Harrison v Danza Loca
[2018] WADC 54
•8 MAY 2018
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL
LOCATION: PERTH
CITATION: HARRISON -v- DANZA LOCA [2018] WADC 54
CORAM: JUDGE STAUDE
HEARD: 19 MARCH 2018
DELIVERED : 8 MAY 2018
FILE NO/S: APP 96 of 2017
BETWEEN: LYNDA HARRISON
Appellant
AND
DANZA LOCA
Respondent
ON APPEAL FROM:
Jurisdiction : WORKCOVER WA
Coram: ARBITRATOR FLETCHER
File Number : A40624 OF 2017
Catchwords:
Appeal - Worker's compensation - Cessation of weekly payments of compensation without notice - Whether cessation of weekly payments lawful - Whether the appellant had returned to work
Legislation:
Workers' Compensation and Injury Management Act 1981
Result:
Leave to appeal granted
Appeal allowed
Orders of arbitrator dated 18 September 2017 set aside
Representation:
Counsel:
| Appellant | : | Mr G Stubbs |
| Respondent | : | Mr D M G Burton |
Solicitors:
| Appellant | : | Perth City Legal |
| Respondent | : | SRB Legal |
Case(s) referred to in decision(s):
Atkinson v Nipper Cleaning Services Pty Ltd (1992) 1 Tas R 276
Department of Education v Kenworthy (1990) 3 WAR 1
JUDGE STAUDE:
Introduction
This appeal is from a decision of an arbitrator dismissing the appellant's application for arbitration of the lawfulness of the respondent's cessation of weekly payments of compensation.
It is conceded by the respondent that the appeal involves a question of law and that leave to appeal should be granted pursuant to s 247 of the Workers' Compensation and Injury Management Act 1981 (WCIMA).
For ease of reference I will refer to the appellant as the worker and to the respondent as the employer.
Facts
The facts are not in dispute and are set out in the arbitrator's reasons for decision at [9] - [29]. They can be summarised as follows.
On 20 August 2014 the worker suffered an injury to her left knee in the course of her employment with the employer. At that time the worker was working in three jobs concurrently as follows:
(a)with the employer as a dance instructor for about 15 hours per week;
(b)with the City of Perth as a waitress for approximately five hours per week; and
(c)with Sugar Blue Burlesque Pty Ltd (Sugar Blue) as a part-time accounts administration officer for about 12 hours per week.
As a result of her injury, the worker was totally incapacitated for work as a dance instructor with the employer and as a waitress with the City of Perth, although she continued to perform occasional light duties with each of those employers. The left knee injury caused no incapacity for work as a part-time accounts administration officer and, accordingly, her work for Sugar Blue continued uninterrupted.
In her claim for compensation (Form 2B) dated 3 September 2014 the worker disclosed her employment with the City of Perth, but not her employment with Sugar Blue. Her claim was accepted. Initially she received weekly payments of compensation for incapacity to work as a dance instructor. These were calculated at $104.04 for the first 13 weeks and thereafter at $88.43 (85%). When the employer's insurer discovered that the worker was also incapacitated for her work as a waitress with the City of Perth, her weekly payments were re‑calculated at $356.40 for the first 13 weeks and $302.94 thereafter. Any income from such work as the worker was able to do with the employer and the City of Perth was taken into account in her weekly payments of compensation.
In September 2014 the employer's insurer issued a notice under s 59(3) of the WCIMA giving notice to the worker of her obligations under s 59(2)(b) to inform the employer within seven days of any commencement of remunerated work with another employer, and, if that had occurred, to give particulars of the remunerated work pursuant to s 59(5).
The worker responded to the request by providing a pro forma document headed 'Section 59 information as to remunerated work', stating that she was employed by the City of Perth as a waitress and that details of her grossly weekly earnings had been provided.
Two years later, in December 2016, the employer's insurer made a further s 59(5) request for particulars of any other remunerated work being done by the worker. The worker returned a partially completed pro forma response dated 22 December 2016 in which she stated that she had been employed by Sugar Blue from 29 March 2010. No other requested particulars were provided.
On the basis of this response, the employer's insurer ceased making weekly payments of compensation without notice. At that time the worker had provided no particulars of the number of hours worked or her remuneration. Indeed, details of the worker's remuneration by Sugar Blue were not provided until after the commencement of the WorkCover proceedings.
On the evidence before the arbitrator there was a dispute as to whether the worker's employment by Sugar Blue had been notified earlier than 22 December 2016. It was the worker's evidence that she disclosed the employment to the claims officer of her employer's insurer, Ms Maria Drinkwater, by telephone before making her claim for compensation and was told that it was immaterial. Ms Drinkwater's evidence was to the contrary. This issue was addressed by the arbitrator at [78] – [84], but he was unable to resolve it.
