Raghavadev v Moonlight Mushrooms Pty Ltd
[2010] NSWWCCPD 120
•16 November 2010
| WORKERS COMPENSATION COMMISSION | ||||||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | ||||||
| CITATION: | Raghavadev v Moonlight Mushrooms Pty Ltd [2010] NSWWCCPD 120 | |||||
| APPELLANT: | Sasibhooshanan Nair Raghavadev | |||||
| RESPONDENT: | Moonlight Mushrooms Pty Ltd | |||||
| INSURER: | Cambridge Integrated Services Australia Pty Ltd | |||||
| FILE NUMBER: | A1-1504/10 | |||||
| ARBITRATOR: | Ms M Dalley | |||||
| DATE OF ARBITRATOR’S DECISION: | 9 June 2010 | |||||
| DATE OF APPEAL HEARING: | 12 November 2010 | |||||
| DATE OF APPEAL DECISION: | 16 November 2010 | |||||
| SUBJECT MATTER OF DECISION: | Calculation of probable earnings but for injury; exercise of the discretion in s 40(1) of the Workers Compensation Act 1987 where worker’s right to work in Australia ceased | |||||
| PRESIDENTIAL MEMBER: | Deputy President Bill Roche | |||||
| HEARING: | Oral | |||||
| REPRESENTATION: | Appellant: | Mr P Stockley, instructed by Ron Kramer Associates | ||||
| Respondent: | Mr F Doak, instructed by Bartier Perry | |||||
| ORDERS MADE ON APPEAL: | Paragraph 1 of the Arbitrator’s orders in the determination on 9 June 2009 is revoked and the following order made in its place: “1. The respondent employer is to pay the applicant worker weekly compensation in the sum of $175 per week under s 40 of the Workers Compensation Act 1987 from 17 August 2009 to date and continuing.” Paragraphs 1 and 2 of the Arbitrator’s findings and paragraph 2 of her orders in the determination of 9 June 2009 are confirmed. | |||||
| The respondent employer is to pay the appellant worker’s costs of the appeal, assessed at $2,200 plus GST. | ||||||
INTRODUCTION
This appeal concerns the Arbitrator’s finding of probable earnings but for injury and the exercise of the discretion in s 40(1) of the Workers Compensation Act 1987 (the 1987 Act) in circumstances where, after the injury, the worker ceased to be entitled to work in Australia and returned to live in his country of birth, India.
BACKGROUND
The appellant worker, Mr Raghavadev, was born in India in 1949. He worked in that country as an electricity linesman for the State Electricity Board for about 21 years. He came to Australia in February 2005 in the hope of obtaining permanent residency and with the intention of bringing his family here.
In June 2005, Mr Raghavadev started to work as a labourer on the respondent employer’s mushroom farm. His duties required him to regularly lift and carry heavy weights. On 5 November 2006, he injured his back whilst lifting mushroom boxes. He reported the injury, but initially remained at work. The insurer accepted liability for his claim.
After various periods off work, Mr Raghavadev resumed work on restricted duties for 20 hours per week. Whilst on those duties, the respondent employer terminated his employment on 4 February 2009.
On 15 July 2009, Mr Raghavadev’s solicitors advised the insurer that Mr Raghavadev’s entitlement to work in Australia had ended and that he wished to return permanently to India. The solicitors requested the insurer to continue to make voluntary compensation payments to Mr Raghavadev whilst he was overseas. In a s 74 notice issued on 17 November 2009, the insurer disputed liability.
Mr Raghavadev filed an Application to Resolve a Dispute (the Application) in the Commission on 24 February 2010 seeking weekly compensation in the sum of $565 per week from 4 August 2009 to date and continuing. He also sought a determination that his incapacity resulting from his injury was “likely to be of a permanent nature”.
The Commission listed the matter for conciliation and arbitration on 27 May 2010. The parties agreed that the following issues remained in dispute:
(a) whether Mr Raghavadev’s incapacity for work resulting from his injury was “likely to be of a permanent nature”;
(b) whether Mr Raghavadev was totally or partially incapacitated for work, and
(c) if Mr Raghavadev was partially incapacitated, the quantum of his entitlement to weekly compensation.
