Naidu v Able Manufacturing Pty Ltd
[2007] NSWWCCPD 237
•3 December 2007
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:Naidu v Able Manufacturing Pty Ltd & anor [2007] NSWWCCPD 237
APPELLANT: Ravikumar Govindarajulu Naidu
FIRST RESPONDENT: Able Manufacturing Pty Ltd
SECOND RESPONDENT: Giesecke & Devrient Australasia Pty Ltd
FIRST RESPONDENT’S INSURER: Gallagher Bassett Services Workers Compensation NSW
SECOND RESPONDENT’S INSURER: CGU Workers Compensation (NSW) Limited
FILE NUMBER: WCC2588-07
DATE OF ARBITRATOR’S DECISION: 24 July 2007
DATE OF APPEAL DECISION: 3 December 2007
SUBJECT MATTER OF DECISION: Section 40(2)(b) of the Workers Compensation Act 1987; factors to be taken into account in assessing a worker’s ability to earn; requirements for a medical specialist to be eligible to provide a valid assessment of whole person impairment
PRESIDENTIAL MEMBER: Deputy President Bill Roche
HEARING:On the papers
REPRESENTATION: Appellant: Buttar Caldwell & Co
First Respondent: Holman Webb Lawyers
Second Respondent: TurksLegal
ORDERS MADE ON APPEAL: The Arbitrator’s amended determination dated 28 July 2007 is revoked and the following orders made in its place:
“1. The Applicant’s claim for lump sum compensation as a result of injury to his cervical and lumbo-sacral spines on 15 August 2002 is referred to the Registrar for referral to an Approved Medical Specialist in order that the level of whole person impairment (if any) resulting from that injury be assessed. The documents to be referred to the Approved Medical Specialist are those listed at paragraph 11 of the Arbitrator’s Statement of Reasons for Decision dated 28 July 2007.
2. Award for the First Respondent.
3. The Second Respondent is to pay the Applicant Worker’s costs as agreed or assessed. The matter is certified complex under Schedule 6 Table 4 Item 4 of the Workers Compensation Regulation 2003.”
The Appellant Worker’s claim for weekly compensation against the Second Respondent is remitted to a different Arbitrator for re-determination of his entitlement under section 40 of the Workers Compensation Act 1987 in accordance with the reasons in this decision.
The Second Respondent is to pay the Appellant Worker’s costs of the appeal.
BACKGROUND TO THE APPEAL
Ravikumar Govindarajulu Naidu (‘the Appellant Worker/Mr Naidu’) was born in India on 20 October 1953 and is now 54 years old. He completed his schooling in India to year 11 standard. After leaving school he completed a diploma course to qualify as a moulder. He came to Australia in June 1999 and started work as a fibreglass laminator with a firm at Blacktown where he stayed until the business closed in April 2000. He started with Able Manufacturing Pty Ltd (a labour hire company) (‘the First Respondent/Able’) in May 2000 and was placed by that company with National Foods at Penrith where he initially worked as a production worker and then in the bottling section. He injured his lower back while lifting a pallet at work on 15 June 2000.
He attended his local doctor, Dr Bonovas, who certified him unfit for work until 4 July 2006 when he returned to work on suitable duties. Mr Naidu returned to his normal duties on or about 10 July 2000. In his statement dated 12 July 2000 Mr Naidu said that his back was “good”, that he had no pain and was able to return to work (Mr Naidu’s statement 12 July 2000, paragraph 45).
On or about 5 October 2000, Mr Naidu ceased working for Able and started work for Giesecke & Devrient Australasia Pty Ltd (‘the Second Respondent/ Giesecke’) as a machine operator. On 15 August 2002 he was stacking mobile phones into a pallet when he experienced pain in his neck, back and arms. Conservative treatment was arranged and modified duties provided. On 9 December 2002 Mr Naidu was declared fit for his pre-injury duties but his physiotherapy continued. In October 2003 Mr Naidu’s symptoms increased and suitable duties were again provided for eight hours per day three day’s per week. In January 2004 his hours were increased to eight per day for five day’s per week, but still with a seven kilogram lifting restriction. At some stage his hours were reduced and a five-kilogram lifting restriction imposed. Since March 2005 Dr Bonovas has declared him unfit for work.
Mr Naidu’s claims were initially accepted. By letter dated 11 March 2005, CGU Workers Compensation (NSW) Limited (‘CGU’) denied liability for his claim against Giesecke on the ground that Mr Naidu was fit for full time permanently modified duties.
On 21 March 2005 a Section 66A agreement was registered in the Commission providing for payment to Mr Naidu of $6,250.00 in respect of 5% whole person impairment as a result of his injury with Giesecke.
In his Application to Resolve a Dispute (‘the Application’) registered with the Commission on 16 April 2007, Mr Naidu sought weekly compensation against each respondent from May 2005 to date and continuing. Against the First Respondent he sought lump sum compensation in respect of an 11% permanent impairment of the back, plus compensation for pain and suffering. Against the Second Respondent he sought lump sum compensation for 11% whole person impairment as a result of injury to his cervical spine and 11% whole person impairment as a result of injury to his lumbar spine, plus compensation for pain and suffering.
The matter was listed for conciliation and arbitration on 25 June 2007 when the following issues were identified by the Arbitrator as being in dispute:
(a)injury/causation;
(b)the degree of incapacity, if any;
(c)contribution between the Respondents;
(d)whether Mr Naidu’s claim for lump sum compensation had been properly made, and
(e)the degree of permanent impairment, if any.
The dispute in respect of whether the claim for lump sum compensation was properly made centred around whether the medical expert on whom Mr Naidu relied (Dr Qidwai) was properly qualified “as required by the WorkCover Guidelines” (T2.16). The basis for this objection was that because Dr Qidwai’s name did not appear on the WorkCover Authority of NSW (‘WorkCover’) website, he was not “approved by WorkCover” (T2.49) regardless of his qualifications and, therefore, the claim was not properly made.
