Kajic v Hawker De Havilland Aerospace Pty Ltd
[2009] NSWWCCPD 136
•22 October 2009
| WORKERS COMPENSATION COMMISSION | |||||
| REFERENCE OF A QUESTION OF LAW TO THE COMMISSION CONSTITUTED BY THE PRESIDENT | |||||
| STATUS: Reported Decision: Kajic v Hawker De Havilland Aerospace Pty Ltd (2009) 8 DDCR 228 | |||||
| CITATION: | Kajic v Hawker De Havilland Aerospace Pty Ltd [2009] NSWWCCPD 136 | ||||
| APPLICANT: | Ivan Kajic | ||||
| RESPONDENT: | Hawker De Havilland Aerospace Pty Ltd | ||||
| INSURER: | CGU Workers Compensation (NSW) Ltd | ||||
| INTERVENER | WorkCover Authority of NSW | ||||
| FILE NUMBER: | WCC8869/08 | ||||
| DATE OF DECISION: | 22 October 2009 | ||||
| SUBJECT MATTER OF DECISION: | Section 60AA(3) of the Workers Compensation Act 1987; gratuitous domestic assistance | ||||
| PRESIDENTIAL MEMBER: | President Judge Greg Keating | ||||
| HEARING: | On the papers | ||||
| REPRESENTATION: | Appellant: | McLaughlin & Riordan | |||
| Respondent: | Bartier Perry | ||||
| Intervener: | WorkCover Authority, Legal Group | ||||
| ORDERS MADE: | 1. Section 60AA(3) of the Workers Compensation Act 1987 is an evidentiary threshold to the entitlement to compensation for gratuitous domestic assistance and must be read in conjunction with the ‘WorkCover Guidelines for the Provision of Domestic Assistance’ dated 15 October 2004. When so read the subsection imposes a maximum level of compensation payable to a carer limited by clause 7.4 of the Guidelines, but the compensation is not determined by the amount of any lost income or the value of forgone employment sustained by the care provider. 2. The Respondent is to pay the Applicant’s cost of the referral of the Question of Law. 3. The WorkCover Authority of NSW is to pay its own costs. | ||||
INTRODUCTION
This case involves a novel and complex question of law, namely the interpretation and application of section 60AA of the Workers Compensation Act 1987 (‘the 1987 Act’) in circumstances where a worker is in receipt of gratuitous domestic assistance.
BACKGROUND TO THE REFERRAL OF THE QUESTION
Mr Kajic is a 51 year old sheet metal worker who sustained a spinal cord injury resulting in quadriplegia when he slipped and fell heavily, striking his head, in the course of his employment on 24 March 2004 (incorrectly pleaded as 23 March 2004).
On 6 November 2008, he filed an ‘Application to Resolve a Dispute’ in the Workers Compensation Commission (‘the Commission’) seeking lump sum compensation under section 66 in respect of 100% Whole Person Impairment and $50,000.00 under section 67 for pain and suffering. In addition he also brought a claim for domestic assistance, as provided by his wife, Mrs Lucija Kajic, under section 60AA of the 1987 Act, in the amount of $1,048.80 per week from 9 July 2004 to date and continuing.
Hawker De Havilland Aerospace Pty Ltd (‘the Respondent’), conceded injury and the matter was referred to the Registrar for referral to an Approved Medical Specialist (‘AMS’) for assessment of Mr Kajic’s whole person impairment.
A Medical Assessment Certificate (‘MAC’) was issued by Dr Davies (AMS) on 12 December 2008. This MAC was the subject of an appeal to a Medical Appeal Panel (‘the Panel’). The Panel revoked the MAC and issued a replacement certificate which certified a 94% WPI as a result of the work injury.
After a teleconference, a ‘Certificate of Determination-Consent Orders’ issued on 19 August 2009, with the following agreed orders:
“1. That the Respondent pay to the Applicant, as lump sum compensation under section 66 of the Workers Compensation Act 1987, $200,000 in respect of 94% permanent impairment assessed as a percentage of whole person impairment, attributable to the injury of 24 March 2004.
2. That the Respondent pay the Applicant, as lump sum compensation under section 67 of the Workers Compensation Act 1987, $50,000 in respect of pain and suffering.
