Rockhard Products Pty Ltd v Economidis
[2009] NSWWCCPD 159
•21 December 2009
| WORKERS COMPENSATION COMMISSION | ||||||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | ||||||
| CITATION: | Rockhard Products Pty Ltd v Economidis [2009] NSWWCCPD 159 | |||||
| APPELLANT: | Rockhard Products Pty Ltd | |||||
| RESPONDENT: | Shane Lee Economidis | |||||
| INSURER: | QBE Workers Compensation (NSW) Limited | |||||
| FILE NUMBER: | A2-3886/09 | |||||
| ARBITRATOR: | Mr R Whitelaw | |||||
| DATE OF ARBITRATOR’S DECISION: | 18 August 2009 | |||||
| DATE OF APPEAL DECISION: | 21 December 2009 | |||||
| SUBJECT MATTER OF DECISION: | Extension of time – Rule 16.2(11) Workers Compensation Rules 2006; operation of section 40 of the Workers Compensation Act 1987 | |||||
| PRESIDENTIAL MEMBER: | Acting Deputy President Michael Snell | |||||
| HEARING: | On the papers | |||||
| REPRESENTATION: | Appellant: | Mulcahy Lawyers | ||||
| Respondent: | Attwood Marshall | |||||
| ORDERS MADE ON APPEAL: | Leave to appeal is refused. | |||||
| The Appellant Employer is to pay the Respondent Worker’s costs of the appeal. | ||||||
BACKGROUND TO THE APPEAL
On 24 September 2009 Rockhard Products Pty Ltd (‘the Appellant Employer’) sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission (‘the Commission’) against a decision, dated 18 August 2009.
The Respondent to the Appeal is Shane Lee Economidis (‘the Respondent Worker’).
The Respondent Worker is 37 years of age. He claimed his wife and four children as dependants. He was a qualified chef, and had worked as such for most of his working life. However from about 2002 he started working in the landscaping industry, and was employed in that industry by the Appellant Employer from about 10 June 2003.
He injured his lower back in the Appellant Employer’s employ on 16 January 2004 whilst lifting and stacking pavers. The injury was reported, he stopped work and attended the Tweed Heads Hospital. He saw his general practitioner, an orthopaedic surgeon Dr Freeman, and then Dr Stephenson, a neurosurgeon. Investigations were consistent with a disc protrusion at L4/5, and Dr Stephenson performed surgery on 19 April 2004 involving decompression of the L4 nerve root. The Respondent Worker has experienced ongoing symptoms in his lower back and left lower limb. He has not resumed any regular employment. The Appellant Employer’s insurer voluntarily accepted liability to pay weekly and other compensation. From October 2007 the Respondent Worker carried out some part-time work self employed mowing lawns.
The Respondent Worker was examined on 9 June 2005 by an approved medical specialist (‘AMS’), Dr Ashwell, who assessed permanent impairment on a whole person basis at 10 per cent. He was, in August 2005, paid $12,500.00 pursuant to section 66 of the Workers Compensation Act 1987 (‘the 1987 Act’), and $10,000.00 for pain and suffering. The Application to Resolve a Dispute states a section 66A complying agreement was signed on 18 January 2009 providing for lump sum payments of $7,500.00. The insurer’s payment records indicate he was paid a further sum of $4,500.00 pursuant to section 66, and $3,000.00 for pain and suffering, in March 2009. The arbitrator referred to there being a whole person impairment assessment by an AMS of 13 per cent (Reasons at [22]).
On 10 September 2009 the Appellant Employer gave the Respondent Worker notice, pursuant to section 54 of the 1987 Act, that it was reducing his voluntary payments of weekly compensation to $223.96. The basis of the reduction was that an assessment had been carried out on the Respondent Worker’s ability to earn. The notice stated probable earnings if not for injury (section 40(2)(a) of the 1987 Act) were $805.96, and ability to earn in some suitable employment (section 40(2)(b)) was $582.00. $223.96 represented the difference between these figures.
The Application to Resolve a Dispute lodged 19 May 2009 claimed $692.30 per week from 22 October 2008 to date and continuing, on the basis probable weekly earnings if not for injury were $832.30, and actual weekly earnings were $140.00.
The matter was listed for arbitration hearing on 21 July 2009. Both parties were legally represented. The Respondent Worker was briefly cross-examined and re-examined, the arbitrator heard addresses, and reserved his decision.
THE DECISION UNDER REVIEW
The ‘Certificate of Determination’, dated 18 August 2009 records the Arbitrator’s orders as follows:
“1. That the Respondent pay to the Applicant weekly compensation at the maximum statutory rate for a worker with 4 dependant children from 22 October 2008 to date and continuing.
2. That the Respondent pay the Applicant’s costs as agreed or assessed.”
An amended Certificate of Determination was issued on 13 October 2009, for reasons described at [12] and [13] below, in which paragraph [1] of the certificate was varied to read:
“1. That the Respondent pay to the Applicant weekly compensation at the rate of $600 per week pursuant to s 40 on the basis of a worker with four dependant children from 22 October 2008 to date and continuing.”