As Mr Raghavadev had returned to live in India, it was not possible for him to attend the arbitration. However, he participated in the arbitration by telephone and was represented by counsel, Mr Stockley. The Arbitrator took no oral evidence, but heard submissions from counsel for both parties. Those submissions appear to have been abbreviated because the arbitration did not commence until late in the afternoon. In the course of the arbitration, the Arbitrator admitted into evidence, over objection by Mr Stockley, a document headed “pay scale” purporting to be a “salary survey” for salaries in India.
In a reserved decision delivered on 9 June 2010, the Arbitrator made the following findings:
(a) at all relevant times Mr Raghavadev had been partially incapacitated for work;
(b) probable earnings but for the injury were $729 per week;
(c) Mr Raghavadev was capable of earning in some suitable employment working 20 hours per week the sum of $364 per week;
(d) the difference between Mr Raghavadev’s probable earnings but for his injury and his ability to earn was $365 per week;
(e) in circumstances where Mr Raghavadev was “no longer able to work in Australia” and having regard to “the economic differences between Australia and India”, in exercise of the discretion in s 40(1) of the 1987 Act the proper award was $95 per week, and
(f) Mr Raghavadev’s incapacity arising from his injury was “likely to be of a permanent nature” and he was entitled to receive weekly compensation payments though not residing in Australia.
The Commission issued a Certificate of Determination on 9 June 2010 with the following terms:
“The Commission determines:
Findings:
1. The Applicant has a partial incapacity for employment arising from the injury on the 5 November 2006.
2. The Applicant’s incapacity is likely to be of a permanent nature.
Orders:
1. That the Respondent pay the Applicant weekly compensation at the rate of $95 per week pursuant to section 40 and section 53(1) and (2) of the Workers Compensation Act 1987 from the 4 September 2009 to date, such payment to continue in accordance with the 1987 Act.
2. That the Respondent is to pay the Applicant’s costs as agreed or assessed.
Certification:
I certify that this was a complex case involving complex questions of law and the maximum payable for both the Applicant’s and the Respondent’s costs pursuant to Table 1 is increased by 25%.”
In the appeal filed on 6 July 2010, Mr Raghavadev sought leave to challenge only two of the Arbitrator’s findings, namely:
(b) the finding of probable earnings in the sum of $729 per week, and
(c) the exercise of the discretion to reduce the sum of $365 to $95.
LEAVE TO APPEAL
Monetary Threshold
Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of s 352 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act).
Mr Raghavadev sought an award at the maximum statutory rate for a worker with a dependent wife and dependent child from 4 August 2009. Had he succeeded, his entitlement to compensation would well and truly have exceeded the monetary thresholds in s 352(2) of the 1998 Act.
Not withstanding this, the solicitor for the respondent employer has submitted that Mr Raghavadev has not met the monetary threshold and that leave to appeal should be refused. This submission is misconceived.
The Commission is not to grant leave to appeal unless the amount of compensation “at issue on the appeal” is both:
(a) at least $5,000, and
(b) at least 20 per cent of the amount awarded in the decision appealed against (s 352(2)).
Reliance is placed on Hamilton v Sydney Water Corporation [2008] NSWWCCPD 5 (Hamilton). In that case, the worker claimed weekly compensation totalling $2,072.62 and $335.38 for medical expenses. In order to overcome the $5,000 threshold, Mr Hamilton argued that, if his appeal succeeded, he could be entitled to weekly compensation in the event that the employer withdrew suitable duties from him in the future. Deputy President Byron rejected that argument and held that the monetary threshold had not been satisfied.
Hamilton provides the employer with no assistance in the present case. The compensation “at issue” in the present claim exceeds both the thresholds in s 352(2) of the 1998 Act. The respondent employer’s submissions were misconceived and reference to Hamilton was taken out of context and should not have been made.