At the conclusion of the arbitration the parties were given leave to file further written submissions on this issue. The Appellant Worker provided further submissions by letter dated 2 July 2006 and the Second Respondent filed submissions by letter dated 16 July 2007, with additional evidence attached in the form of an email from an acting administrative assistant (Laura Burgess) from WorkCover.
In an Amended Certificate of Determination dated 28 July 2007 the Arbitrator’s orders are recorded as follows:
“1.The Applicant’s claim for lump sum compensation with regard to permanent impairment of his back should be struck out as a nullity.
2.Award for the First Respondent as regards the Applicant’s claim for weekly benefits.
3.The Second Respondent to pay the Applicant weekly benefits at the rate of $200.00 per week from 1 May 2005 to date and ongoing.
4.The Applicant’s claim for lump sum compensation for permanent impairment to his neck/cervical spine (which injury occurred on 15 August 2002) should be referred to an Approved Medical Specialist to be appointed by the Registrar in order that the level of Whole Person Impairment (if any) can be assessed.
The documents to be referred to the Approved Medical Specialist should be those listed in Paragraph 11 hereof.
5.The Respondent to pay the Applicant’s costs as agreed or assessed.”
Mr Naidu seeks leave to appeal this determination.
LEAVE TO APPEAL
Monetary Threshold
Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’).
The quantum in issue on the appeal is in excess of $5,000.00 and therefore the threshold in section 352(2)(a) of the 1998 Act is satisfied. There is no dispute that section 352(2)(b) is also satisfied.
Time
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.
I grant leave to appeal.
PRELIMINARY MATTERS
Section 354(6) of the 1998 Act provides:
“(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submissions by the parties that the appeal can proceed to be determined on the basis of these documents, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.
ISSUES IN DISPUTE
The Appellant Worker’s solicitor has not properly identified the grounds of appeal sought to be argued. This is unsatisfactory as it has left the parties and the Commission in the position of having to infer the grounds of appeal from the submissions in support. The “Appeal Against Decision of Arbitrator” (Form 9) and Practice Direction 6 make it clear that parties seeking leave to appeal against a decision by an Arbitrator must clearly and succinctly state their grounds of appeal. The failure to do so in this matter has created confusion and made the review process longer and more cumbersome than it should have been.
Doing the best I can from the submissions filed in support of the appeal, the issues in dispute in the appeal appear to be whether the Arbitrator erred in:
(a)finding Mr Naidu to be fit for modified duties on a full time basis (‘incapacity’);
(b)finding Mr Naidu to be entitled to an award of weekly compensation of only $200.00 per week (‘incapacity’);
(c)failing to accept the opinion of Dr Isbister in his report of 22 October 2006 that Mr Naidu is only fit for light duties work for four hours per day (incapacity’);
(d)failing to take into account Mr Naidu’s limited language skills, work experience and workers compensation background in determining his capacity to earn (incapacity’);
(e)not referring the claim for lump sum compensation in respect of Mr Naidu’s back injury with the Second Respondent to an Approved Medical Specialist (‘AMS’) for assessment (‘lump sum claim’);
(f)striking out Mr Naidu’s claim for lump sum compensation in respect of his back injury with the Second Respondent on the ground that it was a nullity (‘lump sum claim’);
(g)failing to place significance on the fact that Dr Qidwai submitted a request to be added to the list of WorkCover Assessors of Permanent Impairment on 3 February 2006 (‘lump sum claim’);
(h)failing to reconsider, under section 350(3) of the 1998 Act, the matter of the referral of the back injury to an AMS as requested by letter dated 25 July 2007 (‘reconsideration’);
(i)finding that liability for Mr Naidu’s back injury rests with the Second Respondent because Mr Naidu recovered from his injury on 15 June 2000 with the First Respondent (‘the injury on 15 June 2000’), and
(j)failing to apportion liability between the Respondents (‘apportionment’).
FRESH EVIDENCE
‘Fresh evidence’ on appeal is governed by section 352(6) of the 1998 Act, which provides as follows:
“(6) Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the decision appealed against may not be given on an appeal to the Commission except with the leave of the Commission.”
The Appellant Worker seeks to rely on the following fresh evidence or additional evidence on appeal:
(a)correspondence from his solicitor to the Arbitrator dated 19, 23 and 25 July 2007;
(b)a letter from Dr Qidwai to WorkCover dated 8 February 2006 enclosing a document headed “WorkCover Trained Assessor of Permanent Impairment”;
(c)a print out from the WorkCover website dated 25 July 2007 and headed “Trained Assessors of Permanent Impairment Search Results”;
(d)email from Simon Scarr, Manager Medical Providers Branch, Provider Services Group, Workers Compensation Division, WorkCover, dated 1 August 2007, to Mr Naidu, and
(e)Australia Government Job Capacity Assessment Report (‘the Job Capacity Report’) dated 21 December 2006.
The Appellant Worker submits that the fresh evidence should be admitted because:
(a)the intention of the legislation is to provide a fair and expeditious system for resolving disputes;
(b)no prejudice will be caused to the Respondents if the evidence is admitted;
(c)significant prejudice will be occasioned to him if the evidence is not admitted;
(d)the Commission is “set up as a friendly jurisdiction assisting the worker rather than causing prejudice to the applicant” (Appellant Worker’s submissions on fresh evidence filed 13 August 2007, paragraph seven);
(e)the principles of natural justice will be violated if the evidence is not admitted since the Arbitrator based his decision on incorrect information and contains demonstrable error;
(f)the Job Capacity Report is vital to the appeal against the Arbitrator’s finding on incapacity and was obtained from Centrelink after the Arbitrator’s decision;
(g)for the entire gamut of the matter to be decided and in the interest of justice, the evidence should be admitted, and
(h)it will be unjust, unfair and unreasonable to refuse to admit the evidence.
Neither Respondent has made submissions dealing with the application to admit fresh evidence. In particular, neither Respondent argues that it is prejudiced by the introduction of any of the fresh evidence.
