Lisa-Maree Brockett and Military Rehabilitation and Compensation Commission
[2014] AATA 224
[2014] AATA 224
Division VETERANS' APPEALS DIVISION File Number
2013/3917
Re
Lisa-Maree Brockett
APPLICANT
And
Military Rehabilitation and Compensation Commission
RESPONDENT
DECISION
Tribunal Egon Fice, Senior Member
Date 17 April 2014 Place Melbourne The Tribunal sets aside the decision made by a Delegate of the Respondent on
29 July 2013 and remits the matter to the Respondent for the purpose of recalculating the incapacity payments to which Ms Brockett is entitled, taking into account the findings of the Tribunal in this decision..........[sgd Egon Fice]...............................................................
Egon Fice, Senior Member
COMPENSATION – Injury while performing duties during the course of service in the Australian Defence Force – Compensation for injuries – Commonwealth Public Servant with Department of Health and Ageing – Voluntary retirement from Department of Health and Ageing – Statutory construction of s 20 of the Safety, Rehabilitation and Compensation Act 1988 – Interpretation of the expression ‘retired from his or her employment’ – The expression ‘double dipping’ – Statutory interpretation – Use of extrinsic materials in interpreting legislation
Legislation
Acts Interpretation Act 1901 (Cth) ss 15AA, 15AB
Commonwealth Employees’ Rehabilitation and Compensation Act 1988 (Cth) s 19
Defence Force Retirement and Death Benefits Act 1973 (Cth)
Military Rehabilitation and Compensation Act 2004 (Cth)
Safety, Rehabilitation and Compensation Act 1988 (Cth) ss 4, 5, 8, 14, 19, 20, 114
Cases
Aboushadi and Telstra Corporation Ltd [2004] AATA 35
CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384
Cooper Brookes (Wollongong) Proprietary Limited v Federal Commissioner of Taxation (1980) 147 CLR 297
Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 87 ALJR 98
FVNH and Comcare [2013] AATA 832
Hammerton and Comcare (1995) 21 AAR 204
Milliken and Commission of the Safety, Rehabilitation and Compensation of Commonwealth Employees [1991] AATA 292
Saeed v Minister for Immigration and Citizenship (2010) 84 ALJR 507
Sullivan and Comcare [1998] AAT Decision No 13475
Secondary Materials
Australia, House of Representatives, Second Reading of the Commonwealth Employees’ Rehabilitation and Compensation Bill 1988 (1988) No 161, p 2191
Commonwealth Employees’ Rehabilitation and Compensation Bill 1988 (Cth) Explanatory Memorandum (11863/88 Cat. No. 88 4359 7)
Encyclopaedic Australian Legal Dictionary (LexisNexis Australia) viewed 3 April 2014
Public Sector Superannuation Scheme Trust Deed (Cth)
REASONS FOR DECISION
Egon Fice, Senior Member
17 April 2014
Ms Lisa-Maree Brockett enlisted in the Australian Army Reserve in 1990. In 1993, having retired from the Reserve, she enlisted in the Australian Army as a full-time Administrative Officer in the Psychology Corps. In 1999 Ms Brockett transferred to the Australian Army Reserve (active). On 7 May 2002, in the course of training, she fell from a brick retaining wall and injured her right elbow. On 30 July 2002 Ms Brockett was notified by the Commonwealth Department of Veterans’ Affairs (DVA) that the Commonwealth admitted liability for her injury being subluxation of the right elbow with spontaneous reduction and neurapraxia of the right ulnar nerve.
Following her injury, Ms Brockett was transferred from Active Reserves to the Inactive Reserves on 30 August 2002. On 1 April 2005 she transferred to the Standby Reserves. She was medically discharged from the Army Standby Reserves on 14 December 2006. At that time, she was also employed on a full-time basis as a Commonwealth Public Servant with the Department of Health and Ageing (DHA).
On 24 July 2007 DVA notified Ms Brockett that it extended liability to include the condition complete right arm syndrome with a cervical neuromuscular component resulting in headaches. On 16 November 2011 DVA further extended liability to include the condition adhesive capsulitis of the right shoulder. Ms Brockett subsequently applied for a lump sum payment for permanent impairment arising out of her shoulder condition. On 5 January 2012 DVA determined that she suffered a whole person permanent impairment as a result of the compensable injury, the degree of permanent impairment being 10%.