3. Leave is granted to the Applicant to refer a Question of Law to the President in accordance with s351, being the interpretation of the maximum entitlement for domestic assistance under the Guidelines and s60AA.
3. That the application under s60AA be adjourned pending the outcome of the referral by the Applicant.”
On 24 August 2009, Mr Kajic’s solicitor filed in the Commission, through the Arbitrator, an ‘Application for Leave to Refer a Question of Law’. On 4 September 2009 the Respondent filed a ‘Notice of Opposition to Application for Leave to Refer a Question of Law’.
THE QUESTION OF LAW
The Question referred is as follows:
“Does sub-section 60AA(3) of the Workers Compensation Act 1987 constitute more than an evidentiary threshold entitlement requirement, and if so, is it to be read in conjunction with the WorkCover Guidelines for the Provision of Domestic Assistance dated 15th October 2004, so as to impose a maximum level of compensation payable under s. 60AA to a care provider, limited by the amount of any lost income or value of the forgone employment sustained by the care provider?”
On 8 September 2009, I caused to be served on both parties and the WorkCover Authority of NSW (‘the Authority’) a Direction in the following form:
“The Commission has received the following:
1.An ‘Application for Leave to Refer a Question of Law’ to the President, filed by the Applicant on 24 August 2009 containing a Certificate of Service certifying service on Arbitrator Scott, the Respondent, and its legal representative and the WorkCover Authority of New South Wales.
2.A ‘Notice of Opposition to Application for Leave to Refer a Question of Law’ filed by the Respondent on 4 September 2009 containing a Certificate of Service certifying service on Arbitrator Scott, the Applicant, and his legal representative and the WorkCover Authority of New South Wales.
The following directions are made:
1.If the WorkCover Authority seeks to intervene in these proceedings under section 106 of the Workplace Injury Management and Workers Compensation Act 1998, it is to file in the Commission and serve on each party to the dispute, submissions on the question of law on or before 23 September 2009.
2.The parties to the dispute are to file with the Commission and serve on the WorkCover Authority and each other party any further submissions on or before 30 September 2009.”
On 23 September 2009, the Authority sought to intervene and filed submissions on the Question of Law (see [51]-[53] below).
LEGISLATION AND GUIDELINES
Section 60AA of the 1987 Act states:
“60AA Compensation for domestic assistance
(1) If, as a result of an injury received by a worker, it is reasonably necessary that any domestic assistance is provided for an injured worker, the worker’s employer is liable to pay, in addition to any other compensation under this Act, the cost of that assistance if:
(a) a medical practitioner has certified, on the basis of a functional assessment of the worker, that it is reasonably necessary that the assistance be provided and that the necessity for the assistance to be provided arises as a direct result of the injury, and
(b) the assistance would not be provided for the worker but for the injury (because the worker provided the domestic assistance before the injury), and
(c) the injury to the worker has resulted in a degree of permanent impairment of the worker of at least 15% or the assistance is to be provided on a temporary basis as provided by subsection (2), and
(d) the assistance is provided in accordance with a care plan established by the insurer in accordance with the WorkCover Guidelines.(2) Assistance is provided on a temporary basis if it is provided in accordance with each of the following requirements:
(a) it is provided for not more than 6 hours per week,
(b) it is provided during a period that is not longer than, or during periods that together are not longer than, 3 months,
(c) it is provided pursuant to the requirements of the relevant injury management plan.(3) Compensation is not payable under this section for gratuitous domestic assistance unless the person who provides the assistance has lost income or forgone employment as a result of providing the assistance.
(4) Compensation payable under this section for gratuitous domestic assistance is payable as if the cost of that assistance were such sum as may be applicable under section 61 (2) in respect of the assistance concerned.
(5) The following requirements apply in respect of payments under this section:(a) payments are to be made as the costs are incurred or, in the case of gratuitous domestic assistance, as the services are provided,
(b) payments are only to be made if those costs and the provision of the assistance is properly verified (and the WorkCover Guidelines may make provision for how the performance of those services is to be verified),
(c) payments for gratuitous domestic assistance are to be made to the provider of the assistance.
(6) In this section:
‘gratuitous domestic assistance’ means domestic assistance provided to an injured worker for which the injured worker has not paid and is not liable to pay.”
