Secretary, Department of Communities and Justice v Pell
[2023] NSWPICPD 19
•19 April 2023
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY A MEMBER | |
CITATION: | Secretary, Department of Communities and Justice v Pell [2023] NSWPICPD 19 |
APPELLANT: | Secretary, Department of Communities and Justice |
RESPONDENT: | Paul Pell |
INSURER: | QBE Insurance (Australia) Ltd as agent for Treasury Managed Fund |
FILE NUMBER: | A1-W1586/22 |
PRESIDENTIAL MEMBER: | Deputy President Elizabeth Wood |
DATE OF APPEAL DECISION: | 19 April 2023 |
ORDERS MADE ON APPEAL: | 1. The Member’s Certificate of Determination dated 13 May 2022 is confirmed. |
CATCHWORDS: | WORKERS COMPENSATION – Clause 2 of Schedule 3 to the Workers Compensation Act 1987 – calculation of pre-injury average weekly earnings – whether Regulation 8C of the Workers Compensation Regulation 2016 applies to exclude from the calculation a period when workers compensation payments were received in respect of an earlier injury – Sidhu v Secretary, Department of Communities and Justice [2021] NSWPIC 522 considered |
HEARING: | On the papers |
REPRESENTATION: | Appellant: |
| Mr S Grant, counsel | |
| Hall & Wilcox | |
| Respondent: | |
| Mr L Wright KC and Mr R Brennan, solicitor | |
| McNally Jones Staff | |
DECISION UNDER APPEAL | |
MEMBER: | Mr P Young |
DATE OF Member’s DECISION: | 13 May 2022 |
INTRODUCTION AND BACKGROUND
Mr Paul Pell (the respondent) was employed by the Secretary, Department of Communities and Justice (the appellant) as a Correctional Officer. The respondent was involved in an incident at the Liverpool Court in 2020 in which he suffered a shoulder injury. The respondent underwent surgery and was off work until 11 May 2021. Liability for the injury was accepted by the appellant and the respondent was paid weekly compensation. On 30 August 2021, he was diagnosed as suffering from COVID-19 and was unfit for work from that date until 28 September 2021. The appellant accepted that the contraction of COVID-19 was work related.
This appeal concerns a dispute as to how the respondent’s pre-injury average weekly earnings for the COVID-19 injury should be calculated. The appellant calculated the respondent’s pre-injury average weekly earnings as $1,114.49, based upon the average weekly earnings for the period of 52 weeks prior to the injury. The respondent disputed the calculation and argued that his pre-injury average weekly earnings should be calculated from 11 May 2021 because, for the first 36 weeks of the 52 week period, he had been in receipt of weekly payments for compensation for his shoulder injury.
The dispute was listed for arbitration on 12 May 2022. The Member delivered oral reasons on the same day and issued a Certificate of Determination on 13 May 2022. He determined that the period during which the respondent received weekly compensation for his prior injury should be excluded from the calculation of the respondent’s pre-injury average weekly earnings and that the respondent’s pre-injury average weekly earnings figure was $2,581.85.
ON THE PAPERS
Section 52(3) of the Personal Injury Commission Act 2020 provides:
“(3) 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 and enabling legislation without holding any conference or formal hearing.”
Both parties indicate that they are content for the appeal to be determined ‘on the papers’ and that an oral hearing is not necessary.
I have had regard to Procedural Directions PIC2 – Determination of matters ‘on the papers’ and WC3 – Presidential appeals and questions of law, the documents and submissions that are before me, and the submissions by the parties that the appeal can proceed to be determined on the basis of those 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.
THRESHOLD MATTERS
There is no dispute between the parties that the threshold requirements as to quantum and time pursuant to ss 352(3) and 352(4) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) have been met.
THE MEMBER’S REASONS
The Member noted that the respondent claimed weekly compensation in respect of the period from 31 August 2021 and 28 September 2021, when he was incapacitated for work because he had contracted COVID-19. The Member further noted that the appellant paid the respondent weekly compensation at the rate of $1,114.49. The Member identified that the dispute between the parties involved a consideration of whether the period during which the respondent received compensation for his prior injury should be excluded from the calculation of the respondent’s pre-injury average weekly earnings figure.