ISSUES IN DISPUTE
The only matters in dispute at the arbitration went to quantification of the Respondent Worker’s entitlement pursuant to section 40 of the 1987 Act. The Appellant Employer’s Reply claimed probable weekly earnings if not for injury were $542.00, actual weekly earnings were $318.00, and the difference between the two was a sum of $224.00 per week. It will be observed this figure is almost identical to that set out in the section 54 Notice of $223.96, although it is arrived at via quite different figures.
The arbitrator found the Respondent Worker’s probable weekly earnings if not for injury were $800.00, and his ability to earn was $200.00 per week, in his lawn mowing business. He noted the difference between these figures was $600.00 per week, and found there were no discretionary matters requiring reduction of this figure. He stated this sum of $600.00 per week exceeded the maximum statutory rate (I infer pursuant to section 37 of the 1987 Act), and concluded the appropriate award was the maximum statutory rate for “a worker with 4 dependants”.
The maximum weekly figure payable pursuant to section 37 as at the date of the decision, for a worker with four dependant children, was $771.10. It has increased slightly since. Clearly the section 40 entitlement, as determined by the arbitrator, was insufficient to support the maximum entitlement pursuant to section 37 which was originally awarded. The solicitors for the Appellant Employer wrote to the Respondent Worker’s solicitors on 21 August 2009 pointing this out. The Appellant Employer’s solicitors wrote to the Commission on 3 September 2009 requesting the issue of an amended certificate of determination on the basis the certificate dated 18 August 2009 was “issued in error”, and was “inconsistent with the Statement of Reasons”. On 18 September 2009 the Respondent Worker’s solicitors wrote to those acting for the Appellant Employer, advising they agreed to variation of the Certificate of Determination, to a figure of $600.00 per week. The Appellant Employer’s solicitors advised the Commission of this agreement by letter dated 30 September 2009. An amended Certificate of Determination was issued on 13 October 2009.
The discrepancy referred to in the preceding paragraph formed one of the grounds of appeal. Additionally the appeal challenges each stage of the section 40 fact finding process, being the findings of probable earnings if not for injury, ability to earn, and the absence of any reduction of the mathematical difference on account of discretionary factors.
The Respondent Worker conceded the discrepancy identified at [12] and [13] above required correction. The Respondent Worker otherwise disputes the Appellant Employer’s grounds of appeal.
ON THE PAPERS REVIEW
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘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 submission by both 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.
LEAVE
Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act.
The amount of compensation at issue clearly exceeds the sum of $5,000.00 prescribed in section 352(2)(a), and more than 20 per cent of the amount awarded is appealed against. Section 352(2) is satisfied.
The Application to Extend Time
Section 352(4) provides:
“(4) An appeal can only be made within 28 days after the making of the decision appealed against.”
When the appeal was initially lodged on 16 September 2009 it was rejected by the Registry on the basis it had not been lodged within 28 days of the decision appealed against, as required by section 352(4). The Appellant Employer resubmitted the appeal on 24 September 2009 accompanied by submissions in favour of granting an extension of time.
Rule 16.2(11) of the Workers Compensation Commission Rules 2006 (‘the Rules’) makes provision for extension of time as follows:
“The Commission constituted by a Presidential member may, if a party satisfies the Presidential member, in exceptional circumstances, that to lose the right to seek leave to appeal would work demonstrable and substantial injustice, by order extend the time for making an appeal.”
The Appellant Employer’s submissions in support of extending time raise the following matters:
(i) The last day in which to appeal had been incorrectly calculated by the Appellant Employer’s solicitor. The appeal was initially out of time by only one day.
(ii) The Appellant Employer’s solicitors acted reasonably in raising the obvious error in the award (the full award pursuant to section 37) with the Respondent Worker’s solicitors and the Commission, within 28 days of the decision.
(iii) Neither the Commission nor the Respondent Worker’s solicitors responded to the correspondence relating to this error within the 28 day period.
(iv) On 24 August 2009 the Appellant Employer’s solicitors requested a sound recording of the arbitration hearing, from the Commission. This was not supplied within the 28 day period, and was necessary to prepare appropriate submissions.
(v) The likely future cost of the award is likely to be significant to the Appellant Employer.
(vi) In construing Rule 16.2(11) “exceptional circumstances” should not mean more than “unusual circumstances”. The principles to be applied in considering the extension of time are those contained in the judgment of McHugh J in Gallo v Dawson (1990) HCA 30, 93 ALR 479 (‘Gallo’), which have frequently been applied in Presidential decisions dealing with this issue.
The Respondent Worker opposes the extension of time, raising the following matters:
(i) The meaning of the phrase “exceptional circumstances” is dealt with in San v Rumble (No 2) [2007] NSWCA 259. Reference was also made to Bryce v Department of Corrective Services [2009] NSWCA 188 (‘Bryce’), which dealt with Rule 16.2(11). It was submitted that, applying the appropriate test, exceptional circumstances could not be made out.