The question of the introduction of fresh evidence on appeal was considered by the Court of Appeal in Haider v JP Morgan Holdings Aust Ltd t/as JP Morgan Operations Australia Ltd [2007] NSWCA 158 (‘Haider’) where Basten JA referred to Akins v National Australia Bank (1994) 34 NSWLR 155 (‘Akins’) and other authorities. In Akins, Clarke JA (Sheller JA and Powell JA agreeing) stated at 160 that three conditions need to be met before “fresh evidence” can be admitted:
“These are: (1) It must be shown that the evidence could not have been obtained with reasonable diligence for use at the trial; (2) The evidence must be such that there must be a high degree of probability that there would be a different verdict; (3) The evidence must be credible.”
However, in Nowlan v Marson Transport Pty Ltd (2001) 53 NSWLR 116 Heydon JA stated at [15]:
“Even if the three tests stated in the Akins case are applicable and are not satisfied, a question remains: is it just to admit the further evidence in this case?”
In considering an application to rely on fresh evidence or further evidence on appeal, the Commission must balance two competing requirements: the public interest that litigation should not continue indefinitely against the need to ensure that justice is done in all the circumstances of the case. In balancing these matters the Commission must also keep in mind its statutory duty to act “according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms” (section 354(3) of the 1998 Act).
Each document must be considered individually. The letters of 19 and 23 July 2007 were essentially in the nature of submissions and are clearly admissible on appeal as they form part of the Commission’s file.
The letter from Dr Qidwai dated 8 February 2006 rebutted the suggestion by the Second Respondent, in its submissions dated 16 July 2007, that he had not “complied with the procedures required by WorkCover NSW in order to qualify as a Trained Assessor of Permanent impairment”. This letter was forwarded to the Arbitrator before he delivered his decision and should have been considered by him. It is proper that it be admitted on appeal.
The letter of 25 July 2007 is the Appellant Worker’s application that the Arbitrator reconsider his decision under section 350(3) of the 1998 Act. He declined to do so. The letter forms part of the Commission’s file and is admissible on appeal.
The print out from the WorkCover website establishes that as at 25 July 2007 Dr Qidwai’s name appeared on the website as a trained assessor. It is of limited probative value as the question is whether the doctor was a trained assessor at the time of his report of 4 December 2005, which was the basis for the claim for lump sum compensation made on 21 April 2006. I propose to admit it into evidence on appeal as it completes the overall picture concerning Dr Qidwai’s path to being listed on WorkCover’s website.
It is not clear why or how the email from Simon Scarr dated 1 August 2007 came into existence and no explanation is offered as to why it was not obtained before the conclusion of the case. I infer that it was obtained to rebut the evidence from Laura Burgess attached to the Second Respondent’s letter dated 16 July 2007. The email provides important evidence because it highlights the fact that the application by a specialist to have his or her name added to the WorkCover website as a ‘trained assessor’ is purely an administrative step. Therefore, in the absence of any objection by or prejudice to the Respondents, it is just that it be admitted on appeal.
The Job Capacity Report is in a different category. This report is dated 18 December 2006, several months before the arbitration hearing. No explanation has been offered as to why it was not obtained before the arbitration. It does not seek to deal with any new issues or matters that were not already properly in issue at the arbitration. The reason for the assessment is stated as “DSP New Claim”, which I assume to be a reference to a disability support pension. Louise Keen, psychologist, conducted the assessment and relied on Mr Naidu’s statements as to his condition and a report from Dr Bonovas. She conducted no independent assessment of his capacity. She rated his capacity for work to be “0-7 hours per week”. This assessment was based on Mr Naidu’s subjective complaints. Evidence of his complaints and his condition generally is canvassed in detail in other evidence before the Commission. The probative value of the report is therefore minimal. If the report were to be admitted on appeal it has the potential to cause prejudice to the Respondents as they will be denied the opportunity of cross-examining Mr Naidu about its contents and denied any opportunity to respond. In these circumstances justice does not demand that the report be admitted and I decline to admit it on appeal. Whether it should be admitted on the re-determination is a matter for the Arbitrator to determine.
Parties should be aware that the Commission’s practice and procedures require that all relevant evidence be exchanged before proceedings are commenced (section 290 of the 1998 Act and Part 10 of the Workers Compensation Commission Rules 2006 (‘the Rules’)). Arbitrations are not “a preliminary round” (per Basten JA in Aztech Science v Atlanta Aerospace (Woy Woy) [2005] NSWCA 319 at [108]) and it is only in exceptional circumstances, in order to do justice between the parties, that fresh evidence or additional evidence be allowed on appeal.
REVIEW
The nature of a review and the role and function of a Presidential member on appeal has been considered in many cases in the Commission. In The King Island Company Ltd v Deery [2005] NSWWCCPD 1 it was held at [19]:
“19. A Presidential Member on appeal has a specific and limited role in the review of a decision of an Arbitrator. The review is not a rehearing. The Presidential member is not dealing with the matter de novo and is not arriving at a fresh decision based on all of the evidence available at a later time (Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194; Builders Licensing Board v Sperway Constructions (Sydney) Pty Ltd (1976) 135 CLR 616). The powers of the Presidential Member to revoke the decision pursuant to section 352(7) of the 1998 Act and to substitute a new decision in its place, are exercisable only where it is demonstrated that the decision of the Arbitrator is affected by some legal, factual or discretionary error (Allesch v Maunz (2000) 203 CLR 172). Alternatively, the Presidential Member may remit the matter back to the Arbitrator concerned, or to another Arbitrator, for determination in accordance with any decision or directions made.”
