Gill and Comcare

[2009] AATA 381

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 381

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2008/4525 & 4579

GENERAL ADMINISTRATIVE  DIVISION		)
Re		STEVEN GILL

Applicant

And COMCARE

Respondent

DECISION

Tribunal J. W. Constance, Senior Member

Date26 May 2009

PlaceCanberra

Decision The reviewable decision dated 17 September 2008 is affirmed.

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

J. W. Constance, Senior Member

CATCHWORDS

WORKERS’ COMPENSATION – interpretation of legislation – liability for compensation accepted by Comcare – calculation of compensation – meaning of the word “employed” in legislation – ordinary meaning of word – Explanatory Memorandum supports interpretation put forward by Comcare – not appropriate to depart from interpretation as a result of beneficial nature of the Act – decision under review affirmed

Safety, Rehabilitation and Compensation Act 1988 – Section 19

Acts Interpretation Act 1901 – Section 15AB

Wilson v Wilson’s Tile Works Proprietary Limited (1960) 104 CLR 328

REASONS FOR DECISION

26 May 2009 J. W. Constance, Senior Member            

INTRODUCTION

1.      Mr Gill has made two separate claims to Comcare in respect of injuries he suffered in 1986 and 2005.  Comcare has accepted liability to compensate him in respect of both of these injuries, but the parties disagree as to the manner in which weekly compensation for loss of earnings should be calculated.  Mr Gill has sought a review of the decision of Comcare as to the calculation of his entitlement.

2.      For the reasons which follow the decision under review will be affirmed.

FACTS

3.      The facts set out have been agreed between the parties.  On the material before me I am satisfied that the agreement is appropriate and I am satisfied of these facts on the balance of probabilities.

4.      Between 1985 and 1992 Mr Gill was employed as a bus driver by ACTION.  In 1986 he was injured at work.  On 17 May 2005 this Tribunal decided that from 21 June 2001 Comcare was liable to pay compensation to Mr Gill in respect of his partial incapacity for work which arose from the 1986 injury.

5.      In 2000 Mr Gill commenced employment with the Department of Education and Training, a full time position which he continues to hold.  Unfortunately he was injured whilst working in this position in July 2005.  Comcare has accepted liability to pay compensation to Mr Gill in respect of this injury.

6.      Between 17 May 2007 and 1 August 2008 Mr Gill was unable to return to his previous employment with ACTION by reason of the injury suffered in 1986, and he was unable to perform his work with the Department by reason of the injury suffered in 2005.  During all of this period he did not engage in active work for the Department, but he continued to be employed by it.

RELEVANT LEGISLATION

7.      Section 19 of the Safety, Rehabilitation and CompensationAct1988 provides for the payment of compensation for injuries resulting in incapacity, both partial and total.

8.      Subsection 19(2) provides that during the first 45 weeks of incapacity compensation is to be paid at a rate equivalent to the difference between the worker’s normal weekly earnings prior to the injury (NWE) and the amount he or she is able to earn in the week in question (AE).  Compensation is calculated on the basis of weekly figures.

9.      For periods after the 45 weeks referred to in subsection 19(2) compensation is payable in accordance with subsection 19(3) which provides:

Subject to this Part, Comcare is liable to pay compensation to the employee, in respect of the injury, for each week during which the employee is incapacitated, other than a week referred to in subsection (2), of an amount calculated using the formula:

where:

adjustment percentage is a percentage equal to:

(a)       if the employee is not employed during that week—75%; or

(b)if the employee is employed for 25% or less of his or her normal weekly hours during that week—80%; or

(c)if the employee is employed for more than 25% but not more than 50% of his or her normal weekly hours during that week—85%; or

(d)if the employee is employed for more than 50% but not more than 75% of his or her normal weekly hours during that week—90%; or

(e)if the employee is employed for more than 75% but less than 100% of his or her normal weekly hours during that week—95%; or

(f)if the employee is employed for 100% of his or her normal weekly hours during that week—100%.

AE applies in relation to the whole of that particular week and has the same meaning as in subsection (2).

NWE is the amount of the employee’s normal weekly earnings.

ISSUE FOR DETERMINATION

10.      Comcare accepts that Mr Gill is entitled to be compensated in respect of both injuries, but differences have arisen as to the correct calculation of his entitlement to compensation for his incapacity to work in the period referred to.  Comcare has decided that if Mr Gill’s entitlements during the relevant period are to be calculated on the basis of his ACTION normal weekly earnings he is only entitled to receive up to 75% of those earnings as he was not employed (i.e. he was not actively working) during this period.  Mr Gill disagrees.  He says that he was employed by (i.e. he had a current employment contract with) the Department and that this contract was for the same hours as his normal weekly hours when he was employed by ACTION.  On this basis he says that he is entitled to compensation of 100% of his normal weekly earnings because paragraph (f) of the definition of adjustment percentage applies.