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 MATTER
In view of the issues raised on appeal, I held a teleconference on 20 September 2010 in which I informed the parties that, if the appeal succeeded, the matter would have to be re‑determined and, given the state of the evidence, that would mean remitting the matter to another Arbitrator. If I was to conduct the re-determination, as the parties agreed was appropriate, I informed them that I required additional evidence about relevant wage rates in India. To that end, I issued the following Direction on 20 September 2010:
“1. The appellant worker is to file and serve on or before 4.30pm on 11 October 2010 additional evidence as to [the] worker’s probable earnings in the same or some comparable employment in India but for his injury and as to his ability to earn in his injured condition in India.
2. The respondent employer is to file and serve on or before 4.30pm on 1 November 2010 additional evidence in response.
3. The parties are to agree on the average exchange rate between the Indian rupee and the Australian dollar for the relevant period of the claim.”
On 12 October 2010, Mr Raghavadev’s solicitor filed a supplementary statement from his client dated 7 October 2010, a document headed Minimum Wages in Kerala and a document from the Reserve Bank of Australia headed Exchange Rates for 24, 27 and 28 September 2010. Because of difficulties in obtaining relevant information, the employer filed no further evidence.
In the absence of any objection by the respondent employer, at the appeal hearing I admitted the additional evidence filed by Mr Raghavadev.
SUBMISSIONS, DISCUSSION AND FINDINGS
Probable earnings – s 40(2)(a)
The Arbitrator referred to the five steps in Mitchell v Central West Area Health Service (1997) 14 NSWCCR 526 (Mitchell). In respect of the determination of probable earnings but for injury under s 40(2)(a) (step one), she noted that Mr Raghavadev’s wage schedule alleged probable earnings of $859.70. However, she noted that financial records tendered by the respondent employer suggested that Mr Raghavadev’s “pre-injury earnings” averaged $703 in 2007 and $729 in 2008. His Notice of Assessment for 30 June 2006 showed a taxable income of $35,802 or an average of $688.50. After referring to this evidence, the Arbitrator found probable earnings but for injury to be $729 per week.
Mr Raghavadev has challenged this finding on two grounds. First, as the respondent employer never disputed probable earnings in the s 74 notice and never filed a competing wage schedule, the figures in Mr Raghavadev’s wage schedule were deemed to be admitted (Pt 15.5(c) of the Workers Compensation Commission Rules 2010). Second, at the arbitration, counsel for the respondent employer, Mr Doak, conceded probable earnings to be $778 (T21.53).
As to the first point, it is correct that the respondent employer did not file a competing wage schedule. However, on 1 April 2010, the Arbitrator directed the parties to file and serve a schedule of wages with supporting documents. Neither party complied with that direction. Instead, the respondent employer’s solicitor tendered (without objection) financial records produced by Mr Raghavadev in answer to a notice to produce and a letter from Moonlight Mushrooms stating that it had no details of comparable workers’ wages “due to variables” in the business. Those variables included the fact that hours worked per week could “vary by 25%”. These documents were only relevant if the respondent employer disputed the figures in Mr Raghavadev’s wage schedule. In these circumstances, Mr Raghavadev’s probable earnings but for his injury were disputed and were a matter on which the parties called evidence and made submissions. The Arbitrator’s failure to formally note that fact was unfortunate. However, having regard to the history of the matter it is not permissible to argue on appeal that the respondent employer was bound by the figures in Mr Raghavadev’s wage schedule when that point was never argued before the Arbitrator. Though the Arbitrator did not expressly “otherwise order”, as permitted in Pt 15.5, that was the practical effect of the way the parties conducted the arbitration.
The second point on this issue has more merit. Though arbitrators are not bound to accept admissions made by the parties (Damberg v Damberg [2001] NSWCA 87; 52 NSWLR 492 (at [157]), they should not make a finding on a different basis unless the parties have the opportunity to be heard. In submissions in reply at the arbitration, Mr Stockley said that he did not acknowledge that $778 was the correct answer, but did not “seek to vigorously put any alternate submission” (T26.31). The Arbitrator gave no indication that she intended finding a figure lower than that conceded by Mr Doak and, given the way the case was presented, her failure to do so amounted to a denial of procedural fairness.
At the appeal hearing, Mr Doak again conceded probable earnings of $778 per week and Mr Stockley did not make any contrary submission. Having regard to Mr Doak’s concession and the evidence as a whole, I find probable earnings but for the injury were and are $778 per week.
