Keys and Comcare
[2011] AATA 277
•27 April 2011
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2011] AATA 277
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2010/3856
GENERAL ADMINISTRATIVE DIVISION ) Re STEPHEN KEYS Applicant
And
COMCARE
Respondent
DECISION
Tribunal Professor RM Creyke, Senior Member Date27 April 2011
PlaceCanberra, ACT
Decision The decision under review is varied, and remitted to Comcare for further calculation. ....................[sgd]..........................
Professor RM Creyke, Senior Member
CATCHWORDS
WORKERS’ COMPENSATION – Incapacity payments – calculation of normal weekly earnings – whether relevant injury is original injury or aggravation injury − whether employment at the same level − whether ‘relevant period’ for calculation is two weeks prior to injury − decision under review varied
PRACTICE AND PROCEDURE – estoppel – where applicant paid higher amounts of NWE – where respondent induced reliance on higher amounts – Tribunal not estopped from redressing error in NWE calculation
Safety, Rehabilitation and Compensation Act 1988 (Cth) ss 4, 5A, 8, 9, 19
Formosa v Secretary, Department of Social Security (1998) 15 ALD 657
McDonald v Department of Defence [1999] FCA 882
Minister for Immigration, Local Government and Ethnic Affairs v Kurtovic (1990) 21 FCR 193
Re De La Cruz and Australian Postal Corporation (AAT 12496, 18 December 1997)
Re Moon and Telstra Corporation Ltd (2006) 93 ALD 740
Re Prica and Comcare (1996) 44 ALD 46
Re Smith and Comcare [2002] AATA 249
Riddell v Secretary, Department of Social Security (1993) 42 FCR 443
REASONS FOR DECISION
27 April 2011
Professor RM Creyke, Senior Member
1. Mr Stephen Keys has an accepted condition, 'aggravation of adjustment reaction with mixed emotional features' with a date of injury of 17 July 2008. Mr Keys was a disability services officer (DSO1) employed by the ACT Department of Disability, Housing and Community Services (Department). In the relevant period, Mr Keys was employed in residential housing for people with disabilities. His employment was terminated on 22 April 2009.
2. Comcare initially denied liability under section 14 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) (Act) for the injury. On 11 December 2009 the Tribunal decided, by consent, to set aside the decision and to accept liability.
3. Mr Keys claimed for time off work on 29 July 2008. For the period 17 July 2008 to 15 August 2008, Mr Keys claimed payments based on ‘normal weekly earnings’ (NWE) of $1218.52. This figure was based on Mr Keys’s NWE for his original injury, as adjusted for salary increases.
4. On 16 December 2009 Mr Keys applied for compensation under section 19 for the period 16 August 2008 to 2 May 2009, and on 18 December 2009, for the period 3 May 2009 to 15 January 2010. Mr Keys claimed that his NWE at this time was $1120.01, a figure based on the two weeks prior to the aggravation injury.
5. On 30 December 2009, Comcare assessed levels of compensation based on figures supplied by the employer at $1218.52 for NWE for the period 17 July 2008 to 15 August 2008. On 31 August 2010, Comcare affirmed the primary decision.
6. On 9 September 2010, Mr Keys sought review of that decision by the Tribunal. Mr Keys was represented by his sister, Ms Keys; Comcare was represented by Mr Dube.
Legislation
7. The relevant legislation is the Safety, Rehabilitation and Compensation Act 1988 (Cth) (Act). Section 19 of the Act provides a formula for calculating compensation payments for incapacity based on a person’s NWE, deducting monies the person is capable of earning.
4 Interpretation
…
(8) A reference in this Act to an injury suffered by an employee is, unless the contrary intention appears, a reference to an injury suffered by the employee in respect of which compensation is payable under this Act.
(9) A reference in this Act to an incapacity for work is a reference to an incapacity suffered by an employee as a result of an injury, being:
(a) an incapacity to engage in any work; or
(b) an incapacity to engage in work at the same level at which he or she was engaged by the Commonwealth or a licensed corporation in that work or any other work immediately before the injury happened.
5A Definition of injury
(1) In this Act:
injury means:
(a) a disease suffered by an employee; or
(b) an injury (other than a disease) suffered by an employee, that is a physical or mental injury arising out of, or in the course of, the employee's employment; or
(c) an aggravation of a physical or mental injury (other than a disease) suffered by an employee (whether or out that injury arose out of, or in the course of, the employee’s employment), that is an aggravation that arose out of, or in the course of, that employment;
19 Compensation for injuries resulting in incapacity
(1) This section applies to an employee who is incapacitated for work as a result of an injury, other than an employee to whom section 20, 21, 21A or 22 applies.