The nature of a review was considered by the Court of Appeal in Aluminium Louvres & Ceilings Pty Limited v Zheng [2006] NSWCA 34 where Bryson JA said at [38]:
“A review is a different process to an appeal and the matters which may be considered and the manner in which they may be considered are somewhat wider. See Boston Clothing Co Pty Ltd v. Margaronis (1992) 27 NSWLR 580 at 584 (Kirby P). An attack, on review or otherwise, on an Arbitrator's discretionary decision in controlling procedure may be based on the test stated in House v. R (1936) 55 CLR 499 at 504 - 505; but that is not the only basis on which the Presidential member may act. The powers of a Presidential member on review are somewhat wider and extend to power to reopen consideration of a matter of which an Arbitrator has disposed; the manner in which the powers of the Presidential member are to be exercised is itself the subject of discretion of the Presidential member.”
This passage was recently quoted with approval by McColl JA in South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16 at [134] (‘Edmonds’). To describe the relative weight and relevance of the expert evidence as “a discretionary decision which could only be disturbed on House v The King principles” was described by McColl JA as “an over-generalisation” (at [133]).
The nature of a review was further considered by the Court of Appeal in State Transit Authority of New South Wales v Fritzi Chemler [2007] NSWCA 249 where Spigelman CJ said at [28] and [30]:
“28. The concept of a review on the merits is wider than the concept of an appeal in a judicial context. There is a well established line of authority on the use of the terminology of ‘review’ instead of ‘appeal’ with respect to the workers compensation system in this State which establishes the breadth of a review on the merits.
30. A Presidential member exercising a power to review a decision must decide whether the original decision is wrong or, as it is often put in the context of administrative appeals on merits, must decide what is the true and correct view. If s/he does so decide then s/he should substitute his or her own views, unless it is an appropriate case to remit. The power to remit is not constrained in the manner for which the Appellant contends.”
Before an Arbitrator’s decision will be revoked on review it must be demonstrated that it contains or has resulted from an error of fact, law or discretion. The error must be such that, but for it, a different decision should have been made (see Snow Confectionary Pty Ltd v Askin [2004] NSWWCCPD 56; Section 294 of the 1998 Act; YG & GG v Minister for Community Services [2002] NSWCA 247, and Absolon v NSW TAFE [1999] NSWCA 311).
I intend to apply the above principles in the matter before me.
SUBMISSIONS AND FINDINGS
Incapacity
The Appellant Worker submits:
(a)based on medical reports obtained in 2004 and 2005, the Arbitrator assessed Mr Naidu to be fit for suitable duties on a full time basis. The evidence from Dr Isbister in his report of 22 November 2006 is that Mr Naidu is fit for light duties for four hours per day. This opinion should have been accepted over the opinions expressed in 2005;
(b)the Section 40 Assessment Report prepared by rehabSolutionsaustralia on 31 August 2005 (‘the Section 40 Assessment’) should not have been used by the Arbitrator to determine Mr Naidu’s capacity to work because it predates and is inconsistent with Dr Isbister’s opinion that Mr Naidu can only work 20 hours per week;
(c)allowing an ability to engage in suitable duties for 20 hours per week at his ordinary hourly rate of pay ($17.39 per week) Mr Naidu’s ability to earn is $347.80 per week. Deducting this sum from the agreed probable earnings gives a difference of $313.02 [sic];
(d)reliance is placed on Snow Confectionary Pty Ltd v Askin [2004] NSWWCCPD 56 (‘Askin’);
(e)the Arbitrator failed to consider Mr Naidu’s limited English language skills, work experience and workers compensation background;
(f)he only completed high school to the equivalent of year 11 in India and has qualifications to be a laminator/moulder. His work history in Australia is limited to labouring jobs and the labour market now available to him is extremely restricted;
(g)his transferable skills were obtained from his work experience in India, and
(h)he should be awarded weekly compensation at the maximum statutory rate.
The First Respondent submits:
(a)the Arbitrator’s finding of partial incapacity was appropriate and proper;
(b)the award of $200.00 per week from 1 May 2005 to date and continuing was an appropriate finding on the evidence;
(c)the Section 40 Assessment identified four potential jobs as being suitable for Mr Naidu: sales assistant, assembler, hand picker and container filler;
(d)averaging the wage from these four positions gives $557.25 per week, and
(e)the Arbitrator then reduced this figure by $105.12 per week to give an ability to earn under section 40(2)(a) of the 1987 Act of $452.13 per week. Deducting this figure from probable earnings of $652.13 per week gives a difference of $200.00 per week, which the Arbitrator awarded with no deduction in the exercise of his discretion. This amount was a valid and appropriate determination based on all the evidence.
The Second Respondent submits:
(a)Mr Naidu has not identified the specific grounds of appeal on which he relies;
(b)Mr Naidu is seeking a reconsideration rather than “applying for a proper appeal against the Arbitrator’s decision”;
(c)the Arbitrator made no error of discretion when assessing Mr Naidu’s capacity for employment;
(d)the Arbitrator provided detailed reasoning and considered all of the available medical evidence when assessing Mr Naidu’s capacity to earn;
(e)no error of discretion was made in applying a discount of $100.00 [sic] per week to Mr Naidu’s capacity to earn, and
(f)the Arbitrator properly applied the five step process set out in Mitchell v Central West Area Health Service (1997) 14 NSWCA 526 (‘Mitchell’)
The Appellant Worker does not challenge the Arbitrator’s finding of partial incapacity and that finding is confirmed on appeal. He does challenge the finding that he is fit for suitable duties on a full time basis. He relies on the report of Dr Isbister of 22 November 2006.
Mr Naidu has advanced no persuasive reason as to why the Arbitrator was in error in not accepting Dr Isbister’s opinion that Mr Naidu is only fit to work 20 hours per week. The doctor did not describe any deterioration in Mr Naidu’s symptoms between his first examination on 15 February 2005 and his last examination on 21 November 2006 (report 22 November 2006). A comparison of the doctor’s findings on examination in February 2005 with those in November 2006 does not suggest any deterioration. Any differences were minor and, if anything, suggested some improvement in Mr Naidu’s condition. For example, in February 2005 flexion of the cervical spine was found to be 10° but in November 2006 it was 20°. In February 2005 shoulder abduction was 80° but in November 2006 was described as “slightly restricted”. Lumbar flexion in February 2005 was 60° but was described as “slightly reduced” in November 2006. The suggestion of slightly reduced sensation in the left lower limb in November 2006 did not fit any specific dermatome and did not suggest any deterioration. Mr Naidu does not suggest in his statement of 6 June 2007 any deterioration in his condition between 2005 and November 2006.
