Kloren and Comcare (Compensation)

[2018] AATA 1500

Kloren and Comcare (Compensation) [2018] AATA 1500 (29 May 2018)

Division:GENERAL DIVISION

File Number(s):      2017/1450, 2017/1452, 2017/1454, 2017/1456. 2017/1457, 2017/1458, 2017/1459, 2017/1462, 2017/1464, 2017/1465, 2017/1466

Re:Bricet Kloren

APPLICANT

AndComcare

RESPONDENT

DECISION

Tribunal:Mark Hyman, Member

Date:29 May 2018  

Place:Canberra

The tribunal affirms the decision under review.

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

Mark Hyman, Member

Catchwords

PRACTICE AND PROCEDURE – motion for dismissal for abuse of process – principles governing summary decisions – whether estoppel applies in the tribunal – application of provisions allowing the tribunal to manage its own processes – relitigation of matters covered by consent decision - whether the tribunal has jurisdiction where implementation of consent decision challenged – tribunal has jurisdiction within certain constraints

COMPENSATION – AE (ability to earn) – whether based on the ability to earn in suitable employment or actual earnings – application of considerations relating to participation in the labour market – how and when those considerations are taken into account – calculation of compensation

Legislation

Administrative Appeals Tribunal Act 1975, ss 25, 33, 37, 42A, 42B

Safety, Rehabilitation and Compensation Act 1988, ss 14, 16, 19, 62

Cases

Casarotto v Australian Postal Commission [1989] FCA 116

Comcare v Grimes [1994] FCA 1054

Dey v Victorian Railways Commissioners (1949) 78 CLR 62

General Steel Industries v Commissioner for Railways (NSW) (1964) 112 CLR 125

Grimsley and Telstra Corporation (2010) 51 AAR 401

Matusko and Australian Postal Corporation [1995] AATA 14

Novosel v Comcare [2017] FCA 722

Pelgrave v Comcare [2002] FCA 1025

Quinn and Australian Postal Corporation (1992) 15 AAR 519

Woodbridge v Comcare [1994] FCA 558

Secondary Materials

Deeming ability to earn, Fact sheet, Comcare, May 2017

REASONS FOR DECISION

Mark Hyman, Member

1. The applicant, Ms Bricet Kloren, receives compensation from the respondent, Comcare, for a workplace injury sustained in 2009. This decision is about the amount of compensation she is entitled to receive for incapacity to work covering a period from April 2014 up to the end of 2016. Ms Kloren has a condition identified as “adjustment reaction with mixed emotional features”, accepted for compensation under section 14 of the Safety, Rehabilitation and Compensation Act 1988 (the SRC Act). The date of injury was 22 June 2009.

2. In 2014 the amount that Ms Kloren could earn in suitable employment became a matter of dispute with Comcare; Ms Kloren sought review in this tribunal, and arrived at a consent decision with Comcare. That decision, dated 22 June 2016, agrees on the number of hours each week that Ms Kloren was able to work and an amount to be used in the calculation of an amount of weekly compensation, both elements to apply from 2 April 2014. Comcare continued to use those agreed terms after the consent decision, in a series of determinations beginning on 20 July 2016, covering in all the period to 28 December 2016. On 30 October 2016 Ms Kloren sought review of the determinations of her compensation payments between 2 April 2014 and 22 June 2016 (T89). On 17 January 2017 Ms Kloren raised further issues relating to the determination of her compensation payments from 23 June 2016 (T103). On 1 February 2017 Comcare issued a redetermination decision (T104) affirming the determinations dated 31 August, 14 September, 28 September, 12 October, 26 October, 9 November, 23 November and 21 December 2016 and varying the determinations dated 20 July, 17 August and 7 December 2016, as some errors were identified in the calculations. The reviewable decision covered the entire period from 2 April 2014 up to 28 December 2016. On 15 March 2017 Ms Kloren sought review before this tribunal of the reconsideration decision of 1 February 2017 (T2).

3. The tribunal held a hearing on 7 May 2018. Ms Kloren represented herself and was supported by her husband. Comcare was represented by Ms Kristy Katavic of Counsel, briefed by McInnes Wilson Lawyers.