(ii) The appeal was without merit, so the Commission’s discretion should not be exercised in the Appellant Employer’s favour.
(iii) No demonstrable and substantial injustice could be demonstrated. There was no serious challenge to the fact the Respondent Worker had been seriously injured, the only genuine issue between the parties was quantification of the section 40 entitlement. The obvious error in the award could be corrected by application of the slip rule, or section 350(3) of the 1998 Act.
The Appellant Employer then put on further submissions going to the extension of time. The additional point made was that the Respondent Worker had not, in his submissions, explained why he had not responded earlier to the Appellant Employer’s request that the obvious error be corrected.
The amended Certificate of Determination was issued pursuant to section 294(3) of the 1998 Act, which provides:
“(3) If the Registrar is satisfied that a certificate as to a determination or a statement attached to the certificate contains an obvious error, the Registrar may issue, or approve of an Arbitrator issuing, a replacement certificate or statement to correct the error.”
Rule 16.2(1) and (2) provide:
“(1) A party to any proceedings applying for leave to appeal under section 352 of the 1998 Act against a decision of an Arbitrator must lodge the application within 28 days after the making of the decision, or within such extended time for making the appeal as may be ordered under subrule (11).
For the purposes of subrule (1), a decision is made, in respect of a dispute, when the Commission issues a certificate as to the determination of the dispute as required by section 294 (1) of the 1998 Act.”
A certificate as to the determination of the dispute was issued by the Commission on 18 August 2009. The amended certificate was a replacement for it, and would have effect from the date of the original certificate. The appeal, when originally lodged, was one day out of time.
The operation of Rule 16.2(11), and the extent to which it is necessary to establish “exceptional circumstances” as a necessary precondition to enlivening the discretion, were dealt with in Bryce, where Allsop P said:
“The phrase ‘in exceptional circumstances’, bounded as it is by commas, might conceivably be thought to be a jurisdictional fact. Aspects of the argument of the applicant put this today. In my view, the phrase “in exceptional circumstances” finding its place in the middle of the rule is to be dealt with as a matter to be considered by the Presidential member as a matter within jurisdiction as opposed to a precondition to the operation of jurisdiction.”
The existence of “exceptional circumstances” is not a precondition to an extension of time, but is a matter I am required to consider in the exercise of my discretion under the rule.
In Yacob v Pilkington (Australia) Limited [2007] NSWCA 290 (‘Yacob’) Campbell JA dealt with the phrase “exceptional circumstances” in the Uniform Civil Procedure Rules 2005:
“66 Another question of construction concerned “exceptional circumstances” in rule 31.18(4). In San v Rumble (No 2) (2007) NSWCA 259 at [59]-[69], I gave consideration to the expression “exceptional circumstances” in a different statutory context to the present. Without repeating that discussion in full, I shall state such of the conclusions as seem to me applicable in the construction of rule 31.18(4).
(a) Exceptional circumstances are out of the ordinary course or unusual, or special, or uncommon. They need not be unique, or unprecedented, or very rare, but they cannot be circumstances that are regularly, routinely or normally encountered: R v Kelly (Edward) [2000] 1 QB 198 (at 208).
(b) Exceptional circumstances can exist not only by reference to quantitative matters concerning relative frequency of occurrence, but also by reference to qualitative factors: R v Buckland [2000] 1 WLR 1262; [2000] 1 All ER 907 (at 1268; 912-913).
(c) Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors, or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional: Ho v Professional Services Review Committee No 295 [2007] FCA 388 (at [26]).
(d) In deciding whether circumstances are exceptional within the meaning of a particular statutory provision, one must keep in mind the rationale of that particular statutory provision: R v Buckland (at 1268; 912-913).
(e) Beyond these general guidelines, whether exceptional circumstances exist depends upon a careful consideration of the facts of the individual case: Awa v Independent News Auckland [1996] 2 NZLR 184 (at 186).67. In the context of rule 31.18(4) UCP Rules, any decision about whether there are exceptional circumstances would need to bear in mind the explicit statement of objectives of a court in the management of litigation contained in sections 56-59 Civil Procedure Act 2005.”
I have previously expressed the view that, in applying the concept of “exceptional circumstances” in an application pursuant to Rule 16.2(11), it is necessary to have regard to sections 3 and 354 of the 1998 Act, consistent with Yacob at [67]: see NSW Fire Brigades v Turton [2008] NSWWCCPD 66 (‘Turton’).
One of the factors relied upon by the Appellant Employer, in seeking to establish exceptional circumstances, is the failure by the Commission to furnish its solicitors with a sound recording or transcript of the arbitration hearing within the 28 day period. The usual practice (as was followed in this case) is that the Commission forwards transcript of the arbitration hearing to the parties when it is prepared. It is very common for this to occur outside the 28 day period. In this instance transcript was forwarded to the Appellant Employer’s solicitors on 12 October 2009. As is routine, the letter forwarding the transcript to the parties invited them to complete and lodge final grounds and submissions, if these could not be completed earlier, in the absence of transcript. This is consistent with the procedure outlined in Practice Direction No. 6, which provides inter alia:
“A copy of the transcript of proceedings, if available, will be obtained by the Registrar and forwarded to each party to the appeal.