On 22 October 2004 the ‘WorkCover Guidelines for the Provision of Domestic Assistance’ (‘the Guidelines’) were published in the NSW Government Gazette No 166, under the hand of Jon Blackwell, Chief Executive Officer WorkCover NSW (‘the WorkCover Authority’).
The source of the power to issue the Guidelines is in section 376(1) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’).
The Guidelines are relatively extensive and make provision for:
(1) Aim of the guidelines.
(2) Application of the guidelines.
(3) Eligibility to domestic assistance.
(4) Purpose of provision of domestic assistance.
(5) Approval requirements of the domestic assistance.
(6) Level of domestic assistance that can be provided by the insurer.
(7) Special requirements - compensation for gratuitous domestic assistance services.
Relevantly the Guidelines provide as follows:
“6.1 Hours per week
In the event the worker has been certified with at least 15% Whole Person Impairment (WPI), the worker is entitled to all reasonably necessary domestic assistance.
In these cases, the hours provided would be determined based on medical/health professional recommendation and application of the principles listed above. ...’
7.1 Lost income or forgone employment
A person claiming compensation for providing gratuitous domestic assistance must provide evidence to the Claims Manager that they have lost income or forgone employment as a result of providing this assistance.
Examples of evidence may include:
·pay slips demonstrating less overtime worked for that period, with a supporting letter from the employer,
·pay slips demonstrating fewer hours of work (if casually employed), with a supporting letter from the employer,
·evidence of reduced hours of work – eg from full-time to part-time,
·letter of resignation, giving reasons, and
·letter of termination by an employer – outlining reasons for loss of job.”
7.4 Maximum amount payable
The maximum hourly fee amount for which an employer is liable under the Act for gratuitous domestic assistance services is the hourly rate calculated by dividing by 35 the amount estimated by the Australian Bureau of Statistics as the average weekly total earnings (full-time adult ordinary time) of all employees in New South Wales from time to time. Compensation is not payable for more than 35 hours per week.”
LEAVE
Before granting leave to refer the question, I must be satisfied that the question meets the requirements of section 351(3) of the 1998 Act, which provides:
“(3) The President is not to grant leave for the referral of a question of law under this section unless satisfied that the question involves a novel or complex question of law.”
It is common ground that the Applicant’s wife, Lucija Kajic, has lost or forgone income in caring for the Applicant and has provided assistance at all times, other than when the Applicant has been hospitalised, of at least 35 hours per week.
Applicant’s submissions
The Applicant submits that the subject section and relevant Guidelines contain a number of threshold entitlement provisions which, relevant to the circumstances of the Applicant are:
(a) the medical practitioner must certify on the basis of a functional assessment of the worker that it is reasonably necessary that the assistance be provided, and that the necessity to this assistance to be provided arises as a direct result of the injury (section 60AA (1)(a));
(b) the assistance would not be provided to the worker but for the injury (section 60AA (1)(b));
(c) the injury to the worker has resulted in a degree of permanent impairment of the worker of at least 15% (section 60AA (1)(c));
(d) the assistance is provided in accordance with a care plan established in accordance with the Guidelines (section 60AA (1)(d));
(e) compensation is not payable for gratuitous domestic assistance unless the person who provides the assistance has lost income or forgone employment as a result of providing the assistance (section 60AA (3));
(f) payments are only to be made if the costs of the domestic assistance and the provision of the assistance is verified pursuant to the Guidelines (section 60AA (5)(b));
(g) in cases where an injured worker has been certified with at least 15% whole person impairment, it is expected that an on-site Functional Assessment be carried out by a relevant professional (occupational therapist) (Guidelines, clause 5.1);
(h) a person claiming compensation for providing gratuitous domestic assistance must provide evidence that they have lost income or forgone employment as a result of providing this assistance (Guidelines, clause 7.1), and
(i) both the domestic assistance provider and the injured worker must sign diary entries setting out particulars as to the date, hours worked, and the activities performed (Guidelines, clause 7.2).
Once these threshold requirements are satisfied, the Applicant contends that compensation can be paid for the cost of the relevant assistance at an amount not more than the maximum amount, and for not more than the maximum hours as provided by clause 7.4 of the Guidelines.
The Applicant submits that, so assessed, the compensation payable for the domestic assistance provided to the Applicant by his wife from 9 July 2004 amounts to approximately $280,000 with a maximum continuing weekly rate of more than $1,150 per week.