Dr Isbister’s opinions under “Summary and Diagnosis” in each report are virtually identical. He concluded that Mr Naidu has cervical and lumbar spondylosis, described as “mild” in 2005. Though he noted Mr Naidu’s complaints of leg and arm pains in 2006, he added that there was no evidence of identifiable neurological abnormality. Whilst Dr Isbister thought in February 2005 that Mr Naidu could work full time “in permanently modified duties on a 5 day a week basis” (report Dr Isbister 15 February 2005, page six), he gave this opinion in response to a question about whether he felt Mr Naidu was fit to work full time in a specific modified role. The question put to him in November 2006 was:
“Fitness for work. If [sic] he fit for his pre-injury employment? If not, what limitations would you place upon his ability to return to pre-injury duties? What work is he capable of performing and what limitations are there on his hours and duties?”
Dr Isbister responded that in his opinion Mr Naidu is fit for up to four hours a day not lifting more than seven kilograms and not working above shoulder height.
The Arbitrator referred to both of Dr Isbister’s reports at paragraph 18 of his Statement of Reasons for Decision (‘Reasons’). He also considered the other evidence in the case. The Arbitrator concluded that Mr Naidu is fit for the “potential” full time occupations identified in the Section 40 Assessment as being appropriate. At paragraph 26 of his Reasons the Arbitrator quoted from page three of the Section 40 Assessment as follows:
“Transferable Skills
Transferable skills are those skills that a worker currently possesses that could potentially be offered to a new employer when job seeking. Mr. Govindarajulunnaidu’s [sic] was assessed as possessing the following marketable transferable skills.
Many skills relate to Mr. Govindarajulunaidu’s [sic] work experience in India.
Customer Service
Liaising with customers
Cash Handling
Handling instructions from Supervisors
Working in a team
Banking, mailing
Attending meetings
Ordering stock
Promoting ProductsPotential Jobs and Earning Capacity to be pursued
Taking into consideration Mr. Govindarajulunaidu’s [sic] medical and physical restrictions, personal interests, transferable skills and labour market search, it is our opinion that the following potential jobs are appropriate:
Job Option ASCO Code Weekly Earnings
Market Rate – AverageSales Assistant 8211-11 $513.00 Assembler 9211-11 $541.00 Hand Packer 9221-11 $514.00 Container Filler/Packager 9222-11 $661.00 Recommendations
The following action plan is recommended to facilitate Mr. Govindarajulunaidu [sic].
To participate in a suitable physical upgrading program to improve his postural tolerances and function to enable him to work full-time in the identified occupations.
Mr. Govindarajulunaidu [sic] to be referred to a Rehabilitation Provider for assistance with his return to work.”
The Arbitrator then took an average of the above figures ($557.25) and stated at paragraph 31:
“In the circumstances it appears that, it would be proper to discount the above figure of $557.25 somewhat having regard to the need to pursue work hardening and in recognition of the fact that as a fifty-four year old man he could experience additional difficulty in finding work. Despite this, the Applicant’s own rehabilitation report, which emphasizes his transferable skills which do not emphasize physical work, suggests that the discounting should not be significant.”
To allow for the difficulty Mr Naidu may have in finding work because of his age and the need to pursue work hardening, the Arbitrator reduced the sum of $557.25 per week by $105.12 and assessed his ability to earn under section 40(2)(b) of the 1987 Act to be $452.13 per week (step 2 in Mitchell).
Whilst the Arbitrator was correct to take into account Mr Naidu’s age, he erred in failing to consider Mr Naidu’s limited English language skills, work experience and workers compensation background. These factors are critical to any determination of Mr Naidu’s ability to earn on the open labour market. Mr Naidu’s literacy skills were tested as part of the Section 40 Assessment, but only in the most basic way. The author concluded at page nine that:
“Mr Govindarajulunaidu [sic] would likely be hindered in obtaining work if it requires basic competence in English. Mr Govindarajulunaidu [sic] would be suited to those jobs in which no minimum level of education is required. Additional formal testing was considered inappropriate.” (emphasis added)
Given Mr Naidu’s limited work experience in Australia and his basic skills in English, it is hard to see him competing successfully with uninjured workers to obtain employment in any of the “potential” occupations identified in the Section 40 Assessment. The Arbitrator failed to give any consideration to this fact.
The Arbitrator also failed to consider that Mr Naidu only completed high school to the equivalent of year 11 in India and his only qualifications (obtained in India) are as a laminator/moulder. His work experience in Australia has been limited to unskilled manual jobs for which he is now unfit. As a result, I agree with the Appellant Worker’s submission that the labour market now available to him is significantly restricted. The Section 40 Assessment recognises this fact in its conclusion at page 13 where it states that a vocational goal for Mr Naidu is difficult to define and that his “tolerances are likely to limit him in most jobs”.
Therefore, whilst the Arbitrator was not in error in not accepting the opinion of Dr Isbister that Mr Naidu is only fit for suitable work for 20 hours per week, he was in error in failing to consider and allow for the significant disadvantages Mr Naidu faces on the open labour market having regard to the nature of his incapacity, his education, his limited English skills and work experience in Australia. These errors require that the Arbitrator’s section 40 assessment be revoked and this part of the claim be re-determined. In reaching the above decision I have carefully considered the Respondents’ submission that the Arbitrator correctly applied his discretion in determining Mr Naidu’s ability to earn. I have also had regard to the fact that “interference with an Arbitrator’s discretionary judgement as to the weight of evidence should only be done where it is manifestly obvious that the discretion has so miscarried that it has not been exercised fairly and lawfully” (Knight v Eyles Nominees Pty Ltd [2004] NSWWCCPD 73 at [40]). In my view the Arbitrator’s errors do not merely go to matters of discretion, but amount to a failure to fairly and lawfully consider the evidence and apply the correct principles dealing with section 40 of the 1987 Act.