On 20 April 2012 DHA advised Ms Brockett that she was in excess to the Department’s requirements at her substantive classification level of APS Level 4 and offered her voluntary retrenchment. She was given 30 calendar days from the date of the letter to decide whether or not to accept the offer which was made on the basis that her retirement would take effect no later than 21 May 2012. Ms Brockett was informed that if she decided to accept the offer of voluntary retrenchment, she would be entitled to a superannuation benefit under the Public Sector Superannuation Scheme (PSS) and was provided with an application form (Involuntary Retirement) to complete. Ms Brockett accepted the offer of voluntary retrenchment from DHA on 23 April 2012.
As she was entitled to do, Ms Brockett, having retired from the Commonwealth Public Service on or after 1 July 2000 and having ceased to be a member of the PSS due to involuntary retirement before reaching the minimum retiring age, chose to take her final benefit accrual as a pension.
On 7 March 2013, DVA informed Ms Brockett that it had reassessed her entitlement to incapacity payments under the Safety, Rehabilitation and Compensation Act 1988 (the SRC Act) taking into account the provisions in s. 20. According to DVA, Ms Brockett had been overpaid $7354.70 between 1 May 2012 and 30 January 2013. She was informed that she was required to repay this overpayment as a debt due and payable to the Commonwealth pursuant to s. 114(1) of the SRC Act. DVA also informed Ms Brockett of her reduced ongoing fortnightly entitlements from 14 February 2013.
Ms Brockett requested a reconsideration of DVA’s decision that she repay $7354.70. On 29 July 2013 the Review Officer, a Delegate of the Military Rehabilitation and Compensation Commission (MRCC), informed Ms Brockett that the decision made on
7 March 2013 was affirmed. On 9 August 2013 Ms Brockett lodged with the Tribunal an application for review of the decision of the Delegate of the MRCC made on 29 July 2013.
There are no factual matters in dispute. The only issue which I am required to determine is whether s. 20 of the SRC Act applies for the purpose of calculating Ms Brockett’s incapacity payments.
COMPENSATION FOR INJURIES RESULTING IN INCAPACITY
Section 19 of the SRC Act sets out the formula for calculating the maximum rate of compensation per week to be paid to an employee who is incapacitated for work as a result of an injury. However, s. 19(1) provides:
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.
The MRCC contended that s. 20 the SRC Act applies to Ms Brockett. It provides:
(1) Compensation payable to an employee who is incapacitated for work as a result of an injury is determined in accordance with this section if:
(a)the employee is retired from his or her employment (whether the employee retired voluntarily or was compulsorily retired); and
(b)the employee receives a pension under a superannuation scheme as a result of the employee’s retirement.
(2) Comcare is liable to pay compensation to the employee, in respect of the injury, in accordance with this section for each week after the date of the retirement during which the employee is incapacitated.
(3) The amount of compensation is the amount worked out using this formula:
Amount of compensation
Superannuation amount
+
5% of the
employee’s normal
weekly earnings
where:
amount of compensation means the amount of compensation that would have been payable to the employee for a week if:
(a) section 19, other than subsection 19(6), had applied to the employee; and
(b) in the case of an employee who was not a member of the Defence Force immediately before retirement—the week were a week referred to in subsection 19(3).
(4) In using the formula in subsection (3) to calculate an amount of compensation for an employee who retired before the day on which item 22 of Schedule 1 to the Safety, Rehabilitation and Compensation and Other Legislation Amendment Act 2007 commenced, use ― “SC” instead of “5% of the employee’s normal weekly earnings”. For this purpose:
SC means the amount of superannuation contributions that the employee would have been required to pay in that week if he or she were still contributing to the superannuation scheme.
THE PROPER CONSTRUCTION OF SECTION 20 OF THE SRC ACT
While the principles of statutory construction are reasonably well understood by lawyers, although Ms Brockett had the assistance of Mr Roger Greene, who described himself as a Military Compensation Advocate, he is not a lawyer. I should therefore briefly explain the process in so far as it is relevant to this matter.
The principles of statutory interpretation, frequently referred to as rules, may be found in the Acts Interpretation Act 1901 (the Interpretation Act) and in the common law which is, in effect, principles developed by the Courts. Of some significance in this case is
s. 15AA of the Interpretation Act which provides:15AA Interpretation best achieving Act’s purpose or object
In interpreting a provision of an Act, the interpretation that would best achieve the purpose or object of the Act (whether or not that purpose or object is expressly stated in the Act) is to be preferred to each other interpretation.