During the course of the teleconference on 17 August 2009, the Respondent’s representative submitted that any compensation payable for the cost of relevant domestic assistance should be constrained by the second maximum limiting factor, namely the amount of lost income established by the care provider. In support of the submission, the insurer relied upon a decision of Acting Deputy President Roche (as he then was) in John Hayward Enterprises Pty Ltd v Kumar [2006] NSWWCCPD 161 (26 July 2006) (‘Kumar’). The Applicant submits that the question of law before me was not considered in Kumar. In that matter the parties agreed that the operation of section 60AA(3) would be limited by the carers pre-accident earnings. The arbitration and the appeal focused on the quantification of those earnings [34] and [38].
The Applicant submits that the decision in Kumar is obiter only, on the issue of the maximum limitation arising from a construction of section 60AA(3), which was not the subject of argument or determination.
The only other decision of the Commission touching on the interpretation of section 60AA(3) is a matter of Macri v D J Catanzariti t/as Rossies Supermarket [2005] NSWWCCPD 163 (23 December 2005) (‘Macri’). Acting Deputy President McGrowdie refered to the quantification of compensation under the section at [61]–[71] of his decision. Regrettably, it is evident from [63] that the Acting Deputy President was neither provided with a copy of the relevant Guidelines, nor referred to such Guidelines in his decision. On that basis, the decision is not relevant to the present question.
The Applicant submits that this question is novel, complex and important. The novelty stems from the fact that it has not been the subject of an argued decision, providing more than obiter dicta in the Commission. Its complexity arises from a requirement to apply rules of construction to the statutory provision and to the subordinate legislation constituted by the relevant Guidelines.
The Applicant submits that although not a criteria, the matter is one of significance to the Applicant and his wife, and to other carers of catastrophically injured workers, and to the administrators of the workers compensation scheme in New South Wales.
Respondent’s submissions
The Respondent submits, any gratuitous domestic assistance under section 60AA(3) is limited by the carer’s (Mrs Kajic’s) loss of earnings or wage loss due to any employment she had to forgo as a result of having to provide care to the Applicant worker.
The Respondent further submits that, if the Applicant establishes the carer suffered loss of earnings or had forgone employment resulting in loss of income, the calculation of domestic assistance under section 60AA(3) is the difference between the carer’s probable earnings but for the injury and her current income, if any.
During the 18 weeks immediately preceding the Applicant’s injury Mrs Kajic earned an average of $620.00 per week. Her average earnings in the previous financial years had been substantially less.
The Respondent submits that if the decisions in Kumar and Macri do not apply to the question of law referred to me for determination, then the question is novel, because the issue will be determined for the first time.
Authority’s submissions
The Authority submits the application does not raise a novel or complex question of law for the purpose of section 351(3) of the 1988 Act.
The Authority submits that its policy with regard to the provision of domestic assistance is set out in the Guidelines and clause 7 of the Guidelines clearly outlines the requirements with regard to compensation for gratuitous domestic assistance services under section 60AA(3) of the 1987 Act.
It further submits “that section 60AA(3) together with clause 7 of the Guidelines, clearly limits compensation or gratuitous domestic assistance services to the actual amount of the carer’s lost income or the value of income from forgone employment, to be evidenced according to clause 7.1 of the Guidelines, subject to the maximum amount payable, calculated in accordance with clause 7.4 of the Guidelines.”
Decision and finding on leave
I accept the Applicant’s submissions that the Commission’s determinations in Kumar and Macri do not assist in the resolution of the issue now before me. Although both matters resulted in compensation being awarded based on the carer’s lost income, in neither case was the construction of section 60AA(3) the subject of argument or determination.
In my view the issue concerning the construction of the statutory provision and the subordinate legislation constituted by the relevant WorkCover Guidelines is both novel and complex, and in the absence of any prior authority on the issue it is appropriate that leave be given to refer the question of law.
Accordingly, leave to refer the Question of Law is granted.
ON THE PAPERS REVIEW
Section 354(6) of the 1998 Act provides:
(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.
Having regard to Practice Directions Numbers 1 and 5, the documents that are before me, including the written submission by the parties, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.