Relevant provisions
Section 59 provides, relevantly:
(1)This section applies to a worker who has claimed or is receiving weekly payments of compensation from an employer (the employer).
(2)A worker who commences remunerated work (other than work with the employer) after making a claim for weekly payments of compensation, is to, within 7 days of —
(a)commencing the work; or
(b)receiving notification under subsection (3),
whichever is the later, inform in writing the employer or the employer's insurer of the commencement of the work.
Penalty: $500.
(3)The employer or the employer's insurer is to notify in writing a worker of the worker's obligations under subsection (2).
(4)A worker is not to be convicted of an offence under subsection (2) unless the employer or the employer's insurer has complied with subsection (3).
(5)The employer or the employer's insurer may, in writing, request a worker to provide the following particulars of remunerated work (other than work with the employer) commenced after the making of the worker's claim for weekly payments of compensation —
(a)the date of commencement of the work; and
(b) the title, classification or description of the work; and
(c)the remuneration for the work; and
(d)the name and address of the person (if any) for whom the work is performed.
(6)A worker is to provide in writing the particulars requested under subsection (5) within 7 days of the date of the request.
Penalty: $500.
(7)If the particulars provided by the worker under subsection (6) establish that the worker has commenced remunerated work, the employer or the employer's insurer may discontinue or reduce the worker's weekly payments of compensation in accordance with the particulars.
(8)The employer or the employer's insurer must not discontinue or reduce a worker's weekly payments of compensation under subsection (7) otherwise than in accordance with the particulars provided by the worker under subsection (6).
Penalty: $2 000.
(9)Subject to sections 57A, 57B and 58, if —
(a)a worker has claimed but has not received from the employer, weekly payments of compensation;
(b)the worker provides particulars under subsection (6);
(c)the particulars establish that the worker has commenced remunerated work,
the employer or the employer's insurer may make a decision in accordance with the particulars as to whether or not weekly payments of compensation are to be made for the period to which the particulars relate, and if so, the amount of the weekly payments.
(10)A worker who disputes the discontinuance or reduction of weekly payments of compensation under subsection (7) may apply for an order of an arbitrator that the weekly payments be reinstated.
Section 60(1) provides that an employer may apply at any time for an order of an arbitrator that weekly payments be discontinued or reduced. By s 60(2), such an order may be made if the employer satisfies an arbitrator that there is a genuine dispute as to liability to pay compensation or as to the proper amount of such weekly payments.
Section 61 relevantly provides:
(1)Subject to subsections (7) and (8) and section 84, where weekly payments of compensation for total or partial incapacity are made to a worker under this Act, they shall not be discontinued or reduced without the consent of the worker or an order of an arbitrator unless the worker has returned to work or a medical practitioner has certified that the worker has total or partial capacity for work or that the incapacity is no longer a result of the injury and a copy of the certificate (which shall set out the grounds of the opinion of the medical practitioner) together with at least 21 clear days' prior notice of the intention of the employer to discontinue the weekly payments or to reduce them by such amount as is stated in the notice, has been served by the employer upon the worker and unless within that period the worker has not made an application under subsection (3).
(2)Weekly payments of compensation for total or partial incapacity shall not be discontinued or reduced pursuant to subsection (1) unless the notice referred to in that subsection contains a clear statement —
(a)informing the worker of the effect of failing to make an application under subsection (3) within the time referred to therein; and
(b)informing the worker that he may obtain information from WorkCover WA as to the ways and means available to him to establish or protect his rights in respect of his injury; and
(c)containing such other information as may be prescribed.
(2a)If a person is required to give notice under subsection (1) and —
(a)fails to give the notice within the period referred to in that subsection; or
(b)gives a notice that does not comply with subsection (2),
the person commits an offence.
Penalty: $2 000.
(3)A worker who disputes the right of his employer to discontinue or reduce the weekly payments referred to in subsection (1) may, within the period of notice given under that subsection or, if the employer fails to give the notice required under that subsection, within the period of 21 days or such further time as an arbitrator may allow from the day on which the weekly payments were discontinued or reduced, apply for an order of an arbitrator that the weekly payment shall not be discontinued or reduced.
(4)Upon the hearing of an application referred to in subsection (3) an arbitrator shall —
(a)adjourn the application on such terms as the arbitrator thinks fit; or
(b)dismiss the application in which case the weekly payments may be discontinued or reduced, as the case may be; or
(c)make an order as to weekly payments by the employer to the worker on such terms as the arbitrator thinks fit.
…
(5)Subject to subsections (7) and (8), weekly payments shall not be discontinued or reduced otherwise than in accordance with this Act.
Penalty: $2 000.
