Sun Alliance Insurance Ltd & Cuthbertson Brothers Pty Ltd v Nigel Lionel Scott
[1992] TASSC 78
•13 May 1992
Serial No 25/1992
List “A”
CITATION: Sun Alliance Insurance Ltd & Cuthbertson Brothers Pty Ltd v Nigel Lionel Scott [1992] TASSC 78; A25/1992
PARTIES: SUN ALLIANCE INSURANCE LTD
CUTHBERTSON BROTHERS PTY LTD
v
SCOTT, NIGEL LIONEL
TITLE OF COURT: SUPREME COURT OF TASMANIA (Full Court)
FILE NO/S: FCA 115/1991
DELIVERED ON: 13 May 1992
JUDGMENT OF: Cox, Underwood and Wright JJ
Judgment Number: A25/1992
Number of paragraphs: 57
Serial No. 25/1992
List “A”
File No. FCA 115/1991
SUN ALLIANCE INSURANCE LTD. and CUTHBERTSON BROTHERS PTY. LTD. v. NIGEL LIONEL SCOTT
REASONS FOR JUDGMENT FULL COURT
COX J.
UNDERWOOD J.
WRIGHT J.
13 May 1992
Order of the Court
1. Apeal allowed.
2. Liberty to speak to minutes of judgment.
Serial No. 25/1992
List “A”
File No FCA 115/1991
SUN ALLIANCE INSURANCE LTD. and CUTHBERTSON
BROTHERS PTY. LTD. v. NIGEL LIONEL SCOTT
REASONS FOR JUDGMENT FULL COURT
COX J.
13 May 1992
For the reasons given by Wright J. I agree that the appeal should be allowed. The amount of weekly compensation payable to the respondent should be reduced to a rate equivalent to 16 hours per week at the ordinary time rate per hour specified in the relevant award, plus 20%. I anticipate that the parties can agree the precise terms of the order.
Serial No. 25/1992
List “A”
File No. FCA 115/1991
SUN ALLIANCE INSURANCE LIMITED and CUTHBERTSON BROTHERS PTY. LTD. v. NIGEL JOHN SCOTT
REASONS FOR JUDGMENT FULL COURT:
UNDERWOOD J
13 May 1992
The issue on this appeal is the meaning of the words “the ordinary time rate of pay of the worker (as expressed by reference to a week) for the work in which he was engaged immediately before the period of incapacity” as enacted in the Workers Compensation Act 1988, s.69(1)(a)(ii).
This issue arises out of the following circumstances. The first appellant, Cuthbertson Bros. Pty. Ltd. is a respondent to the Tanning Industry Award originally made pursuant to the Conciliation and Arbitration Act 1904 (Cth) and lately, pursuant to the Industrial Relations Act 1988 (Cth). In September 1989, Cuthbertson Bros. advertised for two casual labourers and on 6 September 1989 the respondent was employed as one of them. He was employed as a labourer to work eight hours on each Wednesday and eight hours on each Friday. On his second day at work he suffered an injury compensable in accordance with the provisions of the Workers Compensation Act 1988, and at all material times thereafter was totally incapacitated for work.
The second appellant is Cuthbertson‘s licensed compensation insurer. The respondent was paid compensation. Following representations by the respondent’s solicitors, the amount of weekly compensation being paid was increased to a sum calculated with reference to the Award, on the basis that the respondent was entitled to be paid for a thirty–eight hour week. After making these payments for some time, the appellants applied to the workers’ compensation commissioner for a review, seeking a determination that the amount of weekly compensation payable be reduced to a sum calculated with reference to a sixteen hour week. The application came before the workers’ compensation commissioner who dismissed it on 17 May 1991. An appeal against this decision was dismissed by Zeeman J. and the present appeal is brought against that order of dismissal.
Some agreed facts were put before the commissioner:
“1. On or about the 6th day of September, 1989 Nigel Lionel Scott (“the worker”) was employed by Cuthbertson Bros. Pty. Ltd. (“the employer”) as a part–time labourer at the employer‘s tannery at South Hobart.
2. It was agreed that the worker would work sixteen hours per week for the employer.
3. On or about the 8th day of September, 1989 the worker alleges that he was injured in the course of his employment with the employer.