The High Court of Australia (Gibbs CJ, Stephen, Mason, Aickin and Wilson JJ) in Cooper Brookes (Wollongong) Proprietary Limited v Federal Commissioner of Taxation (1980) 147 CLR 297 dealt with the principles at some length. Gibbs CJ said, at 304:
It is an elementary and fundamental principle that the object of the court, in interpreting a statute, “is to see what is the intention expressed by the words used”: River Wear Commissioners v. Adamson (16). It is only by considering the meaning of the words used by the legislature that the court can ascertain its intention. And it is not unduly pedantic to begin with the assumption that words mean what they say: cf. Cody v. J. H. Nelson Pty Ltd (17). Of course, no part of a statute can be considered in isolation from its context – the whole must be considered. If, when the section in question is read as part of the whole instrument, its meaning is clear and unambiguous, generally speaking “nothing remains but to give effect to the unqualified, words”: Metropolitan Gas Co. v. Federated Gas Employees’ Industrial Union (18).
His Honour went on to say, at 305:
However, if the language of a statutory provision is clear and unambiguous, and is consistent and harmonious with the other provisions of the enactment, and can be intelligibly applied to the subject matter with which it deals, it must be given its ordinary and grammatical meaning, even if it leads to a result that may seem inconvenient or unjust. To say this is not to insist on too literal an interpretation, or to deny that the court should seek the real intention of the legislature.
I should also mention s. 15AB of the Interpretation Act which relevantly provides:
15AB Use of extrinsic material in the interpretation of an Act
(1)Subject to subsection (3), in the interpretation of a provision of an Act, if any material not forming part of the Act is capable of assisting in the ascertainment of the meaning of the provision, consideration may be given to that material:
(a)to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act; or
(b)to determine the meaning of the provision when:
(i) the provision is ambiguous or obscure; or
(ii) the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act leads to a result that is manifestly absurd or is unreasonable.
The High Court of Australia (Brennan CJ, Dawson, Toohey and Gummow J) in CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384, at 408, said this about the use of extrinsic materials:
It is well settled that at common law, apart from any reliance upon s 15AB of the Acts Interpretation Act 1901 (Cth), the court may have regard to reports of law reform bodies to ascertain the mischief which a statute is intended to cure (46). Moreover, the modern approach to statutory interpretation (a) insists that the context be considered in the first instance, not merely at some later stage when ambiguity might be thought to arise, and (b) uses “context” in its widest sense to include such things as the existing state of the law and the mischief which, by legitimate means such as those just mentioned, one may discern the statute was intended to remedy (47). Instances of general words in a statute being so constrained by their context are numerous.
More recently, the High Court of Australia (French CJ, Gummow, Hayne, Heydon, Crennan and Kiefel JJ) in Saeed v Minister for Immigration and Citizenship (2010) 84 ALJR 507, at 515, said this about legislative intention:
As Gummow J observed in Wik Peoples v Queensland, it is necessary to keep in mind that when it is said the legislative “intention” is to be ascertained, “what is involved is the ‘intention manifested’ by the legislation”. Statements as to legislative intention made in explanatory memoranda or by Ministers, however clear or emphatic, cannot overcome the need to carefully consider the words of the statute to ascertain its meaning.…
As was pointed out in Catlow v Accident Compensation Commission it is erroneous to look at extrinsic materials before exhausting the application of the ordinary rules of statutory construction.…
The Court then added, at 523:
In short, as is very common, reading the Explanatory Memorandum and the Second Reading Speech is much less helpful than reading the legislation itself.… In any event, the ultimate question is not what the Parliament intended to do, but what it actually did.
Finally, I should refer to what the High Court of Australia (French CJ, Hayne, Crennan, Bell and Gageler JJ) said in Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 87 ALJR 98 regarding statutory interpretation. The Court said, at 107:
“This Court has stated on many occasions that the task of statutory construction must begin with the consideration of the [statutory] text”. So must the task of statutory construction end. The statutory text must be considered in its context. That context includes legislative history and extrinsic materials. Understanding context has utility if, and in so far as, it is assists in fixing the meaning of the statutory text. Legislative history and extrinsic materials cannot displace the meaning of the statutory text. Nor is their examination an end in itself.