SUBMISSIONS ON THE QUESTION OF LAW
Applicant’s submissions
The Applicant submits that section 60AA(3) is no more than an evidentiary requirement that, if satisfied, establishes an entitlement to compensation under this section. The sub-section itself merely provides that the carer must have either “lost income or forgone employment as a result of providing the assistance”. There is no mention of any amount, value or limitation.
The Applicant submits that clause 7.1 provides assistance to claims managers by setting out examples of evidence, which may be relied upon to establish that the person claiming compensation for providing gratuitous domestic assistance has lost income or forgone employment. The first of the examples given is in the following terms
“pay slips demonstrating less overtime worked for that period, with a supporting letter from the employer.”
The provision of this evidence is not conclusively consistent with establishing an amount of lost income. It is consistent with proving that there has been lost income. “Before and after” income records may well establish that even though there has been a continuity of standard working hours, the care provider has either lost income or forgone employment in the nature of overtime to provide the relevant care.
The Applicant makes a similar submission in relation to other examples set out in clause 7.1.
Clause 7.4 of the Guidelines under the heading of “maximum amount payable” make no mention of a superimposed limitation created by the amount of lost income sustained by the care provider.
Section 61(1) provides a general comparable criteria against which the amount for which an employer is liable for medical or other treatment can be assessed by reference to “the customary charge made in the community for the treatment to persons other than workers”. The weekly amount claimed for a provider of quasi nursing, cleaning, cooking and personal assistance services of the description provided by the Applicant’s wife, that is, $28.34 per hour in July 2004, is consistent with the charge that would be made in the community for those services.
If, as the Respondent contends, the amount of the carer’s lost income, or the value of any employment forgone, should be considered as placing a limit on the quantum of compensation payable under section 60AA, a provision similar to section 37(2) of the 1987 Act, as it relates to a maximum payment for a period of compensation would have been expected. Both the 1987 and 1998 Acts are silent in support of any specific statutory provision which would support the Respondent’s submission and proposed construction of section 60AA(3). Such a construction does not garner support from the relevant Guidelines.
The Applicant submits if it were the legislature’s intention to impose a second limitation upon the maximum amount payable to a carer for “the cost of that assistance” (section 60AA(1)), then the legislature would have enacted clear and unambiguous legislation to achieve this result. The Applicant relies on the rule of construction reiterated by the High Court in Bropho v The State of Western Australia [1990] ALR 207 (‘Bropho’) at 214-215 where in a joint judgment, Mason CJ, Deane, Dawson, Toohey, Gaudron and McHugh JJ stated:
“One can point to other “rules of construction” which require clear and unambiguous words before a statutory provision will be construed as displaying a legislative intention to achieve a particular result. Examples of such “rules” are those relating to the construction of statute which would abolish or modify fundamental common law principles or rights (see, e.g. Benson v Northern Ireland Road Transport Board [1942] AC 520 at 526-7)… The rationale of all such rules lies in an assumption that the legislature would, if it intended to achieve a particular effect, have made its intentions in that regard unambiguously clear. Thus, the rationale of the presumption against the modification or abolition of fundamental rights or principles is to be found in the assumption that it is "in the last degree improbable that the legislature would overthrow fundamental principles, infringe rights, or depart from the general system of law, without expressing its intention with irresistible clearness....”
A fundamental right here is that the cost of assistance should be paid at a proper and reasonable amount (section 61(1)), limited only by specific and clear legislative direction.
The Applicant further submits that a fundamental practical problem arises if the Commission were to adopt the construction urged upon it by the Respondent. Section 60AA(3) does not require, as a matter of necessity, that a care provider has lost income, entitlement can be achieved by proof of forgone employment. The Applicant submits that it is a “long stretch” to suggest that the notion of “lost income” also requires proof of the amount of the lost income, however, it is a hurdle of “ocean-like dimensions” to suggest that the notion of establishing forgone employment carries with it an implicit requirement to also establish the monetary value of that forgone employment.
Respondent’s submissions
The Respondent submits that neither the provisions of section 60AA nor the Guidelines for the provision of gratuitous domestic assistance prescribe a rate of payment for gratuitous domestic assistance.