4. On or about the 8th day of September, 1989 the worker made a claim for workers compensation against the employer.
5. Sun Alliance Australia Limited (“the insurer”) is the employer’s workers compensation insurer.
6. The insurer has paid the worker workers compensation for the alleged injury at a rate calculated pursuant to the Tanning Industry Award 1987 (“the Award”) applicable to a full–time labourer since the 8th day of September 1988 to date.
7. At all material times other than when being paid workers’ compensation the worker was employed and paid pursuant to the terms of the Award.
DATED this Seventeenth day of May, 1991”
Those agreed facts (the first in abbreviated form) are set out in the reasons for judgment of Zeeman J. and followed by this observation:
“The agreed facts were expressed rather inelegantly. It was made clear before the learned commissioner and before me that some of them were not intended to be taken literally and that the first two paragraphs in fact ought to be construed as meaning the following:
1. On or about 6 September 1989, the second appellant engaged the respondent as a labourer.
2. At the time that the respondent was so engaged it was agreed between him and the second appellant that he be employed for eight hours on each of the Wednesday and Friday of each week.”
No complaint about that passage in the reasons for judgment is made by the notice of appeal and, in my view, it is plainly correct.
After referring to the section in the Workers Compensation Act which gave the commissioner jurisdiction to determine the application, his Honour said:
“I should say at once that the learned commissioner’s finding that the respondent was not specifically employed to work a sixteen hour week as a term of his contract of employment was not open to him, even if there was some suggestion in the evidence to that effect. The effect of the agreed facts was that the parties were agreed that the respondent’s contract of employment provided that he would work for eight hours on each of two days in each week. Regardless of what may have been suggested in evidence, the parties having put agreed facts before the learned commissioner, it was not open to him to find as a fact something which was at variance with those agreed facts. The ground of appeal which relies on this error is made out but I do not consider that anything turns on it.”
His Honour was no doubt referring to the following passage in the reasons given by the commissioner for his decision:
“Perhaps I should stress at the outset my conclusion that the worker was engaged as a casual worker according to the terms of the Award. I felt that, at times during the presentation of his argument, counsel for the insurer was slipping into the assumption that the worker was specifically employed to work a 16 hour week as a term of his contract of employment. That is not so according to the evidence as I heard it. The worker was employed as a casual labourer. The expectation of the employer at the time of engagement was that work for a 16 hour week would be available with the hope of increased hours in the future. Neither side abrogated any of their rights under the Award; for example, the right to terminate employment by one hour’s notice conferred by the Award upon both sides to the employment contract.”
10. There was no basis for the commissioner concluding that the respondent was not employed to work sixteen hours a week. The agreed facts, from which the commissioner was not entitled to depart, were that he was engaged to work sixteen hours each week and the unchallenged oral evidence was that eight of those hours were to be worked on Wednesday and the other eight to be worked on Friday of each week. I can see no connection between the last sentence of the passage set out above and those that precede it. The Award, tendered in evidence, provided (in part):
“13 Casual Workers
(a) A casual worker is a worker engaged and paid as such. A casual employee for working ordinary time shall be paid per hour, one thirty–eighth of the weekly rate prescribed by this Award for the work the employee performs plus 20% …
10 Wages
In addition to all other rates of pay all employees shall be paid an industry loading of $14.80 per week
Group Rate of pay per week
Group 1 $227.90
...”
11. The Award also made provision for a supplementary payment of $33.40 to all employees in Group 1, and defined Group 1 to include labourers. In those circumstances then, the question is, what is the respondent’s “ordinary time rate of pay (as expressed by reference to a week)” for the work in which he was engaged immediately prior to suffering injury on 8 September 1989?
12. There is nothing novel about the provisions of the Workers Compensation Act 1988, ss.69 and 70. Apart from some minor changes, they are a re–enactment of the Workers’ Compensation Act 1927, Sch.1, rr.3 and 4. It is surprising that the question for determination on the appeal has not arisen earlier. The substance of those rules was first enacted in 1972. Prior to that date, the Act made provision for the payment of a weekly payment calculated by reference to factors other than the actual earnings of the worker and contained a proviso that such weekly payments should not exceed the average weekly earnings of the worker. No doubt, the provenance of these early provisions is the Workers‘ Compensation Act 1925 (UK).