4. The evidence before the tribunal comprised the documents submitted under section 37 of the Administrative Appeals Tribunal Act 1975 (the AAT Act) – the “T-documents” – and a number of documents submitted before or at the hearing by the parties:

   (a)For the applicant, a letter from Kowalski Recruiting dated 25 October 2017 (Exhibit A1);

   (b)For the respondent, a report by Dr John Saboisky dated 14 March 2018, with the briefing letter to the doctor (Exhibit R1);

   (c)A fact sheet issued by Comcare, dated May 2017 and titled “Deeming ability to earn” (Exhibit R2);

   (d)A report by Ms Nicola Peaker, a rehabilitation consultant from the provider Injury Treatment, dated 9 March 2016 (Exhibit R3);

   (e)A report by Mr Rodney Stanton, a rehabilitation consultant from the provider Injury Treatment, dated 31 March 2016 (Exhibit R4);

   (f)A letter from Ms Carmen King, a Senior Associate with McInnes Wilson Lawyers, acting on Comcare’s behalf, dated 31 May 2016, proposing consent terms of agreement and including draft terms of agreement as an attachment (Exhibit R5);

   (g)An email exchange between Ms King and Ms Kloren, dated variously 7 June and 8 June 2016 acknowledging Ms Kloren’s acceptance of and signature to the terms of agreement (Exhibit R6);

   (h)An extract from the Explanatory Memorandum to the Safety, Rehabilitation and Compensation and other Legislation Amendment Bill 2006, outlining the purpose of that Bill (Exhibit R7); and

   (i)A report by Ms Colleen Larice of the rehabilitation provider Rehab Management dated 27 October 2017 assessing Ms Kloren’s earning capacity (Exhibit R8).

   ISSUES

5. The issues before the tribunal are:

   ·how Ms Kloren’s compensation should be determined for the period from 2 April 2014 to 22 June 2016;

   ·how Ms Kloren’s compensation should be determined for the period from 23 June 2016 to 28 December 2016; and

   ·the amount of Ms Kloren’s compensation for those periods.

   LEGISLATION

6. The relevant legislation is set out in the SRC Act. The basic scheme of that Act is that section 14 acts as a gateway provision for determining Comcare’s liability, where, generally speaking, and subject to the definitional constraints and exclusions set out in the Act, a person suffers a workplace injury resulting in death, incapacity or impairment. Later provisions provide for compensation of various kinds, for example section 16 provides for compensation for medical expenses and section 19 for incapacity.

7. Section 19 provides a formula, or more accurately a series of formulae, for the calculation of compensation payments on a weekly basis to a person who is incapacitated by a workplace injury (subject to some exceptions not presently relevant). A person’s compensation is calculated to recognise that the person may still be able to work to some extent. Subsection 19(2) sets out the general formula, as follows:

   (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:

   NWE - AE

   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. Subsection 19(2A) provides that the “maximum rate compensation week” referred to in subsection 19(2) above is the initial period of incapacity (until the number of hours the person is prevented from working by the incapacity equals or exceeds 45 times the person’s normal weekly hours), following which compensation will be paid (after transitions managed under subsections (2B), (2C) and (2D)) under subsection 19(3), in which the amount is reduced in accordance with the application of an adjustment percentage as follows:

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

   (Adjustment percentage x NWE) - AE

   where:

   adjustment percentage is a percentage equal to:

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

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

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

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

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

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

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

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

9. As can be seen, the calculation of AE itself does not change, whether compensation is calculated under subsection (2) or subsection (3).

10. Subsection 19(4) reads as follows:

    (4) In determining, for the purposes of subsections (2) and (3), the amount per week that an employee is able to earn in suitable employment, Comcare shall have regard to:

    (a)  where the employee is in employment (including self‑employment)—the amount per week that the employee is earning in that employment;

    (b)  where, after becoming incapacitated for work, the employee received an offer of suitable employment and failed to accept that offer—the amount per week that the employee would be earning in that employment if he or she were engaged in that employment;

    (c)  where, after becoming incapacitated for work, the employee received an offer of suitable employment and, having accepted that offer, failed to engage, or to continue to engage, in that employment—the amount per week that the employee would be earning in that employment if he or she were engaged in that employment;