The Member referred to a decision of Member Beilby in Sidhu v Secretary, Department of Communities and Justice.[1] He said that that case involved a similar issue, in which Member Beilby found that the relevant earning period for the purposes of calculating the pre-injury average weekly earnings should exclude a period during which the worker received weekly compensation for an unrelated injury. He noted that the appellant submitted that Member Beilby’s decision was wrong, and that while the amount of compensation should be excluded, the period during which the respondent received that compensation should be included. He summarised the submissions of both parties.
[1] [2021] NSWPIC 522 (Sidhu).
The Member referred to the amendment made by the Workers Compensation Amendment (Pre-injury Average Weekly Earnings) Regulation 2019 to the Workers Compensation Regulation 2016 (the 2016 Regulation), to add cl 8A to cl 8EA which made provision for the adjustment of the calculation period of 52 weeks in certain circumstances. The Member referred to the appellant’s submissions that cl 8C of the 2016 Regulation required that there had to be a change in the ongoing nature of the worker’s financial earnings and that the purpose of cl 8C was to ensure that workers were not unfairly penalised or enriched by a change in the nature of their employment. The Member recorded that the appellant submitted that there was no change in the respondent’s ongoing employment arrangements.
The Member observed that:
“It is important to note, I think, that when one examines future prospects at any given point in time, it is impossible to forecast in advance what is the change of an ongoing nature. One can only rely upon information which is available at the time. In this case, it was clear that the [respondent] had a closed period of workers compensation paid.”[2]
[2] Transcript of oral reasons (T), Pell v Secretary, Department of Communities and Justice W1586/22, T11.28–34.
The Member added that “regardless of whether those workers compensation payments were to continue indefinitely”,[3] the respondent was without his usual income within the 52 week period that applied to the calculation of his pre-injury average weekly earnings. The Member considered that, consistent with the decision in Sidhu, the period during which the respondent received payments of compensation should be excluded from the calculation. He said that the weeks commencing from the 52 weeks prior to the injury up to the period when the respondent received compensation for his prior injury should be included in the period the subject of calculation.
[3] T12.1–2.
The Member observed that, in his view, it would be highly unlikely that beneficial legislation such as the Workers Compensation Act 1987 (the 1987 Act) and the 1998 Act would work to penalise a worker because of a previous unrelated injury when the worker had returned to full time work before the later injury. The Member considered that there would otherwise be no incentive for a worker to return to normal duties and thus the appellant’s submission had no merit “from a policy point of view, as well as from an interpretation point of view.”[4]
[4] T12.23–25.
The Member turned to the remaining issues. He pointed to the definition of “pre-injury average weekly earnings”, as referred to in Sch 3 to the 1987 Act, noting that the clause refers to “earnings received” for “work in any employment in which the worker was engaged.” He observed that, although the respondent was employed by the appellant when he was receiving weekly compensation for the prior injury, the respondent was not engaged in “work.” He considered the word “work” meant that the respondent received earnings in reward for effort. The Member said that payments of compensation might not have any relevance to the respondent’s normal earnings, were not reward for effort, and thus should not be included in the calculation of the pre-injury average weekly earnings.
The Member proceeded to determine that the respondent’s pre-injury average weekly earnings figure was $2,581.85, the relevant rate pursuant to s 36 of the 1987 Act was 95% of that figure. However because 95% of the figure exceeded the adjusted maximum statutory cap provided for in s 34 of the 1987 Act, the payment of weekly compensation was capped at $2,254.60.
The Member issued a Certificate of Determination on 13 May 2022, which records:
“The determination of the Commission in this matter is as follows:
1. Award in favour of the [respondent] in respect of weekly payments of compensation for the period 31 August 2021 to 28 September 2021 inclusive (the period).
2. The [respondent’s] pre-injury average weekly earnings are determined to be $2581.85 per week and 95% of that amount is above the relevant payment under section 36 of the 1987 Act.
3. The weekly payments payable by the [appellant] during the period are in the sum of $2254.60 per week indexed.
4. The [appellant] is to receive credit for payments made during the period.”
GROUNDS OF APPEAL
The appellant brings two grounds of appeal, asserting that the Member erred in law as follows:
(a) Ground A: the Member erred by excluding from the calculation of the respondent’s pre-injury average weekly earnings a period during which the respondent received compensation benefits for an unrelated condition and when doing so failed to address the issue raised by the appellant or failed to give reasons for reaching that conclusion, and
(b) Ground B: The Member erred by finding in the alternative that the respondent was entitled to compensation at the rate that he claimed based on pre-injury average weekly earnings entitling him to compensation at the maximum adjusted rate because of his acceptance of the submissions prepared by Mr Wright KC.