13. The issue on this appeal is one of statutory interpretation; the ascertainment of the will of Parliament, and a reference to the written expression of the will of another Parliament is of limited use unless that other expression is identical, or at least similar to, the provision under consideration. However, all worker’s compensation legislation has a common philosophy, namely, financial compensation for the deprivation of the utilization of the capacity to earn income by reason of injury or disease arising out of and/or in the course of employment. In Tasmania, prior to the 1972 amendments, the extent of that compensation was limited. Upon suffering a compensable injury, the weekly payment to which most workers were entitled was less than their pre–accident average weekly earnings. Virtually all injured workers suffered a diminution in income when compelled, by reason of injury or disease, to rely upon weekly payments under the Workers Compensation Act in lieu of wages. Those then required to bear the greatest loss included workers ordinarily paid more than the basic wage (as defined by the Act) by reason of the terms of their employment or by reason of entitlement to penalty rates. The clear intention of Parliament in 1972 when it enacted the provisions, which, in substance, appear today in ss.69 and 70, was to ensure that, generally speaking, a worker who suffers a compensable injury will not in consequence, suffer a diminution in weekly earnings. The primary weekly entitlement during total incapacity is the receipt of “average weekly earnings ... over the period of 12 months ending at the commencement of the period of incapacity.” As long ago as 1909 Lord Lorebourn expressed the philosophy of workers’ compensation legislation in Anslow v. Cannock Chase Colliery Co. Ltd. [1909] A.C. 435 at p.437:
“The object of the Act broadly stated is to compensate a workman for his loss of capacity to earn, which is to be measured by what he can earn in the employment in which he is, under the conditions prevailing therein, before and up to the time of the accident. If he takes a holiday and forfeits his wages for a month, then that does not interfere with what he can earn. It is only that for a month he did not choose to earn. So, too, if there be a casualty accidentally stopping the work. But if it is part of the employment to stop for a month in each year, then he cannot earn wages in that time in that employment, and his capacity to earn is less, over the year.”
14. His Lordship omitted to make it clear that the then legislative scheme imposed liability to pay no more than a percentage of the average weekly earnings to which he was referring, for only three days if the period of incapacity was less than four weeks, and in any event, the weekly sum was subject to a maximum specified amount.
15. Presently in Australia, there are at least nine legislative enactments which provide for the payment of compensation in the event of the occurrence of a work related injury or disease which either totally or partially incapacitates the worker from working. There is no uniformity of expression and the terms of some are such as to defy comprehension by the average reader. However, the concept common to all is that ordinarily, upon suffering a compensable injury, the worker will suffer no diminution in the weekly amount he was ordinarily earning in his employment. Some of the legislative provisions make it clear that the worker shall receive no more than ordinarily earned in his employment. See for example, the Workers Compensation and Rehabilitation Act (WA) 1981 Sch.1, r.12; an express provision with respect to part time workers to the effect that the weekly payment shall be proportionately reduced “to the extent that the hours worked by him in each week are less than the number of hours that are stated in [the Award] as ordinary hours which constitute a week’s work.”
16. The common legislative intent is perhaps well expressed in the Workers Rehabilitation and Compensation Act (SA) 1986 s.4(1) which provides:
“Subject to this section, the average weekly earnings of a disabled worker are the average amount that the worker could reasonably be expected to have earned for a week‘s work if the worker had not been disabled.”
17. With respect to part time workers, the South Australian legislation contains the following interesting provision:
“4)5) [Full–time wage allowance] The average weekly earnings of a disabled worker who –
(a) was not a full–time worker immediately prior to the relevant date;
(b) immediately prior to the relevant date had been seeking full–time employment;
and
(c) had been predominantly during the preceding 18 months a full–time worker, shall be determined as if the worker had been a full–time worker.”
18. Whilst legislation in other places is of very limited used in ascertaining the intention of the Tasmanian Parliament by the enactment of ss.69 and 70, I consider it legitimate to approach that task upon the basis that, in the absence of words indicating a contrary intention the philosophical basis for the work of this Parliament was the same as that in every other Australian jurisdiction, as evidenced by the terms of the legislation.