Though no oral evidence was given at the arbitration, it is not appropriate that I re-determine the matter as the parties have not made submissions on several key aspects of the section 40 claim. As the matter must be re-determined in any event, I will make only general observations about these matters.
First, all parties have referred to the Commission’s decision in Askin. In that case probable earnings but for injury were $460.13 per week. The Arbitrator found the worker had an ability to earn of $549.23 in certain specified jobs. However, because she was unable to obtain such work her capacity to earn in suitable employment was found to be nil. Therefore, the Arbitrator found the worker had an entitlement to an award of $460.13 per week. On appeal, the Presidential member held that the Arbitrator erred in failing to exercise her discretion under section 40(1) (step 4 in Mitchell). In purported exercise of the discretion the Presidential member determined that the worker did in fact have a residual earning capacity of $150.00, which reduced the worker’s entitlement to $310.13 per week. The end result may well have been appropriate in the circumstances of that case, but the method adopted was inconsistent with accepted authority on section 40. If the worker had a residual earning capacity of $150.00 that finding should have been made at step 2 of the process after due regard to the worker’s injury, incapacity, the available labour market and the other matters listed in section 43A of the 1987 Act. Then the discretion can be considered to determine if the difference between step 1 ($460.13) and step 2 ($150.00) was “proper in the circumstances of the case” (section 40(1)).
Step 2 in Mitchell requires the determination of “the average weekly amount which the worker is earning, or would be able to earn in some suitable employment, from time to time after the injury” (section 40(2)(b)). In making that determination it is necessary to consider the matters in sections 40(3) and 43A of the 1987 Act. Section 40(3) provides:
“(3) Ability to earn in suitable employment
The determination of the amount that an injured worker would be able to earn in some suitable employment is subject to the following:(a) the determination is to be based on the worker’s ability to earn in the general labour market reasonably accessible to the worker,
(b) the determination is to be made having regard to suitable employment for the worker within the meaning of section 43A.”
Section 43A(1) provides:
“43A Suitable employment
(1) For the purposes of sections 38, 38A and 40:
‘suitable employment’, in relation to a worker, means employment in work for which the worker is suited, having regard to the following:(a) the nature of the worker’s incapacity and pre-injury employment,
(b) the worker’s age, education, skills and work experience,
(c) the worker’s place of residence,
(d) the details given in the medical certificate supplied by the worker,
(e) the provisions of any injury management plan for the worker,
(f) any suitable employment for which the worker has received rehabilitation training,
(g) the length of time the worker has been seeking suitable employment,
(h) any other relevant circumstances.”
Therefore, in assessing a worker’s ability to earn under section 40(2)(b) the Commission is required to consider all the factors listed in section 43A and determine the worker’s ability to earn in the labour market reasonably accessible to the worker. If the worker is physically fit for a certain job that is not available, or not readily available, to a person in the circumstances in which the injured worker finds himself or herself, then that fact must be taken into account in determining ability to earn. The worker’s capacity as a result of the physical and/or psychological consequences of his or her injury is obviously of critical importance, but so too are the other factors listed in section 43A. In the present matter the Arbitrator has failed to properly consider the factors in section 43A.
The approach to calculating a worker’s ability to earn under section 40 was considered in Mangion v Visy Board Pty Ltd (1992) 8 NSWCCR 175 (‘Mangion’), which has been expressly approved by the Court of Appeal in Cowra Shire Council v Quinn (1996) 13 NSWCCR 175. In Mangion, a Commissioner of the former Compensation Court of NSW (‘the Court’) found an injured worker to be partially incapacitated but did not award any weekly compensation on the ground that the worker was able to earn more as a security guard (suitable light duties) than he had in his pre-injury job. On appeal to a judge of the Court it was held by Judge Burke that the Commissioner had fallen into error in his approach to calculating compensation under section 40 of the 1987 Act. His Honour said at 180:
“When assessing a capacity to earn under section 40(2), it is not sufficient to merely identify a particular potential avenue of employment and attribute the income from such a job as a man’s capacity to earn. Allowance must be made for the availability of work - availability, not so much in the sense of a presently depressed labour market but in the sense of the general availability in any labour market. A rarely available niche in the labour market which carries, perhaps, substantial remuneration, does not serve as a sole criterion of capacity to earn.”
His Honour added:
“When one assesses an ability to earn under section 40(2), one is really arriving at a weighted average. Wage rates for jobs within capacity that are rarely available, though perhaps highly paid, rate poorly in such an assessment. Conversely, the income derivable from more readily available work rates highly.”
The approach in Mangion, having been approved by the Court of Appeal, is the correct approach to section 40 assessments and should be preferred to the method adopted in Askin. In applying Mangion to the present matter the Commission is required to consider not only the jobs considered to be suitable for Mr Naidu, but also the availability of that work together with the matters listed in section 43A.
Second, the Arbitrator stated at paragraph 30 of his Reasons that he had no evidence of the “difficulties which pertain to the market place in which” Mr Naidu would seek employment. The Section 40 Assessment noted at page 11 that the job competition was “hard” for new entrants (which Mr Naidu would be) in the fields of light to medium assembler, hand packer and container fillers/packages. Job prospects for sales assistants were considered “not too hard” (page 10), but experience is required. The report continued at page 12 that enquiries revealed that whilst a number of jobs were available for part time sales assistants, very few jobs were available for assemblers (11 jobs advertised on a total of three websites) with only two jobs advertised for packagers and none for container fillers. Further enquiries revealed:
(a)when work is available, assembler jobs can be light depending on the product however heavy lifting can be required in packaging. It was thought that Mr Naidu’s lifting restrictions would likely preclude him from being a competitive applicant for some roles unless the positions were specifically for work of a light nature;
(b)regarding assembler/filling/packaging positions, positions available were mainly casual though some were permanent. Lifting requirements varied with the product involved. Some assembler jobs were light but not many packager positions are “light” with the jobs involving a variety of physical duties which at times require heavy lifting, and
(c)in respect of retail sales jobs, experience is required and some such jobs require heavy lifting though at times customer service roles are required where lifting is not involved to any great extent depending on the goods sold.