The Respondent submits that if the Commission were to find that Mrs Kajic had to forgo employment, or would have returned to employment (as she was not employed at the time the injury occurred), but for the need to care for the Applicant, then she probably suffered some wage loss. On that basis, the Respondent submits that the payment for her services would be calculated by reference to what Mrs Kajic would have been earning had the Applicant not been injured and she continued working or earning what she had prior to his injury. It is submitted that this approach is consistent with the Commission’s decisions in Kumar and Macri.
Section 61(4) [sic, Section 60AA(4)] provides that compensation payable for gratuitous domestic assistance under section 60AA is payable as if the cost of that assistance was such sum as may be applicable under section 61(2) in respect of the assistance concerned. Section 61(2) provides that maximum amount for which an employer is liable to pay, may be fixed by the Authority by order published in the Gazette. It is submitted that the Applicant has misconceived the interpretation of the relevant statutory provisions and the Guidelines. The maximum rate provided by the Guidelines is not the applicable rate for gratuitous domestic assistance in every case. It clearly provides the limit for payment in respect of gratuitous domestic assistance.
Although a carer providing gratuitous domestic assistance who has forgone employment as a result of providing the assistance is entitled to compensation, it is essential for the carer to establish the amount he or she would have been earning but for having to provide care to the injured worker in order to be entitled to payment under section 60AA. In the absence of evidence to that effect, there will be no entitlement to compensation under section 60AA(3). It is common sense a person would have suffered a loss of income as a result of forgoing employment. There is little doubt the carer has to establish a loss of income as a result of forgone employment in order to be entitled to compensation under section 60AA(3) of the 1987 Act.
There is no provision in the legislation, Regulation or Guidelines to suggest a specific rate is payable. The Guidelines regulate the maximum amount payable under section 60AA(3). The payment for gratuitous care cannot exceed the rates prescribed by the Guidelines, but it can be a lesser amount, depending on the wage loss of the carer.
Authority’s submissions
The Authority’s submissions are referred to at [30]–[32]. At risk of repetition the Authority submits that its policy with regard to the provision of domestic assistance is set out in the Guidelines. Clause 7 of the Guidelines clearly outlines the requirements with regard to compensation for gratuitous domestic assistance services under section 60AA(3) of the 1987 Act.
It further submits that section 60AA(3) together with clause 7 of the Guidelines, clearly limits compensation or gratuitous domestic assistance services to the actual amount of the carer’s lost income or the value of income from forgone employment, to be evidenced according to clause 7.1 of the Guidelines, subject to the maximum amount payable, calculated in accordance with clause 7.4 of the Guidelines.
Clause 7.4 of the Guidelines limits the amount payable for gratuitous domestic assistance services to an hourly rate calculated by dividing by 35 the amount estimated by the Australian Bureau of Statistics as the average weekly total earnings (full-time adult ordinary time) of all employees in New South Wales. Compensation is not payable for more than 35 hours per week
Applicant’s further submissions
The decisions in Kumar and Macri are not instructive, the former being obiter and the latter defective as to the relevant Question of Law.
The Respondent does not make any submission as to any specific wording of either section 60AA(3) or clause 7 of the Guidelines that would support its proposed construction.
The Respondent’s assertion that in the circumstances the Applicant’s wife would be unjustly enriched is an incorrect interpretation of the relevant facts. The Applicant’s wife has either “lost income” or “forgone employment”, arguably in an amount of $620.00 per week, however, she has taken on other taxable employment as a provider of domestic and quasi-nursing services far exceeding both the hourly commitment of the previous employment and the regulatory limitation contained in clause 7.4 of the Guidelines. Mrs Kajic’s evidence is that she is available to the Applicant 24 hours per day 7 days per week. The Respondent’s submission assumes that the Applicant’s wife has a legal or moral obligation to provide the personal and domestic assistance that the Applicant’s quadriplegic condition requires. She has neither. Had the Applicant’s wife decided, for whatever reason, that she would not provide such required assistance, the Respondent would have been required to meet the cost of the commercial provision of such assistance (section 61(1) of the 1987 Act). The Applicant submits that the supporting legal and social principles of his position as to the relevant Question of Law are not dissimilar to those underpinning section 15 of the Civil Liability Act 2002 and section 128 of the Motor Accidents Compensation Act 1999.
The Applicant submits that the proper construction of section 60AA(3) read in conjunction with clause 7.1 of the Guidelines, creates an evidentiary threshold directed at dissuading abuse of the provision.