As I understood the essence of Ms Brockett’s submissions regarding the application of s. 20 of the SRC Act, it applied to persons contributing to a Commonwealth superannuation scheme who subsequently retired on invalidity grounds which resulted in them being granted an invalidity rate pension under that scheme. She explained that the PSS provides benefits which include, in addition to superannuation pension arrangements linked to salary and length of service, arrangements for payment of invalidity (disability) pensions at various levels of assessed incapacity where the employee ceases employment due to invalidity attributable to that employment.
Her situation was that the superannuation payments she received as a consequence of her involuntary retirement (redundancy) were payments which she would have ordinarily received regardless of her part-time employment as an Army Reservist and regardless of her claim for compensation for injury when she was a member of the Australian Defence Force. According to Ms Brockett, such retirement superannuation payments are outside the intended scope of s. 20.
In her oral submissions, Ms Brockett said she understood that the intention of s. 20 of the SRC Act was to prevent double dipping. She understood that expression to mean that the intention was to prevent payment by the Commonwealth for incapacity under the SRC Act and payment for invalidity under the PSS.
My understanding of the expression double dipping in the context used by Ms Brockett is it occurs where a person receives a payment for a particular reason on more than one occasion, whether that payment comes from the same source or different sources. In fact, the Encyclopaedic Australian Legal Dictionary (LexisNexis Australia), in respect of social welfare and services, offers the following definition:
The practice of claiming a benefit, compensation, or other payment to which one is entitled, more than once, or in more than one way, thus receiving a greater benefit than the original entitlement intended.
Ms Premala Thiagarajan of counsel, who appeared on behalf of the MRCC, submitted that there was no question that Ms Brockett was unable to engage in work at the same level as she did prior to sustaining her injury. She submitted that Ms Brockett retired from her employment in terms of s. 20 of the SRC Act when she retired from her full-time job, which was with DHA. Ms Thiagarajan submitted that Ms Brockett received a pension under the PSS as a result of her retirement with DHA. Therefore, s. 20 applied in her circumstances.
The first step which must be taken when interpreting a statute is to look carefully at the words used. Those words need to be considered in the context in which they appear in the relevant statutory provision.
Section 20 appears in Part II of the SRC Act which deals with compensation for injuries. Section 14(1) (which is also in Part II) provides that Comcare (in this case MRCC) is liable to pay compensation in accordance with the SRC Act in respect of an injury suffered by an employee if, amongst other things, it results in incapacity for work or impairment. Section 5(1) of the SRC Act defines the expression employee generally as a person who is employed by the Commonwealth or by a Commonwealth authority or a person who is employed by a licensed Corporation. However these definitions do not apply to Ms Brockett who was a member of the Australian Defence Force at the time she sustained her injury. Members of the Defence Force are not regarded as employees of the Commonwealth. They are deemed to be so for the purposes of the SRC Act by reason of s. 5(2) which provides:
(2) Without limiting the generality of subsection (1):
(a)…
(b)a member of the Defence Force; or
(c)…
shall, for the purposes of this Act, be taken to be employed by the Commonwealth, and the person’s employment shall, for those purposes, be taken to be constituted by the person’s performance of duties as… such a member of the Defence Force or by the person’s performance of the duties of that office, as the case may be.
By virtue of the deeming provision set out in s. 5(2)(b), Ms Brockett was eligible to claim compensation for her injury suffered while an active Reservist with the Australian Army if that injury resulted in incapacity for work. Because her injury occurred prior to the commencement of the Military Rehabilitation and Compensation Act 2004, her claim was properly made under the SRC Act. Her employment, for the purposes of the SRC Act, was the performance of her duties as a member of the Defence Force.
There was no issue about the fact that Ms Brockett was entitled to compensation for the injuries she suffered on 7 May 2002 when she was a member of the Army. Those injuries resulted in an incapacity for work. Section 4(9) defines the expression incapacity for work to include incapacity to engage in work at the same level at which the employee was engaged by the Commonwealth in that work or any other work immediately before the injury happened. The only question is whether the amount of that compensation should be calculated under s. 19, or whether that section is excluded because s. 20 applies.
The introductory words of s. 20(1) make it clear that it applies to any employee who satisfies the provisions set out in s. 14 dealing with compensation for injuries. It then sets out the circumstances under which that section applies to an employee. It contains two limbs, (a) and (b). The first limb requires that the employee be retired from his or her employment. It matters not whether the employee was retired voluntarily or compulsorily. The second limb requires that the employee receive a pension under a superannuation scheme as a result of his or her retirement.