    (d)  where, after becoming incapacitated for work, the employee received an offer of suitable employment on condition that the employee completed a reasonable rehabilitation or vocational retraining program and the employee failed to fulfil that condition—the amount that the employee would be earning in that employment if he or she were engaged in that employment;

    (e)  where, after becoming incapacitated for work, the employee has failed to seek suitable employment—the amount per week that, having regard to the state of the labour‑market at the relevant time, the employee could reasonably be expected to earn in such employment if he or she were engaged in such employment;

    (f)  where paragraph (b), (c), (d) or (e) applies to the employee—whether the employee’s failure to accept an offer of employment, to engage, or to continue to engage, in employment, to undertake, or to complete, a rehabilitation or vocational retraining program or to seek employment, as the case may be, was, in Comcare’s opinion, reasonable in all the circumstances; and

    (g)  any other matter that Comcare considers relevant.

    THE FACTUAL CONTEXT AND THE ARGUMENTS OF THE PARTIES

11. Ms Kloren suffered her compensable injury, identified as “adjustment reaction with mixed emotional features”, on 22 June 2009. Comcare accepted liability under section 14 of the SRC Act, and the background is set out in the decision accepting liability, at T5. At that time Ms Kloren was employed by the then Department of Broadband, Communications and the Digital Economy. Ms Kloren resigned from employment with the Commonwealth on 23 May 2010.

12. Ms Kloren began self-employment with her own organisation, Bobrick Consulting, from 1 July 2010. Ms Kloren works as a scribe for public sector recruiting. Most of her work is gained through Kowalski Recruitment, an accredited provider (Ex A1).

13. In 2014 the number of hours that Ms Kloren was able to work each week became the subject of dispute between her and Comcare. It will be apparent that the number of hours a person can work will directly influence the amount the person is able to earn in a week, as the latter amount is that number of hours multiplied by the hourly rate of pay. Some medical practitioners had advised that Ms Kloren was able to work for 20 hours each week (T13),  and on 20 March 2014 Comcare determined that Ms Kloren was able to work for up to 20 hours a week and could earn $666.67 per week in suitable employment from 2 April 2014 (T18). Ms Kloren sought reconsideration of that decision, and the decision was affirmed in a reconsideration decision dated 31 July 2014 (T24).

14. Ms Kloren had alternative medical advice that she could work for up to 10 hours per week (T41). She continued to agitate for Comcare to reconsider its estimate of her ability to earn (T45, T49, T52, T53). On 12 November 2015 she sought a reconsideration of the Comcare decision of 31 July 2014 (T58) and was advised that as it had already been reviewed she should apply to this tribunal, which she did on 18 December 2015. The matter was settled by a consent decision  in the following terms (T67):

    Pursuant to section 42C(2) of the Administrative Appeals Tribunal Act 1975, the Tribunal varies the reviewable decision dated 31 July 2014 as follows:

    1.    the applicant is fit to work as a recruitment consultant for 10 hours per week;

    2. as at 2 April 2014, the Applicant has an ability to earn of $365.60 (based on the average weekly wage for a recruitment consultant of $1,371.00), in accordance with section 19 of the Safety, Rehabilitation and Compensation Act 1988.

15. From 23 June 2016 Comcare continued to use the number of hours and ability to earn figures in the above decision to determine Ms Kloren’s compensation. Determinations were made on 20 July (T75), 17 August (T78), 31 August (T82), 14 September (T83), 28 September (T84), 12 October (T86), 26 October (T87), 9 November (T91), 23 November (T92), 7 December (T96) and 21 December 2016 (T98). The last of those determinations decided Ms Kloren’s compensation up to 28 December 2016.

16. In the reviewable decision of 1 February 2017, the decision under review (T104), Ms Jennifer Waterhouse, a Senior Review Officer with Comcare, recalculated Ms Kloren’s entitlements for the entire period from 2 April 2014 to 28 December 2016. Where the number of hours Ms Kloren worked was constant over each week in a given period the entitlement was calculated for that period; otherwise the entitlement was calculated week by week. Ms Waterhouse identified and corrected some errors in earlier calculations. The decision records that Ms Kloren disputed that she was able to earn $365.60 for 10 hours of work each week during the period from 23 July to 28 December 2016, and Ms Waterhouse determined that the number of hours that Ms Kloren could work each week remained at 10 in the period from 23 June to 28 December 2016.