(2) Subject to this Part, Comcare is liable to pay to the employee in respect of the injury, for each week that is a maximum rate compensation week during which the employee is incapacitated, an amount of compensation worked out using the formula:
where:
"AE" is the greater of the following amounts:
(a) the amount per week (if any) that the employee is able to earn in suitable employment;
(b) the amount per week (if any) that the employee earns from any employment (including self‑employment) that is undertaken by the employee during that week.
"NWE" is the amount of the employee's normal weekly earnings. …
8. Section 8 of the Act provides that the NWE of an employee before an injury is to be calculated in relation to the relevant period under the formula:
8 Normal weekly earnings
(1) For the purposes of this Act, the normal weekly earnings of an employee (other than an employee referred to in subsection (2)) before an injury shall be calculated in relation to the relevant period under the formula:
where:
"NH" is the average number of hours worked in each week by the employee in his or her employment during the relevant period;
"RP" is the employee's average hourly ordinary time rate of pay during that period; and
"A" is the average amount of any allowance payable to the employee in each week in respect of his or her employment during the relevant period, other than an allowance payable in respect of special expenses incurred, or likely to be incurred, by the employee in respect of that employment.
(2) Where an employee is required to work overtime on a regular basis, the normal weekly earnings of the employee before an injury shall be the amount calculated in accordance with subsection (1) plus an additional amount calculated in relation to the relevant period under the formula:
where:
"NH" is the average number of hours of overtime worked in each week by the employee in his or her employment during the relevant period; and
"OR" is the employee's average hourly overtime rate of pay during that period.
… (5) Where, because of the shortness of the relevant period, the normal weekly earnings as calculated in relation to the relevant period under subsection (1) or (2) would not fairly represent the weekly rate at which the employee was being paid in respect of his or her employment before the injury, the normal weekly earnings before the date of the injury shall be calculated in relation to such other period as Comcare considers reasonable for the purpose of arriving at an amount that does fairly represent the weekly rate at which the employee was being so paid. …
9. Section 9 of the Act provides for the relevant period for the purposes of the calculation of NWE.
9 Relevant period
(1) For the purposes of calculating the normal weekly earnings of an employee before an injury, a reference in section 8 to the relevant period is, subject to this section, a reference to the latest period of 2 weeks before the date of the injury during which the employee was continuously employed by the Commonwealth or a licensed corporation. …
(4) If, during any part of the period calculated under the preceding subsections, the employee's earnings were reduced, or the employee did not receive any earnings, because of absence from his or her employment for any reason, that part of that period shall be disregarded for the purposes of calculating the relevant period.
Issues
10. The issue is the correct calculation of Mr Keys's normal weekly earnings (NWE) under section 8 of the Act from 17 July 2008, and in particular whether:
·The amount should be based on the period immediately prior to him being injured on 17 July 2008, or another period; and
·The amounts which should be used as the base NWE figures were correctly identified.
History
11. Mr Keys has an accepted claim for liability under section 14 of the Act for 'adjustment disorder with mixed emotional features' (the original injury) with a deemed date of injury of 21 October 2005. The claim was accepted on 5 May 2008 following a consent decision by the Tribunal.
12. Mr Keys had recovered from that injury and from 6 February 2007 was certified fit for work by his general practitioner, Dr Zdenta Grundel, although it was recommended Mr Keys work in a different position and in a different Department. He did not then return to work.
13. On 15 May 2007, Mr Graham George, consultant psychiatrist, reported that Mr Keys was not suffering from any diagnosable psychiatric injury and was fit to return to work without restrictions except that he should ‘work in a different area’. This recommendation was clarified to mean not work with the people involved in the circumstances which led to his initial injury. Again, he did not then return to work.
14. The Department implemented these recommendations on 10 October 2007, and advised Mr Keys to commence a graduated return to work on 19 October 2007. Initially, Mr Keys was to work for three days a week (five hours a day) at Murchison Group House, building up to full time work within four to six weeks. On 18 October 2007, Mr Keys responded by email to his employer relating to a roster saying: 'I am fit to work full time hours'.