19. In the majority of cases these days almost all the terms of a contract of employment are governed by the provisions of an Award. An Award usually fixes rates of pay for work done during specified periods for each day of the week. The rate of pay, i.e., a number of dollars multiplied by a unit of time, depends upon the period of time within which the work is done. In most cases, what is “ordinary time” is specified by the Award itself and the rate of pay for work done during that time is invariably less than the rate of pay for work done outside that time. See Catlow v. Accident Compensation Commission (1989) 87 A.L.R. 663 at p.676. It may be that, in cases not governed by an Award, what is ordinary time will depend upon terms expressly or impliedly agreed between the worker and his employer. In Robertson v. Accident Compensation Commission [1991] 2 V.R. 333 the following appears at p.337 in the joint judgment of Crockett and Southwell JJ.:
“If the primary submission should fail it was argued that the appellant’s ‘ordinary time rate of pay’ should be construed as the pay received as a ‘continuous shift worker’ calculated, as it was, on the basis of a notional 46.1 hours having been worked for an actual 35 hours week which the appellant and respondent had by the terms of the award contracted should be served.
We turn then to deal with the first submission i.e. that the determination of the appellant’s ‘pre–injury average weekly earnings’ is to be governed by the terms of s.95(3)(b). The expression ‘ordinary time rate of pay’ is not defined in the Act. Nor is there an express definition to be found in the terms of the Award. However it is clear, in our view, that a number of provisions of the Award when taken together do disclose that an ‘ordinary time rate of pay’ was fixed for each employee’s ‘ordinary’ number of hours per week.”
20. The Award tendered in evidence defines ordinary hours of work by reference to times in a day and days in a week. The respondent worked ordinary hours. The Award provides that the rate of pay for a casual worker shall be one thirty–eighth of the weekly rate prescribed by this Award for the work performed, plus 20%, per hour. Thus, the respondent was in receipt of the ordinary time rate of pay immediately prior to sustaining the compensable injury. Under the heading “Contract of Employment” cl.9(a) of the Award provides:
“Except as to casual workers and subject to the undermentioned provisos, employment shall be by the week.”
Clause 13(a) provides that “the employment of a casual worker may be terminated by the giving of one hour‘s notice by either side.”
21. It is necessary to construe the words, “as expressed by reference to a week”. Having regard to the introduction of the subjective factor in the assessment of weekly payments in 1972, and the apparent legislative intent that a worker should not, ordinarily, suffer a diminution in weekly earning upon sustaining a work related injury, it is likely Parliament intended to attribute a subjective meaning to the words “a week” in s.69(1)(a)(ii) so that, in effect, a week means the incapacitated worker’s week. In this statutory context, a week means the period of time, within a cycle of seven days, that the worker worked pursuant to the contract of service or training with the employer immediately prior to the commencement of the period of incapacity. In the majority of cases this can be ascertained by reference to an Award which prescribes the minimum number of hours to be worked during a cycle of seven days.
22. In White v. F.A.I. General Insurance Co. Ltd. & Anor. No.29/1991, Zeeman J. said (at p.13):
“I conclude that the meaning to be expressed to the expression [sic] ‘the ordinary time rate of pay of the worker (as expressed by reference to a week)’ is to be determined by reference to a week constituting the basic hours fixed by the terms of the employment to the extent that they are not to be remunerated at penalty rates.”
23. With respect, I find myself in agreement with his Honour about that proposition but not with the result he reached when it was applied to the facts in this case. The parties to the contract of service made no express term governing either ordinary time or the rate of pay. Both these matters were fixed by the Award. Clause 13(a) prescribed the rate of pay and, read in conjunction with the clauses defining ordinary time, spelled out the ordinary time rate of pay. However, in the present case, the Award did not prescribe the minimum number of hours to be worked during a cycle of seven days. Clause 19 which specified that ordinary hours of work shall be an average of thirty eight, to be worked on one of the bases set out in that clause, had no application to the respondent as he was a casual worker. The respondent‘s week, within the meaning of s.69(1)(a)(ii) was fixed by an express term of the contract of service namely, sixteen hours, to be worked eight hours on each Wednesday and eight hours on each Friday.