17. The central contention of Ms Kloren is that her compensation should take into account her ability to earn in each week, and that should be determined by whether she looked for work and took any work offered to her; if she took all available work – and Ms Kloren asserts that she did – then her compensation should be calculated on the basis of how much she actually earned in that week, and not some higher figure calculated on a default basis. Ms Kloren bases that contention on subsection 19(4).

18. Comcare contends that for the period from 2 April 2014 to the date of the consent decision on 22 June 2016, Ms Kloren’s compensation is calculated in accordance with that decision; and that in the period from 23 June 2016 to 28 December 2016, the same basis applies, first because the consent date sets no end date for its operation, and second because nothing in Ms Kloren’s circumstances had changed.

    MOTION FOR DISMISSAL FOR ABUSE OF PROCESS

19. Comcare gave notice shortly before the hearing that it would move for dismissal of the application for review for abuse of process, and the hearing indeed began with that motion.

20. Comcare argued that Ms Kloren’s application involved circularity: she had been party to a consent decision on 22 June 2016, which had settled the question of her “ability to earn” under subsection 19(2) of the SRC Act. In paragraphs 30 and 31 of her statement of facts, issues and contentions Ms Kloren had acknowledged the consent decision. She was now attempting to relitigate (using that term in a broad sense to encompass the reagitation of a matter in a tribunal as well as a court) that settled issue.

21. Comcare took me to Novosel v Comcare [2017] FCA 722 where at [103] Perry J commented that

    … a consent decision made under s 34D of the AAT Act is no less final than a decision made on the merits following a hearing. As the respondent contends, “[i]t would be contrary to the intention of the legislature in enacting a range of alternative dispute resolution mechanisms to conclude that a consent decision is any less final than a decision that has been dealt with on the merits.” That Parliament so intended is supported by the fact that a consent decision can be made under s 34D(1) of the AAT Act only where neither party has notified the Tribunal that she or he wishes to withdraw from the agreement within a seven day “cooling off” period after agreement is reached and the Tribunal is satisfied that a decision giving effect to the agreement is within its powers.

22. Comcare also noted the comments of D P Hack in Grimsley and Telstra Corporation (2010) 51 AAR 401, in finding that the applicant should not be allowed to reopen a matter already resolved in a consent decision: “Prima facie, the consent decision in the matter ought to be regarded as having determined the matters in controversy.”

23. Ms Kloren insisted that she was not attempting to reopen the earlier consent decision: rather she was challenging how it had been given effect. She did not take issue with the number of hours she could work, as determined in that decision: rather it was Comcare that had raised that question. On a plain reading of section 19 of the SRC Act, and subsection 19(4) in particular, her actions in seeking work and making herself available for work were required to be taken into account in determining the “AE” figure to be used in determining her compensation in each week of the period covered by the consent decision and afterwards up to 28 December 2016. The way in which that had been done by Comcare was not consistent with the consent decision. The path she was advocating flowed from the consent decision but did not attempt to reopen or relitigate that decision. Comcare had accepted that she had not failed to seek suitable work and to undertake such work when it was available.

24. Comcare argued in response to these arguments that if the controversy before the tribunal was about the implementation of the consent decision then there was no jurisdiction for the tribunal to consider the matter. The AAT Act limits the tribunal’s jurisdiction to the review of a decision made under an enactment, where the enactment provides for such review. Where an enactment provides for the tribunal to review a decision, it is the decision itself that the tribunal is empowered to review, not its implementation.

    Dismissal motion - consideration

25. Dismissal of a matter is a summary action that prevents a party from agitating its issues. The courts have clearly signalled that the power to dismiss a matter and deny an applicant an opportunity of presenting a case should be exercised cautiously and sparingly: Dey v Victorian Railways Commissioners (1949) 78 CLR 62 (Dixon J, at 91); General Steel Industries v Commissioner for Railways (NSW) (1964 112 CLR 125 (Barwick CJ, at 128-9)).