15. However, Mr Keys objected to the placement since his supervisor would be a person implicated in the events which caused his accepted disability. As a consequence, having commenced work on 19 October 2007 at Murchison Group House, Mr Keys was then allocated to commence work at Ruwoldt Group House on 15 November 2007. By then he had completed his graduated return to work program and was working on a full time basis in a DSO1 position.
16. On 6 February 2008, Mr Keys was directed to leave the workplace until further notice, pending a medical examination. On 27 February 2008, Mr Keys was examined by Dr George, who reported on 29 February 2008, that he was not suffering from a diagnosable psychiatric illness. On 28 March 2008, Mr Keys was directed by the Department to return to work at Ruwoldt Group House, commencing on 3 April 2008.
17. On 14 May 2008, Mr Keys formally sought rehabilitation assistance in accordance with section 36 of the Act. On 13 June 2008 his application was refused, as Mr Keys had returned to work.
18. On 22 April 2009, Mr Keys’s employment was terminated. Since termination he has been paid incapacity entitlements based on NWE of $1218.52. He continued to receive adjustments for indexation. He is currently receiving the 75 per cent of his NWE which is payable after the first 45 weeks of payments.[1]
[1] Act, s 19(2A), (3)
19. On 16 December 2009, Mr Keys applied for compensation under section 19 of the Act. In his covering letter, Mr Keys said 'it is my understanding … that':
· at the time I suffered the aggravation of my injury my NWE were $1120.01 (comprising base salary of $764.16 plus $355.85 in shift penalties); and
· with effect from 2 April 2009, my NWE were $1164.81 (comprising $794.73 plus $370.08 in shift penalties).
20. In the claim forms Mr Keys's employer noted that:
· from 18 July 2008 to 1 April 2009, Mr Keys's NWE were $1218.52 (based on normal weekly hours (NWH) of 40 hours 48 minutes; and
· from 2 April 2009 to 22 April 2009, Mr Keys's NWE were $1267.26 (based again on NWH of 40.48), the increase to take account of a pay rise from 2 April 2009.
21. The NWE figure provided by the employer was higher than that provided by Mr Keys and Comcare accepted the employer's figures in its initial decision of 16 December 2009.
22. On 15 February 2010 Mr Keys sought reconsideration of the decision claiming that Comcare had 'erred in relying on inaccurate and insufficient information provided by the Agency'. In particular, he said he believed:
· The normal working hours (NWH) of 40.48 was incorrect;
· The amount of NWE of $1218.52 was incorrect;
· The compensation amount of $5362.39 for the period 17 July 2008 to 15 August 2008 at the rate of $1218.52 per week was incorrect; and
· No decisions were made in relation to applications for compensation for other periods of incapacity, the first for the period 16 August 2008 to 2 May 2009, and the second, for the period 3 May 2009 to 15 January 2010.
23. On 23 April 2010, Comcare sought clarification from the employer relying on section 71 of the Act.
24. On 6 May 2010, the employer replied, noting a base salary of $764.17, a weekly sleepover allowance of $105.76 and average weekly penalties, calculated over the 12 weeks leading up to the date of injury of $219.36. This provided NWE of $1089.29 for 38 hours per week.
25. In response, Mr Keys relied on the decision by the Tribunal, made by consent on 25 May 2010, that in respect of section 19 payments arising from his original accepted injury with a date of injury of 21 October 2005:
· as at 21 October 2005 his NWE were $1,159.71;
· from 1 April 2006 to 4 April 2007 the NWE were $1206.10; and
· from 5 April 2007 to 14 November 2007 the NWE were $1,254.34.
26. Comcare affirmed its primary decision on 31 August 2010, preferring the higher rate of NWE given in the forms of 2 March 2010 over both Mr Keys's lower assessment in his letter of 16 December 2009 and the employer's alternative and lower assessment in its letter of 6 May 2010. The Comcare form dated 2 March 2010, was based on Mr Keys working 40:48 hours a week, and his NWE were calculated with effect from 3 April 2008 as $1218.52, comprising overtime of $91.30 per week, shift penalties of $224.89 per week, and allowances of $138.17 per week.
27. Effective from 2 April 2009 to 3 April 2008, the NWE for 40.48 hours increased due to a payrise on 2 April 2009, to $1267.26 comprising overtime $94.95 per week, shift penalties $233.88 per week and allowances $143.70 per week.
