DMDV and Comcare (Compensation)

Case [2018] AATA 473

DMDV and Comcare (Compensation) [2018] AATA 473 (20 February 2018)

Division:                  GENERAL DIVISION

File Number(s):      2017/1764, 2017/3434 - 3448, 2017/4715

Re:DMDV

APPLICANT

AndComcare

RESPONDENT

Decision

Tribunal:L M Gallagher, Member

Date:20 February 2018

Place:Perth

The decisions under review are affirmed.

..........[sgd]...........................................................

L M Gallagher, Member

Catchwords

COMPENSATION - compensable injury under section 14 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) – Commonwealth employee – involuntarily redundancy –pension under a superannuation scheme - statutory construction of subsection 20(1) of the Safety, Rehabilitation and Compensation Act 1988 (Cth) – interpretation of expression ‘retirement from his or her employment’ – ‘double dipping’ - whether retirement from employment must result from compensable injury for the purposes of subsection 20(1) – temporal connection only between retirement and employment – reviewable decisions affirmed

Legislation

Commonwealth Employees’ Rehabilitation and Compensation Act 1988 (Cth)

Safety, Rehabilitation and Compensation Act 1998 (Cth) – ss 4(1) – s14, ss 20(1), ss 20(2) – ss 20(3)

Cases

Brockett and Military Rehabilitation and Compensation Commission [2014] AATA 224

Hammerton and Comcare (1995) 21 AAR 204

Keen v Telstra Corporation Limited [2005] FCA 241

Lonergan and Comcare [2005] FCA 377

Lushington and Comcare [2001] AAT 310

Milliken and Commission of the Safety, Rehabilitation and Compensation of Commonwealth Employees [1991] AATA 292

Re McKernan and Comcare (2004) 85 ALD 508

Shorthouse and Military Rehabilitation and Compensation Commission [2014] AATA 528

Sullivan and Comcare [1998] AATA 907

Secondary Materials

Explanatory Memorandum, Commonwealth Employees’ Rehabilitation and Compensation Bill 1988 (Cth) 20

Commonwealth, Parliamentary Debates, House of Representatives, 27 April 1988, 20, (Brian Howe)

REASONS FOR DECISION

L M Gallagher, Member

20 February 2018

INTRODUCTION

  1. By way of background, the Tribunal notes a number of agreed factual matters which are set out in the T documents, the Supplementary T-Documents and the Tribunal registry records.

  2. The Applicant (‘DVMV’) was employed by a Commonwealth organisation (the ‘Organisation’) from 28 October 2002 until 5 November 2014, when he was provided with a redundancy (T7) due to the Organisation’s changed operational requirements and no apparent opportunities for redeployment (T74). 

  3. On 11 June 2014, DVMV lodged a claim for workers’ compensation in relation to a condition with a date of injury of 10 June 2013 (T4) (‘the injury’). 

  4. On 19 August 2014, the Respondent (‘Comcare’) accepted liability under section 14 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) (‘the SRC Act’) for the injury (T5).

  5. At all relevant times, DVMV remained incapacitated for work and compensation was payable under the SRC Act.

  6. As a result of the redundancy on 5 November 2014, DVMV received a pension under a superannuation scheme.

  7. On 16 February 2015, Comcare advised DVMV that it had recently received information from his superannuation authority indicating DVMV was in receipt of a superannuation benefit and that periods of incapacity determined between 6 November 2014 and 11 February 2015 would be re-determined in accordance with section 20 of the SRC Act to take into account any employer-funded portion…

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AGLC
DMDV and Comcare (Compensation) [2018] AATA 473
Case
[2018] AATA 473
Decision Date

CaseChat Overview and Summary

This matter concerned an appeal by DMDV against decisions made by Comcare concerning the application of section 20 of the *Safety, Rehabilitation and Compensation Act 1988* (Cth). The central dispute revolved around whether DMDV's involuntary redundancy from his employment, which was unrelated to his compensable injury, constituted "retirement from his employment" for the purposes of section 20(1) of the Act, thereby impacting his incapacity payments. The decision was made by Member L M Gallagher of the Administrative Appeals Tribunal.

The primary legal issue before the Tribunal was to determine whether, for subsection 20(1) of the *Safety, Rehabilitation and Compensation Act 1988* to apply, the employee's retirement from employment must be caused by their compensable injury. This question arose in the context of DMDV receiving a pension under a superannuation scheme following his redundancy, which Comcare argued should lead to a deduction from his incapacity payments. DMDV contended that his retirement was not a result of his injury, and therefore section 20(1) should not apply.