24. In Fenton v. Webster Hall Timbers [1981] Tas.R. 1 Everett J. considered the meaning of the expression, “ordinary time rate of pay of the worker (as expressed by reference to a week)”, in the case of a piece worker engaged to fell timber. The plaintiff had only been employed for nineteen days when he suffered a compensable accident. He was paid according to the quantity and type of timber felled. For the work he had done during those nineteen days he was entitled to be paid $3,000. Everett J. held that in the circumstances, the ordinary time rate of pay was arrived at by dividing the entitlement by the number of days worked to acquire it and multiplying the result by five. He said at p.12:
“Counsel for the plaintiff correctly argued in my opinion that the ‘ordinary time rate of pay of the worker (as expressed by reference to a week)’ should be calculated by dividing the plaintiff’s total entitlement of $3,000 (an approximate but agreed figure) by nineteen (the number of days worked prior to the occurrence of the accident) and multiplying the daily rate by five in order to calculate a weekly rate.”
25. “Ordinary time rate of pay of the worker (as expressed by reference to a week)” embraces two separate concepts both of which are ascertained by reference to the individual worker. The first is a rate of pay, viz. a number of dollars multiplied by a unit of time, and the second is the time, within a seven day cycle, immediately prior to the commencement of the period of incapacity, that the worker worked or had contracted to work. This construction of the expression, “ordinary time rate of pay of the worker (as expressed by reference to a week)” puts the Tasmanian legislation on the same basis as legislation elsewhere in Australia namely, that on sustaining a compensable injury, s.69(1)(a)(i) and (ii) will entitle an injured worker to receive by way of compensation, the amount he might reasonably have expected to receive for work done had the injury not intervened.
26. I would allow the appeal, but would need to hear the parties further with respect to any consequential order.
Serial No 25/1992
List ”A“
File No FCA115/1991
SUN ALLIANCE INSURANCE LIMITED and CUTHBERTSON BROTHERS PTY. LTD. v. NIGEL LIONEL SCOTT
REASONS FOR JUDGMENT FULL COURT:
WRIGHT J.
13 May 1992
27. This appeal requires an interpretation of the Workers Compensation Act 1988, s.69(1)(a)(ii). The legislation itself gives little or no assistance to those seeking to apply this crucial provision of the Act.
28. Section 69(1)(a) provides for the assessment of weekly payments to be made to a totally incapacitated worker. Two alternative methods of calculating a rate are specified. The worker is entitled to payment at the higher rate. The two calculations involve a determination of the “average weekly earnings” of the worker on the one hand and “the ordinary time rate of pay of the worker (as expressed by reference to a week) for the work in which he was engaged immediately before the period of incapacity” on the other.
29. It is the latter of these formulae which arises for consideration on this appeal.
30. The learned trial judge made the following observations as to the facts and issues which arose for his consideration.
“This is an appeal from a determination of the Workers Compensation Commissioner made in July 1991 whereby he dismissed an application by the appellants that a weekly payment of workers’ compensation, being made to the respondent, be reduced pursuant to the provisions of s.88(2)(a) of the Workers Compensation Act 1988 (‘the Act’) or, alternatively, under s.69(8) of the Act. It was common ground before the learned commissioner that at all relevant times, the respondent was a worker within the meaning of the Act employed by the second appellant and that the first appellant was the licensed insurer of the second appellant.”
31. Upon the hearing of the application the learned commissioner was told that the parties agreed on a number of facts. Those agreed facts were expressed as follows:
1. On or about 6 September 1989 the respondent was employed by the second appellant.
2. It was agreed that the respondent would work 16 hours per week for the second appellant.
3. On or about 8 September 1989 the worker alleges that he was injured in the course of his employment with the second appellant.
4. On or about 8 September 1989 the respondent made a claim for workers’ compensation against the second appellant.
5. The first appellant is the second appellant‘s workers’ compensation insurer.
6. The first appellant has paid the worker compensation for the alleged injury at a rate calculated pursuant to the Tanning Industry Award 1987 (‘the Award’) applicable to a full time labourer since 8 September 1989 to date.
7. At all material times, other than when being paid workers’ compensation, the respondent was employed and paid pursuant to the terms of the Award.
32. The agreed facts were expressed rather inelegantly. It was made clear before the learned commissioner and before me that some of them were not intended to be taken literally and that the first two paragraphs in fact ought to be construed as meaning the following:
1. On or about 6 September 1989, the second appellant engaged the respondent as a labourer.
2. At the time that the respondent was so engaged it was agreed between him and the second appellant that he be employed for eight hours on each of the Wednesday and Friday of each week.