28. On 24 November 2010, Comcare provided pay records for Mr Keys for the period 13 December 2007 to 23 July 2008. The pay slips indicated that Mr Keys regularly earned shift penalties. Comcare averaged the amount of the penalties over the period to calculate NWE of $1060.36. That figure is less than the delegate assessed of $1218.52.
Consideration
29. Comcare contended that in calculating Mr Keys's NWE, the relevant period (as defined in section 4 of the Act and calculated under section 9 of the Act) is' the latest period of two weeks before the date of injury' or as adjusted under section 8(5) of the Act to fairly represent the weekly rate at which Mr Keys was being paid.
30. Comcare also contended that taking into account the weekly rate that Mr Keys was earning between April 2008 to 17 July 2008, a period when Mr Keys was certified fit to work and was consistently earning shift penalties, the NWE figure as reasonably applied, when exercising the discretion in section 8(5), is $1101.23.
31. In addition, Comcare contended that the difference in the NWE figures from Mr Keys's original injury to the accepted aggravation is plausible given:
· the range of variables that affect these assessments (such as the availability of shift penalties); and
· the fact that there are two injuries over two years apart, with different relevant periods applying to each injury.
32. Ms Keys contended that a calculation of NWE based on Mr Keys’s earnings in the two weeks prior to the aggravation injury was not fairly representative of his weekly earnings. Her argument was that the period is short and during that period his earnings were reduced because of the consequences of his return to work which was not to the same pre-injury position. That meant he had not returned to either 'suitable employment' or to duties for which he received pay equivalent to his pre-injury earnings, specifically in relation to shift penalties and regular overtime. He claimed accordingly, that his NWE were $1304.51 at 17 July 2008, taking into account pay rises and indexation.
33. Ms Keys further contended that:
·Mr Keys’s NWE increased to $1356.69 for the period 2 April 2009 to 30 June 2009 as a result of the operation of the agency's Collective Agreement; and
·Mr Keys’s NWE increased to $1388.25 from 1 July 2009, as a result of the application of section 8(9B) of the Act.
34. Ms Keys also contended that the Agency was estopped, under principles of equitable estoppel, from denying payment of amounts based on the higher figures relating to Mr Keys’s NWE in respect of the original decision. Mr Keys would otherwise be prejudiced as he had relied on the higher amount, the Agency had induced that reliance through the decisions in the primary determination and reconsideration and Mr Keys had been paid in line with those figures.
35. Ms Keys also contended that if the compensation amounts are to be on the original figures as the Agency indicated, then the amounts should also be increased to take account of the increases indicated in the consent decision of 25 May 2010.
Preliminary issues
36. A preliminary issue is whether the ‘injury’ in the definition of ‘normal weekly earnings’ in section 8 of the Act refers to the initial injury suffered by Mr Keys or the aggravation injury which arose on 17 July 2008. Mr Keys had contended that for the purposes of assessing his normal weekly earnings it was permissible to take into account amounts assessed for his initial injury.
37. Counsel for Comcare contended that it was only the aggravation injury which arose on 17 July 2008 which was relevant when assessing the amounts earned for the purposes of calculating NWE.
38. Section 14 of the Act provides that Comcare is liable to pay compensation in respect of ‘an injury’ which resulted in incapacity for work. An aggravation of an injury is a separate form of injury for the purposes of the definition of ‘injury’ in section 5A of the Act. In accordance with the preparatory words to that definition the definition applies for the purposes of ‘this Act’ and therefore the definition is applicable to section 8.
39. Section 4(8) of the Act provides that:
A reference in this Act to an injury suffered by an employee is, unless the contrary intention appears, a reference to an injury suffered by the employee in respect of which compensation is payable under this Act.
40. No contrary intention is apparent in the relevant provisions. This proceeding relates to the aggravation injury since it is that injury for which Comcare is liable to pay compensation. The task of the Tribunal in this matter is the quantification of that liability. Accordingly, it is the aggravation injury, not the initial injury, which is the ‘injury’ under consideration.
41. A related preliminary issue is the nature of the ‘employment’ in which Mr Keys was engaged at the time of the aggravation injury. Ms Keys contended that:
Prior to aggravating his previous condition on 17 July 2008, [Mr Keys] had not returned to either ‘suitable employment’ or to duties (roster) for which he received pay equivalent to his pre-injury earnings.