…
(8)Subsections (1) and (2) do not apply to a discontinuance or reduction of weekly payments of compensation under section 59(7).
Section 5 provides, relevantly:
return to work, in relation to a worker who has suffered an injury compensable under this Act, means -
(a)the worker holding or returning to the position held by the worker immediately before the injury occurred, if it is reasonably practical for the employer who employed the worker at the time the injury occurred to provide that position to the worker; or
(b)if the position is not available, or if the worker does not have the capacity to work in that position, the worker taking a position -
(i)for which the worker is qualified; and
(ii)that the worker is capable of performing,
whether with the employer who employed the worker at the time the injury occurred, or another employer.
It is clear from these provisions that an employer who is liable to make weekly payments of compensation pursuant to sch 1 cl 7 may only discontinue or reduce the payments without the consent of the worker in three circumstances, firstly, if particulars provided by the worker establish that the worker has commenced remunerated work (s 59(7)), secondly, if an arbitrator orders a suspension, discontinuance or reduction on the basis of a genuine dispute as to liability (s 60), and, thirdly, if the worker has returned to work or a medical practitioner has certified that the worker has total or partial capacity for work or that the incapacity is no longer a result of the injury and a copy of the certificate and at least 21 days' notice of intention to discontinue or reduce those payments is given to the worker, unless the worker makes an application within the period of notice (s 61(1)).
Clause 13 of sch 1 of the WCIMA prescribes the means by which the rate of weekly payments may be reduced proportionately in the case of a worker who has entered into concurrent contracts of service with two or more employers where the total number of hours worked each week is less than the number of hours stated in the industrial award rate to the employment in which the injury occurred.
The arbitration
The application for arbitration (form 150) lodged 17 February 2017 stated the issue in dispute to be 'unlawful cessation of weekly payments'. The employer's reply (form 154) under the heading 'Dispute details' stated:
The applicant's current earnings exceed the approved workers' compensation rate as notified to her. The Respondent therefore denies any unlawful cessation of weekly payments.
The worker's application did not indicate the provision of the WCIMA under which it was made. However, in the worker's outline of submissions for arbitration dated 27 April 2017 the issues for determination were stated to be as follows:
1.Whether the applicant's weekly payments of compensation were unlawfully ceased pursuant to s 61 of the WCIMA and/or, in the alternative;
2.Whether the applicant's declared employment with Sugar Blue both pre and post-injury is such that she has 'commenced remunerated work' for the purposes of s 59(7) of the WCIMA; and
3.Whether the applicant's weekly payments of compensation were lawfully ceased pursuant to s 59(9) of the WCIMA.
It is apparent from the transcript and the written submissions that the worker's application was treated at the hearing of the arbitration as an application under both s 59(10) and s 61(3), the basis for the employer's discontinuance of weekly payments being ambiguous.
In relation to s 61, the worker submitted, firstly, that she had not 'returned to work', and, secondly, that she had not been served with a notice of intention to discontinue weekly payments on the basis of a medical practitioner having certified that her incapacity was no longer a result of the injury. The worker's position was that her employment with Sugar Blue commenced before the injury giving rise to the incapacity for which she was entitled to compensation by the employer and had continued. There was no 'return to work'. Accordingly, weekly payments could only be discontinued by the order of an arbitrator on the grounds of a genuine dispute pursuant to s 60(2), or upon 21 days' notice on the basis of a medical certificate pursuant to s 61(1).
It is not in dispute that no s 61 notice of intention to discontinue weekly payments based on medical certification of capacity was ever served.
It was not contended by the worker in the arbitration or in this appeal that the requirement of notice of the employer's intention in s 61(1) applied to a return to work.
With reference to s 59, the worker submitted that by s 59(7) the employer's insurer may only discontinue or reduce weekly payments of compensation in accordance with particulars provided pursuant to s 59(6). The worker had not given any particulars which would allow the employer's insurer to discontinue weekly payments.
In any event, the worker disputed that she had 'commenced remunerated work'. She contended that she commenced employment with Sugar Blue on 23 March 2010 and that that employment had continued such that it could not be said that she 'commenced remunerated work' after claiming weekly payments from the employer.
In response the employer submitted (respondent's submissions lodged 5 May 2017) that the worker's weekly payments were lawfully ceased on the basis that her earnings exceeded the approved weekly compensation rate as notified to her for the purpose of s 59(7), and, alternatively, that she had returned to work for the purposes of s 61.
It is clear from the employer's written submissions in the arbitration that at the time of discontinuing the weekly payments it did not have any particulars of the remuneration of the work done for Sugar Blue. Rather, the employer sought to justify the discontinuance of weekly payments pursuant to s 59 by reliance on information set out in the worker's witness statement dated 8 February 2017 filed in the proceedings, particularly as to the hours worked for Sugar Blue (15 – 20 hours per week), and the remuneration ($30 per hour).