LEGISLATION
Clause 2 of Sch 3 to the 1987 Act provides:
“Meaning of ‘pre-injury average weekly earnings’
(1) Pre-injury average weekly earnings, in relation to an injured worker, means the weekly average of the gross pre-injury earnings received by the worker for work in any employment in which the worker was engaged at the time of the injury.
Note—
See also clauses 3–5 relating to modifications of pre-injury average weekly earnings by agreement and in relation to apprentices, trainees and persons aged under 21 years.
(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).
(3) The regulations may provide for the adjustment of the relevant earning period for a worker in employment (including, for example, by extending or reducing the period)—
(a)to take into account any period of unpaid leave or other change in earnings circumstances in the employment, or
(b)to align the relevant earning period with any regular interval at which the worker is entitled to receive payment of earnings for work performed in the employment.
(4) … .”
Clause 6 of Sch 3 to the 1987 Act relevantly provides:
“Meaning of ‘earnings’
(1) The earnings received by a worker in respect of a week means the amount that is the income of the worker received by the worker for work performed in any employment during the week.
(2) The income of a worker does not include—
(a)any minimum amount paid to a superannuation fund or scheme in respect of the week to avoid an individual superannuation guarantee shortfall, within the meaning of the Superannuation Guarantee (Administration) Act 1992 of the Commonwealth, for the worker, or
(b)the monetary value of any non-monetary benefit provided to the worker for the performance of work by the worker, or
(c)any payment in respect of loss of earnings under a scheme to which the workers compensation legislation relates or under any other insurance or compensation scheme, or
(d)any payment made without obligation by the employer.
(3) However, the monetary value of a non-monetary benefit of a worker is to be included as part of the income of the worker for the purposes of the calculation of the weekly payments of compensation payable to the worker if the worker is not entitled to the use of the benefit.
(4) The Workers Compensation Guidelines may make provision for or with respect to the matters to be taken into account for the purposes of determining whether a benefit has been provided to a worker or whether the worker is entitled to the use of a benefit.”
Regulation 8AA of the 2016 Regulation defines “the relevant earning period” as having “the same meaning as in clause 2(2) of Schedule 3 to the 1987 Act”. Division 2 of Pt 4 of the 2016 Regulation (reg 8A to reg 8EA) provides for an adjustment of the “relevant earning period” under cl 2(2) of Sch 3 for the purpose of calculation of the worker’s pre-injury average weekly earnings in the following circumstances:
(a) adjustment for workers not continuously employed (reg 8B);
(b) adjustment for financially material change to earnings (reg 8C);
(c) alignment of relevant earning period with pay period (reg 8D);
(d) adjustment for unpaid leave (reg 8E), and
(e) adjustment for prescribed periods relating to COVID-19 (reg 8EA).
Relevantly, reg 8C provides:
“Adjustment for financially material change to earnings–Schedule 3, clause 2(3)(a) of 1987 Act
(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.”
SUBMISSIONS
The appellant’s submissions as to Ground A
The appellant refers to the definition of pre-injury average weekly earnings as defined in cl 2(1) of Sch 3 to the 1987 Act and says that the respondent’s employment was that of a Correctional Officer and the relevant earning period was 29 [sic, 30] August 2020 to 30 [sic, 29] August 2021. The appellant says that, in accordance with cl 6(1) of Sch 3, the respondent’s earnings are the income he received for work performed by him, but, in accordance with cl (6)(2)(a) of Sch 3, does not include the weekly compensation payments received by the respondent for his unrelated injury between 29 August 2020 and 10 May 2021.
The appellant indicates that cl 2(3)(a) of Sch 3 allows for the Regulations to provide that the earning period can be extended or reduced “to take into account any period of unpaid leave or other change in the earning circumstances in the employment.” The appellant points to reg 8C of the 2016 Regulation which permits the adjustment if, during the 52 week period, there was a change to the employment arrangements “of an ongoing nature” and “resulting in a financially material change” to the respondent’s earnings.
The appellant submits that the respondent’s pre-injury average weekly earnings figure was calculated by the appellant to be $1,114.49 without the period during which the respondent received prior weekly payments being discarded, whereas the respondent’s case excluded the period for which the respondent received weekly compensation for his unrelated injury.