The first limb of s. 20(1)
The first question which needs to be answered is: what was Ms Brockett’s employment for the purposes of the first limb of s. 20(1) of the SRC Act? The difficulty in answering this question appears to have arisen because Ms Brockett was also employed on a full-time basis by the Commonwealth in her capacity as an Australian Public Servant with DHA.
Ms Thiagarajan submitted that the reference in s. 20(1) to the expression his or her employment need not be confined to the employment out of which or in the course of which the injury was sustained. In fact, she submitted that the first limb in s. 20(1) did not require there to be a causal link between Ms Brockett’s injury and the retirement from her employment. That is a common theme running through a number of cases decided by this Tribunal (see for example Hammerton and Comcare (1995) 21 AAR 204 at 222; Sullivan and Comcare [1998] AAT 13475 at [65]; Aboushadi and Telstra Corporation Ltd [2004] AATA 35 at [12])
However, and with respect to Ms Thiagarajan, that interpretation seems to ignore the definition and deeming provisions set out in s. 5(2). It also seems to ignore the context in which that expression appears in the SRC Act.
The opening paragraph in s. 20 makes it clear that the section is dealing with the quantum of compensation payable to an employee, or a person deemed to be an employee of the Commonwealth, who has suffered an injury. Such compensation is only payable if the injury is suffered by an employee in the course of, or arose out of, his or her employment (see definition of injury in s. 5A). As s. 5(2) explains, for the purposes of the SRC Act, a member’s employment with the Defence Force is constituted by the performance of his or her duties. Therefore, where the expression his or her employment arises in a section of the SRC Act when referring to a member of the Defence Force, contextually, it must necessarily be a reference to performance of the duties of that member.
Although Ms Thiagarajan submitted the retirement referred to in s. 20(1)(a) is not causally linked to the injury suffered by a member of the Defence Force, as will become apparent presently, I do not consider that submission to be correct. That is because the plain meaning of the expression the employee is retired from his or her employment, in the context in which it appears in the SRC Act, appears to be a reference to the particular employment in the course of which, or out of which, the injury arose. While those words might not, on a strictly literal interpretation, establish a direct link between retirement and the compensable injury which resulted in incapacity, if I am correct in stating that the retirement referred to in the first limb of s. 20(1) is retirement from the particular employment out of which the injury arose, there is some logic in connecting the retirement to the injury.
There is some support in the Tribunal decisions for my interpretation of the expression retired from his or her employment. In Milliken and Commission of the Safety, Rehabilitation and Compensation of Commonwealth Employees [1991] AATA 292, Deputy President B J McMahon referred to the Second Reading Speech on the introduction of the 1988 Bill to the House of Representatives and he said this about s. 20, at [21]:
The purpose of the section is, as was said in the Second Reading Speech to which I have referred, to avoid double dipping, to avoid a situation where a former employee receives both compensation and superannuation from his former employer. Consistently with the observations of Moss J [in Breust and Commission for the Safety Rehabilitation and Compensation of Commonwealth Employees [1990] AATA 267], both must arise out of the same relevant employment, and the superannuation must arise out of retirement from that employment.
Deputy President S A Forgie in FVNH and Comcare [2013] AATA 832 also drew a link between the calculation of an employee’s normal weekly earnings and the relevant employment. She said, at [27]:
A clear distinction is made between the employment giving rise to the injury and employment also offered by the Commonwealth or the licensed authority.
Once that distinction is understood, it becomes clear that an employee’s normal weekly earnings calculated by reference to the number of hours worked and the rate for those hours in the employee’s employment. That is the same employment in which the employee suffered an injury so that the injury could be said to have arisen out of, or in the course of, that employment.
In my opinion, care should be taken in applying a consistent meaning to the expressions used in s. 20(1), particularly as the SRC Act is concerned, at least in part, with compensation for injury to a Commonwealth employee who is incapacitated, either wholly or partly, for his or her employment. Section 20(1) is concerned with the calculation of the amount of compensation payable. As its starting point, it invokes s. 19 and the concept of an employee’s normal weekly earnings. While I need not set out how normal weekly earnings are calculated, s. 19 makes clear the connection between an employee’s normal weekly earnings and the hours the employee was able to work despite his or her incapacity, compared with the hours the employee was able to work before the injury. The employment referred to in s. 19 is the particular employment out of which the injury and incapacity arose.
