McCluskey v Oxford Managers
[2017] VMC 2
•1 February 2017
| IN THE MAGISTRATES’ COURT OF VICTORIA |
AT MELBOURNE
G11553992
| MARK McCLUSKEY | Plaintiff |
| V | |
| A B OXFORD MANAGERS PTY LTD | Defendant |
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MAGISTRATE: | Magistrate B.R. Wright |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 18 January 2017 |
DATE OF DECISION: | 1 February 2017 |
CASE MAY BE CITED AS: | McCluskey v Oxford Managers |
MEDIUM NEUTRAL CITATION: | [2017] VMC002 |
REASONS FOR DECISION
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Catchwords:
Workers Compensation – Pre-Injury Average Weekly Earnings – Earnings Enhancement – Enhancement Period – Overtime Pay – Worker Retrenched After Injury and Prior to Lodging Accepted WorkCover Claim – Workplace Injury Rehabilitation and Compensation Act 2013 – s20, s153(1)(b), s157 “earnings enhancement”, “enhancement period”, s174.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Ms A Ryan | Dimitra Panagopoulos |
| For the Defendant | Mr C Miles | Minter Ellison |
HIS HONOUR:
1 Mr McCluskey seeks to review the determination of the quantification of his weekly payments for his accepted right knee injury. In short, he submits that his pre-injury overtime should be taken into account which argument the authorised agent, CGU, has rejected.
2 It submits that as he was made redundant prior to the lodging of his workers compensation claim it could not be said that he would have been likely to have worked overtime as at the date of the lodging of that claim.
3 Both parties agreed on the facts and relevant documentation and made brief submissions. Neither Counsel was able to find any specifically relevant authority going to this point.
4 Of course, the relevant provisions in the Workplace Injury Rehabilitation and Compensation Act 2013 (“the Act”) were only introduced into its predecessor, the Accident Compensation Act 1985 in the late 2010 amendments which introduced wholesale changes to the pre-injury average weekly earnings (“PIAWE”) and related provisions.
5 I will briefly summarise the facts. Mr McCluskey injured his right knee when he fell down stairs at work on 5 August 2015. The injury was reported on that date and a formal incident report was lodged on 7 August 2015. He had one day off work and saw a company doctor, both apparently on 10 August 2015. The doctor certified him on 10 August and 17 August 2015 as being fit for full time alternative duties which he performed with Oxford and continued to receive his full wages. That doctor arranged an x-ray on 14 September 2015.
6 Both prior to and after his injuries he had continued to work overtime as well. On 4 September 2015 Oxford paid a chemist bill and two physiotherapy bills totalling about $191.91 on an apparently ex-gratia basis.
7 On 17 September 2015 he received a letter from Oxford that he was being made redundant as at that date. Five other employees were also made redundant at about the same time. He was paid appropriate entitlements including about five weeks' pay in lieu of notice and/or for redundancy. He ceased work then and has not returned to work since.
8 He lodged his formal workers compensation claim form on 1 October 2015 and Oxford compiled its employer claim report on 8 October 2015. On 29 October 2015 CGU accepted the claim.
9 By way of an email sent on 4 November 2015 by CGU to Mr McCluskey, and later confirmed after review by Notice of 24 November 2015, his claim for the overtime component to be included in his weekly benefit was rejected as "the claim was only lodged after the redundancy not due to incapacity. Overtime is only inclusive if it would have been worked but for the incapacity, that is if you were not injured you would still not have been working."
10
Both parties agreed that the relevant provision, being s.157 of the Act, allows
PIAWE to be calculated by including overtime as an “earnings enhancement” for the purposes of weekly payments to the worker for the first 52 weeks "in respect of which such compensation is paid or payable to the worker." (emphasis added)
11 However, Oxford submits that s.157(b) is relevant in this case. An “earnings enhancement" (that is, including overtime) is only a relevant consideration if "but for the worker's injury or death the worker would have been likely at any time prior to the 'enhancement period' (that is, the first 52 weeks of paid or payable) to have worked paid overtime."
12 Oxford
simply says that because Mr McCluskey was made redundant as of
17 September 2015, that it could not be said that he would have been likely to have worked paid overtime. It points to the fact that Mr McCluskey was made redundant prior to the formal submission of his workers compensation claim form and thus his workers compensation claim was not made until then based on s.20 of the Act.
13 On any view he was made redundant prior to the formal acceptance of his claim and the consequential assessment of the quantum of his weekly payments. Interestingly, in this case the Notice of Acceptance of his claim stated PIAWE was assessed at $1,424 including "$66 for overtime" and stated that his weekly payment would be $1,353 gross, being 95 per cent of PIAWE.
14 However, in its email of 4 November 2015 it now resiled from including the $66 overtime component in the PIAWE figure and stated weekly payments would be $1,290, being 95 per cent of $1,358.