The appellant says that it submitted to the Member that Sidhu was wrongly decided and should not be followed and maintains that position in this appeal. The appellant refers to the Member’s consideration of the legislation being “beneficial” and thus unlikely that it would seek to penalise a worker because of a prior injury, and refers to the Member’s reliance on “policy”.
The appellant asserts that there was no evidence in this matter that the respondent had experienced an ongoing change in the nature of his employment arrangements resulting in a material financial change. The appellant observes that the respondent had simply returned to his role as a Correctional Officer and there was no change in the nature of his contracted role or the nature of his employment.
The appellant contends that the Member did not address that submission made by it and failed to provide proper reasons for rejecting the submission.
The appellant points to the example in reg 8C of there being a change from full time work to part time work and submits that such a change would be a change of an ongoing nature in respect of a worker’s employment arrangements and would result in a material financial change. The appellant submits that, in those circumstances, a worker would otherwise be able to enjoy an unfair advantage. The appellant concedes that if a worker changed from part time work to full time work, the opposite would be true.
The appellant asserts that, even on a wide reading of the Regulation, the respondent’s factual circumstances could not fit with the type of change suggested by the example provided in the legislation.
The appellant contends that the Member erred in his interpretation of reg 8C, and in his observation that it was important to examine future prospects but that it was impossible to forecast what “could be a change of an ongoing nature.” The appellant submits that the calculation of the pre-injury average weekly earnings involves almost exclusively a consideration of the worker’s past, and, in the application of reg 8C, an assessment of whether there had been a change in the worker’s employment arrangement that occurred in the 52 weeks prior to the injury. The appellant submits that an interpretation of reg 8C that requires forecasts or predictions amounts to an error of law.
The appellant asserts that the Member’s failure to address, or give reasons as to how the circumstances of this case are consistent with the example provided for in reg 8C, constitutes an error of law. The appellant refers to Sidhu, in which Member Beilby found that a change in the ongoing nature in the employment arrangements had occurred because the worker had returned to normal duties. The appellant asserts that such a circumstance is not the type of change suggested by reg 8C, in particular because the “earnings” of a worker specifically exclude compensation payments in respect of loss of earnings. The appellant contends that the receipt of workers compensation payments does not constitute “a change of an ongoing nature to the employment arrangement”, as contemplated by reg 8C. The appellant says that in Sidhu and in this case, the worker’s job description did not change and there was no evidence that the worker (the respondent in this case) suffered any financially material change in earnings. The appellant contends that to find otherwise constitutes an error of law. The appellant adds that if the legislature had intended that reg 8C should apply to matters where the worker had been in receipt of workers compensation payments, it would have referred to such as an example to the regulation or elsewhere in the legislation, but it did not.
The appellant’s submissions as to Ground B
The appellant refers to the Member’s acknowledgment that the respondent relied upon the written submissions provided by Mr Wright KC and the Member’s consideration that on the basis of those submissions, it was appropriate to award compensation at the rate relied upon by the respondent, which excluded the period the respondent received weekly compensation for a prior injury. The appellant also refers to the Member’s observation that some of the submissions as to the statutory provisions were consistent with his own view.
The appellant points to Mr Wright’s submission that the payments of compensation cannot be part of the respondent’s pre-injury average weekly earnings. The appellant says that such payments are expressly precluded by cl 6(2) of Sch 3 to the 1987 Act. The appellant indicates that Mr Wright KC does not address why the period, rather than the payments, should be excluded. The appellant asserts that the Member’s reasoning process in accepting the respondent’s written submissions as to the rate that should apply was not clear. The appellant adds that “it is not possible to draw a connection between amounts considered earnings as prescribed by [cl 6(2) of Sch 3 to the 1987 Act] and the relevant earning period as prescribed by [cl 2(2) of Sch 3 to the 1987 Act], as adjusted.”[5] The appellant describes the calculation of the pre-injury average weekly earnings as a methodical process, firstly requiring a determination of the relevant period and then only when that has been done, the earnings during that period are to be calculated so as to arrive at the appropriate figure. The appellant says that the two steps are not inherently linked. The appellant asserts that the Member erred in law by failing to provide a reasoning process for his conclusion reached.
[5] Appellant’s submissions, [37].