1. One basis for dismissal of a matter is where the matter has already been before the tribunal, which has taken a final decision. There has been debate about whether this tribunal (and tribunals more generally) are subject to doctrines such as res judicata, cause of action estoppel and issue estoppel: see Quinn and Australian Postal Corporation (1992) 15 AAR 519 (Quinn); Matusko and Australian Postal Corporation [1995] AATA 14 (Matusko). It appears that the question is yet to be definitively determined (although it appears to be the preferred position that estoppel does not apply to the tribunal, as an administrative decision maker: see Comcare v Grimes [1994] FCA 1054 (Wilcox J)), but it is a common position in the authorities that the powers given the tribunal by sections 33, 42A and 42B of the AAT Act provide the tribunal with very flexible means of controlling its own processes, and these powers can be used to address the concerns that doctrines such as res judicata and issue estoppel evolved to deal with in the courts.

2. In particular, in the present context, it is clear that the tribunal has the power under section 42B of the AAT Act to dismiss a matter that has already been finally decided and to prevent its reagitation. A constraint in practice on the exercise of that power, however, arises from the provision in some statutes, including the SRC Act, for continuing determination of a person’s entitlements. The SRC Act provides in section 62 for reconsideration of determinations, on the determining authority’s own motion or at the request of a claimant or another affected body. Thus a person who has a worsening compensable injury under the SRC Act, or an exacerbation of an injury, or a new condition, can seek redetermination of their matter. That implies that the tribunal may be called on to review a matter already determined in the tribunal at an earlier time.

3. This requirement is recognised in Quinn and Matusko. In the latter case the tribunal reached the conclusion that while in general the tribunal should not allow the relitigation of issues already decided it might do so where:

   ·there is a new or different decision;

   ·there is a clear legislative intent;

   ·the reconsideration decision is not final;

   ·there has been a change in circumstances or new evidence; or

   ·justice to the parties requires a departure from the general rule.

4. In the present context Ms Kloren is seeking review of a reconsideration decision that applies but does not vary the terms of the consent decision of 22 June 2016. The consent decision is not new or different, and it shows every indication of finality; nor has Ms Kloren introduced new evidence or suggested a change in circumstances. I cannot see that justice requires that the consent decision be reopened; nor any other reason to take that action. Ms Kloren may not reopen or relitigate the consent decision, and if that were the complete intent of her application to the tribunal, I would dismiss the matter as an abuse of process under section 42B of the AAT Act.

5. But Ms Kloren says she is not attempting to relitigate the consent decision but rather to challenge how it is applied. On the face of it, Comcare’s argument that implementation of the decision does not provide a basis for review and the tribunal has no jurisdiction appears correct: that flows from the terms of section 25 of the AAT Act, which establishes the tribunal’s jurisdiction to review decisions made under enactments. But the decision under review, the reconsideration decision of 1 February 2017 does not deal with the matters resolved in the consent decision, but rather uses or draws on those settled matters in the determination of Ms Kloren’s weekly compensation. That is, the decision deals not with the amount Ms Kloren is able to earn, as set out in paragraph 19(2)(a) of the SRC Act, but rather with the use of that figure in deciding the AE figure each week and the use of the AE figure in the calculation of weekly compensation, in accordance with subsection 19(3). In Casarotto v Australian Postal Commission [1989] FCA 116 Hill J held that when a matter comes to the tribunal for review the whole matter before the original decision-maker is open to review and not only the issues contested at the earlier stage. The calculation process under section 19 of the SRC Act, although straightforward, is nevertheless open to review to the extent it has not been resolved by the consent decision.

6. The above deals with the period up to 22 June 2016. For the period after that date and up to 28 December 2016 Ms Kloren’s application for review can proceed. I do not accept Comcare’s contention that the consent decision is prospective because no end date is specified. That mischaracterises the effect of tribunal decisions which cannot determine a person’s rights and interests for a future period, where the person’s circumstances are unknown and inherently unknowable. The end date of the consent decision is the date it was made. Further, the contention that the consent decision continued to apply after 22 June 2016 because nothing had changed after that date is one that is challengeable through the review process. And apart from any other consideration, the Senior Review officer who made the decision under review considered Ms Kloren’s objection to the continued use of 10 hours a week as the amount she was medically fit to work, and determined that the figure still applied. That determination is clearly within the scope of this review.

