Vila v Essential Smash Repairs Pty Ltd (Deregistered) - [2023] NSWPICPD 34

DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY A MEMBER
CITATION:	Vila v Essential Smash Repairs Pty Ltd (Deregistered) [2023] NSWPICPD 34
APPELLANT:	Michael Vila
FIRST RESPONDENT:	Essential Smash Repairs Pty Ltd (Deregistered)
FIRST RESPONDENT’S INSURER:	GIO General Ltd
SECOND RESPONDENT:	Workers Compensation Nominal Insurer (icare)
FILE NUMBER:	A1-W6304/21
PRESIDENTIAL MEMBER:	Acting Deputy President Michael Perry
DATE OF APPEAL DECISION:	22 June 2023
ORDERS MADE ON APPEAL:	1. The Member’s Certificate of Determination dated 20 April 2022 is revoked. 2. The matter is remitted for re-determination by a different Member.
CATCHWORDS:	WORKERS COMPENSATION – Statutory interpretation – consideration of the term “actual earnings paid or payable to the worker in respect of that week” in section 44E(1) (in force at date of injury but since repealed) of the Workers Compensation Act 1987 – whether proper application of the principles of construction – Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (NT) [2009] HCA 41; 239 CLR 27; 2 Elizabeth Bay Road Pty Ltd v The Owners – Strata Plan No. 73943 [2014] NSWCA 409; 88 NSWLR 488 applied
HEARING:	On the papers
REPRESENTATION:	Appellant:
Ms E Grotte, counsel
Paul A Curtis & Co
Respondent:
Mr J Beran, counsel
Hall & Wilcox
DECISION UNDER APPEAL
MEMBER:	Ms C McDonald
DATE OF Member’s DECISION:	20 April 2022

INTRODUCTION AND BACKGROUND

Michael Vila (the appellant) commenced employment with the first respondent, Essential Smash Repairs Pty Ltd (Deregistered) (ESR) on 7 January 2013 as a full-time panel beater. ESR was insured by QBE Workers Compensation (NSW) Ltd (QBE) until 20 February 2013 and uninsured thereafter. The second respondent is the Workers Compensation Nominal Insurer (the nominal insurer). There was an earlier second respondent, Tekket Properties Pty Ltd (deregistered) (Tekket), but by direction on 27 January 2022, the Member discontinued the proceedings as against Tekket. By email dated 6 July 2022, Ms Joanna Turnbull from Hall & Wilcox advised the Commission that she acted for both GIO and the nominal insurer and that the submissions filed to contradict the appellant’s submissions on appeal were for the first and second respondents.
Mr Vila suffered a back injury (the injury) in the course of his employment with ESR on 20 February 2013. On 13 May 2013, QBE accepted liability with respect to the injury and began to pay Mr Vila weekly compensation under the Workers Compensation Act 1987 (the 1987 Act).[1] GIO General Insurance Ltd (GIO) has subsequently taken over or assumed responsibility for liability under the 1987 Act with respect to the injury. QBE and GIO have accepted Mr Vila as having no current work capacity since 13 May 2013.
[1] Application to Resolve a Dispute, (ARD), p 50.
On 5 August 2015, the respondents made a work capacity decision (WCD) which determined, relevantly, Mr Vila’s pre-injury average weekly earnings (PIAWE) as $1,000 per week.[2] He disputed this, alleging his PIAWE were $1,100 net per week pursuant to a term of the employment contract he made with ESR through Mr Silvestro. The insurer made a further WCD on 30 August 2016, determining Mr Vila’s PIAWE as $1,269 – the asserted gross figure based on net weekly earnings of $1,000.[3]
[2] ARD, p 113.
[3] ARD, p 171.
On 27 July 2021, the respondents determined Mr Vila’s PIAWE were $1,270 gross and moved by indexation to $1,450 from 12 February 2021 and $1,460 from 1 April 2021.[4] That determination was based on a decision that Mr Vila was paid $1,000 net per week with ESR, on the basis of this being the amount agreed between the parties.
[4] ARD, p 207.
The dispute before the Member involved two issues: firstly, as to the correct construction of (the now repealed) s 44E(1) of the 1987 Act – which dealt with the “ordinary earnings” ingredient of PIAWE (s 44E(1) or the s 44E(1) issue); and secondly, what were the terms of the agreement relevant to Mr Vila’s ordinary earnings with ESR (the contract issue).
The parties provided written submissions to the Member in relation to both issues. In the Certificate of Determination dated 20 April 2022,[5] the Member found Mr Vila’s ordinary earnings for the purposes of s 44E(1)(b) of the 1987 Act were $1,000 net per week. Mr Vila has appealed against that finding and determination.
[5] Vila v Essential Smash Repairs Pty Ltd (Deregistered) & others [2022] NSWPIC 168 (reasons).
The main issue on appeal is the meaning of s 44E(1), in force at the time of the injury which has since been repealed. There is also an issue about whether or not the Member determined the contract issue. References to the 1987 Act which follow are intended to refer to the relevant provisions in force on 20 February 2013 unless otherwise stated. Such references are also interchangeable with references to “the 2012 amendments”.