42. Behind this claim was the fact that although Mr Keys had returned to work full-time from 19 October 2007, he was working in a different location and on a different roster from his pre-injury location. In particular he was not in receipt of overtime as he had been while working at Finniss Group House prior to the initial injury.
43. In addition, Mr Keys maintained that although he was engaged in a broadly similar position, namely, as a Disability Services Officer Grade 1 (DSO1), his position at the time of the aggravation injury was less beneficial since the overtime and allowances available were not as high as those he had received prior to his initial injury at Finniss Group House.
44. The argument was that ‘but for’ the initial injury Mr Keys could have returned to work in Finniss Group House on the same terms and conditions as he had initially, and that financially this would have been to his advantage. As it was the actions of his employer that had caused his initial injury and been the reason for his move initially to Murchison, and then to Ruwoldt, Group Houses and this had led to less overtime and lower allowances, it was the actions of his employer which had caused this disadvantage and he should not be penalised thereby.
45. Counsel for Comcare contended that Mr Keys was medically certified as fit for full time work. He was working at the same level in which he had previously been working and it is that level that is relevant for the purposes of section 4(9) of the Act.
46. Section 4(9) states, as relevant:
(9) A reference in this Act to an incapacity for work is a reference to an incapacity suffered by an employee as a result of an injury, being: …
(b) an incapacity to engage in work at the same level at which he or she was engaged by the Commonwealth or a licensed corporation in that work or any other work immediately before the injury happened. (emphasis added).
47. In Re Moon and Telstra Corporation Ltd, the Tribunal summarised the cases dealing with the meaning of the expression ‘at the same level’:
The definition of ‘incapacity for work’ in subsection 4(9) refers to an incapacity to engage in work ‘at the same level’; it does not require a return to precisely the same duties. The decisions in Re Prica and Comcare and Smith v Comcare referred to the nature and quality of the work being carried out and similarly, did not suggest that the Act requires an injured employee be able to perform each and every pre-accident duty before it can be said that he or she is no longer incapacitated.[2]
[2] Re Moon and Telstra Corporation Ltd (2006) 93 ALD 740 at 744.
48. The Tribunal also considered whether ‘at the same level’ could refer to the grade or salary or simply the nature of the work. This issue was considered in Re Prica and Comcare where a Full Tribunal said,
The reference to ‘level’ could be construed as a reference to a grade or salary level or could be a reference to the nature of the work in the sense of its characteristics, which will include its degree of difficulty. If the former construction were adopted it would produce the apparently anomalous result that a person with severe (or moderate) disabilities would be found to lack any incapacity for work as long as they continued to occupy the same grading or earn the same salary as at the date of the injury. The anomaly would not arise under the latter construction. A finding of an incapacity itself does not necessarily result in any entitlement to periodic or lump sum compensation under the Act. There are additional requirements in ss 19, 24 and 27 concerning those issues. Hence a construction of s 4(9)(b) which permits a finding of an incapacity for work in circumstances where the applicant subsequent to an injury is engaged in light duties at their former salary does not produce any anomaly within the Act and recognises that incapacity for work is a relative concept and a matter of degree. [3]
[3] Re Prica and Comcare (1996) 44 ALD 46 at 51. See also Re Smith and Comcare[2002] AATA 249 at [84].
49. In reaching a conclusion on this preliminary issue the Tribunal takes into account that Mr Keys was working as a DSO1 in both Finniss Group House (prior to his initial injury), and in Murchison Group House and Ruwoldt Group House (his locations prior to his aggravation injury).
50. Applying the interpretation from Re Moon and Telstra Corporation to the circumstances of Mr Keys means that since he was working again at a DSO1 level within the Department, he was working ‘at the same level’ as previously. This is notwithstanding that the precise conditions under which he was working and in particular the duties he was performing did not attract the same level of overtime and allowances as his pre-initial injury position.
51. Equally, the findings in Re Prica and Comcare and Re Smith and Comcare, with which the Tribunal agrees, have the effect that as the nature of the work as a DSO1 that Mr Keys was doing was broadly similar both before his initial injury and prior to his aggravation injury he was working ‘at the same level’. On both grounds, therefore, Mr Keys’s arguments on this preliminary issue would not be successful.
Calculation of NWE
52. Section 19 of the Act makes Comcare liable to pay compensation to an employee who is incapacitated for work as a result of an injury. The amount payable is calculated in accordance with a formula, one of the components of which is the employee’s ‘normal weekly earnings’ (NWE).