7. The tribunal has jurisdiction to hear this matter within the constraints outlined above. On the basis of the above reasoning I denied the motion for dismissal of the application, and the matter proceeded to be heard.

   DETERMINATION OF COMPENSATION PAYABLE TO MS KLOREN

8. The amount of compensation that Ms Kloren is entitled to receive over the period from 2 April 2014 to 28 December 2016 is decided in accordance with section 19 of the SRC Act, and the controversy between the parties turns on the construction of that section. After I had denied Comcare’s motion to dismiss the matter, Ms Kloren stated that she would accept the matters determined in the consent decision as applying equally in the period following the consent decision, that is, from 23 June to 28 December 2016. During that period, therefore, she conceded that she was able to work 10 hours each week and that the amount she was able to earn in suitable employment was $365.60 per week. Her wish was to limit the matters to be determined to the application of section 19 using those parameters.

9. This led to the remainder of the hearing focusing solely on the construction of section 19; no evidence was taken, as no issues of fact remained for resolution. It was recognised, however, that, depending on the outcome of the controversy over the construction of section 19 of the SRC Act, some evidence might need to be taken at a later time. The focus of the hearing on the construction of section 19 also had the result that there is no use to be made of much of the documentary material tendered as exhibits.

10. Ms Kloren did not put a detailed argument for the construction of section 19, although a preferred construction of that section might be readily inferred from the various arguments put either in her written statement of facts issues and contentions, in her protracted email exchanges with Comcare over several years, or in oral argument. Ms Kloren argued that the determination of a person’s AE figure must take account of whether, in practice, employment was available to the person. The consent figure of $365.60 for weekly ability to earn in suitable employment was, in her contention, to be applied if she was unavailable for work, or stopped looking for work, or failed to take up the work that was available to her, to the extent of the agreed 10 hours per week. Otherwise, as she was working to the extent that was possible for her, the amount she actually earned in each week should be used as the AE figure. After all, that amount was demonstrably what she had been able to earn in that week.

11. In arriving at an AE figure, Ms Kloren argued, Comcare needed on each occasion to take into account the considerations set out in subsection 19(4). Taking those matters into account would then oblige Comcare on each occasion to consider whether she had been available for employment, had sought employment, and had taken up the employment that was available to her. Ms Kloren argued that she had consistently done so, and if Comcare had applied the legislation as she contended for, Comcare would have concluded that the figure to be used in calculating her compensation for a week was what she had actually earned in that week. Comcare had admitted that she had not failed to seek suitable employment.

12. In putting her argument Ms Kloren relied in part on a Comcare fact sheet titled “Deeming ability to earn” (Ex R2), dated May 2017. This fact sheet provides information about the way in which the AE figure is determined. It notes that the word “deeming” is not used in the SRC Act, but that Comcare uses the word to describe an amount that a person has been found to be able to earn but is not actually being earned. The fact sheet also notes that the determination of an AE figure depends on whether the person is a Commonwealth employee or has left the Commonwealth’s employ, and on whether the person has received and failed to accept, or failed to continue to accept, an offer of suitable employment. In a part of the fact sheet headed “Ex-employees” there is a passage as follows:

    In order to deem an ability to earn, suitable employment options need to be identified as being available to the employee. Identification of employment options is generally undertaken by an Occupational Therapist or Vocational Assessor with appropriate labour market expertise.

13. It appears that Ms Kloren derived from the above passage, not unreasonably, that if no work was available to her, or if she took up all the employment offered to her in a week, then no “deeming” of an amount she was able to work would occur, and her AE figure would be her actual earnings for the week.