The employer's submissions noted that the undisputed rate of weekly payments of compensation after week 13 was $302.94. The worker had admitted in her statement that she had been working for Sugar Blue earning between $450 and $600 per week. As these earnings exceeded the notified compensation rate, the employer was entitled to cease weekly payments pursuant to s 59.
Implicit in the employer's submissions was the proposition that the continuation of the worker's concurrent employment with Sugar Blue amounted to a 'commencement of remunerated work' for the purposes of s 59(2) and a 'return to work' for the purposes of s 61(1).
The employer also submitted in supplementary submissions lodged 11 May 2017 that the worker's alleged representation to the employer's insurer that she was working only for the employer and the City of Perth when her claim to compensation arose amounted to an estoppel by representation. No issue in relation to that contention arises in this appeal.
Arbitrator's reasons for decision
Section 59
Dealing firstly with s 59, the arbitrator upheld the worker's submission that the particulars provided by her in the pro forma dated 22 December 2016 were insufficient to permit the employer to discontinue weekly payments pursuant to s 59(7). The particulars did not indicate that she had ceased to be under a disability due to her left knee injury or that she was earning more than the weekly payments to which she was entitled. At [42] the arbitrator held:
Subsection 57(7) and (8) of the Act provide that the employer may only discontinue or reduce a worker's weekly payments in accordance with the particulars provided under s 59(6) and not otherwise. In my opinion it is not open to the employer to rely on subsequent information in the worker's witness statement dated 26 April 2017 as a supplement to her s 59(6) particulars dated 22 December 2016 in order to give ex post facto legitimacy to an earlier discontinuation of weekly payments purportedly done under s 59(7) on 23 December 2016.
Effectively, the arbitrator concluded that it was unlawful for the employer to discontinue weekly payments pursuant to s 59(7), as it claimed to be entitled to do.
Although the arbitrator acknowledged that it was unnecessary to decide the issue, as to whether the worker had 'commenced remunerated work' with Sugar Blue after making a claim for weekly payments of compensation, the arbitrator held at [45]:
I consider that the phrase 'commenced remunerated work' in s 61(1) [sic – s 59(1)] must be construed in light of the principle that a worker is only entitled to weekly payments of compensation 'from the date of incapacity resulting from the injury': s 21 of the Act, see also s 18. On this basis, any work performed from the date of making a claim for weekly payments for incapacity resulting from 'the injury' would be relevant to the question of the extent to which a worker continues to suffer incapacity for work, regardless of whether the work was of the same that was done before making the claim. In other words, in my view, 'remunerated work' done after making a 'claim for weekly payments' is a 'commencement' of work for the purposes of s 59(2) and (5), notwithstanding that the worker may have been performing the same work previously.
No issue arises in this appeal from the disposal of the s 59 issues.
Section 61
The arbitrator identified the s 61 question as whether the worker had 'returned to work' with Sugar Blue, and if so, whether the employer was entitled to discontinue the weekly payments. He observed that it was common cause between the parties that there was no requirement for formal notice of the employer's intention to reduce or discontinue weekly payments under s 61(1) on the basis of a return to work.
The arbitrator's decision turned on the construction of the definition of 'return to work' in s 5 of the WCIMA. The arbitrator noted that the definition (enacted in 2004) displaced the construction applied by the Full Court of the Supreme Court of Western Australia in Department of Education v Kenworthy (1990) 3 WAR 1 to the effect ‘returned to work’ as used in s 61(1) meant returned to remunerated work with the employer who is paying weekly payments.
The arbitrator concluded [60]:
On this basis, any work performed from the date of 'the injury' would be relevant to the question of the extent to which a worker continues to suffer incapacity for work, regardless of whether the work was done for the employer who was liable to make weekly payments, or a third party. If the nature of the said work manifests amelioration in the worker's incapacity resulting from the injury, then the employer may be entitled to reduce or discontinue weekly payments. This is consistent with the s 5 definition of 'return to work' referring to work 'with the employer who employed the worker at the time the injury occurred, or another employer'.
Accordingly I find that the work performed by the worker with Sugar Blue after the occurrence of the left knee injury was a 'return to work' within s 61(1), notwithstanding that the work she was doing for Sugar Blue pre and post the left knee did not change.
