Rao v Warrumbungle Shire Council
[2024] NSWPIC 33
•29 January 2024
| CERTIFICATE OF DETERMINATION OF MEMBER | |
| CITATION: | Rao v Warrumbungle Shire Council [2024] NSWPIC 33 |
| APPLICANT: | Rabia Rao |
| RESPONDENT: | Warrumbungle Shire Council |
| MEMBER: | Diana Benk |
| DATE OF DECISION: | 29 January 2024 |
| CATCHWORDS: | WORKERS COMPENSATION - Workers Compensation Act 1987; calculation of weekly benefits (pre-injury average weekly earnings) with reference to schedule 3, cl 2 and regulation 8C of the Workers Compensation Regulation 2016; Held – the applicant did experience ‘a change of an ongoing nature’ to the employment arrangement resulting in a financially material change to the earnings and on that basis, income earned prior to that change is to be excluded from the calculation of pre-injury average weekly earnings. |
| DETERMINATIONS MADE: | The Commission determines: 1. The pre-injury earnings of the applicant are assessed at $1,628.32. The respondent is to pay weekly compensation to the applicant from 30 July 2021 using that figure as indexed pursuant to ss 36 and 37 of the Workers Compensation Act 1987. |
STATEMENT OF REASONS
BACKGROUND
On 2 November 2023, following arbitration, the Personal Injury Commission (Commission) determined:
(a) Rabia Rao (the applicant) suffered a psychological injury in the course of her employment with Warrumbungle Shire Council (the respondent) on 30 July 2021.
(b) The respondent is to pay the applicant’s reasonably necessary medical and treatment expenses pursuant to s 60 of the Workers Compensation Act 1987 (the Act).
(c) As a result of the injury, the applicant has suffered total incapacity for employment from 30 July 2021 and is entitled to weekly compensation from that date.
(d) The parties have liberty to approach for a period of 28 days if the issue of pre-injury average weekly earnings (PIAWE) cannot be resolved.
At the time of the arbitration there were insufficient particulars to hand to make a determination regarding PIAWE. Paragraph 53 of my reasons stated
“With regards to PIAWE, here the parties were not able to agree with both parties averaging earnings for different periods. It was suggested that the contracted earnings of $1605.75 be applied, but I decline to make such a finding. Instead, now that the issue of liability is clear and findings have been made in regards to incapacity, the matter regarding PIAWE should be resolved amongst the parties who may have additional information regarding earnings that I was not privy to. In the event, that consensus cannot be reached, (which is doubtful given the experience of the parties), liberty is granted to either party to apply within 28 days.”
The parties have since advised that they have not been able to resolve the issue of PIAWE and request a determination. Timetabled submissions were issued and complied with.
ISSUES FOR DETERMINATION
The only issue that I will determine is the quantum of the PIAWE.
Relevant law
The law relevant to this dispute is found in the Act. Schedule 3, cl 2 of the Act provides, relevantly:
(2) Except as provided by this clause (or by regulations made under this clause), in calculating the "pre-injury earnings" received by a worker in employment for the purposes of subclause (1) no regard is to be had to earnings in the employment paid or payable to the worker for work performed before or after the period of 52 weeks ending immediately before the date of the injury ("the relevant earning period").
Further regulation 8C of the Workers Compensation Regulation 2016 provides:
(1) The relevant earning period for a worker is to be adjusted in accordance with this clause if, during the unadjusted earning period, there was a change of an ongoing nature to the employment arrangement resulting in a financially material change to the earnings of the worker (for example, a change from full-time to part-time work).
(2) The relevant earning period is to be adjusted by excluding from the period any period before the change to the earnings of the worker occurred.
Documentary evidence
The following documents were in evidence before the Commission and considered in making this determination:
(a) submissions by the applicant and respondent as timetabled.
Applicant’s submissions
In summary, the applicant maintains PIAWE should be calculated at $1,921.52 and that the respondent’s contention the applicant’s earnings whilst she was the acting chief financial officer (CFO) between 16 November 2020 and 4 April 2021 should be excluded does not come within the scope of regulation 8C because:
(1) a change in the applicant’s job title does not equate to a change in the employment arrangement;
(2) there was no clear demarcation between the employment requirements of the role of acting CFO and the duties that the applicant engaged in after the return of the CFO from leave;
(3) there was a pattern and it was highly likely that the applicant would be asked to undertake the duties of the CFO in an acting capacity from time to time had she not been injured, and
(4) in summary, there is nothing to suggest a change in the employment relationship between the applicant and the respondent that would enliven regulation 8C.
Respondent’s submissions
In summary, the respondent maintains PIAWE should be calculated at $1,628.32 subject to indexation because:
i) the applicant returned to her substantive position as an accountant from 5 April 2021 following the recruitment of a permanent CFO on 5 April 2021. There is no dispute the applicant acted in the role of CFO between 16 November 2020 to 4 April 2021;
ii) there is no evidence to support the applicant’s contention that she would have continued to be called upon to act in the role of CFO, particularly given that a permanent CFO had been appointed;
iii) on appointment of the substantive and permanent CFO, the acting arrangement ended constituting “a change of an ongoing nature to the employment arrangement” which resulted in a reduction of the weekly earnings of the applicant, returning to her salary as an accountant, and
iv) the appointment of the new CFO on 5 April 2021 was “ongoing” and did not change at any time up to the applicant’s injury or cessation of employment.
FINDINGS AND REASONS
I have previously found the applicant suffered a workplace injury in the course of her employment on 30 July 2021 (deemed). There is no dispute the applicant was employed by the respondent as an accountant and maintained this role but did act as the CFO pending the recruitment of a permanent CFO between 16 November 2020 to 4 April 2021. The evidence shows the applicant returned to her substantive position as an accountant on 5 April 2021 on the permanent appointment of the CFO. I find given that a permanent CFO had been recruited by the respondent, that the change to the employment relationship was of an “ongoing nature… resulting in a financially material change to the earnings of the worker”.
Regulation 8C(2) prescribes that “the relevant earning period is to be adjusted by excluding from the period any period before the change (my emphasis) to the earnings of the worker”.
Applying this regulation results in a finding that PIAWE is to be calculated from the date of the ongoing change in the employment relationship, that is, 5 April 2021 up until the time of injury, which I calculate to be a period of 16.8 weeks.
Payroll records of the respondent show that the applicant’s gross earnings on return to her substantive position, that is “from the ongoing change in employment relationship” between 5 April 2021 to 29 July 2021 was $27,355.77.[1]. The Act requires that this gross sum be divided by the 16.8 weeks, resulting in a PIAWE figure of $1,628.32.
[1] Wages records at folios 275-304 of the Application to Admit Late Documents filed by respondent on 25 July 2023.
I find there is no evidence the applicant would have continued to act in the role from time to time, given that the position had been formally and permanently filled after such an extended vacancy. Further the fact that her duties did not largely change, or that she continued to undertake tasks associated with the CFO role is of no relevance, as it is evident that the employment relationship of the applicant reverted to her substantive position as accountant on 5 April 2021 and I further find on the basis of the evidence that such change was of a “ongoing nature”.
The respondent is therefore ordered to pay the applicant weekly compensation at a PIAWE of $1,628.32.
SUMMARY
For the above reasons, I made the findings and orders as set out on page 1 of the Certificate of Determination.
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