14. Comcare proposed that section 19 of the SRC Act (and specifically the combination of subsections 19(2), (3) and (4)) requires that subsection (4) be taken into account in the determination of the amount to be used as the person’s ability to earn in suitable employment, that is, for the purposes of determining paragraph 19(2)(a). That is the only application of subsection (4). Thus once paragraph 19(2)(a) has been determined for a period, subsection 19(4) has no further application, and the formula set out in subsection 19(2) would be applied to arrive at a figure for AE. For the period covered by the consent decision, the figure of $365.60 had been agreed as the amount that Ms Kloren was able to earn each week in suitable employment. That having been agreed, AE was the greater of the amount that she actually earned in the week and $365.60, and the amount of compensation to be paid then followed the calculation formula (specifically, in her case, that set out in subsection 19(3)).

15. For the period following the consent decision, Comcare contended that the same reasoning applied, as by the concessions she had made Ms Kloren once again had an agreed value of $365.60 for paragraph 19(2)(a), which then entered the calculation of the weekly compensation amount in the same way.

16. In support of these contentions Comcare took me to two cases that deal with the application of section 19, namely Woodbridge v Comcare [1994] FCA 558 (Woodbridge) and Pelgrave v Comcare [2002] FCA 1025 (Pelgrave).

17. After Ms Katavic had put forward Comcare’s proposed construction of section 19 Ms Kloren did not reiterate her earlier contentions, but rather argued that the approach adopted by Comcare was wrong because it was unfair. By adopting a set and unvarying figure, Comcare placed an artificial floor under the value of AE to be used, and consequently created an upper limit for the amount of compensation that might be paid in any week. This did not take account of the person’s circumstances. If a person was unable to work, for example, or if work was not available in a given week, how could it be reasonable to use some set figure, ignoring the realities of the market for the person’s skills?

    Construction of section 19 – consideration

18. The difference between the competing constructions advanced by Ms Kloren and Comcare boils down to whether the considerations enumerated in subsection 19(4) are taken into account in determining AE itself, as Ms Kloren advocated, or in determining the amount the person is able to earn in suitable work, i.e. the amount specified in paragraph 19(2)(a), as advocated by Comcare.

19. Section 19 of the Act sets out the process to be used to calculate how much in weekly compensation is to be paid to a person for incapacity for work where Comcare has liability. The section sets out different methods of calculating the weekly amount (in subsections (2), (2C), (2D) and (3), but common to all of them is the value of AE, which is defined in subsection (2) and then adopted for the other subsections.

20. Subsection (2) defines AE as the greater of two amounts: the amount the person is able to earn in suitable employment; or the amount that the person earns from any employment in that week (the legislation uses “employee” rather than “person” but section 5 of the Act defines “employee” to extend to a person who ceased to be an employee after Comcare has incurred liability). Subsection (4) then provides a list of matters that Comcare is to have regard to “In determining for the purposes of subsection (2) and (3), the amount per week that an employee is able to earn in suitable employment”.

21. It is plain from the above that the purpose of subsection (4) is limited to determining the value of paragraph 19(2)(a); the words “the amount per week that an employee is able to earn in suitable employment” are a direct quote from that paragraph and clearly refer to subsection (2), where AE is defined. It follows directly from the legislation, then, that the construction contended for by Comcare is correct.

22. Woodbridge is the leading case on the operation of subsection 19(4) of the Act. In that case Hill J made it clear that

    ·In determining the amount that a person is able to earn, Comcare must have regard to all the matters in paragraphs (4)(a) to (4)(f);

    ·Comcare must also consider any other relevant matter, as required by paragraph (4)(g);

    ·Some of the paragraphs in subsection (4) in a given case may point in one direction and some in another;

    ·It will, in general, be necessary for the decision maker to take into account the considerations in subsection (4) and then determine an amount that the person is able to earn in suitable work, i.e. determine a figure for paragraph 19(2)(a).

23. Although the particular issues decided in that case are different from those in the present matter, it is clear from Hill J’s judgment that Comcare’s contention in the present matter is right: the point of subsection 19(4) is that it is used to determine the figure in paragraph 19(2)(a). As outlined above, so much flows directly from a plain reading of subsections (2) and (4) in any case.

24. In Pelgrave Merkel J found that this tribunal, in reviewing a decision that extended to the determination of the amount of compensation to be paid under section 19, failed to make the necessary findings. His Honour’s reasoning confirmed the conclusion arrived at in Woodbridge that the considerations in subsection 19(4) are to be taken into account for the purposes of determining the amount a person is able to earn in suitable employment.