The Applicant contends that the Authority’s submissions at [51]-[53] are bare assertions, unsupported by reasoned argument.
DISCUSSION AND FINDINGS
The 1987 Act was amended by the Workers Compensation Legislation Further Amendment Act 2001 No 94, by inter alia, the insertion of section 60AA, operational from 1 January 2002.
In the second reading speech in the Legislative Council on 28 November 2001, the Hon. John Della Bosca, referred to Schedule 3, of the Workers Compensation Legislation Further Amendment Bill 2001, which dealt with the provisions relating to domestic assistance and the new section 60AA and said:
“Schedule 3 introduces a new entitlement to statutory compensation for domestic assistance that is reasonably necessary to be provided to an injured worker as a direct result of the injury, but only where the degree of permanent impairment of the injured worker resulting from the injury is 15 per cent or more, with exceptions for short-term special needs. These substantial improvements to non-economic loss benefits and the introduction of a new entitlement for domestic assistance are being provided mainly out of the estimated savings in legal and investigation costs in the scheme. Workers with comparatively moderate degrees of injury, such as back injuries, are expected to receive a similar amount to that currently provided by the table of disabilities. The provision of increased statutory benefits is intended both to ensure that the long-term care needs of the most seriously injured workers are met by the statutory scheme, and to make provision for a range of seriously injured workers to seek common law remedies, if appropriate, to their circumstances.” (emphasis added)
Section 60AA was further amended by the Workers Compensation Legislation Amendment Act 2004, to ensure that the Authority could make guidelines for the payment of non-gratuitous domestic services as well as gratuitous domestic services.
In the second reading speech in the NSW Legislative Council, on 24 June 2004, in introducing the Workers Compensation Legislation Amendment Bill 2004, the Hon. John Della Bosca, confirmed that the provision of statutory compensation for domestic assistance “was intended to ensure the long term care needs of the most seriously injured workers were met by the statutory scheme.” (emphasis added)
It can be readily seen from the Minister’s second reading speeches that the introduction of section 60AA was intended as a remedial provision in otherwise beneficial legislation to ensure that the long-term care needs of the most seriously injured workers are met by the statutory scheme.
Whilst there is no legal obligation on family members to provide domestic assistance and personal care for catastrophically injured workers, it is often the case that family members willingly provide such care. Were it not for the willingness of such family members to provide the care, there would be no alternative, in many cases than to engage paid professional carers, remunerated at rates that are commonly charged in the community for the provision of care to such workers. (Section 61(1) of the 1987 Act)
In my view, it is consistent with the objects of the Workers Compensation Acts (the 1987 Act and the 1998 Act), and the Minister’s stated intention of ensuring that the long-term care needs of seriously injured workers are met, that section 60AA should be seen in the context of ensuring appropriate remuneration for the provision of gratuitous care whilst at the same time ensuring that the provision of gratuitous care by family members does not result in a windfall gain to the employer or its insurer.
Workers compensation legislation has long been regarded as beneficial in nature. In beneficial legislation where any ambiguity exists it is to be construed beneficially. The true significance of the provision should not be strained or exceeded, but it should be construed so as to give the fullest relief which the fair reading of its language will allow, (Bull v Attorney General (NSW) (1913) 17 CLR 378 per Isaacs J).
In my view, section 60AA(3) can only be read as a qualifying provision or evidentiary threshold. The sub-section itself merely provides that the carer must have either “lost income or forgone employment as a result of providing the assistance.” There is no mention of compensation being limited to or measured by the extent of the lost income or forgone employment.
Section 60AA(4) is concerned with the quantum of compensation payable for gratuitous domestic assistance. It provides that compensation is payable as if the cost of that assistance were such sum as may be applicable under section 61(2) in respect of the assistance concerned.
Section 61(2) states:
“The maximum amount for which an employer is liable for any particular medical or related treatment shall not exceed such sum (if any) as may be fixed by the Authority in respect of that treatment or by order published in the Gazette.”
By virtue of its powers under section 376(1) the Authority issued in the NSW Government Gazette No 166 the “WorkCover Guidelines to the Provision of Domestic Assistance”, providing for the regulation and verification of compensation for gratuitous domestic assistance.