15 On its face, Counsel's submissions would mean that in any case if a worker was dismissed, or indeed retrenched, for any reason save maybe as a result of the work-related injury at least prior to the calculation of PIAWE on acceptance of a claim, then overtime would never be included in the calculation of PIAWE for weekly payments in appropriate cases. An authorised agent may even be able to re-calculate PIAWE in the first 52 weeks of weekly compensation being paid or payable at least prospectively as well.
16 Counsel for Mr McCluskey points to the agreed facts in this matter noting that although he did not make a formal workers compensation claim, Oxford informally accepted his claim after having him examined by its own doctor. It gave him alternative duties on full pay and made ex-gratia payments of some of his reasonable medical and like expenses. Thus, there was no basis for making any claim then as although he may have justified an weekly payment entitlement, it would not have been quantifiable as he continued to receive his weekly wage and indeed overtime as well.
17 Despite the fact he only lodged his workers compensation claim on 1 October 2015, compensation under the Act was at least payable on the date of injury, that is 5 August 2015, and/or for the one day off work on 10 August 2015 if not for the fact that he had been paid fully and separately by Oxford.
18 That completes Counsels’ submissions.
19 As the payments made by Oxford did not come within the exceptions set out in s.174 of the Act, then regard must be had to those payments in any quantification of actual payment of benefits under the Act (see, Cahill v ACC (1987) 1 Vic ACR 187).
20 For whatever reason Counsel for Mr McCluskey did not specifically address Oxford's argument based on paragraph (b) of the definition of “earnings enhancement” in s.157 of the Act.
21 I now proceed to make my ruling.
22 In order to calculate the appropriate weekly compensation payable to a worker in any case, it is necessary to calculate PIAWE. Of relevance in the present case is the definition of PIAWE in s.153(1) being:-
“(a) the average of the worker’s ordinary earnings during the relevant period. . . and -
(b) the worker's earning enhancement (if any) in the relevant earning enhancement period.”
23 It is thus necessary to consider the definition of “earnings enhancement” and “enhancement period” in s.157 as to which I have already referred in Counsels' submissions.
24 I agree with Oxford's submission that the main qualification in this case is paragraph (b) of the definition of “earnings enhancement” in s.157. It is not in dispute that Mr McCluskey was retrenched while working full time on alternative light duties. It is agreed he was retrenched with other workers. There is no material that his work related injury had any part to play in his retrenchment.
25 At that stage, although he had not lodged a formal workers compensation claim it appears Oxford at least accepted that he did have a work-related injury and consequential current work capacity at least.
26 In those circumstances I cannot see how it would have been “likely” that he would have worked paid overtime at any time during the earning enhancement period but for his injury. In fact, because he was retrenched he could not have worked paid overtime in that period. Quite simply he would not be working for Oxford at all.
27 The argument on behalf of Oxford is further enhanced by consideration of paragraph (a) of the definition of “enhancement period” in s.157. Whether or not his Counsel is correct in her submission on that point does not assist as there is no earning enhancement payable anyway. In any event, I do not think her submission helps in this case.
28 Even if Mr McCluskey had been paid some benefits by Oxford prior to the formal acceptance of the claim, this could not be weekly payments pursuant to the Act as his formal workers compensation claim had not been lodged prior to his retrenchment.
29 Although his entitlement to benefits under the Act would be backdated from the initial date of injury, there are no weekly payments paid or payable in this case as there is no dispute he did not lose any earnings despite his injury. No compensation is payable in those circumstances for that period based on s.174 of the Act.
30 The concept of compensation being "paid or payable" was inserted into the Accident Compensation Act 1985 by Act No.107 of 1997. Prior to then a worker was entitled to weekly payments which would cease on a prima facie basis after the worker had been incapacitated for 104 weeks (see, s.93B(3) and similarly s.93A(1) of Reprint 6 of the Accident Compensation Act 1985).
31 In Cassar v VWA [1996] 1 VR 490, the Supreme Court upheld that the period of entitlement of weekly payments under that previous provision included any preclusion period under s.96 of that Act.
32 Thus, if a worker was precluded from receiving weekly payments pursuant to s.96, then no weekly payments were payable over the same period. However, those payments still counted towards the prima facie period of 104 weeks of weekly payments.
33 This was remedied by s.29 of Act 107 of 1997 which changed the prima facie entitlement period to that in which a weekly payment of compensation "has been paid or is payable" to the worker. As a result, any preclusion period under s.96 of the Act did not affect the overall prima facie period of entitlement of 104 weeks of weekly payments. This is also clear from p.15 of the Second Reading Speech for the relevant Bill as well.
34 Thus the words, "paid or payable" did not cover payments made by an employer outside the strict provisions of the Act. As Mr McCluskey's employment was terminated prior to the lodging of his claim, any benefit paid prior to that was not “paid” pursuant to paragraph (a) of the definition of ”enhancement period”, even if that provision is relevant in these circumstances. Similarly, weekly payments cannot be payable if moneys were paid by the employer and not excluded by s.174 of the Act.
35 Because of the circumstances of the termination of his employment in this case, I find that he is not entitled to an “earnings enhancement” anyway.
36 In the circumstances, these proceedings are dismissed.
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