Any supplementary submissions following receipt of the transcript must be lodged and served within 28 days of the date of the letter from the Registrar addressed to the party enclosing a copy of the transcript.”
A second factor relied upon is the failure by the Respondent Worker’s solicitors, and the Commission, to respond, within the 28 day period, to the correspondence from the Appellant Employer’s solicitors seeking that the obvious error in the Certificate of Determination be rectified. In its further submissions on the extension application, dated 29 September 2009, the Appellant Employer submits that, had the Respondent Worker consented to correction of the obvious error “more expeditiously and prior to the expiry of the Appeal period then the Appellant Employer would have filed the balance of the Appeal within time”. The implication is that the Appellant Employer let the period expire whilst waiting for a response to its correspondence about the obvious error. It is difficult to identify any reason why, if the Appellant Employer wished to pursue an appeal in any event, it would get out of time waiting for such a response. This is also arguably inconsistent with the earlier submissions of 23 September 2009, which state that a factor in the appeal being out of time was that the last date for appeal was incorrectly calculated and diarised by the Appellant Employer’s solicitors.
It is unusual for a Certificate of Determination to contain an obvious error, of the type encountered in this case. However it is difficult to identify anything out of the ordinary course, unusual, special or uncommon in the time taken by the Respondent Worker’s solicitors to take instructions and reply to the correspondence about the obvious error. Similarly the time taken by the Commission to respond to the correspondence in my view was not unusual. When the Appellant Employer ultimately provided the Commission with copy correspondence confirming the agreement of the Respondent Worker to the amendment of the certificate, this amendment occurred within two weeks.
The balance of the material relied upon by the Appellant Employer, describes procedural steps of an apparently routine nature. It is submitted the Appellant Employer’s solicitors acted reasonably in taking steps such as seeking instructions, and seeking amendment of the obvious error.
There have been a number of decisions dealing with situations where appeals have been filed out of time following procedural or administrative misadventure. Some of these are referred to in Turton at [40] and [42]. As the Appellant Employer submits, each such application must be dealt with on its own facts.
In my view the circumstances in the current matter, taken as a whole, are those regularly, routinely or normally encountered. There is no single exceptional matter, nor a combination of factors which “although individually of no particular significance, when taken together are seen as exceptional”. I cannot find the existence of ‘exceptional circumstances’ on the facts of this case.
Having regard to the decision in Bryce, this is not fatal to the application, although it clearly is a factor that would militate against exercise of the discretion in the Appellant Employer’s favour.
The Appellant Employer relies on the judgment of McHugh J in Gallo. The following passage has been frequently applied in Presidential decisions, dealing with the extension of time:
“The discretion to extend time is given for the sole purpose of enabling the court or justice to do justice between the parties: see Hughes v National Trustees Executors & Agency Co of Australasia Ltd [1978] VR 257 at 262. This means that the discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the applicant. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time: see Avery v No 2 Public Service Appeal Board [1973] 2 NZLR 86 at 92; Jess v Scott (1986) 12 FCR 187 at 194-5; 70 ALR 185. When the application is for an extension of time in which to file an appeal, it is always necessary to consider the prospects of the applicant succeeding in the appeal: see Burns v Grigg [1967] VR 871 at 872; Hughes at 263-4, Mitchelson v Mitchelson (1979) 24 ALR 522 at 524. It is also necessary to bear in mind in such an application that, upon the expiry of the time for appealing, the respondent has “a vested right to retain the judgment” unless the application is granted: Vilenius v Heinegar (1962) 36 ALJR 200 at 201.” (at 480)
I have ultimately concluded the appeal does not have reasonable prospects of success, and this is a powerful factor against the granting of an extension of time. This involves some consideration of the merits of the appeal.
Ground 1 – Probable Earnings
The Appellant Employer argues that late documents, tendered by it at the arbitration hearing, demonstrated that two employees of the Appellant Employer, who were comparable to the Respondent Worker, had earnings that reduced considerably after 10 September 2008, and that those particular employees had ceased to be employed by the Appellant Employer due to “the economic downturn”. At the arbitration hearing the Appellant Employer submitted that “There aren’t any comparable employees”. Accordingly, it was submitted, “if the applicant hadn’t been injured, then if he was to sell his services elsewhere, then he’d be faced with the award wage for that type of work.” The appropriate award rate was submitted to be $586.10. It was submitted this represented probable earnings if not for injury (section 40(2)(a)).