Third, at page seven of the Section 40 Assessment it was noted:
“As per [the] functional assessment at [the] present time he would appear to [be] fit for work on suitable duties with lifting up to 5 kg with gradual upgrading of his lifting capacity to 7-8 kg and hours [of] work graduating to 25 hours work per week.” (emphasis added)
The Arbitrator did not consider this significant evidence. Nor was it raised on appeal. It will need to be considered on the re-determination, but as none of the parties have made any submissions on this evidence, it is not appropriate that I comment further.
Therefore, regrettably, the issue of Mr Naidu’s entitlement to compensation under section 40 must be remitted to a different Arbitrator for these issues to be fully debated and re-determined.
Lump Sum Claim
Mr Naidu gave notice of his claim for lump sum compensation by letter from his solicitor dated 21 April 2006 addressed to CGU. Attached to that letter is a report from Dr Qidwai dated 4 December 2006. Dr Qidwai’s letterhead states, among other things, that he is a Fellow of the Royal College of Surgeons.
On 24 and 25 August 2002 he completed “Training in the Evaluation of Permanent Impairment” at the University of Sydney and was issued a certificate headed:
“The University of Sydney
WorkCover New South Wales”
The document certified that Dr Qidwai completed training in the following modules:
“Core Module
Musculskeletal [sic] (Spine)
Musculoskeletal (Upper Limb)
Musculoskeletal (Lower Limb)”
The Respondents argued at the arbitration that Mr Naidu’s claim for lump sum compensation had not been duly made because Dr Qidwai was not “qualified as required by the WorkCover Guidelines” (T2.16). It was further submitted at T2.44:
“MR DOAK: Well, Mr Arbitrator, I say that certainly holding a certificate does not comply. The doctor must not only be certified but approved by WorkCover according to the guidelines. There’s no evidence that the doctor is approved by WorkCover, regardless of whether he holds a certificate or not. Those doctors who are approved by WorkCover appear on the WorkCover website. That’s a convenient way of checking it. But, be that as it may, there’s no evidence before you that in accordance with the guidelines Dr Qidwai is approved by WorkCover, notwithstanding, and I concede I’ve seen the certificate, but, notwithstanding that, it still doesn’t get the applicant, as it were, over the line.”
At the conclusion of the arbitration the parties were given leave to make further submissions about the ‘guidelines’. By letter dated 16 July 2007 the Second Respondent submitted:
“…WorkCover’s advice is to the effect that completion of training is not the end point in a specialist qualifying as a Trained Assessor of Permanent Impairment and the specialist will not be recognised by WorkCover as a Trained Assessor of Permanent Impairment until he/she completes the further paperwork required by WorkCover for approval and inclusion in the list published on its Website.”
Attached to the letter of 16 July 2007, and presumably received into evidence by the Arbitrator, is an email from Laura Burgess, Acting Administrative Assistant, dated 16 July 2007. It reads:
“Dr Qidwai is not listed on the WorkCover website as a trained assessor of permanent impairment. Only doctors listed on the WorkCover website can be used for the purpose of an assessment of whole person impairment. Dr Qidwai may have undertaken the training in whole person impairment however has not submitted the additional paperwork to WorkCover for approval and inclusion on the WorkCover website.”
The Arbitrator carefully considered the parties’ submissions and concluded that because Dr Qidwai did not appear on the website as a “trained assessor”, he was not “competent to provide the necessary assessment of permanent impairment to support the Applicant’s claim with regard to his back in this Application” (Reasons, paragraph 57). He accepted the Respondents’ argument that more than just completion of the appropriate training was required before a doctor could be listed on the WorkCover website as a trained assessor. Exactly what more is required is not addressed in the evidence.
The Arbitrator then found that Mr Naidu’s claim for lump sum compensation had not been properly made because it was not supported by a certificate “from a WorkCover listed assessor of permanent impairment” and the Commission did not have jurisdiction to refer the claim to an Approved Medical Specialist (‘AMS’) (Reasons, paragraph 60). He therefore struck out the claim for lump sum compensation for Mr Naidu’s back injury on the ground that it was a nullity.
To make a claim for lump sum compensation a worker must comply with the WorkCover Guides for Claiming Compensation Benefit (issued under section 376 of the 1998 Act) (‘the Claim Guides”). Part 5 paragraph 2.12 of the Claim Guides provides that a claim must include, among other things:
“2.12 a medical report completed in accordance with the WorkCover Guides
for the Evaluation of Whole Person Impairment by a medical specialist
with qualifications and training relevant to the body system being
assessed who has been trained in the WorkCover Guides.…” (emphasis added)
The WorkCover Guides for the Evaluation of Permanent Impairment dated 27 October 2006 (‘the Evaluation Guides’) state at paragraph 1.26:
“Medical assessors
1.26 An assessor will be a medical specialist with qualifications, training and experience in a medical specialty relevant to the body system being assessed who has undertaken the requisite training in use of the WorkCover Guides. A list of trained medical assessors may be obtained from the WorkCover website Assessors may be one of the claimant’s treating specialists or an assessor engaged on behalf of the employer/insurer/Scheme Agent/claimant to conduct an assessment for the purposes of assessing the level of permanent impairment.1.28 Assessors of levels of permanent impairment are required to use the WorkCover Guides for the Evaluation of Permanent Impairment current at the time of the assessment.”
Whilst the term “medical assessor” does not appear in the Claim Guides, I cannot see any logical distinction between a “medical specialist” in the Claim Guides and a “medical assessor” in the Evaluation Guides. Both must be duly qualified medical specialists who have who have been trained in the “WorkCover Guides”.