Ability to earn – s 40(2)(b)
Step two in Mitchell requires a calculation of Mr Raghavadev’s ability to earn in suitable employment from time to time after the injury. The parties have not challenged the Arbitrator’s finding that Mr Raghavadev was capable of earning in some suitable employment (in Sydney) the sum of $365 per week. Though an issue may have arisen as to whether the Commission should calculate ability to earn in the labour market in which Mr Raghavadev lives at the time of the hearing (in this case, Kerala in India) or in the labour market where Mr Raghavadev lived at the time of his injury (Sydney), neither party submitted that the Arbitrator’s approach was incorrect or that I should re-calculate the finding of Mr Raghavadev’s ability to earn on the basis that Mr Raghavadev has returned to live in India.
The Arbitrator’s approach (in assessing Mr Raghavadev’s ability to earn in Sydney) was consistent with the approach taken by Burke CCJ in Taufia v Nonferral (NSW) Pty Ltd & another (1995) 12 NSWCCR 431 (Taufia), by Campbell CJ in Crowhurst v North Sydney City Council (Crowhurst) (unreported, No 35179 of 1998, 26 July 1999) and by Moore ADP in Singh v TAJ (Sydney) Pty Ltd [2007] NSWWCCPD 152 (Singh). This approach may be seen as an exception to the general rule that “the labour market reasonably accessible to the worker” (s 40(3)(a)) is the market in the geographical area in which the worker lives (Collins v Days Transport Service Pty Ltd (1999) 18 NSWCCR 116). The exception is appropriate given that the Commission is an expert tribunal with respect to wage rates and labour markets in New South Wales (J & H Timbers v Nelson (1972) HCA 12; 126 CLR 625), but has no expertise with respect to those matters in foreign countries. In addition, it will always be difficult, as this case has demonstrated, for parties to obtain and present reliable evidence as to wage rates and labour markets in foreign countries.
Step three in the Mitchell process requires a calculation of the difference between Mr Raghavadev’s probable earrings ($778) and his ability to earn ($364). That difference is $414 per week.
Step four requires the exercise of the discretion in s 40(1) and is the main area of controversy in this matter.
The discretion – s 40(1)
Section 40(1) provides:
“(1) Entitlement. The weekly payment of compensation to an injured worker in respect of any period of partial incapacity for work is to be an amount not exceeding the reduction in the worker’s weekly earnings, but is to bear such relation to the amount of that reduction as may appear proper in the circumstances of the case.”
The leading authority on the exercise of the discretion is Australian Wire Industries Pty Ltd v Nicholson (1985) 1 NSWCCR 50 (Nicholson) where McHugh JA (as his Honour then was) said (Kirby P and Mahony JA agreeing) (at 54F-55A):
“The third step [step four in Mitchell] in the process requires the Compensation Court to look at the circumstances of the case. The weekly payment awarded must bear such relationship to the differential amount – which is the result of the exercise under the first and second steps – as under the circumstances of the case is proper. This third step therefore calls for the exercise of a judicial discretion of a kind with which courts have long been familiar.
It is at this stage that the Compensation Court can and must examine all the facts. The matters which can be examined include such matters as retirement, other supervening illnesses or injuries, the personal employment history of the worker, and so on.” (emphasis added)
His Honour added (at 57G):
“Compensation for lost earnings as the result of work injuries remains the primary purpose of the statute. Money which was not likely to be earned cannot be regarded as lost earnings for that purpose.”
As was observed in Mitchell (at 534F) “The discretion is a broad one”. The courts have considered the exercise of the discretion in many cases in recent years and have applied it in the following situations:
(a) where the worker has retired or suffered some supervening illness or injury (Nicholson, and Australia Iron & Steel Pty Ltd v Elliott (1966) 67 SR (NSW) 87);
(b) where the worker had been retired for two years before the injury which occurred during a short period of work which was a one-off job (Pratt v Claydon (1996) 14 NSWCCR 86);
(c) where the worker was imprisoned during a period of partial incapacity (Stranlund v Mid Coast Meat Co Pty Ltd (1999) 19 NSWCCR 91);
(d) where, since the injury, the worker has been dismissed because of a criminal conviction (Morgan v Commissioner for Railways [1972] WCR 33);
(e) where, before the injury, the worker chose to work for only limited periods each year (Moy v Eisenhower 1967 WCR 137);
(f) where the worker was pregnant (Wrigley Co Pty Ltd v Holland (2002) NSWCCR 463);
(g) where the worker’s visa did not permit him to work legally in Australia (Taufia; Singh), and
(h) where a worker sustained injury while working two jobs and the court had regard to the practical impossibility of continuing two full-time jobs over any lengthy period (Erisir v Kellogg (Australia) Pty Ltd [1987] NSWCC 4; 3 NSWCCR 92).