11.     The only issue for determination is the meaning of the word “employed” in the definition of adjustment percentage in subsection 19(3).

THE ARGUMENT ON BEHALF OF MR GILL

12.     Mr Gill argues that in the context of section 19 “employed” means “contracted to work” rather than attending at a place of employment and physically carrying out the duties of the employment.  In support of this argument he has put that:

·Parliament has used the words “is employed” rather than “works”, and had it intended the latter it would have said so;

·the ordinary and current meaning of the term “employed”  implies being the subject of a contract of employment to work;

·the amount per week earned by the employee is not relevant to the interpretation of adjustment percentage as actual earnings are dealt with in a different part of the formula for calculating compensation set out in subsection 19(3);

·if Comcare was required by the subsection to determine the number of hours physically worked by an employee each week  this would place an excessive administrative burden on it;

·the Safety, Rehabilitation and Compensation Act 1988 is beneficial legislation, and if there are two competing interpretations the one most favourable to the injured employee should be adopted.

THE ARGUMENT ON BEHALF OF COMCARE

13.     It was put on behalf of Comcare that “is employed” means “actually worked”.I was referred to the following definition of “employ”  in the Macquarie Dictionary:

Verb (t) 1. to use the services of (a person); have or keep in one’s service; keep busy or at work: this factory employs thousands of workers. 2. to make use of (an instrument, means, etc.); use; apply. 3. to occupy or devote (time, energies, etc.): I employ my spare time in reading.

Noun 4. employment; service: to be in someone’s employ.[1]

[1] Respondent’s submissions dated 2 April 2009 – para 3.6.

14.     It was argued also that the intention of the Legislature in enacting this section can be determined by the Explanatory Memorandum to the amending legislation.  In part the Memorandum states:

Provisions designed to encourage injured workers to return to the workforce as soon as possible after an incapacity are a significant feature of this Part.

...

If the employee is working full-time but at a reduced rate of pay, the amount of compensation payable will be his or her normal weekly earnings less the amount payable in respect of that employment.

Reference was made to a passage in the Second Reading Speech to the amending Bill (27 April 1988) which included the following:

At the heart of the new scheme is the change from a system of fixed long-term benefits adjusted by regulation to one of weekly benefits calculated on the basis of the individual’s normal weekly earnings. An employee’s normal weekly earnings will be based on his or her pre-injury salary and will take into account certain allowances and regular rostered overtime which the employee is required to work as a condition of his or her employment. Employees who are incapacitated for work will receive weekly benefits equal to 100 percent of normal weekly earnings for the equivalent of the first 45 weeks of that incapacity.

Where appropriate, the Bill will encourage employees to return to work on a gradual basis by allowing their income to increase according to the number of hours worked. For example, an employee who returns to work for 50 percent of the number of hours he or she worked before the injury will be entitled to an amount of compensation which, combined with the income from that employment, would provide the employee with 85 percent of his or her normal weekly earnings.

15.     Comcare relied on the principle that legislation should be interpreted to avoid “absurd consequences”.Such consequences were said to be:

(a)If ‘employed’ was only the fact of being an employee, then so long as an employee remained employed on the same hours, the 45 week limitation period would have no effect;

(b) The ‘adjustment percentage’ would only apply where the employee’s employment conditions changed;

(c)An employee who because of an injury ceased employment and commenced employment in a part-time capacity would not be entitled to 100% of his or her NWE because he or she was not ‘employed for 100% of his or her normal weekly hours during that week’.[2]

[2] Respondent’s submissions dated 2 April 2009 – para 3.14.

It was put that it was not the intention of Parliament that subsection 19(3) would only apply to an employee whose employment ceased after the injury and who resumed work with changed employment conditions.

REASONING

16.     The first step in statutory interpretation is to look to the ordinary meaning of the words used in the statute in the context in which they are used.  If there is no ambiguity there is no need to go to sources outside the statute to ascertain their meaning.

17.     It is clear that the verb “employ” can mean either to engage under a contract of employment or to engage in active work.  Both these definitions appear in the Macquarie Dictionary (previously quoted) and in the Oxford English Dictionary (2^nd ed. Online).  The latter definition includes:

To find work or occupation for (a person, his bodily or mental powers); in pass. often merely to be occupied, to be at work.

However, when one considers the context of the definition of adjustment percentage in subsection 19(3), it is apparent that “is employed” is intended to have the meaning of actively engaging in work rather than being the subject of a contract of employment.