As at December 2005 Dr Qidwai was a qualified medical specialist who had “been trained in the WorkCover Guides”. The Claim Guides do not say or imply that a claim must be supported by a medical report from a specialist listed on the WorkCover website. There is no support in the legislation or in any of WorkCover’s many guides for the assertion by Ms Burgess that “Only doctors listed on the WorkCover website can be used for the purpose of an assessment of whole person impairment”.
The evidence from Mr Scarr, manager of the medical providers branch at WorkCover, in his email of 1 August 2007 is:
“It came to WorkCover’s attention that Dr Qidwai was not on the website as a permanent impairment assessor in early July 2007.
Dr Qidwai was under the impression that he was on the website as he had previously sent in an application in February 2006. In July, it became apparent that WorkCover had not received this application which was why he had not been placed on the website. Dr Qidwai has since resent the application and his name was entered on the website on 20/7/07.
It is clear to me that Dr Qidwai did apply to go on the website in February 2006. If WorkCover had received the application at that point in time, there is no reason he would not have been placed on the website then. Under the circumstances, I would be willing to advise your insurer and solicitor that a report prepared by Dr Qidwai after February 2006 for the purpose of assessing Whole Person Impairment should be considered valid.” (emphasis added)
The February 2006 application referred to by Mr Scarr is signed by Dr Qidwai and dated 3 February 2006. It is headed “WorkCover Trained Assessor of Permanent Impairment” and sets out Dr Qidwai’s name, qualifications, body systems trained for evaluation of permanent impairment, special expertise and his contact details. At the bottom of the form, Dr Qidwai provided a statement that he understood the information was provided to WorkCover for inclusion in the list of WorkCover Assessors of Permanent Impairment.
There is no evidence to support the submission by counsel for the Second Respondent that a doctor must, in addition to being a specialist who has completed the necessary training in the WorkCover guides, also be “approved by WorkCover according to the guidelines”. The listing on the WorkCover website is no more than an administrative step that is taken once a specialist completes the necessary training and asks to be listed. Mr Scarr’s email makes it clear that no further requirements need to be satisfied before a specialist is listed on the website. There is no dispute that Dr Qidwai is an appropriately qualified medical specialist. The “requisite training” necessary before Dr Qidwai could provide an assessment of whole person impairment is the training he completed at Sydney University on 24 and 25 August 2002.
It follows that as Dr Qidwai was a properly trained and qualified assessor as at December 2005, the lump sum compensation claim made on behalf of Mr Naidu on 21 April 2006 complied with the Claim Guides. Therefore, the Arbitrator was in error in striking out Mr Naidu’s claim for lump sum compensation in respect of his back. That claim should be referred to an AMS for appropriate whole person impairment assessment.
In view of the above finding it is not necessary for me to rule on the parties’ submissions about the application of Fletcher International Exports Pty Ltd v Barrow & anor [2007] NSWCA 244. I do note, however, that Mason P stated at [39] that the 1998 Act does not “state that any or all failures to comply with the Guidelines might preclude the Commission from embarking on its task, in accordance with the statutory regime”. Any application that the Commission lacks jurisdiction because of a failure to comply with any of the WorkCover guides must be considered in the light of his Honour’s comments and with due regard to the terms of the legislation.
The Injury On 15 June 2000 and Apportionment
The Appellant Worker submits that the First Respondent acknowledged liability for the injury on 15 June 2000 when Gallagher Bassett Services Workers Compensation NSW made an offer of settlement on 6 June 2006. I reject this submission. The offer was made on a “without prejudice” basis. The question of whether the effects of any injury on 15 June 2000 had ceased was argued, without objection by Mr Naidu’s counsel, at the arbitration and the Arbitrator made a determination based on all the evidence.
The evidence that Mr Naidu had recovered from the effects of his injury on 15 June 2000 is overwhelming and is set out at paragraphs 38 to 42 inclusive of the Arbitrator’s Reasons. After reviewing the evidence the Arbitrator found that it was more probable than not that any injury to Mr Naidu’s back with the First Respondent had settled. There was therefore no basis for any apportionment of liability between the Respondents. This finding was well supported by the evidence and the Appellant Worker has not made any submission to suggest that the Arbitrator was in error. The Second Respondent has not sought to challenge the Arbitrator’s findings in respect of the injury on 15 June 2000 or on apportionment and these findings are confirmed.
COSTS
The Appellant Worker seeks an order that the proceedings before the Arbitrator be certified ‘complex’ under Schedule 6 Table 4 Item 4 the Workers Compensation Regulation 2003. In view of the issues involved and submissions by the Respondents at the arbitration, I believe this is an appropriate matter for a certification that the matter is ‘complex’ and I make that order.
DECISION
The Arbitrator’s amended determination dated 28 July 2007 is revoked and the following orders made in its place:
“1.The Applicant’s claim for lump sum compensation as a result of injury to his cervical and lumbo-sacral spines on 15 August 2002 is referred to the Registrar for referral to an Approved Medical Specialist in order that the level of whole person impairment (if any) resulting from that injury be assessed. The documents to be referred to the Approved Medical Specialist are those listed at paragraph 11 of the Arbitrator’s Statement of Reasons for Decision dated 28 July 2007.
2.Award for the First Respondent.
3.The Second Respondent is to pay the Applicant Worker’s costs as agreed or assessed. The matter is certified complex under Schedule 6 Table 4 Item 4 of the Workers Compensation Regulation 2003.”
The Appellant Worker’s claim for weekly compensation against the Second Respondent is remitted to a different Arbitrator for re-determination of his entitlement under section 40 of the Workers Compensation Act 1987 in accordance with the reasons in this decision.
COSTS
The Second Respondent is to pay the Appellant Worker’s costs of the appeal.
Bill Roche
Deputy President
3 December 2007
I, MELANIE CURTIN CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF BILL ROCHE, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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