Moreover, I am satisfied that the worker's return to work with Sugar Blue falls within the meaning of 'return to work' as considered in the passage from Atkinson v Nipper Cleaning Services Pty Ltd (1992) 1 TAS R 276, 288 quoted at [56] above, and in Glenn v Compass Group (Australia) Pty Ltd [2014] WADC 86 (Braddock DCJ) [43] reviewing the decisions of Department of Education v Kenworthy and Philmac Pty Ltd v Asti (1980) 26 SASR 213, and then quoting the following passage from Philmac at (218) (King CJ):
Return to work is considered a sufficient reason, as it seems to me, because it involves the reestablishment of the injured worker as a wage earner who is no longer in need of weekly payments of compensation. For return to work to have significance for this purpose it must be, in my opinion, a return as a settled or established member of the wage earning workforce.
Accordingly, I find that the work performed by the worker with Sugar Blue after the occurrence of the left knee injury was a 'return to work' within s 61(1) in the sense that it was as a settled or established member of the wage earning workforce.
The arbitrator then held that his decision to dismiss the worker's application for continuation of weekly payments enlivened his discretion to determine the substantial merits of the worker's claim [65]. He went on to decide, firstly, at [71], that the worker's demonstrated partial capacity for alternative work with another employer reduced the rate of weekly payments by the amount earned from the alternative work and, secondly, at [77], that the worker was fit for full‑time sedentary work of the type she was performing for Sugar Blue.
The latter decision was based on a medical report by Mr Ross McLaren, orthopaedic surgeon, dated 24 January 2017 in which he opined that the worker was unlikely to return to work as a dancer due to her left knee injury, but that she was fit for sedentary work on a full‑time basis.
At [88] the arbitrator concluded that the worker had not discharged the onus of showing that the employer had unlawfully discontinued weekly payments. The arbitrator dismissed the application and ordered further that weekly payments were to be discontinued from 16 March 2017 the date of the last payment.
Grounds of appeal
The worker's grounds of appeal were (as numbered in the appeal notice) as follows:
5.The Arbitrator erred in law when he held the Applicant bears the burden of proof in establishing the discontinuation of weekly payments was unlawful.
6.The Arbitrator should have held that the Respondent bears the onus of proof to establish that the Applicant had returned to work and that the discontinuation of weekly payments was lawful.
7.The Arbitrator erred in law when he found that the Applicant had 'returned to work' with Sugar Blue Burlesque pursuant to s 61(1) when on the facts there had been no absence from work with Sugar Blue Burlesque as a result of the injury sustained during her employment with the respondent.
8.The Arbitrator failed to afford the Applicant procedural fairness when he found that the Applicant had partial capacity for full‑time, settled employment in her alternative duties with the respondent without giving the Applicant the opportunity to be heard.
9.The Arbitrator failed to afford the Applicant procedural fairness when he referred to an authority and legislation not raised by the parties at the arbitration.
10.The Arbitrator's reasons for decision are inadequate:
(a)as there is no clear indication whether the Arbitrator found that the Applicant had made a return to work with Sugar Blue or the Respondent or both;
(b)in that the Arbitrator has left the Applicant to infer whether any of the matters in s 5(b) have been considered in concluding the Applicant had made a return to work;
(c)in that the Arbitrator has left the Applicant to infer which facts as found he considered relevant in determining weekly payments of compensation ought to be discontinued;
(d)in that the Arbitrator has left the Applicant to infer how he came to the conclusion that the Applicant had at all material [times] been earning more than the rate of weekly payments payable by the employer when he never made a finding as to what was the rate of weekly payments payable by the employer.
Grounds 9 and 10 were abandoned and counsel for the appellant conceded in relation to grounds 5 and 6 that the question of onus did not require determination where the real issue was the correctness of the finding that the worker had returned to work (ground 7) and the determination by the arbitrator of the worker's capacity for full-time sedentary work (ground 8).
Return to work issue
This issue is essentially one of construction. The worker contends that the continuation of concurrent employment following an injury that causes an incapacity to do other work is not a return to work for the purposes of the WCIMA, where the worker has no incapacity for such concurrent employment.
It is argued that as she had not held or returned to the position of a dance instructor for the employer, the first limb of the s 5 definition did not apply. The question for the purposes of the second limb of the definition was whether the worker had 'taken a position for which she was qualified and that she was capable of performing, whether with the employer who employed her at the time the injury occurred, or another employer'. The worker's position is that merely continuing a concurrent job with another employer for which she suffered no incapacity did not amount to taking a position and was therefore not a return to work.
No reliance was placed on Department of Education v Kenworthy, notwithstanding that it had been cited at first instance. It is not in dispute that taking a position with another employer after a period of incapacity is a return to work.
The point raised by the appeal in this respect is whether a return to work requires some interruption of pre-injury employment, some period of absence from work.