The decision in Taufia is instructive. The worker came to Australia from Tonga on a visitor’s visa in March 1992. His visa precluded him from working without permission. He started work with the respondent in October or November 1992 and was injured on 7 May 1993. His claim was accepted and he was paid compensation. He was arrested on 1 August 1993 and deported to Tonga on 8 August 1993. After his return to Tonga, Mr Taufia worked between 11 October 1994 and 21 June 1995 as a carpenter on construction work earning T$116.38 (Tongan dollars) per week. Probable earnings uninjured (in Australia) were found to be $380 per week. His Honour determined that the correct approach was to assess the value of Mr Taufia’s labour in Tonga as if it had been done in New South Wales. On that basis, the value of his work as a construction carpenter was greater than $380 per week and there was no loss for the period when he had been employed in Tonga.
In respect of the period when Mr Taufia was not working in Tonga, his Honour assessed his ability to earn, “initially”, by reference to what he could have earned in New South Wales. He determined that figure to be $300. His Honour added (at 439E):
“I say initially, because it would seem that, since the applicant is precluded from earning in our local labour market, that fact would be cognisable in the exercise of the discretion provided by the legislation.”
Deducting $300 from $380 gave a difference of $80. After the exercise of the discretion in s 40(1), his Honour awarded only $25 per week for the period when Mr Taufia was not working. After quoting the above passage from Nicholson (see [34] above), his Honour said (at 440E):
“This Court is endeavouring to compensate the applicant for the actual loss that is likely to follow from the effects of his injury and not just the hypothetical difference revealed by the operation of the formula provided in the section. That difference is to be adjusted to reflect the realities of the case. Having regard to the circumstances of the applicant being precluded from employment in this State, working in an economy which returns considerably lower wages but recognising that he yet has a disability which would affect him in that environment, it seems to me that the figure suggested above [$25] appropriately reflects those realities.”
The employer appealed (Nonferral (NSW) Pty Ltd v Taufia (1998) 43 NSWLR 312). It argued that, as Mr Taufia had no right to work in Australia, his purported contract of employment with the employer was illegal and he was not a worker within the meaning of the legislation and had no entitlement to compensation. The Court of Appeal dismissed the appeal holding that the Migration Act 1958 (Cth) did not expressly prohibit an illegal entrant from performing work as such. In respect of the trial judge’s use of the discretion, Stein JA said (at [70]), after noting that there was no challenge to the use of the discretion:
“For the record, the Judge concluded that the s 40(2)(b) figure was approximately $300 per week and the difference, therefore, $80 per week. In exercising the discretion in s 40(1) his Honour discounted the $80 per week down to $25 per week for the reasons he gave. If I may say so, this seems to be a perfectly sensible and just result.”
After dealing with the substantive grounds of appeal, Cole JA said (at [14]) that he agreed with the judgment of Stein JA “in all other respects”. Sheppard A-JA said (at [112]) that he was in agreement with what Stein JA said about “the amount of his Honour’s award”.
In Singh, the worker came to Australia in 1997 on a bridging visa class A that entitled him to work in Australia. He obtained employment as a general hand and truck driver. He was injured on 19 April 2000. The insurer accepted liability and made voluntary payments of compensation. On 9 July 2003, Mr Singh’s visa status changed to a bridging visa class E, which disentitled him to work in Australia. On 2 February 2004, the insurer ceased payments of compensation.