33. The way in which the case was conducted before the learned commissioner was that it was common ground that the appellants had been paying to the respondent weekly compensation at a rate equivalent to the wage which would have been payable to the respondent had he been a labourer in the full time employ of the second appellant but that the appellants asserted that the obligation was to pay the respondent at the rate equivalent to the wages payable to a labourer who worked for sixteen hours each week. I should say at once that the provisions of s.69(8) and (9) of the Act can have no application to this matter. Assuming that those provisions could be relevant in circumstances such as the present (as to which I express no view) the jurisdiction conferred by those subsections is incapable of being exercised unless there is evidence of the then current weekly earnings of workers of the same grade or classification as the respondent. There was no such evidence before the learned commissioner.
34. I will assume that a reference under s.88(1) is the proper mechanism to deal with the case of an employer who asserts that from the outset he has paid weekly compensation at a rate in excess of that to which a worker is entitled. The present review was sought for the purpose of reducing the payment to an amount which, on the appellants’ case, was the amount in which the payment should have been made from the outset. In the light of the conclusions which I have reached, I do not need to consider whether s.88(1) is available for this purpose.
35. I should say at once that the learned commissioner’s finding that the respondent was not specifically employed to work a sixteen hour week as a term of his contract of employment was not open to him, even if there was some suggestion in the evidence to that effect. The effect of the agreed facts was that the parties were agreed that the respondent’s contract of employment provided that he would work for eight hours on each of two days in each week. Regardless of what may have been suggested in evidence, the parties having put agreed facts before the learned commissioner, it was not open to him to find as a fact something which was at variance with those agreed facts.“
36. After discussing a number of authorities and considering the provisions of the Workers Compensation Act 1988, his Honour reached the following conclusions:
“The ordinary time rate of pay of the respondent (as expressed by reference to a week) for the work in which he was engaged is to be determined by an objective consideration of the provisions of the Award. It provides that the basic working week of a labourer consists of 38 hours and that that working week is to be remunerated at a particular rate. The parties are agreed that the weekly compensation being paid to the respondent is equal to that weekly award rate. That rate is the relevant rate for the purposes of s.69(1)(a)(ii). It matters not whether the respondent was required to or was accustomed to work ten hours or sixty hours in each week. His ordinary time rate of pay expressed by reference to a week remains the same. It is the basic weekly rate provided for by the Award. The rate is not determined by reference to the hours normally worked by the respondent but by reference to the rate payable for a week’s work whether or not what the respondent was required to do could be said to be a week’s work. In all cases where a worker is remunerated pursuant to the provisions of an award which provides for a basic working week to be remunerated at a particular rate, that rate will be the rate for the purposes of s.69(1)(a)(ii) of the Act. The relevant ordinary time rate of pay is one expressed by reference to a week in the objective sense and not by reference to the hours normally worked by the particular worker during the course of a week.”
37. The respondent’s employers and their insurers now appeal against his Honour’s dismissal of the appeal against the determination made by the learned workers‘ compensation commissioner whereby he ordered payment of compensation to the respondent to continue at a rate equivalent to 38 hours per week at the ordinary time rate specified in the relevant Award, plus 20%.
38. The respondent was a casual employee and as such, for working ordinary time, was entitled to be paid “per hour, one thirty eighth of the weekly rate prescribed by this Award for the work the employee performs plus twenty per cent.”
39. In view of certain submissions made during the course of the appeal to this Court, it is necessary to make some preliminary observations. Firstly it is plain that as “ordinary time” is in no way defined by the Act, it must derive its meaning from the relevant Award (if any), or an examination of the actual terms of engagement of any worker employed otherwise than in accordance with an Award. This proposition is not at variance with what Gibbs J. said in Kezich v. Leighton Contractors Pty. Ltd. (1974) 131 C.L.R. 362 at pp.364–365:
“The Act deals with the compensation payable to workers generally; it is not confined in its operation to any particular trade. Moreover, although most workers within the meaning of the Act are no doubt employed in accordance with the terms of an industrial award, that is not a condition of the employer’s liability to pay Compensation. It would not be legitimate to construe the schedule by placing upon the words ‘ordinary hours’ the meaning which they may happen to bear in an industrial award governing employment of a particular kind. The meaning of the Act cannot be determined by reference to the provisions of the Building Construction Employees and Builders‘ Labourers’ Award, 1973. Indeed, even if it could be established that many industrial awards use the phrase ‘ordinary hours’ and that wherever it appears in any award it has the same meaning, that would not justify referring to a multitude of unrelated documents by different authors as an aid to the construction of a statute. What has to be determined is the meaning that those words have in the Act and since the words ‘ordinary hours’ are common English words they should, in accordance with established principles of statutory construction, be understood in their natural meaning unless the context otherwise requires.