The Tribunal considered the interpretation of "retirement from his or her employment" within section 20(1) of the Act, particularly in light of the decision in *Brockett and Military Rehabilitation and Compensation Commission* [2014] AATA 224. The Tribunal found that the reasoning in *Brockett* indicated that for section 20(1) to apply, an employee must retire from the employment out of which, or in the course of which, the injury arose, and crucially, that this retirement must result from the injury. The Tribunal noted that Comcare's argument that redundancy did not require a causal link between the retirement and the injury was not supported by the full context of the *Brockett* decision. The Tribunal also referred to the *Keen v Telstra Corporation* (2005) FCA 241 decision, which held that "retirement" could include involuntary retrenchment, but this did not address the requirement for the retirement to be caused by the injury.

The Tribunal concluded that the application of section 20(1) of the *Safety, Rehabilitation and Compensation Act 1988* requires that the employee's retirement from employment be a consequence of their compensable injury. As it was not disputed that DMDV's involuntary redundancy was unrelated to his compensable injury, the Tribunal found that section 20(1) did not apply to his situation. Accordingly, the Tribunal set aside the reviewable decisions and ordered that subsection 20(1) deductions from incapacity payments be restored to DMDV.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

On 10 November 2015, Comcare sent an email to DVMV regarding its view that the word ‘retired’ in section 20 of the SRC Act included circumstances of redundancy, referring to the decision of the Federal Court in Keen v Telstra Corporation (2005) FCA 241; 83 ALD 17 (the ‘Keen decision’), as follows (T35):“In Keen v Telstra Corporation Limited (2005), the applicant sustained a strain injury in employment in 1991 and experienced recurrent pain in the following years. In December 1997 she was compulsorily retired and received a redundancy payment and a lump-sum pay-out of her non-preserved superannuation. The applicant submitted that her retrenchment should not be treated as retirement for the purposes of s 21(1). The Court held that this phrase has wide meaning and included situations of involuntary retrenchment:24[1]. Having regard to this legislative history and the scope of the legislation regulating “retirement” in the Australian Public Service in force at the time the Act was enacted, namely 1988, it is difficult to avoid the conclusion that the expression “retires voluntarily, or is compulsorily retired” was intended to have a wide operation and to include circumstances where an employee was dismissed from employment because the employee was redundant. This would be so even if the applicant’s employment was not directly affected by this legislation at the time she was made redundant. Once the width of the expression is recognised, it follows it comprehends any person to whom the Act applies even if that person’s employment was not then directly regulated by legislation dealing with termination (including redundancies) in the Australian public sector.Therefore, even tho [sic] you were made redundant [sic] for the purposes of the legislation it refers to retired hence why the letter states retired from the commonwealth [sic]. The calculation of your ongoing incapacity entitlement under Section [sic] 20 of the SRC Act is therefore correct.”[emphasis added][1] Paragraph 24 in FCA 241 (and paragraph 25 in (2005) 83 ALD 17). On 17 November 2015, DVMV sent an email to Comcare in response to its email dated 10 November 2015 (referred to in paragraph 9 above) (T38) and referred to a subsequent decision of this Tribunal to the effect that subsection 20(1) of the SRC Act applies only where an employee’s retirement from employment, of itself, is as a result of the compensable injury. DVMV’s email states, relevantly:“There are more recent cases than the one you cite from…“Brockett and Military Rehabilitation and Compensation Commission [2014] AATA 224 (17 April 2014)”[2] reports a situation nearly identical to my own in the sequence of events and the source of the superannuation…[2] Referred to throughout this decision as ‘the Brockett decision.’52. If there was any doubt about the meaning of the words used in both limbs of s. 20 of the SRC Act taking into account their context, the Explanatory Memorandum removes any such doubt. Plainly, the intention of Parliament in enacting s. 20 of the SRC Act was to prevent an employee from receiving payments under the SRC Act for incapacity, then retiring either voluntarily or compulsorily as a result of the work injury, and being paid again for that invalidity for work out of a superannuation pension. The words used in the Explanatory Memorandum do not displace the statutory text nor do they contradict it in any way. In fact, as I have indicated by my analysis of the statutory text in the context in which it appears in the SRC Act, it is entirely consistent.CONCLUSION 53. Having first conducted the statutory construction exercise regarding s. 20 of the SRC Act, I have found that to fall within the first limb of s. 20(1), the employee must retire from the employment out of which, or in the course of which, the injury arose. Even further, the retirement must result from the injury. The expression his or her employment is not a reference to other employment in which the employee was engaged at the same time. That construction is consistent with the words of the statute in their literal and grammatical sense, and it is plainly consistent with the intention of its operation evidenced by the Explanatory Memorandum and Second Reading Speech of the Minister.54. I have also found that on its literal and grammatical construction, in context, the reference in the second limb of s. 20(1) to receiving a pension under a superannuation scheme as result of the employee’s retirement means that to fall within the section, the employee must have received payment from a superannuation scheme because of the retirement which resulted from the injury the employee received out of, or in the course of, his or her employment. Again, this construction is entirely consistent with the intention of the provisions in that section as evidenced by the Explanatory Memorandum and the Second Reading Speech of the Minister.55. The consequences of my construction of s. 20 of the SRC Act are that for it to apply to Ms Brockett, she must necessarily have retired from her role as a reservist in the Defence Force as a result of her injury incurred while carrying out her duties associated with Defence Force employment; and she must have received compensation from the MSBS as a consequence of her retirement. The fact that Ms Brockett was made redundant from her full-time employment with DHA some four years after the injury occurred plays no part whatsoever as far as s. 20 of the SRC Act is concerned. It is a totally unrelated event.56. I did not have before me any evidence of a superannuation payment being made to Ms Brockett upon retirement from the Defence Force. I did have evidence of her retirement from the Defence Force due to the injuries she sustained and her subsequent inability to meet the required medical standard. If Ms Brockett in fact received a payment under the MSBS, then that payment should be taken into account as s. 20(1) would apply to her. The superannuation payment she received from the PSS upon redundancy from DHA does not invoke the application of s.20 (1) and therefore it cannot affect any incapacity payments she has received.My involuntary redundancy was not as a result of the psychological injury that I received at [the Organisation]. My situation neatly mirror the conclusions I have cited from the 2014 case, and supports my conclusion that the payments that PSS makes to me are not relevant in relation to my ComCare [sic] incapacity payment. I conclude that a recalculation of incapacity payments is required.[3][emphasis added][3] Comcare has interpreted this email, in particular the final sentence, as a request for it to conduct an independent review of the List 1 determinations (refer to T44).