The worker failed in his claim for weekly compensation before a Commission Arbitrator and on appeal to Moore ADP because it was found that, as he had no right to work in Australia, the calculations under steps one and two in Mitchell were nil (Singh v Taj (Sydney) Pty Limited [2006] NSWWCCPD 7). On appeal to the Court of Appeal (Singh v TAJ (Sydney) Pty Ltd [2006] NSWCA 330; 4 DDCR 557), the Court held that the process under ss 40(2)(a) and (b) is a hypothetical one where it is assumed that the worker’s pre-injury employment would have continued even if that was not so. That Mr Singh had no entitlement to work (in Australia) did not foreclose an application for weekly payments for partial incapacity.
Beazley JA (Tobias JA agreeing) stated (at [13]) that the relevance of Mr Singh’s change in visa status arose in “connection with the exercise of the discretion” under s 40(1). The employer argued that the only possible result of the exercise of the discretion was that no award of compensation could be made. Her Honour considered the facts in Taufia and Burke CCJ’s use of the discretion in that case (see [38] above) and said (at [46]) “This Court accepted that that was an appropriate approach to take in the exercise of the discretion”. Her Honour added (at [47]):
“It follows therefore that although the appellant had no entitlement to work in Australia from the time that his visa status changed, it is not a foregone conclusion that his application for weekly payments for partial incapacity under s 40 must be dismissed. It may be that the approach endorsed by this Court in Nonferral vTaufia would recommend itself to the primary decision maker. It is also possible that there is an argument available to the respondent that that approach is either not available, or ought not be available given that the migration legislation has changed since that decision. There may be other discretionary factors of which this Court is not aware that may also be relevant. In those circumstances, I am of the opinion that the appellant, having established error in the determination of the Acting Deputy President, is entitled to an order that the matter be remitted for redetermination.”
In the remittal hearing, Moore ADP re-determined the matter and found probable earnings but for the injury to be $540 per week and ability to earn in some suitable employment (in New South Wales) to be $270 per week. However, after referring to Nicholson and Taufia, and to the fact that the discretion cannot be used to reduce weekly compensation to nil (Kesen v Luke Singer Pty Ltd (1989) 5 NSWCCR 298), she reduced the difference between steps one and two to $70, because of the worker’s “illegality”.
In the present case, the evidence is that Mr Raghavadev arrived in Australia in February 2005 wanting a better life and hoping to get permanent residency and bring his family to Australia (Mr Raghavadev’s statement 20 November 2009 at [5]). He did not obtain permanent residency and did not bring his family to Australia. His “right to work in Australia ended” in about June 2009 and he said that he “decided to return to India” (see Mr Raghavadev’s statement 20 November 2009 at [32]).
Mr Raghavadev added (at [33] of his statement) that his new general practitioner, Dr Sivaguru, reinstated total incapacity for work on 14 July 2009. His back pain and right leg pain continued and his anxiety and depression had not improved. He told his doctor of his intention to return to India and added that, in addition, his wife became sick and he wanted to return to India. He left Australia on 6 August 2009.
In his supplementary statement dated 7 October 2010, Mr Raghavadev said that if he were able to work as a linesman (as he had done before coming to Australia) he would earn about A$200 per week in India. Jobs in the area where he lives in India (Kerala) were mostly related to the agricultural and food processing industries. Work in those industries involves bending and lifting and, in his view, is not suitable for him. There is some work in the textile industry, however, he does not believe he is fit for that work because it involves bending, lifting and prolonged sitting. He conceded that work in a cinema theatre or in light retail shops would be suitable, but even those jobs require prolonged standing, walking and some bending. He has looked for suitable work since returning to India but found nothing. He said that, if not for his injury, he would have returned to Australia to work so he could continue to send money to his family in India.
Mr Raghavadev’s evidence establishes that, as at June 2009, his right to work in Australia ceased. It was then that he decided to return to India. I am satisfied that, though his wife may have been unwell, the loss of his right to work in Australia was a decisive factor in his decision to return to India. There is no evidence that his right to work in Australia has been restored and I infer that he still has no right to work in this country. In these circumstances, his statement that, but for his injury, he would have returned to work in Australia is of limited relevance. If he did return, he would still not be entitled to work legally.