The Respondent Worker submits an analysis of his earnings records from his commencement on 10 June 2003, to his injury on 16 January 2004, demonstrates average weekly earnings of $832.30. The taxation return for 2003/04 demonstrates an average weekly income of $734.65, but this figure would have been affected by the Respondent Worker not working, and being in receipt of compensation payments, after the injury on 16 January 2004. He was not employed pursuant to an award, but was paid on a piecework basis (see the Employer’s Report of Injury dated 20 January 2004). The evidence of the earnings of two other employees of the Appellant Employer did not establish their comparability, their earnings were significantly less than the Respondent Worker’s earnings. It is submitted if the Appellant Employer wished to establish work of the sort carried out by the Respondent Worker was no longer available, it should have put on evidence to this effect, which it did not.
The approach taken by the arbitrator was to take the Respondent Worker’s taxation return for 2003/04, described by him as “the only objective evidence” on the point. He then increased that figure by somewhere between 1 per cent and 2 per cent per annum, to yield probable weekly earnings for the 2008/09 financial year of $800.00. This is the figure he found to represent the upper limb of the section 40 equation.
In determining “the weekly amount which the worker would probably have been earning as a worker but for the injury”, it is necessary to assume continuation of the worker’s employment. In Australian Wire Industries Pty Ltd v Nicholson (1985) 1 NSWCCR 50 McHugh JA at 54D, dealing with the corresponding provision in the Workers Compensation Act 1926 said:
“That is because the continuation of the worker’s employment is part of the hypothesis which the first step in section 11(1) requires. Whether or not the actual facts of the worker’s employment are consistent with that hypothesis is beside the point.”
This approach is settled law, and has been recently restated in the Court of Appeal in Singh v TAJ (Sydney) Pty Ltd (2006) 4 DDCR 557. See also by way of illustration Miller v A & R Pearson Pty Ltd [2007] NSWWCCPD 111, Plumbers Supplies Co-Operative Limited v Behnampirouz [2008] NSWWCCPD 47. It is not to the point that some other employees of the Appellant Employer may have had their hours reduced and then been terminated due to economic downturn.
There was evidence that could have justified a finding of probable earnings in excess of the sum of $800.00 found by the arbitrator. The arbitrator based his calculation on the taxation return for 2003/04. That figure is likely to have been somewhat reduced by the effects of the injury. The Respondent Worker’s actual earnings in fact were in excess of $800.00 per week prior to his injury. If the figure of $832.30 were simply increased from 16 January 2004 by the somewhat conservative rate of 1% per annum applied in Goktas v Goodyear Australia Pty Ltd [2007] NSWWCCPD 1, this would have yielded a figure of approximately $875.00. Additionally, the Appellant Employer, in its section 54 Notice dated 10 September 2009, described the Respondent Worker’s probable weekly earnings as $805.96. As was observed by the arbitrator, one does not know on what evidence or information this was based. But it was entitled to weight as an admission. No evidence or material was put on by the Appellant Employer to indicate it flowed from mistake, or to otherwise explain on what it was based, and why it should be disregarded.
Overall, I do not find any valid basis for concluding the arbitrator’s determination of the upper limb of the section 40 equation was too high. If reviewing the matter pursuant to section 352, I would arrive at a figure of at least that magnitude.
Ground 2 – Ability to Earn
The lower limb of the section 40 equation is set out in section 40(2)(b), and is “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 (but not exceeding $1,000).” The arbitrator noted the worker was actually earning income carrying out casual lawn mowing, and that “Prima facie, the amount that the worker is actually earning is the appropriate amount to be considered in the second leg of the Mitchell test” (a reference to Mitchell v Central West Health Service (1997) 14 NSWCCR 526). The arbitrator referred to Aitken v Goodyear Tyre & Rubber Co (Aust) Pty Ltd (1945) 62 WN (NSW) 233 (‘Aitken’). He did not base his finding of the lower limb of the section 40 equation on the actual earnings, but rather said he accepted the Respondent Worker’s evidence that the lawn mowing business was suitable employment, and that he could do three to four lawns per week at $50.00 each. He adopted $200.00 per week on this basis.
The Appellant Employer challenges this figure on various distinct bases:
(i) It did not take account of a concession in cross-examination that the Respondent Worker would be able to do 20 hours per week as a cold larder chef on a split shift basis. It was submitted that, under an appropriate award, this would yield income of between $324.40 and $500.00 per week (depending on whether weekend work was involved).
(ii) It did not reflect a concession made by the Respondent Worker in cross examination that he could “carry out additional lawn mowing hours” to that contained in his statement. It is submitted the Respondent Worker’s counsel submitted on the basis the Respondent Worker could carry out 20 hours per week of lawn mowing, and insufficient weight was given to this concession. It is submitted the Respondent Worker on these concessions would be capable of earning between $333.40 and $400.00 per week lawn mowing.
(iii) The arbitrator erred in not accepting the report of Interact Injury Management dated 5 October 2007. That was the report referred to in the s 54 Notice, that considered the Respondent Worker could perform various jobs such as sales representative, sales person or telemarketer.