The word ‘ordinary’ means ‘regular, normal, customary, usual’. A man’s ‘ordinary hours’ of work are the hours during which it is usual for him to work. There is nothing in the expression ‘ordinary hours’ that connotes payment at any particular rate, and to understand the words as meaning ‘hours during which work is done for which overtime is not paid’ would be to place upon them a meaning which they simply do not bear. The expression ‘the ordinary hours he would have worked’ in my opinion means the same as ‘the hours he would ordinarily have worked’ and it is of course no reason to depart from the proper meaning of the words because the same meaning could have been achieved by a different form of words; in the collocations to which I have just referred the use of the adjective instead of an adverb does not change the sense of the expression.”
40. My first proposition however does not necessarily lead to the result arrived at by the learned judge hearing the appeal at first instance.
41. Secondly, it is the ordinary time rate of pay “of the worker”, that is the incapacitated man himself, which must be considered. Thirdly, and here lies the real difficulty, it is that rate of pay “as expressed by reference to a week” which is the essential feature of the formula which determines its meaning.
42. Unaided by authority I would have had little difficulty in concluding that the relevant formula applicable to the instant case should be 1/38th of the ordinary time rate specified in the Award plus 20% multiplied by 16, being the hours per week for which the respondent was engaged to work for the appellant. No perceived injustice would arise on this interpretation. The respondent would be entitled during his incapacity to the same payment as that to which he was entitled whilst working. Unless he was engaged in other part–time or casual work, he would not be entitled to payments of the kind specified in s.70(2)(c) of the Act in reliance upon the “average weekly earnings” formula, but no doubt he would still be entitled to some form of Social Security benefit to supplement his income and bring it up to the level of an unemployment or sickness benefit. It is a little difficult to see why his employer should be required to compensate him at the same level as he would be required to compensate a full time employee. According to the respondent’s argument, it matters not whether the worker is employed for 16 hours per week or only one hour. In any such case his compensation is payable at the same level as it would be payable to a full time worker on ordinary time and it would continue to be payable so long as that incapacity lasted or until each of them reached an amount equivalent to 284 units (s.69(6)).
43. This consideration of itself does not demonstrate that the respondent‘s contentions are erroneous but the provisions in question require close scrutiny before concluding that our legislators intended such a strange result and one which appears to be at odds with the philosophies which find expression in ss.69(4)(a), (7), (8), (9), (10), and (11).
44. It is clear, I think, that the formula provided by s.69(1)(a)(i) is a subjective one, in the sense that the person calculating the average weekly earnings is obliged to look at the actual earnings of the individual employee who has sustained injury. Other elements may be introduced into the equation where for example the employee has been employed for a time shorter than 12 months (s.70(2)(b)) but, in the main, the calculation depends on the actual earnings of the injured worker himself.
45. Why an alternative formula should be based upon (not simply modified by) the objective criterion of an amount specified in an Award or payable to other workers performing full time work of the same kind as the injured man is difficult to follow. The respondent, who argues for this view of the legislation, claims to be aided to some extent by the terms of s.69(3) which reads as follows:
“(3) If, during a period of incapacity of a worker, the ordinary time rate of pay (as expressed by reference to a week) for any work on which he was engaged immediately before the commencement of that period increases or decreases, the compensation payable to him shall correspondingly be increased or decreased by the like amount.”
46. In this subsection the phrase utilized is “the ordinary time rate of pay (as expressed by reference to a week) for any work on which he was engaged immediately before ...” whereas in s.69(1)(a)(ii) the phrase is “the ordinary time rate of pay of the worker (as expressed by reference to a week) for the work in which he was engaged immediately ...”