The question I have to decide is the effect of Mr Raghavadev’s inability to work legally in Australia on his entitlement to compensation. I have approached that question on the basis that the employer carries the onus of establishing that grounds exist that justify the exercise of the discretion (Sutherland Shire Council v Wurzel [2010] NSWWCCPD 79 at [92]).
My view is that, as in Taufia and Singh, the effect is substantial because Mr Raghavadev’s employment prospects, assuming he had remained in Australia and remained uninjured, would have been severely restricted by the cessation of his right to work here. Though he may have been able to obtain work, such work would most likely have been irregular and or seasonal and would have paid him less than he earned with the respondent employer. Money that was not likely to be earned cannot by regarded as lost earnings (Nicholson). Therefore, his probable earnings but for his injury would have been (in reality) lower than $778. How much lower is not capable of calculation with scientific precision, however, in the circumstances of the case, in the exercise of the discretion having regard to the worker’s employment history and circumstances, the proper measure of the reduction in Mr Raghavadev’s weekly earnings as a result of his injury is $175 per week.
Mr Doak also submitted that the Commission should use the discretion to reduce Mr Raghavadev’s entitlement to compensation because he has returned to India and wage rates are much lower in India compared to Australia. He argued that the appropriate award was $95 per week, as found by the Arbitrator. I do not accept those submissions. Such an approach may have been appropriate if I had determined ability to earn after the injury by reference to the substantially lower wage rates in India. However, as I have calculated Mr Raghavadev’s ability to earn by reference to wage rates in New South Wales it is not appropriate to apply the discretion to the step two figure.
The approach I have taken is consistent with the approach taken by Campbell CJ in Crowhurst. In that case, the worker injured his back in compensable circumstances in November 1994 and October 1995. The insurer accepted liability and paid weekly compensation until 19 March 1996, about which time the worker returned to live on Waihele Island in New Zealand where there was “much unemployment” and many people lived under a barter arrangement. The employer argued that the discretion applied to both probable earnings but for the injury and to the figure for ability to earn after the injury. His Honour declined to exercise the discretion at all because, unlike Taufia, no question of illegality arose, and he was satisfied that, had Mr Crowhurst not been injured, he would probably have continued to work for the employer in Sydney. Having determined the worker’s ability to earn after his injury by reference to pay and employment conditions in Sydney, not Waihele Island, there was no reason to reduce the award in the exercise of the discretion.
Date of the award
The Application sought weekly compensation from 4 August 2009. However, for reasons that were not explained, the Arbitrator awarded compensation from 4 September 2009. At the conclusion of the appeal hearing, the parties were requested to advise of the correct date from which Mr Raghavadev sought weekly compensation. Ms Bellemore, the respondent employer’s solicitor, advised in writing on 15 November 2010 that compensation had been paid until 16 August 2009 and that any award should date from 17 August 2009.
CONCLUSION
Having conducted a review on the merits, I have determined:
(a) Mr Raghavadev’s probable earnings but for his injury were and are $778 per week;
(b) Mr Raghavadev’s ability to earn in some suitable employment in Sydney was and is $365 per week;
(c) the difference between probable earnings but for the injury and ability to earn after the injury was and is $414 per week;
(d) in the exercise of the discretion under s 40(1) the amount that is proper in the circumstances of the case, having regard to the fact that, from June 2009, Mr Raghavadev’s right to work in Australia ceased, was and is $175 per week, and
(e) Mr Raghavadev is entitled to an award under s 40 in the sum of $175 from 17 August 2009 to date and continuing.
DECISION
Paragraph 1 of the Arbitrator’s orders in the determination on 9 June 2009 is revoked and the following order made in its place:
“1. The respondent employer is to pay the applicant worker weekly compensation in the sum of $175 per week under s 40 of the Workers Compensation Act 1987 from 17 August 2009 to date and continuing.”
Paragraphs 1 and 2 of the Arbitrator’s findings and paragraph 2 of her orders in the determination of 9 June 2009 are confirmed.
COSTS
The respondent employer is to pay the appellant worker’s costs of the appeal, assessed at $2,200 plus GST.
Bill Roche
Deputy President
16 November 2010
I, MARGOT UNDERCLIFFE, 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
2
10
0