The natural and ordinary meaning of 'return' as a noun is the act of going back to a place, state or activity. It is defined in the New Shorter Oxford Dictionary as 'the act of coming back to or from a place, person, condition'. A 'return' obviously requires that the subject has been away. This construction is consistent with that of Zeeman J in Atkinson v Nipper Cleaning Services Pty Ltd (1992) 1 Tas R 276, 287:
Upon a proper construction of s 86(1)(a) a return to work occurs where, after the expiration of a period of incapacity, a worker returns as a settled or established member of the wage earning workforce with an employer by whom the worker was employed at the time of the commencement of the relevant period of incapacity whether or not that employer is the employer liable to make payment of compensation referable to the injury. Where at the time of the commencement of that period of incapacity the worker was employed by several employers under concurrent contracts of employment, then a return to work, in the sense which I have mentioned, with one of such employers would constitute a return to work.
This dictum was cited by the arbitrator who noted that s 86(1)(a) of the Workers' Compensation Act 1988 (Tas) was in similar terms to s 61(1) of the WCIMA ([56]). While the arbitrator also considered that the construction of 'return to work' by Zeeman J in Atkinson v Nipper Cleaning Services Pty Ltd was consistent with the s 5 definition, he seems, with respect, to have overlooked, or not given meaning to, the words 'after the expiration of a period of incapacity'.
The thrust of the employer's submission is that, by continuing to perform work as an accounts administration officer for Sugar Blue, the worker has demonstrated a capacity for work, notwithstanding that she does not have the capacity to return to work with the employer as a dance instructor.
The employer contends, moreover, that as her income from Sugar Blue is greater than the rate of weekly payments for which the employer is liable, the discontinuance of weekly payments is justified.
The employer places reliance on the decision of Atkinson v Nipper Cleaning Services Pty Ltd, but as I have observed, in that case the worker's return to work followed a period of incapacity for all work. The facts were that the worker had concurrent part-time jobs with two cleaning firms. An injury suffered in the course of her employment by Nipper Cleaning Services caused her to be wholly incapacitated for work. She recovered and was able to resume work with both employers. Later she suffered further incapacity. Her weekly payments were resumed. During the subsequent period of incapacity, however, she continued to work for the other employer, receiving wages as well as weekly payments of compensation for incapacity to work in both positions. In those circumstances she was found to have made a return to work. At (288), Zeeman J observed:
In a case where a worker is serving under concurrent contracts of employment it may well be that initially the worker suffers from total incapacity, i.e., is incapable of performing the duties required of the worker under any of the contracts of employment, but then regains the capacity to do the work required by one employer, but by reason of the worker's injury remains incapable of doing the work required by the other employer. In such a case, if the worker returns to work with the former employer, there has been a return to work within the meaning of s 86(1)(a) but one which would justify no more than a reduction of the weekly payment in an amount equivalent to the earnings capable of being earned by the worker under that contract of employment which the worker is capable of performing. A variety of circumstances may lead to such a result. The nature of the work to be performed for one employer may differ markedly from that to be performed for the other employer so that the effect of the injury may be such that the worker is capable of performing that required by one employer but incapable of performing that required by the other employer. The nature of the work to be performed for each employer may be similar, but the effect of the injury may be such that the worker is only able to work limited hours which are no greater than those required to perform the worker's duties with one employer only.
At (289), his Honour concluded:
In the circumstances of this case, the learned commissioner was required to be satisfied that it had been established by the respondent that the appellant no longer suffered from any incapacity for work, total or partial, before being justified in upholding the termination. It was accepted before the learned commissioner and before me that the respondent carried the onus of proof on the reference. If the respondent did no more than persuade the learned commissioner that there had been a return to work in the sense that the appellant had returned to work with Coppleman Cleaners, so that it could be concluded that the incapacity was no longer a total incapacity, then that was insufficient to justify upholding the termination. It was incumbent upon the respondent to persuade the learned commissioner that there was no longer any incapacity for work before the termination could be upheld. Had the learned commissioner been persuaded that the appellant was capable of performing the duties of her employment with the respondent, then, on the facts of this case, he ought to have been persuaded that there was no longer any incapacity for work.
Incidentally, his Honour considered the construction of 'return to work' in Kenworthy, noting at (282) that s 61 of the WCIMA differed from s 86 of the Tasmanian act in that it permitted a discontinuance or reduction of weekly payments upon a return to work to be made without notice. The Tasmanian act required that 10 days' notice be given and had no provision equivalent to s 59.
The facts of this case are quite different. The worker has never received weekly payments of compensation for any incapacity to do her part-time work for Sugar Blue. Her weekly payments have been calculated on the basis of her incapacity for work with the employer as a dance instructor and the City of Perth as a waitress.
In my opinion the arbitrator erred in concluding that the worker, by continuing to work in a concurrent job for which she was not incapacitated by the injury for which the employer is liable, made a return to work for the purposes of s 61. The statutory meaning of 'return to work' is not ambiguous in its context. Both limbs refer to resuming paid work after a period of incapacity, the first by returning to the position held at the time of the injury, and the second by taking another position with the employer or another employer.