One should also be mindful of the part played by other employment which an employee may have in addition to the employment out of which the injury arose. Where the employee is employed by the Commonwealth in a part-time position (being the relevant employment out of which, or in the course of which, the injury arose), s. 8(3) applies so as to deem the earnings from other employment to be earnings of the employee from his or her employment by the Commonwealth or the licensee Corporation. The earnings from other employment includes earnings from a Commonwealth agency or otherwise. Those earnings form part of the employee’s normal weekly earnings for the purposes of calculating the loss the employee has suffered as a consequence of the incapacity.
Care must also be taken when interpreting a deeming provision. The purpose of s. 8(3) is simply to allow other earnings to be taken into account when calculating normal weekly earnings. To not do so would act unfairly on an employee injured in his or her employment with the Commonwealth where they are employed on a part-time basis and where they had other employment outside the Commonwealth. That is because s. 8(1) is focused solely on the number of hours worked in each week by the employee in his her employment and the employee’s average hourly ordinary time rate of pay during that period. Without the deeming provision, other significant employment earnings would be excluded from the calculation. However, the deeming provision does not go any further than that. Simply because an employee also has other employment on a full-time basis with the Commonwealth does not mean that the other employment should be considered to be his or her employment for the purposes of the SRC Act. The SRC Act is directed to the employment with the Commonwealth or licensee Corporation out of which the injury or disease arose.
My interpretation of the first limb in s. 20(1) of the SRC Act is consistent with that of the Full Court of the Federal Court of Australia (Davies, Beaumont and O’Connor JJ) in Breust v Commission for Safety, Rehabilitation and Compensation of Commonwealth Employees (1991) 101 ALR 1. The issue in that case was whether the calculation of normal weekly earnings of the applicant should take into account not merely the applicant’s pre-injury earnings at the Australian Taxation Office, where Mr Breust was a full-time employee, but also his earnings as a part-time member of the Army Reserve.
While the issue in Breust’s case arose out of s. 19 of the Commonwealth Employees’ Rehabilitation and Compensation Act 1988 (which was the former short title of the SRC Act prior to its amendment on 24 December 1992), the Court dealt squarely with the application of s. 5(2) and s. 8 which is concerned with the calculation of normal weekly earnings. Section 8 of the SRC Act then, as now, bases the normal weekly earnings of an employee on the average number of hours worked in his or her employment during the relevant period. Mr Breust suffered a disease arising out of his employment as an officer of the Australian Taxation Office. It did not arise out of his part-time employment as a member of the Army Reserve. In any event, given that his employment with the Australian Taxation Office constituted employment by the Commonwealth, Mr Breust was entitled to compensation in accordance s. 19 the SRC Act.
Mr Breust argued that his normal weekly earnings, as defined in s. 8 of the SRC Act, should have included his earnings as a member of the Defence Force Reserve. As far as s. 5(2) is concerned, Davies J said, at 3:
However, I would point out that the provisions of s 5(2) of the Act detract from, rather than support, the submission that the Act is concerned with totality of an employee’s employment or employments with the Commonwealth rather than with the employee’s individual employment or employments with the Commonwealth. Section 5(2) specifies, in relation to the employments there mentioned, that such an employee “shall, for the purposes of this Act, be taken to be employed by the Commonwealth, and a person’s employment shall, for those purposes, be taken to be constituted by the person’s performance of duties as such a member of the Australian Federal Police or member of the Defence Force or the duties of that office, as the case may be”. This sub-section contemplates that employment as a member of the Defence Force will be looked at as a separate employment by the Commonwealth.
Davies J then considered the construction of s. 8 the SRC Act. His Honour said, at 4:
However, s. 8 is drafted so as to leave no doubt that the references in s 8 (1) to “his or her employment” and “that employment” are references to the employment out of which or in the course of which the injury or disease arose or was incurred. This is because the section does not refer to earnings generally, but to the number of hours worked each week in an employment, to the employee’s average hourly ordinary time rate, to the average amount of allowances payable “in respect of his or her employment” and to “the relevant period”, a term defined in s 9. All these provisions show that s. 8 is not concerned with earnings generally. From this, I deduce that the term “employment” has the meaning of “the relevant employment”, the meaning which the tribunal gave to it.
His Honour found support for his interpretation in s. 8(3), s. 8(8) and s. 8(10). He concluded, at 5:
It follows that, in the case of an officer holding a full-time position with the Commonwealth who suffers injury or disease arising out of or in the course of that employment, his normal weekly earnings are to be calculated by reference to the incidents of that employment alone. It is only in the case of an employee who suffers injury or disease arising out of or in the course of part-time employment that normal weekly earnings will take account of earnings from other employment. And in that case, the other employment will take account of earnings from any other employment, whether it be employment with the Commonwealth or outside Commonwealth employment.