53. What are ‘normal weekly earnings’ is covered by section 8(1). That provision, as relevant, states:
For the purposes of this Act, the normal weekly earnings of an employee … before an injury shall be calculated in relation to the relevant period under the formula (NH x RP) + A where
NH is ‘the average number of hours work in each week by the employee in … employment during the relevant period;
RP is the employee’s average hourly ordinary time rate of pay during that period; andA is the average amount of any allowance payable to the employee in each week in respect of … employment during the relevant period…
54. The ‘relevant period’ is stated in the Act to be ‘the latest period of 2 weeks before the date of the injury during which the employee was continuously employed by the Commonwealth’ (section 9(1) of the Act). Alternatively, if that period ‘would not fairly represent the weekly rate at which the employee was being paid in respect of … employment before the injury the normal weekly earnings … shall be calculated in relation to such other period as Comcare considers reasonable’ (section 8(5)).
55. Counsel for Comcare, in deference to the fairness principle in section 8(5) had provided alternative calculations of Mr Keys’s NWE based firstly on a period of seven weeks prior to the aggravation injury, a calculation which avoided a fortnight in which Mr Keys was not working. Alternatively, a calculation was made which covered a period of 16 weeks prior to the aggravation injury. The NWE for the seven week period would have been $1,101.23 per week. The NWE for the 16 week period, which included the periods of nil earnings, would have been $1,074.65 per week. In both cases, Comcare’s calculations were made for a period immediately prior to the aggravation injury.
56. Ms Keys contended, that taking into account the fairness principle in section 8(5), the calculation could be based on ‘such other period’ as would more fairly represent Mr Keys’s rates of pay. In Ms Keys’s submissions for the purposes of the hearing she contended that Mr Keys’s NWE should not be based on any period from 17 October 2007 to 17 July 2008 since that did not ‘fairly represent the weekly rate at which he was being paid before the aggravation of his injury on 17 July 2008’. Instead the calculation should be based on the same period used to calculate his NWE before the date of his initial injury on 21 October 2005. This figure would be adjusted for salary increases. Mr Keys had earlier claimed that the calculation should be based on the two weeks prior to the aggravation injury, in his calculation, $1120.01.
57. In the initial claim form, Mr Keys’s employer noted that his NWE, as at the time of the aggravation injury, was $1218.52 based on normal weekly hours of 40 hours 48 minutes. Mr Keys had queried both the hours and the amount. The material before the Tribunal indicated that Mr Keys’s normal weekly hours were only 38 per week and the figures provided for his base salary and penalty payments were also different from those provided. These differences have made it difficult to calculate the correct amounts to which Mr Keys is entitled. The Tribunal accepts the accuracy of the figures for Mr Keys’s earnings as found in his pay records from 13 December 2007 to 23 July 2008, provided by Comcare.
58. The first matter for consideration is the meaning of ‘such other period’ in section 8(5). Ms Keys suggested at the hearing that the ‘other period’ was at large. The Tribunal concedes that the expression is intended to permit the decision-maker to exercise a discretion and where a discretion, as is this one, is expressed in broad terms, that discretion should not be unduly fettered.[4] Nonetheless, it is clear from the structure of the compensation scheme, and as a matter of logic, that the intention of the Parliament was to choose as a period for comparison, a period when the earning capacity of the employee was not inhibited by injury so that a calculation may be made of the loss of that capacity. That means that the period must precede the injury the subject of the claim.[5]
[4] Riddell v Secretary, Department of Social Security (1993) 42 FCR 443 at 449.
[5] McDonald v Department of Defence [1999] FCA 882, at [10].
59. Logically, too, the period of earnings should be as close to the injury as possible since a choice of any earlier period has the potential to disadvantage a person who might be denied the benefits of promotions or other benefits which have accrued or been earned over time. It is no accident that section 9(1) refers to the latest period of two weeks preceding the injury. Beyond these propositions it would be unsafe to venture since the discretion is intended to be able to take account of all relevant factors.
60. In the case of Mr Keys, his earning capacity prior to the relevant injury must take account of the legislation. That means, it is the aggravation injury, not the initial injury which is relevant and his earning capacity prior to the aggravation injury should be the comparator. As he had recovered, he was working full-time at ‘the same level’ as he was prior to his initial injury.