I will deal briefly with these arguments in turn. The Respondent Worker, in cross-examination, did not concede he would be physically capable of work as a cold larder chef. The passage of cross-examination dealing with this is at T4.25 to 5.25. He qualified his initial partial agreement with the proposition by adding “as long as there’s no heavy lifting”. He went on to say such work involved “a lot of carrying”. The cross-examiner went on to ask whether the Respondent Worker could work as a cold larder chef “where you could work at a bench, sit or stand”. The somewhat non-responsive answer at T5 did not suggest a complete acceptance of the proposition, although at one point the Respondent Worker said “You ask me if I could do that job. Yes, I could.” In re-examination the Respondent Worker described the work of a chef as “non-stop” (T6.45), and also said reliability was important (T7.10).
It is also noteworthy work as a chef was not one of the recommended options, notwithstanding the Respondent Worker’s experience in that area, in the section 40 Vocational Assessment of Interact Injury Management dated 6 September 2007, on which the Appellant Employer relied in its section 54 Notice. This may well be explained by the fact that a ‘Vocational Assessment for section 40’ by the same organisation, dated 30 March 2006 considered the suitability of work as a chef and concluded:
“Mr Economidis has extensive experience as a chef. However, his standing restrictions prevent him from pursuing this vocation.”
Work as a chef typically includes long periods of standing, lifting and carrying, and bending. On the medical evidence overall it is clearly unsuitable. There is no evidence that work of the sort put to the Respondent Worker in cross-examination (work at a bench, sitting or standing) would be available on the labour market. The evidence overall did not support the proposition the Respondent Worker could undertake duties as a chef, and the guarded concession at T5.20 must be viewed in context.
The Respondent Worker’s description in cross-examination, of the hours he thought he could cope with lawn mowing, was at T5:
“So with what I’m doing, three to four hours, sort of three days a week, because I found – I’ve tried to work in my business and with other things more time than that, my medication goes out of control, my pain levels go out of control and I suffer greatly. So that’s why I do the hours that I do, and, yeah, three to four hours is my max.”
This would amount to nine to twelve hours per week. An occupational therapist, Karen Smibert, reporting on 11 December 2008 recorded a history of the lawn mowing “He said he takes a long time to complete a job because he needs regular rest breaks.” The Respondent Worker’s evidence on this issue is not inconsistent with the basis on which the arbitrator approached it. The Respondent Worker’s general practitioner Dr Engel, in a report dated 29 January 2009, apparently commenting on work capacity, said “4 hours per day, 3 days per week. Sitting less than ½ - 1 hour. Standing less than ½ - 1 hour.” It is also worth noting Dr Atkinson, medical director of a pain management program the Respondent Worker undertook at The Wesley Hospital, reported on 20 June 2008:
“It was emphasised to him that he needs to pace himself. There continues to be this difficulty with his work. The lawn mowing business does not have a great opportunity to expand and there is the risk of him stirring up his back. Again he has been encouraged to explore job opportunities and look for something that is more productive.”
The evidence overall comfortably supports the conclusion reached by the arbitrator, as regards ability to earn from the Respondent Worker’s lawn mowing business. It is consistent with the approach I would take on reviewing the matter. I note the figure was not reduced by the arbitrator to take account of expenses and overheads the Respondent Worker doubtlessly had. For example his statement describes him purchasing a self propelled easy start mower to assist in the lawn mowing activities.
This leaves the Appellant Employer’s reliance on the vocational assessment dated 6 September 2007, and its suggestion the Respondent Worker could carry out full-time work as a sales representative, sales assistant or telemarketer.
The Respondent Worker’s statement says he “never received any training in any sales area apart from a small work trial at Bunyips at South Tweeds, in a camping shop”. He states he does not believe he is suited to sales work due to lack of experience, and his inability to present a “happy demina (sic)” due to his fear of an attack of sciatica.
The reference to “Bunyips” is a reference to a work trial arranged by Interact Injury Management, described in a report dated 4 October 2005. The Respondent Worker commenced the work trial on 29 August 2005. On 5 September 2005 the Respondent Worker reported “severe symptoms while attending his work trial”. He was able to attend only four days of this work trial in sales work before being certified totally unfit by a doctor. His statement says he suffered a “severe exacerbation” of his back pain when attempting to erect a barbeque at Bunyips.
Sales assistant work is not necessarily physically easy. There is a description of the potential duties of a sales assistant in the Interact Injury Management report dated 6 September 2007 at P 13. The duties potentially include packaging goods, pricing, stacking and displaying items for sale, and keeping a store tidy. Shelf stacking is frequently part of such work, as is long periods of standing. Bending would be expected from time to time, to access goods stored at lower levels of a store. The Respondent Worker’s experience at Bunyips is indicative of the extent to which such work can involve duties beyond simply standing at a counter and serving customers. I could not be satisfied such duties were physically suitable for the Respondent Worker.