The respondent’s amended submissions
Unhelpfully, the respondent’s submissions did not comply with Procedural Direction PIC7 – Appeals, reviews, reconsiderations and correction of obvious errors in medical disputes, which relevantly requires that:
“16. All submissions provided with an application must:
(a) clearly and succinctly address each ground of appeal;
(b) be divided into numbered paragraphs with appropriate subheadings, which separately address each ground of appeal;
…”.
The respondent was directed to file amended submissions. Unfortunately, the submissions remained non-compliant. Such a practice is unsatisfactory and must be avoided. In some circumstances, it may result in the document being rejected for failure to comply with the Direction. It is not up to the Presidential Member to sift through the submissions and attempt to identify which submissions relate to each ground of appeal.
In any event, the respondent submits that the Member did not err as alleged. The respondent contends that Member correctly applied the relevant statutory provisions, addressed the appellant’s submissions and gave reasons for his decision. The respondent describes the appellant’s submissions as illogical, confused, and incorrect.
The respondent submits that the relevant legislation should be interpreted by giving the actual words of the provisions their ordinary and natural meaning. The respondent says that the only difficulty posed in that exercise is identifying which provision applies and, because of the way in which the parts of the statute are drafted, the task “requires some minor amount of excavation of those provisions.”[6]
[6] Respondent’s submissions, [6].
The respondent refers to s 36 of the 1987 Act, which provides that where the injured worker had no incapacity for work during the first 13 weeks of the entitlement period, the worker is entitled to 95% of the worker’s pre-injury average weekly earnings, or, if the worker has some capacity for work, the worker is entitled to that amount, less the worker’s current weekly earnings. The respondent says that the task is to determine the worker’s pre-injury average weekly earnings, which is defined in cl 2(1) of Sch 3 to the 1987 Act as “the weekly average of the gross pre-injury earnings received by the worker for work in any employment in which the worker was engaged at the time of the injury.”
The respondent also cites cl 2(2) of Sch 3, which prescribes that, in calculating the pre-injury average weekly earnings, “no regard is to be had to earnings in employment … for work performed before or after the period of 52 weeks ending immediately before the date of injury.” The respondent submits that the essential words of cl 2 are that the pre-injury average weekly earnings are “the earnings received ... for work in any employment in which the worker was engaged ... at the relevant time.”[7] The respondent contends that such earnings clearly do not include payments of workers compensation because during the period during which the respondent was paid weekly compensation, he was not performing work in any employment. The respondent submits that it is evident from the actual words of the statutory provisions that weekly payments cannot be relevant and cannot be included in the calculation of the pre-injury average weekly earnings.
[7] Respondent’s submissions, [12].
The respondent points to the Member’s reliance and adoption of the reasoning and conclusion in the decision of Member Beilby in Sidhu, and repeats his submission that, on the same basis, the weekly payments in this case should not be included in the calculation of the respondent’s pre-injury average weekly earnings.
Curiously, other than a broad general denial that the Member erred, the respondent does not provide any submissions in response to the appellant’s submissions relating to the application of reg 8C of the 2016 Regulations. That is, whether the provision provided a proper basis upon which the Member could conclude that the 52 week period should be adjusted to exclude the period during which the respondent received weekly payments of compensation.
CONSIDERATION
The decision in Sidhu
Given that the Member adopted the reasoning and conclusion in Sidhu, it is appropriate to review Member Beilby’s approach in that case. The brief facts were that the applicant sustained an injury on 3 September 2020. Liability for that injury was accepted and the applicant was paid weekly compensation at 95% of his pre-injury average weekly earnings for a period of nine weeks. He then returned to work and suffered a further injury on 12 December 2020, which rendered him unfit for work for eleven weeks, following which he returned to work on reduced hours performing suitable duties. The respondent accepted liability but calculated the applicant’s pre-injury average weekly earnings on the basis of the applicant’s earnings for the whole 52 weeks prior to 12 December 2020. The respondent did not include in the earnings figure the payments of weekly compensation received following the first injury.
Member Beilby summarised the submissions of the parties, noting that the applicant submitted that:
(a) the 52 week period for calculating the applicant’s pre-injury average weekly earnings should be shortened by excluding the nine weeks during which the applicant was paid workers compensation benefits;
(b) any other method of calculation would lead to the absurd result that the 52 weeks would be based on 43 weeks of earnings;
(c) the legislation must work together so as to harmonise the intention and ensure a productive outcome;
(d) any ambiguity should be resolved in the applicant’s favour as the legislation is beneficial in nature, and
(e) regulation 8C of the 2016 Regulation permitted the period to be adjusted in the applicant’s case in that there was an ongoing change in the nature of the applicant’s employment resulting in a financial material change.