61. The conditions of his employment, due to the circumstances of the particular group house in which he was working, were not as beneficial in 2008 as the conditions he had experienced earlier. The nature of work as a disability services officer is that the demands of the work vary according to the needs of the residents of a particular group house. Inevitably, the level of that need determines the level of overtime and shift allowances. That is inherent in the work of a DSO1 officer.
62. Mr Keys had no guarantee that he would continue to work in a group house with residents with high needs. He accepted a position in a particular house in which the DSO1 work was less demanding. It was in that environment and during that phase of his working career that his injury occurred.
63. In Re De La Cruz and Australian Postal Corporation[6] the Tribunal concluded that when the case involved shift workers with fluctuating shift patterns, it is appropriate to calculate NWE by averaging shift payments over a longer, in that case, 12 week period, preceding the injury. In that case, however, an average drawn over a much longer period was very close to the higher amount the applicant earned in the two week period immediately before the injury. On that basis there was no justification to apply section 8(5).
[6] Re De La Cruz and Australian Postal Corporation (AAT 12496, 18 December 1997)
64. Similarly in the case of Mr Keys, based on the base salary and averaged penalty payments as provided by the employer, the calculations for Mr Keys’s NWE in the fortnight preceding his aggravation injury were $2238.52 or $1119.26 per week. The fortnightly pay records do not correspond with the two week period prior to Mr Keys’s injury. Accordingly, the Tribunal has calculated fortnightly penalty payments by averaging the amount found in the last two pay records, which includes a one week period after the injury occurred. The matter will be remitted to Comcare for a more precise calculation of the penalty payments earned by Mr Keys in the two weeks prior to the injury.
65. The figure of $1119.26 is higher than the figures provided to the hearing if a calculation is based on the longer period preceding the injury provided by Comcare comprising either seven or 16 weeks. In those circumstances, the Tribunal sees no need to ignore the prescription in section 9(1) of the Act that the relevant period is the ‘latest period of 2 weeks before the date of the injury’.
66. The figures for those two weeks for Mr Keys’s base salary have apparently been accepted by Mr Keys as correct, and have been used by the Tribunal, together with the penalty allowances in the figures supplied at the hearing by counsel for Comcare to calculate Mr Keys’s NWE for the purposes of sections 8, 9 and 19 of the Act.
67. The sole remaining issue is whether Comcare is estopped from denying that Mr Keys should be paid a lesser amount than Comcare originally calculated. In Ms Keys’s submission she conceded the foundational principle which applies, namely, that ‘the authority of a decision-maker cannot be extended beyond that given by the statute through the mechanism of an estoppel’.[7]
[7] Formosa v Secretary, Department of Social Security (1988) 15 ALD 657, at 665. See also Minister for Immigration, Local Government and Ethnic Affairs v Kurtovic (1990) 21 FCR 193 at 207 per Gummow J.
68. That principle means that where, as here, an officer has made payments on a basis which is not sustainable under legislation, the agency is not estopped from redressing the error, whether it be to the benefit or the detriment of the recipient of the funds. In the circumstances, the Tribunal too is bound to apply the law. The argument by Ms Keys that Comcare:
… should be estopped from denying the correctness of its determination of the Applicant’s NWE in respect to the aggravation of the Applicant’s injury on 17 July 2008, as being equivalent to the amount of his NWE in respect of the injury he sustained on 21 October 2005, as well as the Respondent’s affirmation of that determination, and the consequent making of weekly incapacity payments to the Applicant at the determined weekly rate for the period from 17 July 2008 and continuing, as adjusted in accordance with section 8
is not sustainable in light of these authorities.
69. Accordingly the Tribunal finds that the NWE for Mr Keys for the purposes of section 9(1) and section 19 of the Act is the amount he earned in the latest 2 weeks preceding his aggravation injury, being based on the agreed base rate of salary he was then earning and the average of the penalty payments he was then receiving. This is higher than the amounts which would be attained if the averaging took place over a longer period of either seven or 16 weeks.
70. The decision under review is varied and the matter is remitted to Comcare to calculate Mr Keys’s payments.
I certify that the 70 preceding paragraphs are a true copy of the reasons for the decision herein of Professor RM Creyke, Senior Member.
Signed: .................[sgd]..............................
C. Baillie, AssociateDate of Hearing 11 April 2011
Date of Decision 27 April 2011Counsel for the Applicant Judith Keys
Solicitor for the Respondent Emily Hilly
Australian Government Solicitor
Counsel for the Respondent Ben Dube
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