Additionally, the Respondent Worker’s statement indicates he attempted to obtain work in sales related areas before a friend gave him a start doing lawn mowing, which led to him starting his own small lawn mowing business. He says that from when he finished with the Appellant Employer, until he started lawn mowing in about 2007, he “would have applied for approximately 150 jobs”. These “included sales reps positions, basically anything sales including motor vehicle sales, catering sales, electrical appliances sale eg. Good Guys, Harvey Norman.” He “tried camping disposal stores and plenty of other sales positions”. He succeeded in obtaining no such work. He states he “did not have any experience in sales”. Additionally “When the employers found out about my restrictions, they were unable to give me a start.” He states he has difficulty standing for long periods, walking, bending, squatting and lifting. If I demonstrate anything I would find it difficult.” This demonstrates the inherent difficulty in working in such positions with the restrictions the Respondent Worker has.
S 43A(1) of the 1987 Act sets out various factors to be taken into account in identifying ‘suitable employment’:
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.
Sub-sections (a), (b) and (g) are, on the facts of this case, of clear relevance in considering whether work as a sales assistant is ‘suitable employment’ for the Respondent Worker. When work as a sales assistant was raised with the Respondent Worker, when the Interact Injury Management report dated 6 September 2007 was being prepared, the Respondent Worker said he was “not interested in such work as he struggles with the face to face interactions required”. Such difficulties would be inconsistent with working as a sales representative or sales assistant. Difficulty of this sort would represent “other relevant circumstances” for the purposes of s 43A(1). In my view consideration of these matters leads to the conclusion work as a sales assistant is not suitable.
Similar considerations would militate against the work of a sales representative being suitable. Possible duties in such positions are described in the Interact Injury Management report dated 6 September 2007 at P 11. The author postulates the Respondent Worker would, given his experience as a chef, be well placed to apply for such jobs in the hospitality and catering industry. It states the requirements of such positions include “good product knowledge, good communication including phone manner and computer skills”.
The Respondent Worker has no experience or training as a sales representative. His occupations in the past have not been based on good communication skills, the evidence does not indicate his work in the past involved computer skills. His difficulty with “face to face interactions” suggests he does not have good communication skills. He has, in the past, sought sales representative positions, and has been unsuccessful, he says due to his lack of experience and restrictions (see [61] above). Such work typically involves travelling by motor vehicle during a working day, to visit potential customers, take orders, and demonstrate products. One would anticipate much of the working day would be passed sitting in a motor vehicle. One would anticipate it would be necessary to carry product into the premises of potential customers, and if necessary demonstrate it. Sub-sections (a), (b), (g) and (h) of section 43A would suggest work as a sales representative is not suitable.
The third employment classification postulated in the Interact Injury Management report dated 6 September 2007 is the work of a telemarketer. The physical requirements of the work do not appear heavy, according to the description at page 16 of the report. Although it is not referred to in the report, one would anticipate this work would need to be carried out from a seated position, as it involves use of a telephone, allied with use of a computer to record appointments, record orders, change entries on a database, and the like. On a physical level, that report recorded the Respondent Worker was “able to sit for twenty to thirty minutes provided he is able to move in his seat during this time. After this time, Mr Economidis would need to change posture to standing or perform a small stretch to alleviate pressure in his lower back and left leg region”. Ms Smibert, an occupational therapist who reported on 11 December 2008, recorded:
“He is limited to sitting for ½ to 1 hour before he needs to lie down, limited by low back and sciatic pain. During his assessment he alternated between siting on a couch, lying on the floor and sitting on a chair. If he wants to watch a movie he takes medication so that he can be more comfortable.”
Employment that predominantly involves working from a sitting position would appear unsuitable. Additionally, the personal requirements of such work are described at page 17 of the rehabilitation report, and include “pleasant and friendly manner”, “enjoy talking to people”, and an “aptitude for working with computers”. The Respondent Worker’s difficulties interacting with others have already been referred to. His “Transferable Skills Analysis” is set out at page 8 of the rehabilitation report. He is described as possessing “Basic computer skills, internet and email”. His education is to Year 12 at High School, followed by training at TAFE as a chef. He also has a forklift licence. He has no experience working as a telemarketer, his computer skills are basic, he has no experience in clerical work, and he experiences difficulty interacting with others. Sub-sections (a), (b) and (h) of section 43A would indicate the work of a telemarketer is probably unsuitable for the Respondent Worker.
The Respondent Worker sought suitable work over a long period whilst under the care of rehabilitation providers, without success. He eventually got into lawn mowing work with the assistance of a friend. He then set up his own small business, and invested money of his own in doing so, in an attempt to carry out some work for which he was suited by experience, and of which he was physically capable. He performs such work with the freedom associated with self employment – he can vary his hours, take breaks if needed, not work when his symptoms are severe. There would be good reason for simply taking the actual earnings of the Respondent Worker, in his lawn mowing business, as the lower limb of the section 40 equation: Aitken, JC Ludowici & Son Ltd v Cutri (1992) 26 NSWLR 580, North Broken Hill Ltd v Tumes [1999] NSWCA 309, Tang v Integrated Parramatta Pty Ltd [2008] NSWWCCPD 63.