47. If the apparently minor differences between the two subsections are ignored, considerable weight is added to the respondent’s argument because it is plain from s.69(3) that the rate requiring consideration in that subsection is not one based upon the worker’s actual earnings but is rather a rate fixed by reference to other employees doing the same “work”. However, in my opinion, the differences are not so insignificant as they may at first appear. I think the draftsman has attempted to carry the same terminology from s.69(1)(a)(ii) into s.69(3) but has found the necessity to make the changes which I have emphasized when it has been realized that different criteria are being employed in each case. Indeed, if appropriate care had been taken with s.69(3), the phrase “work on which he was engaged” should obviously have been discarded. Whatever else is clear it is that the test being applied in s.69(3) is in respect of “work of the same kind as that on which he (the injured worker) had been engaged immediately before the commencement of his incapacity.”
48. With this consideration in mind I have no difficulty in rejecting the argument that s.69(1)(a)(ii) must be construed pari passu with s.69(3).
49. As already observed the words “as expressed by reference to a week” present real difficulty. However, I think it reasonably obvious that this cannot mean “as expressed by reference to a week in the relevant award or contract of employment”. Whilst some Awards may so express a rate, it by no means follows that all Awards or contracts will contain such a formula. In this respect the dicta of Gibbs J. in Kezich v. Leighton Contractors Pty. Ltd. (supra) are of particular applicability. It seems plain to me that to be ‘expressed by reference to a week’ the rate, whatever it is, must be expressed by the person doing the requisite calculations – the worker, the employer, or the insurer no doubt in the first place, but ultimately by the person vested with a responsibility to make the relevant determination, i.e. the workers’ compensation commissioner or a judge upon appeal.
50. That a more felicitous and less cumbersome phrase could have been selected must be fairly obvious. A number of cases were cited to us during the course of argument, amongst them an earlier decision of my own, Johns Perry Hayward Pty. Ltd. v. Greaves (No.2) No.131991. As Zeeman J. correctly pointed out in his reasons for judgment in the present case, my remarks there as to the scope and meaning of s.69(1)(a)(ii) were obiter dicta but in any event they are not directly pertinent to a resolution of the present appeal. These cases are of only marginal significance however because (apart from Johns Perry) they were all concerned with the “ordinary time rate” (or a similar rate) in respect of a worker who was employed full time. The debate accordingly centred upon the nature of “ordinary” time as distinct from over–time or penalty rates and whether a week related to a full time week of 38 hours or something more, e.g. Catlow v. Accident Compensation Commission (1989) 87 A.L.R. 663. The question in the present case is essentially different.
51. It cannot be overlooked that s.69(1)(a)(ii) is concerned initially with “the rate” of pay. The primary meaning of “rate” according to the Shorter Oxford Dictionary is “the (total) estimated quantity, amount, or sum of anything usually forming a basis for calculating other quantities or sums.” [My emphasis].
52. A casual worker’s “rate” of pay is thus 1/38th plus 20% per hour worked of a full time worker’s entitlement to payment for ordinary hours worked. To express that rate “by reference to a week” can only be expressed, in my view, by reference to the hours actually worked in the course of a week by the relevant casual worker whose position is being considered.
53. I can see no valid objection to such a construction of the provisions in question – as already pointed out, s.69(1)(a)(i) relating to average weekly earnings, requires such an approach. (See Anslaw v. Cannock Chase Colliery Co. Ltd. [1909] A.C. 435).
54. It seems to me that the words of Lord Loreburn L.C. at p.437 still express the main thrust of modern workers’ compensation:
“The object of the Act broadly stated is to compensate a workman for his loss of capacity to earn, which is to be measured by what he can earn in the employment in which he is, under the conditions prevailing therein, before and up to the time of the accident.”
55. Section 69 provides two alternative formulae to achieve this end by permitting an averaging process in relation to wages actually earned during an immediately preceding period or an assessment based on actual weekly earnings at non–penalty rates. The worker is to be compensated for the loss in fact produced by his incapacity. This too is the basic approach of the common law in assessing the value of lost earning capacity in actions for damages for personal injury.
56. It would be unusual, to say the least, for a no fault insurance scheme such as that found in workers’ compensation legislation to provide compensation at a substantially higher rate than could be expected in an action for negligence, yet such would be the result in the present case if the respondent‘s arguments were to prevail.
57. As a result of these considerations I am of the view that the learned judge appealed from erred in his conclusions and that the appeal should be allowed.
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