18.     The scheme set out in section 19 provides for an injured worker to receive a weekly payment of compensation such that for the first 45 weeks of incapacity he or she will continue to receive an income equal to his or her normal weekly earnings at the time of the injury.[3]  This applies to all workers, regardless of the hours worked in a particular week for which compensation is payable.  Subsection 19(3) then provides for the compensation payable after the first 45 weeks, on the basis of compensation being a varying percentage of normal weekly earnings less actual earnings.  

[3] Subsections (2) – (2D).

19.     Mr Gill argues that whilst a worker is subject to a contract of employment for the requisite number of hours (whether engaged in active work or not) he or she is entitled to receive 100% of normal weekly earnings less actual earnings indefinitely.  He says that paragraph (f) of the definition of adjustment percentage applies in his case.

20.       Mr Gill’s interpretation means that an employee who continues to be subject to a contract of employment (although not actively working) will be entitled to receive the equivalent of his or her pre-injury earnings indefinitely.  By contrast, an injured worker whose employment ends after the injury and who does not enter a new contract and is not actively working, will receive only 75% of normal weekly earnings under paragraph (a) of the definition of adjustment percentage.  Similarly, an injured worker who is only able to actively work part-time following an injury will receive compensation based on less than 100% of normal weekly earnings if he or she works for a new employer.  I agree with Comcare that these would be absurd results, and strongly suggest that this was not the intention of Parliament.

21.     If Parliament intended an employee to continue on the maximum rate of compensation under subsection 19(2) as long as he or she continued to be subject to a contract of employment it would have been a simple matter of drafting to say so and to apply the different rates (determined in accordance with subsection 19(3)) to those whose contracts of employment changed.

22.     The Explanatory Memorandum to which I have already referred confirms the ordinary meaning of the words I have decided is correct.  It is abundantly clear that a significant purpose of the section is to encourage injured workers to return to the workforce.  This purpose would not be served by an interpretation which entitled a worker to remain on maximum compensation based on his or her contract of employment continuing.  The purpose is served by allowing for increasing compensation as the hours worked each week increase, regardless of whether the work is carried out for the employer at the time of the injury or a new employer. 

23. Subsection 15AB(1) of the Acts Interpretation Act 1901 provides for the use of extrinsic material in this way. Subsection 15AB(1)(a) provides:

Subject to subsection (3), in the interpretation of a provision of an Act, if any material not forming part of the Act is capable of assisting in the ascertainment of the meaning of the provision, consideration may be given to that material:

(a)to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act; …

24.     If I am wrong in deciding that there is no ambiguity in the words in context, subsection 15AB(1)(b) applies.  It provides that extrinsic material may be used “to determine the meaning of the provision when …… the provision is ambiguous or obscure”.  If there is ambiguity, for the reasons already stated, the Explanatory Memorandum supports the interpretation put forward by Comcare.

25.     I do not agree with the argument that actual earnings (as determined by actual hours worked) is not relevant to the interpretation of adjustment percentage because actual earnings are taken into account elsewhere in the formula in subsection 19(3).  There is nothing to suggest that the same concept cannot be relevant to more than one factor in the formula.

26.     As to the argument based on the administrative burden on Comcare, the Safety, Rehabilitation and Compensation Act 1988 is clear that compensation is to be calculated on a weekly basis.4  The administrative tasks involved were matters for consideration when the legislation was drafted and do not affect the ordinary meaning of the words under consideration.

4 See subsection 19(2).

27.     As the principles to which I have referred lead to one interpretation of the ordinary meaning of the words used, it is not appropriate to depart from that interpretation based on the beneficial nature of the Act. In the decision of the High Court of Australia in Wilson v Wilson’s Tile Works Proprietary Limited[4] cited by Counsel for Mr Gill, Fullagar J referred to “the established principle that, where two constructions of a  Workers Compensation Act are possible that which is favourable to the worker should be preferred.” I have formed the view that in this case there are not two constructions possible based on the ordinary meaning of the words.

[4] (1960) 104 CLR 328 at 335.

DECISION

28.     The reviewable decision of Comcare made 17 September 2008 is affirmed.

I certify that the 28 preceding paragraphs are a true copy of the reasons for the decision herein of J. W. Constance, Senior Member.

Signed:         .....................[sgd]...........................................................
  T. Aviram, Associate

Date of Hearing  3 April 2009
Date of Decision  26 May 2009
Counsel for the Applicant         Mr D. Richards
Solicitor for the Applicant          Mr B. Hatch, Pamela Coward Higgins
Counsel for the Respondent     Mr B. Dube
Solicitor for the Respondent     Mr S. Marris, Sparke Helmore