Consistent with the context in which the reference to his or her employment appears in the first limb of s. 20(1), I find that it simply requires retirement of the employee from the particular employment out of which, or in the course of which the injury arose. In Ms Brockett’s case, the reference in s. 20(1)(a) of the SRC Act to having retired from his or her employment must necessarily be a reference to her part-time employment as a reservist in the Defence Force. It is not a reference to her retirement from DHA. Because Ms Brockett was deemed to have been employed by the Commonwealth on a part-time basis while she was a reservist with the Army, her earnings from DHA are taken into account for the purposes of calculating her normal weekly earnings (s. 8(3) of the SRC Act). However, there is no connection whatsoever between Ms Brockett’s injury or incapacity and her retirement from DHA. She was compulsorily retired from the Defence Force when she was medically discharged on 14 December 2006.
Ms Brockett’s retirement from DHA was involuntary as she accepted an offer on her position becoming redundant. The Public Sector Superannuation Scheme Trust Deed (the Trust Deed) defines the expression involuntary retirement which, in the case of a permanent employee, means the position or office of the member ceases to exist, whether by reason of its being abolished or otherwise. The letter offering Ms Brockett voluntary retrenchment pointed out that if she decided not to accept the offer, her employer would continue to provide appropriate training during what was described as the retention period and take all reasonable steps to find alternative employment for her. If at the end of the retention period she did not gain an alternative permanent position in the Australian Public Service, she would then be involuntarily retired.
The second limb of s. 20(1)
An employee fits within the second limb of s. 20(1) if he or she receives pension under a superannuation scheme as a result of the retirement. The first point to note is reference to the phrase a pension under a superannuation scheme. The phrase is broad and may be a reference to any kind of pension under a superannuation scheme, depending on any contextual considerations which need to be taken into account. There was no dispute that the PSS is a superannuation scheme for Commonwealth Public Servants. Its rules are governed by a Trust Deed. The Schedule to the Trust Deed sets out the rules for its administration and Part 6 deals with Member’s Benefit Options. The relevant provision in Ms Brockett’s case is paragraph 6.3.2 which provides:
6.3.2 A member who, on or after 1 July 2000, ceases membership on involuntary retirement before minimum retiring age is entitled to leave his/her final benefit accrual in the scheme as a preserved benefit, or, as an alternative, may choose:
(a)…
(b)to take his/her final benefit accrual as a pension; or…
Ms Brockett chose to take her final benefit accrual as a pension.
The second element contained in the second limb of s. 20(1) requires there to be a causal connection between receipt of a pension under a superannuation scheme and the employee’s retirement. Again, that is evident from a reading of the ordinary words used and their grammatical construction. However, the reference to retirement must be read in the context of the first limb where it refers to an employee having retired from his or her employment. If I am correct in my interpretation of the first limb of s. 20(1), to fall within the second limb, Ms Brockett must necessarily have received a pension under the military pension scheme which applied to her upon discharge from the Defence Force. Given that she enlisted after 1 October 1991, the Defence Force Retirement and Death Benefits Act 1973 (DFRDB) would not have applied to her. It is likely that she was a member under the Military Superannuation and Benefits Act 1991 which established the Military Superannuation and Benefits Scheme (MSBS). However, I had no evidence about that before me. Nor did I have before me any evidence of any payment having been made to Ms Brockett under the MSBS.
In order to confirm that my interpretation of both limbs of s. 20(1) is correct, and because there have been varying opinions regarding that interpretation by the Tribunal, I have resorted to an examination of extrinsic materials. In doing so, I mindful of the fact that I must not displace the words used in the statute with words used in extrinsic materials. My purpose in examining these materials is to shed light on the intention underlying the introduction of the provisions set out in s. 20 of the SRC Act.
A number of the cases to which I have referred above mention the Second Reading Speech of the Minister (Mr Howe) in the House of Representatives on 27 April 1988. He said at 2194:
This Bill will also seek to reduce the unreasonable costs associated with work-related injuries by introducing measures to prevent double dipping by employees using sick leave payments or superannuation entitlements while on compensation. For example, many employees who have been retired on invalidity grounds under the current legislation enjoy benefits under both compensation and superannuation schemes at a rate considerably in excess of their previous income.