Ratio Decidendi

Legal Principle Established

In response to Comcare’s submissions regarding the “primary and obiter elements of the Brockett decision” (A1, page 11, subparagraph 21.6, referring to R3, page 4, paragraph 26), DVMV made the following additional submissions:(a)Comcare makes its arguments by “breaking apart paragraph 53 of the Brockett decision” in order to make the argument that the primary issue is “whether the employee must retire from the employment out of which, or in the course of which, the injury arose” and the secondary issue (“obiter”) is that “the retirement must result from the injury (A1, page 11, subparagraph 21.6).(b)Comcare’s argument is implausible when the two quotations in paragraph 53 of the Brockett decision are shown in their original position, as follows (A1, page 11, subparagraph 21.6):53. Having first conducted the statutory construction exercise regarding s. 20 of the SRC Act, I have found that to fall within the first limb of s. 20(1), the employee must retire from the employment out of which, or in the course of which, the injury arose. Even further, the retirement must result from the injury…(c)The two sentences in paragraph 53 of the Brockett decision, underlined at subparagraph 63(b) above, joined by the phrase “even further,” which Comcare omits, are part of a single assertion and that together they “negate” Comcare’s arguments regarding the Brockett decision (A1, page 11, subparagraph 21.6).(d)With regard to Comcare’s submission at subparagraph 61(e) above, Comcare makes its own arguments regarding not having to be bound by senior Member Fice’s decision in Brockett but “puts forward its own submissions to follow.”CONSIDERATION DVMV seeks an order that (A1):(a)The reviewable decisions be set aside and “subsection 20(1) deductions from incapacity payments be restored” to him.(b)Comcare publish a “Jurisdictional Advice” in relation to the Tribunal’s decision “so that in future, injured Commonwealth employees do not waste AAT resources, and so that Comcare does not needlessly spend funds on legal representation.” The orders DVMV seeks are based on his view that for subsection 20(1) of the SRC Act to apply, there is a requirement (given the Tribunal’s decision in Brockett and a number of secondary sources addressed in that decision) that he have retired from his employment as a result of his compensable injury. It is not in dispute that DVMV’s retirement from the Organisation was unrelated to his compensable injury. Comcare seeks an order that the reviewable decision(s) be affirmed (R3) on the basis that there is no such requirement that the retirement from employment be as a result of the compensable injury. Comcare is of the view that the Explanatory Memorandum and Second Reading Speech provides no support for DVMV’s notion that the application of subsection 29(1) of the SRC Act is restricted by reference to the reason for the Commonwealth employee’s retirement. The issue before the Tribunal is therefore whether, for subsection 20(1) of the SRC Act to apply, subsection 20(1) of the SRC Act itself requires that DVMV’s retirement from his employment be caused by his compensable injury. This issue is considered below.The legislation