Concurrent contracts of employment are common. Indeed, as noted, cl 13 of sch 1 of the WCIMA specifically provides the means of calculation of weekly payments in such cases. It would be absurd if a worker who had two part-time jobs, and who by reason of injury suffered an incapacity for one, but not the other, were on that ground alone not entitled to weekly payments, as it would be if a worker, injured in the course of one contract of employment, were not entitled to weekly payments of compensation for incapacity to work, simply because his or her ongoing income from a concurrent contract of employment exceeded the rate of the weekly payments for which the first employer would otherwise be liable.
As the worker had not 'returned to work', the employer's discontinuance of weekly payments without notice breached the prohibition in s 61(1).
Of course, in such a case, a continuing capacity for other employment may demonstrate a total or partial capacity for work. In that event, however, the pathways to a discontinuance or reduction of weekly payments are by an application pursuant to s 60(2) on the grounds of a genuine dispute, or notice of medical certification of a total or partial incapacity for work in accordance with s 61(1). This observation leads to consideration of the second main issue raised in the appeal.
Before moving to that issue, I would observe that in my view it is not clear that s 61(1) does not require notice to be given to a worker of an employer's intention to discontinue or reduce weekly payments on the grounds of a return to work. However, as it was common cause that the notice requirement in s 61(1) applies only where the employer is relying on medical certification of a total or partial capacity for work, that question is not open to adjudication in this appeal.
Insofar as s 61 is concerned, the worker contends that the cessation of weekly payments was unlawful not because the employer failed to give notice of its intention do so, but because she had not 'returned to work'.
Capacity for work issue
The worker's contention is that the question of her demonstrated capacity for alternative work as an accounts administration officer was not raised by the application for arbitration and was not otherwise litigated in the arbitration. Accordingly, it was not open to the arbitrator to determine the substantive merits of her claim for compensation as he did at [87] on the basis of Mr McLaren's report of 23 February 2017.
As I have noted, the employer did not seek to discontinue or reduce weekly payments by serving on the worker a medical certificate of total or partial capacity for work, but rather purported to discontinue weekly payments without notice on the basis of a return to work, arguing that the worker's earnings from Sugar Blue exceeded the rate of weekly payments for which it was liable.
The employer's contention is that the issue of the worker's capacity for full‑time alternative work was argued at the arbitration on the basis of the medical report of Mr McLaren. The employer argues that the worker had every opportunity in the arbitration to adduce evidence on the issue in rebuttal of Mr McLaren's report, but did not do so. In this regard I observe that the worker's book of documents filed in the arbitration proceedings included the report of Mr McLaren dated 24 January 2017 and that her responsive witness statement dated annexed a report of Mr McLaren dated 19 February 2015. A supplementary report dated 23 February 2017 was tendered by the employer.
In the supplementary report Mr McLaren opined that the worker was
fit for full-time sedentary work of the sort presently being undertaken by her with the employer and with Sugar Blue as an accounts and administration officer, albeit with some restriction requiring her to periodically get up and move around.
In Mr McLaren's opinion she was not fit for the full duties involved in her pre-injury role as a dance teacher 'because of the need to load her injured patellofemoral joint'.
In evaluating the employer's submission I have reviewed the transcript of the arbitration hearing, the documentary evidence adduced in the arbitration and the parties' written submissions.
The transcript of the preliminary discussion between the arbitrator and the parties' legal representatives at the commencement of the hearing on 12 May 2017 reveals that some confusion about the issues arose when the worker's counsel objected to the employer adducing evidence of earnings from the employer that had been set off against her weekly payments. (The employer sought to tender the payslips to show her total earnings since her injury. The evidence was ultimately admitted.)
The confusion was caused by the employer maintaining that it was entitled to discontinue weekly payments without order or notice by virtue of both s 59(7) and s 61(1), in other words, on the basis that she had 'commenced remunerated work' or had 'returned to work'. Although the worker's counsel objected to the employer invoking s 61(1), the worker's outline of submissions, referred to above, anticipated both grounds.
The employer's position is made clear in a number of places, firstly, at ts 7:
MR FREEMAN:
The reason I say that section 61 does apply if there is a return to work is that the provisions say this, that:
'where weekly payments of compensation for a total or partial incapacity are made to a worker under this act they shall not be discontinued or reduced without the consent of the worker or an order of an arbitrator unless the worker has returned to work or a medical practitioner has certified that the worker has total or partial incapacity [sic - capacity] to work'.
So, for example, if the worker returns to work with her employer on a full-time basis, there can't be any doubt, so there's no need to serve a notice on her because she has returned to work.