Member Beilby summarised the respondent’s submissions, which were that:
(a) the application of reg 8C may result in an unfair and unjust outcome;
(b) it is not a matter for the Commission or the scheme agent to determine what is fair;
(c) the written word of the statute provides the only basis upon which the compensation is to be paid;
(d) the word “ongoing” must have some import and there was no ongoing change to the nature of the employment arrangements;
(e) the change must be current and ongoing, and
(f) regulation 8C therefore does not apply to the applicant.
Member Beilby agreed with the applicant’s submission that a finding as to the meaning of the language that produces an unjust or capricious result should be avoided. Member Beilby reviewed reg 8A(3), which defined the “relevant earning period” as the adjusted earning period, and discussed reg 8C. She noted there was some tension in reg 8C in that there must be a change of an ongoing nature to the employment relationship resulting in a financial material change to the earnings of the worker.
Member Beilby reasoned and concluded as follows:
“After considering the submissions I find that 8C does provide some assistance with the applicant. I find that there has been a change of an ongoing nature to the employment arrangement resulting [in] a financial material change the earnings of the worker. That is there has been a material change as the worker has changed from receiving workers compensation payments to ordinary earnings. The ongoing nature of this change is that after the first nine weeks the method of payment has changed and has continued so that the worker is no longer paid workers compensation payments (at 95% of his salary) but is paid normal ordinary earnings by his employer.
The words financial material change, to my mind mean that there can be a change in the amount the worker is paid, and/or additionally there can be a change in the method and type of payment. In the circumstances of this case, bearing in mind the beneficial intent of the legislation, the worker has shown that there is a change in ongoing nature to the employment arrangement. That is that the worker is receiving payment from his employer as opposed to the workers compensation insurer. The financial material change to the earnings of the worker is that he is now receiving his salary from his employer, whereas he was not receiving his salary from his employer for those first nine weeks of the 52-week calculation. In addition to those nine weeks payment the applicant would have only received 95% of his salary and not 100%.
The effect of this finding is that the relevant earning period should be adjusted by excluding those first nine weeks before the change occurred in the PIAWE calculation.”[8]
[8] Sidhu, [21]–[23].
No appeal was lodged from the decision of Member Beilby.
This appeal
Ground A: The Member erred by excluding from the calculation of the respondent’s pre-injury average weekly earnings a period during which the respondent received compensation benefits for an unrelated condition and when doing so failed to address the issue raised by the appellant and failed to give reasons for reaching that conclusion
The appellant does not dispute that, in accordance with cl 6(2)(a) of Sch 3, the calculation of an injured worker’s pre-injury average weekly earnings does not include any weekly compensation payments paid to the worker during the 52 week period. The appellant disputes that the respondent experienced an ongoing change in the nature of his employment because there was no change in his contractual role or the nature of his employment.
I reject that submission. There is nothing in reg 8C that requires the change to be in the nature of a change in the contract of employment. The words of the regulation should be read as they are expressed. That is, there must be “a change of an ongoing nature to the employment arrangement.” The change in the “employment arrangement” was that the respondent was off work as a result of an incapacity, following which, by a return-to-work arrangement with the appellant, he returned to his pre-injury role. That change in the employment arrangement was clearly ongoing in that the respondent continued to work for the appellant.
The appellant asserts that the Member did not address, or provide reasons for rejecting, its submission that the respondent had not experienced an ongoing change in the nature of his employment arrangements. The Member correctly identified the issue raised by the appellant and summarised in some detail the appellant’s submissions. He noted the respondent’s written submissions and further noted that both parties referred to the decision of Member Beilby in Sidhu, which he summarised. The Member noted that the appellant asserted Sidhu was wrong.[9] The Member proceeded to consider the application of reg 8C to the circumstances of the respondent’s case. He considered that:
“In those circumstances, in my view, and in accordance with, I think, the decision of Member Beilby, that period should be carved out of the equation for [pre-injury average weekly earnings] and it is those weeks prior to the event of incapacity, which include the 52 weeks but exclude the period and payments within the workers compensation period, that should be considered.”[10]
[9] T4.23–29; T10.14–11.26.