As I understand the expression double dipping, consistent with the definition provided by LexisNexis, it means receiving more than one payment for the same underlying reason. In this case, in accordance with the example given by Minister Howe, double dipping would have occurred if Ms Brockett had received incapacity payments as a consequence of her work injury and received payments from a superannuation scheme based on her incapacity to continue with her work, bringing about her retirement. I do not consider it to be double dipping where an employer makes two payments to an employee on unrelated grounds. That does not result in an employee receiving a greater benefit than the original entitlement intended. Therefore, the fact that Ms Brockett received incapacity payments from the Commonwealth because of her injury, and was also paid by the Commonwealth from her PSS because of her redundancy, does not constitute double dipping. Her redundancy at DHA resulted in her retirement from the PSS and gave rise to an entitlement from that scheme. Her redundancy is completely unrelated to her injury and incapacity for work. It appears to me that the MRCC has treated that as double dipping. It cannot be correct.
I have also examined the Explanatory Memorandum circulated by Minister Howe on the introduction of the Commonwealth Employees’ Rehabilitation and Compensation Bill 1988. In respect of clause 20, it states:
This clause provides rules for the calculation of weekly benefits payable to an employee who, as a result of an injury retires voluntarily or is retired from employment after the commencing day and receives a superannuation pension (emphasis added).
If there was any doubt about the meaning of the words used in both limbs of s. 20 of the SRC Act taking into account their context, the Explanatory Memorandum removes any such doubt. Plainly, the intention of Parliament in enacting s. 20 of the SRC Act was to prevent an employee from receiving payments under the SRC Act for incapacity, then retiring either voluntarily or compulsorily as a result of the work injury, and being paid again for that invalidity for work out of a superannuation pension. The words used in the Explanatory Memorandum do not displace the statutory text nor do they contradict it in any way. In fact, as I have indicated by my analysis of the statutory text in the context in which it appears in the SRC Act, it is entirely consistent.
CONCLUSION
Having first conducted the statutory construction exercise regarding s. 20 of the SRC Act, I have found that to fall within the first limb of s. 20(1), the employee must retire from the employment out of which, or in the course of which, the injury arose. Even further, the retirement must result from the injury. The expression his or her employment is not a reference to other employment in which the employee was engaged at the same time. That construction is consistent with the words of the statute in their literal and grammatical sense, and it is plainly consistent with the intention of its operation evidenced by the Explanatory Memorandum and Second Reading Speech of the Minister.
I have also found that on its literal and grammatical construction, in context, the reference in the second limb of s. 20(1) to receiving a pension under a superannuation scheme as result of the employee’s retirement means that to fall within the section, the employee must have received payment from a superannuation scheme because of the retirement which resulted from the injury the employee received out of, or in the course of, his or her employment. Again, this construction is entirely consistent with the intention of the provisions in that section as evidenced by the Explanatory Memorandum and the Second Reading Speech of the Minister.
The consequences of my construction of s. 20 of the SRC Act are that for it to apply to Ms Brockett, she must necessarily have retired from her role as a reservist in the Defence Force as a result of her injury incurred while carrying out her duties associated with Defence Force employment; and she must have received compensation from the MSBS as a consequence of her retirement. The fact that Ms Brockett was made redundant from her full-time employment with DHA some four years after the injury occurred plays no part whatsoever as far as s. 20 of the SRC Act is concerned. It is a totally unrelated event.
I did not have before me any evidence of a superannuation payment being made to Ms Brockett upon retirement from the Defence Force. I did have evidence of her retirement from the Defence Force due to the injuries she sustained and her subsequent inability to meet the required medical standard. If Ms Brockett in fact received a payment under the MSBS, then that payment should be taken into account as s. 20(1) would apply to her. The superannuation payment she received from the PSS upon redundancy from DHA does not invoke the application of s. 20(1) and therefore it cannot affect any incapacity payments she has received.
I set aside the decision made by a delegate of the MRCC on 29 July 2013 and remit the matter to the delegate for the purpose of recalculating the incapacity payments to which Ms Brockett is entitled taking into account the findings I have made herein.
I certify that the preceding 57 (fifty -seven) paragraphs are a true copy of the reasons for the decision herein of
Senior Member Egon Fice...[sgd].....................................................................
Associate
Dated 17 April 2014
Date of hearing 17 March 2014 Applicant In person Representative for the Applicant Mr R Greene Counsel for the Respondent Ms P Thiagarajan Solicitors for the Respondent Australian Government Solicitor
7
0