25. The determination of AE therefore proceeds in the following steps:

    ·the decision maker considers the matters enumerated in paragraphs (4)(a) to (4)(f);

    ·the decision maker considers any other relevant considerations, in accordance with paragraph (4)(g);

    ·on the basis of these considerations the decision maker determines what the person is able to earn in suitable employment (paragraph 19(2)(a));

    ·the decision maker determines the actual earnings of the person in each week (paragraph 19(2)(b)); and

    ·in each week, the figure to be used as AE in the formula is the amount the person has been found to be able to earn or the actual earnings in that week, whichever is greater.

26. The amount calculated under paragraph (2)(a) is likely to be a figure that can be used for a sustained period. Phrases used in subsection (4) - “the amount… the employee is earning”; “the amount … the employee would be earning” - imply a continuing process. What is envisaged is an amount that represents an ongoing ability to earn in paragraph (2)(a) which is then compared in each week with the amount actually earned. That is no doubt why the Comcare fact sheet referred to above speaks of the amount being determined by a vocational assessor or occupational therapist: the task lends itself to being decided for an extended period based on an expert assessment of the market for the skills identified under the heading of the person’s “suitable employment”. But it does not necessarily have to proceed in that way: a person may suffer from a severely episodic or fluctuating condition that may make the amount he or she is able to earn at one period very different from the amount at another period, or there may some significant change in the labour market that leads to change in the person’s ability to earn.

27. In the present matter, however, the amount Ms Kloren is able to earn is $365.60, as that is the amount agreed in the consent decision and, for the period following that decision, as a result of Ms Kloren’s concession. When the consent decision was being negotiated or arrived at, some consideration was presumably given (or could have been given) to what was suitable work for Ms Kloren (recruitment consultant) and how many hours she could work in a week (agreed at 10). An amount was evidently determined as the average weekly wage of a recruitment consultant. From those hours and wage figures flows the amount of $365.60. Once the figure set by paragraph 19(2)(a) of the Act is decided, AE is decided by a simple comparison between the agreed figure for paragraph (a) and the amount earned in practice, specified in paragraph (b). Any unfairness that results from this process, which does indeed provide a lower bound for the value of AE and therefore an upper bound for the payment of compensation, is a result of the drafting of the legislation and not of its implementation or of subsequent decision making.

28. As for Comcare’s fact sheet, in the first place that document has no formal standing - not even, so far as I can determine, as policy (for the role of policy in tribunal decision making see Drakeand Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634); and if there is any inconsistency between the fact sheet and the legislation, it is the legislation that must prevail. The reference to “deeming” I understand to be to the determination of the person’s ability to earn in suitable employment, i.e. the value to be decided under paragraph 19(2)(a). The statement that no deeming of AE can occur without it having been determined that suitable work is available is, I think, intended to refer to the kind of general test of the labour market described above in paragraph [52], and not the kind of week-by-week determination of that matter that Ms Kloren envisages. Comcare may wish to consider whether the drafting of the fact sheet might be revised.

29. In practice, the determination of Ms Kloren’s AE in each week or other period was based on the detailed reports of earnings by Ms Kloren, reports which she has conscientiously provided throughout the period. Ms Kloren has frequently in the past challenged Comcare’s determination of the compensation amount for any given week or period, but she has not challenged any of the earnings figures used in deciding whether in the periods covered by the reconsideration decision it is the amount in paragraph (2)(a) or (2)(b) that should be used. Once AE is determined, the amount of compensation to be paid each week is a simple calculation under subsection 19(3) based on the amount of NWE (which is not disputed) and Ms Kloren’s employment record for that week (which decides the adjustment percentage to be used). Once again, Ms Kloren has not challenged any of the calculations and nothing has been put to me to suggest that there is any error.

55.     I certify that the preceding 54 (fifty-four) paragraphs are a true copy of the reasons for the decision herein of  Member Mark Hyman

56.      

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

Associate

Dated: 29 May 2018

Date(s) of hearing:	7 May 2018
Solicitor for the Applicant:	Self-represented
Solicitors for the Respondent:	McInnes Wilson Lawyers