[10] T12.5–16.
The Member then went on to express other reasons as to why the reg 8C applied, including the beneficial nature of the legislation, policy reasons and “an interpretation point of view,” before concluding that the appellant’s argument was without merit. The appellant cannot say that the Member failed to address its submissions, or that the Member failed to give reasons for his conclusion.
The appellant asserts that the respondent’s circumstances were not the type of change suggested by reg 8C. The appellant says that this is because the “earnings” of a worker specifically exclude workers compensation payments, and the receipt of workers compensation payments does not constitute “a change of an ongoing nature to the employment arrangement”. That submission is somewhat obtuse. In any event, the Member did not find that workers compensation payments were included in earnings or that the receipt of workers compensation payments constituted a change of an ongoing nature in the employment arrangement. The Member determined that the change in the ongoing nature of the employment arrangement was the cessation of weekly payments (which weekly amount is as a matter of course less than a worker’s full weekly earnings) and the return to remunerative employment. He expressed a view that his finding was “in accordance with” the determination in Sidhu. There was no error in that approach.
Finally, the appellant submits that, if the legislature intended reg 8C or generally that the circumstances where a worker had been in receipt of workers compensation should apply, it would have said so. Regulation 8C provides one example of when the regulation applies, which is that the worker moves from full time work to part time work. The example is clearly not intended to be exhaustive of all applications of the regulation and the appellant concedes that the converse position would apply, that is where a worker moves from part time work to full time work. I see no difference in the situation where a part time worker moves into full time employment and the circumstances where a worker is in receipt of weekly payments of compensation and then returns to full pre-injury duties. The submission is rejected.
The appellant has failed to establish error on the part of the Member and this ground of appeal is unsuccessful.
Ground B: The Member erred by finding in the alternative that the respondent was entitled to compensation at the rate that he claimed based on pre-injury average weekly earnings entitling him to compensation at the maximum adjusted rate because of his acceptance of the submissions prepared by Mr Wright KC
The Member’s references to the respondent’s written submissions prepared by Mr Wright KC were as follows:
(a) “The [respondent], on the other hand, has provided a three page submission signed by a Mr Wright, but adopted by Mr Brennan and Mr Halligan, which confronts the issue in a slightly different fashion.”[11]
(b) “The next issue for consideration is the submission in relation to a document prepared by Mr Wright dated 9 May 2022, relied upon by the [respondent]. That document was expressed in terms of an advice, and I must say at the outset that I’m not prepared to regard the document in that respect. However, some consideration of the relevant statutory provisions adopted by Mr Wright do accord with my own view about the matter, in particular, the consideration of the meaning of pre-injury average weekly earnings, which is referred to in Schedule 3.”[12]
[11] T4.29–34.
[12] T14.15–25.
The Member then proceeded to consider the meaning of the term “pre-injury average weekly earnings” by reference to Sch 3 and the wording of cl 2 of Sch 3. He considered the term in the context of the respondent’s position, that is that when the respondent had been in receipt of weekly payments he was not engaged in “work,” which in his view meant that the respondent had to be engaged in “earnings for effort”.[13] He said, in his view, those earnings did not include compensation for an injury.
[13] T15.2–8.
The Member concluded that, on that basis, the respondent’s pre-injury average weekly earnings figure was the higher rate asserted by the respondent. Given that the appellant conceded that the weekly payments of compensation were not to be included in the earnings, and the Member’s acceptance of the respondent’s submissions was limited to that aspect of the decision-making process, it cannot be said that the Member fell into error in his approach.
On that basis, Ground B of the appeal also fails.
CONCLUSION
The appellant has failed to establish error on the part of the Member and the appeal fails. It should be noted that, in this case, the respondent was in receipt of weekly compensation for his prior injury at the commencement of the 52 week period.
Regulation 8C(2) provides that “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.” How the period should be adjusted in circumstances where the injured worker’s receipt of workers compensation, or other change to earnings, is to be assessed where the period within the 52 weeks falls between two periods of full employment is not relevant to this appeal.
DECISION
The Member’s Certificate of Determination dated 13 May 2022 is confirmed.
Elizabeth Wood
Deputy President
19 April 2023
Key Legal Topics
Areas of Law
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Administrative Law
Legal Concepts
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Judicial Review
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Statutory Interpretation
7
1
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