Clause 6.1 provides that once the Whole Person Impairment criteria has been satisfied “the worker is entitled to all reasonably necessary domestic assistance”. Clause 5.2 provides guidance as to what is to be regarded as reasonable and necessary domestic assistance.
Reading the Act and the Guidelines together as a scheme for the provision of compensation for gratuitous assistance, once an entitlement to compensation has been established, the amount of compensation payable is regulated by clause 7.4 which provides for an hourly rate by reference to the Australian Bureau of Statistics publication on average earnings i.e. dividing by 35 the amount estimated as the average weekly total earnings (full time adult ordinary time) of all employees in New South Wales. Clause 7.4 also sets a limitation on the total compensation payable by providing that compensation is not payable for more than 35 hours per week.
If clause 7.4 were to be construed in a manner suggested by the Respondent and by the Authority, one would expect to see a clear and unambiguous provision limiting the amount of compensation payable to the quantum of the lost or forgone income. In the absence of such a provision in clause 7.4, or indeed anywhere else in the Act or Guidelines, as a matter of statutory construction (see Bropho), given the beneficial nature of the legislation, I see no justification for concluding that the compensation for gratuitous domestic assistance should be limited by the quantum of the carer’s pre-accident earnings or forgone employment.
For example, if a worker’s spouse or a family member, has so arranged his or her affairs to limit their working hours to a modest level, but through no fault of their own are thrust into the position of being a full-time carer, providing domestic and personal assistance to a catastrophically injured worker, providing a commitment that far exceeds the hours worked in their previous employment, or indeed the regulated limitation of 35 hours in clause 7.4 of the Guidelines, then there seems to me no rational reason to construe the Act and the Guidelines in such a way as to limit the compensation for the gratuitous domestic assistance to that modest level of the carer’s pre-accident earnings. What the carer is being compensated for is the time spent providing gratuitous domestic assistance. They are not being compensated for their lost income or forgone employment per se that is merely a precondition or evidentiary threshold to the entitlement to the compensation.
Clause 7.1 of the Guidelines provides a number of examples of evidence that may be offered to establish lost income or forgone employment. These examples are not consistent with establishing the quantum of the lost income. They are consistent with proving that there has been lost income.
I reject the Respondent’s submission that neither the provisions of section 60AA or the Guidelines prescribe a rate for the payment of gratuitous domestic assistance. Clause 7.4 of the Guidelines prescribes an hourly fee calculated by dividing by 35 the amount estimated by the Australian Bureau of Statistics as the average weekly total earnings (full-time adult ordinary time) of all employees in New South Wales from time to time.
I also reject the Respondent’s submission that calculating any entitlement of the Applicant by reference to Mrs Kajic’s previous earnings is consistent the Commission’s decisions in Kumar and Macri. In Kumar the parties agreed that the entitlement to compensation for gratuitous domestic assistance was to be calculated by reference to the carer’s previous earnings. Whether that was the correct approach was not the subject of argument or consideration by the Commission. It Macri the Commission was not directed to and did not consider the Guidelines published in Gazette number 166. Therefore, the outcome in the matter of Macri is of no utility in deciding the current question before me.
The Authority asserts that sections 60AA(3) together with clause 7 of the Guidelines, limits compensation for gratuitous domestic assistance services to the actual amount of the carers lost income or the value of income from forgone employment. That assertion is unsupported by any reasoned argument or authority, and is inconsistent with the proper construction of the Act and Guidelines.
DETERMINATION
The answer to the Question of Law in this matter is:
Section 60AA(3) of the Workers Compensation Act 1987 constitutes an evidentiary threshold to the entitlement to compensation for gratuitous domestic assistance and must be read in conjunction with the ‘WorkCover Guidelines for the Provision of Domestic Assistance’ dated 15 October 2004. When so read the subsection imposes a maximum level of compensation payable to a carer limited by clause 7.4 of the Guidelines, but the compensation is not determined by the amount of any lost income or the value of forgone employment sustained by the care provider.
COSTS
The Respondent is to pay the Applicant’s costs of the referral of the Question of Law, and the Authority is to pay its own costs
His Hon. Judge G Keating
President
22 October 2009
I, MELANIE CURTIN, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF HIS HONOUR JUDGE GREG KEATING, PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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