MR FLETCHER:
We're just got to read on. 21 clear days' prior notice of the intention of the employer to discontinue.
MR FREEMAN:
That's said on the basis that you - my submission's that's if there is - you're working under a medical practitioner certification.
Then, at ts 8:
MS CHESWORTH:
But they didn't cease the payments on the basis of a return to work. The reason that they were ceased were pursuant to s 59. That's always the - well, that's what the respondent told us, that they exercised their right under s 59 and not under 61. And now at this late date they're saying, 'Oh well by the way we're going to exercise our right under s 61.'
…
MR FREEMAN:
My response would be that they are alternatives either way that the payments were to be ceased and that they are both relevant to the issue of why they are discontinued.
Mr Freeman (for the employer) said that his client's position was that the weekly payments were validly ceased pursuant to s 59 and s 61 (ts 13). He made it clear that the real issue was 'that the work she did for Sugar Blue after the injury was essentially replacement income and therefore voided her right to compensation or, at least, that share of compensation' (ts 18).
There was no suggestion made on behalf of the employer in the discussion that preceded the evidence that the arbitration involved a determination of capacity for work based on medical evidence.
In her responsive statement of 26 April 2017 the worker stated that Mr McLaren had asked her about her work activities when he reviewed her on 27 February 2015 and that she told him about her work at Sugar Blue. It is clear that that statement was made in response to the employer's allegation that the worker did not disclose her work for Sugar Blue until December 2016.
In the worker's cross‑examination no reference was made to Mr McLaren's reports.
I note also that the employer's written closing submissions lodged 4 July 2017 argued, in relation to s 61:
3.9It is submitted that there has been a clear and obvious return to a position for which the worker was qualified and capable of performing with another employer, in this case Sugar Blue Burlesque.
3.10It is submitted that as the rate of pay received at Sugar Blue Burlesque exceeds the rate of weekly compensation payments, that therefore weekly payments have been lawfully ceased based upon a return to work.
There was no argument made that the employer was entitled to discontinue weekly payments on the basis of the worker having a capacity for full‑time work in alternative duties.
It is clear upon a review of the evidence and the proceedings that the issue for arbitration was the lawfulness of the employer's discontinuance of weekly payments without notice on the basis of a return to work. The arbitration did not raise any issue as to the worker's capacity for alternative work.
It was not open for the arbitrator, therefore, no issue having been joined in this regard, to determine on the basis of a medical report or reports that had been put in evidence for a different purpose, to determine the substantive issue of whether the employer was entitled to discontinue weekly payments based on the worker having a capacity for full-time alternative work. The arbitrator was not entitled to go beyond the issues joined in the arbitration. Accordingly, the arbitrator erred by holding at [65] that upon the dismissal of the worker's application (taken to have been made pursuant to s 61(3)), he was empowered to determine the substantive merits of the claim.
If that is not correct, then there can be little doubt that, as the worker contends, procedural fairness was not observed. Upon a review of the case as a whole I can find no evidence that the worker was put on notice of the proposed determination of that issue and given the opportunity to address it.
Further, and in any event, in my opinion, no issue for adjudication of capacity for work arose in this case because the employer had not, in compliance with s 61(1), served a copy of a medical certificate that the worker had total or partial incapacity for work and given the worker at least 21 clear days prior notice of the employer's intention to discontinue the weekly payments on that basis. Accordingly, even if the employer had sought to rely on Mr McLaren's opinion to justify the discontinuance of weekly payments, which it did not, it could not have done so without complying with that provision.
Conclusion
The employer's cessation of weekly payments without order or notice did not comply with requirements of s 59(7), as the arbitrator found. Neither, as these reasons show, did it comply with s 61(1).
The issue raised by the fact of the worker's capacity for her ongoing work for Sugar Baby and the opinion of Mr McLaren that she had a capacity for full-time sedentary work, warranted an application pursuant to either s 60, on the grounds that there was a genuine dispute, or the giving of notice of the employer’s intention to discontinue weekly payments on the basis of medical certification of capacity for work pursuant to s 61(1). It was not lawful for the employer to discontinue weekly payments merely on the basis that the worker’s earnings from a concurrent ongoing contract of employment exceeded the rate of weekly payments for which the employer was liable.
For these reasons I find that the arbitrator erred by holding that the cessation of the worker's weekly payments in March 2017 was lawful and by proceeding then to determine the substantive issue of the worker's capacity for work. I would therefore grant leave to appeal, allow the appeal and set aside the orders made on 18 September 2017. I will hear counsel on the issue of reinstatement.
I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
RR
ASSOCIATE TO JUDGE STAUDE7 MAY 2018
0
2
1