Certainly, to adopt the language of Jordan CJ in Aitken, it does not appear “he is deliberately taking lower paid work than he could get or is idling and on this account receiving less than he could be reasonably expected to obtain, or where his actual earnings have been compulsorily reduced by something unconnected with his injury or general earning power.” Had the arbitrator simply taken the actual earnings, this would have produced a figure lower than the sum of $200.00 per week found by the arbitrator to represent the Respondent Worker’s ability to earn. In reviewing the matter, I would not find a figure, for the purposes of section 40(2)(b), higher than the figure of $200.00 per week found by the arbitrator.
Ground 3 – Failure to Properly Address S 43A(1)
The Appellant Employer’s argument on this basis was founded on a proposition the arbitrator should have given greater consideration to the Respondent Worker’s training and experience as a chef and in the hospitality industry. For the reasons given above, I would conclude work as a chef (for which the Respondent Worker was trained) is not suitable employment. I have sought to address the requirements of section 43A(1) in the analysis of the Respondent Worker’s ability to earn above.
Ground 4 – Failure to exercise a Discretion
The Appellant Employer raises three specific matters, in support of its argument the figure produced, by deducting the section 40(2)(b) figure from the section 40(2)(a) figure, should be reduced on a discretionary basis:
(i) The Respondent Worker is deliberately taking lower paid work than he could obtain as a chef or in the hospitality industry.
(ii) The level of lawn mowing engaged in by the Respondent Worker is “regulated by his desire to actively participate in the raising of his young family”.
(iii) The arbitrator, in assessing the Respondent Worker’s ability to earn, should have had regard to the value of the Respondent Worker’s labour, rather than to what he actually earns. It is said deductions are claimed to almost the entire extent of the monies earned. Reference is made to a decision of Candy ADP in Santa Sabina College Limited v Agius [2009] NSWWCCPD 10:
“There is no reason why the employer should bear a greater liability for weekly payments by reason of the Workers preference for working in her own business rather than seeking better paid employment in the market place.”
The Appellant Employer did not, at the arbitration hearing, direct submissions to the discretionary element of section 40. No specific matters were raised as supporting the application of a discretionary reduction of the mathematical difference produced by the section 40 equation. In such circumstances the arbitrator dealt with this aspect of his task briefly, simply stating at [33] of his reasons “There are no matters before me which would cause me to exercise my discretion.”
The first of the matters submitted on, as justifying exercise of the discretion, is misconceived. It is a submission that echoes the language of Jordan CJ in Aitken. It is a submission that goes to the determination of the lower limb of the section 40 equation, being the sum a worker is earning or would be able to earn in some suitable employment: section 40(2)(b). This is the second of the steps in determining an award pursuant to section 40, as those steps are described in Mitchell. It is a step that must be taken to determine the arithmetical difference produced by the section 40 equation. The discretionary exercise is the fourth of the steps set out in Mitchell, and involves exercising the statutory discretion to decide whether it is proper to award the arithmetical difference produced by the equation, or some lesser figure.
The third of the matters raised as supporting the exercise of the statutory discretion is similarly misconceived. It goes to determination of the sum a worker is earning or is able to earn in some suitable employment, for the purposes of section 40(2)(b), where a worker is operating a business. This is sufficient to dispose of this submission. I would note the submission, additionally, is inconsistent with the decision of the Court of Appeal in Akora Holdings Pty Ltd v Ljubicic [2008] NSWCA 339 per Campbell JA at [23], and the passage of the decision of the High Court in Cage Developments Pty Ltd v Schubert [1983] HCA 37, 151 CLR 584 cited therein.
The second matter submitted on, as justifying a discretionary reduction, also is little more than a submission the Respondent Worker’s actual earnings are not a true reflection of his ability to earn, on the basis he undertakes less work lawn mowing than he is capable of, because of his family commitments. Again, this submission goes to the ascertainment of a figure pursuant to section 40(2)(b), rather than the discretionary stage of the process. However it could also be read as a submission the Respondent Worker has withdrawn himself from the workforce, at least in part, due to matters unrelated to the effects of injury. Such a submission could arguably go to the section 40 discretion. I do not, in the circumstances of this case, accept the submission. There is ample evidence, discussed above going to Ground 2 of the Appellant Employer’s appeal, that indicates the Respondent Worker has attempted to exercise his residual earning capacity to the full, subsequent to his injury.
For the above reasons, had leave been granted, the Appellant Employer’s appeal would have failed in any event. Having regard to the absence of exceptional circumstances, and the appeal’s failure on the merits in any event, the appropriate order is that an extension of time not be granted, and that leave to appeal be refused.
DECISION
Leave to appeal is refused.
COSTS
The Appellant Employer is to pay the Respondent Worker’s costs of the appeal.
Michael Snell
Acting Deputy President
21 December 2009
I, TUYET WALLIS, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF MICHAEL SNELL, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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