of the Act would result in a situation not contemplated by the Act. That arises because of the evidence, which I accept, that availability of overtime to the applicant has reduced for reasons unconnected with the applicant's injury. The evidence satisfies me that Qantas has reduced the availability of overtime to employees working in the applicant's field of work.
In Bortolazzo v Comcare (1997) 25 AAR 290 at 293 Heerey J said:
"In my opinion the Tribunal was correct in its construction of s8(10)(a). The applicants' construction would require a reading into s8(1)(a) of something like "in the employment in which he or she was engaged at the date of inquiry".
I accept the submission of counsel for the applicants that the Act is social legislation which ought to be construed, in the event of ambiguity, liberally in favour of injured employees: McDermott v Owners of SS "Tintoretto" [1911] AC 35; Wilson v Wilsons Tileworks (1960) 104 CLR 328 at 335. But a liberal interpretation is one thing, rewriting the statute is another.
Moreover, the construction for which the respondent contends is consistent with the structure and purpose of the Act. The provision of compensation is to operate from week to week; see, for example, the detailed formulae in s19. The underlying policy is that an injured employee should not be worse off during the period of incapacity as a result of work-related injury. However, it follows conversely that the injured employee should not be better off.
I do not doubt for a moment that the sudden termination of regular penalty payments would create great hardship for people like Mrs Bortolazzo and Mrs Saffron. Financial commitments and lifestyle would be drastically affected. The figures already quoted in this judgment make that clear enough. Nevertheless, most terms and conditions of employment do not include a permanent right to overtime. Had they not been injured, Mrs Bortolazzo and Mrs Saffron would from 11 March 1994 have suffered the reduction in income as a result of the cessation of overtime work. The Act does not place them in any better position because they were not working at that date but in receipt of compensation."

With respect his Honour's dicta is a complete answer to the case put by the applicant. The change in the circumstances of the applicant's employment must be taken into account when determining normal weekly earnings and in particular the adjustment to be made under section 8(2) of the Act.

More difficult is the non-working of the voluntary overtime available. If I could be satisfied that it was the applicant's injury alone that caused him to cease to nominate for overtime I would have been satisfied that some greater allowance should have been made for loss caused by the injury. However I am not so satisfied. Firstly I was unimpressed with the applicant's evidence because of evasive answers and secondly I am satisfied that the overtime work available to the applicant was in essence similar to his normal duties, did not involve significant amounts of lifting and little or no overhead use of the right arm. The likelihood of aggravating the degenerative condition was remote. Other unascertained factors seem to have been taken into account by the applicant in determining that he would not nominate for additional overtime.
I am satisfied this is a case to which section 8(10)(a) of the Act applies because of the changed circumstances in relation to the availability of overtime. I am not satisfied that it is more likely than not that the injury was the only factor in the applicant's decision not to nominate for overtime.
In the circumstances I am satisfied that the decision under review is on the generous side and gives full effect to the intention of the Act that an employee should be compensated for loss arising from injury as defined because of incapacity for work.
The decision in relation to normal weekly earnings will be affirmed.
Section 24(1) of the Act provides for liability for compensation where an injury to an employee results in a permanent impairment. There is no dispute in this case that the applicant suffers a permanent impairment. The respondent does not dispute that the shoulder condition is a relevant permanent impairment.
The respondent's position is consistent with dicta set out in Comcare v Amorebieta (1996) 66 FCR 83 at 95.
Section 24(5) provides that the degree of permanent injury shall be determined under the provisions of the Guide and expressed as a percentage (s24(6)).
Because of the injury the applicant suffers variable reduction in abduction and forward flexion of his right arm. The limitation of movement in the shoulder has particular relevance to use of the arm overhead but can also have relevance to the applicant's lifting of luggage, house painting and gardening activities. I am satisfied that there is some loss of function in the right arm and that loss of function is likely to be permanent.
Relying in particular on the evidence of the treating orthopaedic surgeon, Dr Gilpin, I am satisfied that there are degenerative changes to the right shoulder which Dr Gilpin and Dr White describe following X-Ray. Both doctors also describe some loss of function in the right arm.
The issue is the extent of the loss of function. I have decided that I should accept Dr Gilpin's assessment of the applicant which is consistent with the earlier assessment by Dr Gillett (T5).
I am satisfied on the balance of probabilities that the loss of function of the shoulder is minimal and the correct level of impairment under Table 9.1 of the Guide is 5%.
The decision in relation to assessment of permanent impairment must be affirmed by virtue of the operation of section 24(7) of the Act.
The Tribunal decides that the decisions under review are affirmed.
I certify that the 43 preceding paragraphs are a true copy of the reasons for the decisions herein of Mr K L Beddoe (Senior Member).
Signed:
  T G Lowther
  Associate
Dates of Hearing  2 November 1999
Date of Decision  27 June 2000
Counsel for the Applicant        Mr Rangiah
Solicitors for the Applicant       Maurice Blackburn & Co
Counsel for the Respondent    Miss Ford
Solicitor for the Respondent    Australian Government Solicitor