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.”
Having regard to Procedural Directions PIC2 and WC3, the documents before me, and the submissions by the parties that the appeal can be determined on the basis of these documents, I am satisfied I have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing and that such is the appropriate course.

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 EVIDENCE

The Member stated that “because of the issues between the parties it is only necessary to consider the evidence which goes to the agreement made about Mr Vila’s earnings and the evidence about what he was paid”.[6] In circumstances where I have come to the view that the Member did not ultimately determine the contract issue (see [101]–[102] below), it is only necessary and appropriate that I note the Member’s summary of the evidence.
[6] Reasons, [25].

THE MEMBER’S REASONS

The Member noted “the dispute … is whether [Mr Vila’s PIAWE] should be calculated on the basis of net weekly earnings of $1,000 or $1,100. In essence, Mr Vila argued that he should be paid the amount that was agreed with ESR. ESR argued that the agreement was irrelevant and that PIAWE should be calculated on the basis of what was paid.”[7]
[7] Reasons, [2].
The Member considered Mr Vila’s statement of 8 November 2021 (which also attached a series of past statements), noting he answered an advertisement for a permanent full-time panel beater on 2 January 2013 by speaking to ESR’s owner, Mr Paul Silvestro, as follows:
“Mr Silvestro: ‘you sound suitable, so what are you looking to earn in this job?’
I said: ‘I am looking to get $1,100 in the hand for a forty (40) hour week after tax and super’.
Mr Silvestro: ‘I am happy to pay you that. Why don’t you come down to the shop today so I can meet you when you can have a look around’.
I said: ‘OK’.
When I arrived at the shop and after I had a look around, Mr Silvestro said to me:
‘You can start on 7 January 2013, that [is] when we open up after Christmas, but I have changed my mind regarding your pay. I will pay you $1,000 in the hand for a month to see how you work and after that I will increase your pay by $100 per week to $1,100 net’.”[8]
[8] ARD, pp B–C.
The Member noted Mr Vila said he was unhappy with this but agreed, gave Mr Silvestro his bank details, started on 7 January 2013, “and worked 42.5 hours per week”. Then on 7 February 2013 he checked his bank account and noted “he had not been paid $1,000 [sic, $1,100].” He then gave Mr Silvestro a resignation letter saying he was giving a week’s notice “because Mr Silvestro had broken his promise about payment of $1,100 in the hand each week”. Mr Vila stated that Mr Silvestro then said:
“Michael, you cannot resign. We are too busy. I am sorry. I will pay you the $1,100 net per week you are wanting. Just wait until the next pay cycle and I will fix it”.[9]
[9] Reasons, [28].
The Member noted Mr Vila stated that he accepted Mr Silvestro’s apology and said, “OK Paul I will keep working, but if you don’t pay me properly, I will leave!” On 16 February 2013, Mr Vila checked his bank account and saw he had not been paid $1,100 and decided to give Mr Silvestro another week to adjust his pay. In the meantime, he suffered the injury, but kept working. He decided to give notice of his intention to resign when his back pain eased.[10]
[10] Reasons, [29]–[30].
The Member noted Mr Vila then complained to the Fair Work Ombudsman (FWO) and resigned. The Member considered the job advertisement attached to the ARD[11] was “difficult to read but does not appear to include anything about payment”. She also noted a copy of Mr Vila’s draft resignation letter dated 8 February 2013 “which did not provide any reason for his resignation”; but that Mr Vila’s complaint to the FWO did set out “a brief version of the history, noting that ESR had never paid the agreed amount and never provided payslips”.[12]
[11] ARD, p 57.
[12] Reasons, [32].
The Member noted Mr Vila’s statement that ESR failed to remit PAYG tax to the Australian Taxation Office (ATO) and to assist the enquiries made by the FWO, the ATO or the liquidator of ESR. She also noted that on 21 May 2015, “a decision maker in the Review Teams of the Fair Entitlements Branch of the Commonwealth Department of Employment determined that Mr Vila’s weekly wage was $1,000 and that there was no evidence to substantiate that it was $1,100” and that “[o]n 29 July 2016 a delegate in [the State Insurance Regulatory Authority’s] Workers Compensation Merit Review Service determined that Mr Vila’s PIAWE was $1,000”.[13]
[13] Reasons, [35]–[36].
The Member noted Mr Silvestro’s statement of 6 May 2013 stated that Mr Vila worked from January 2013 on a casual basis at the flat rate of $1,000 per week and worked Monday to Friday 7 am to 4 pm. She also noted that “[w]ithout elaborating, Mr Silvestro said that Mr Vila’s work was below average, his aptitude was average and his attendance record was bad [and he] was a slow worker”.[14]
[14] Reasons, [37].
The Member then noted Mr Silvestro’s statement that Mr Vila had “said that he was not coming to work on 25 February 2013 because he had a cold”, that he did not report the injury, but “returned to work on the following day”, and “resigned in early February but did not provide a reason but Mr Silvestro asked him to complete the big jobs he was working on. He resigned again in April. [Mr Silvestro] said that he was aware that Mr Vila was working somewhere else.”[15]
[15] Reasons, [38].
The Member summarised the submissions for the appellant as follows. Mr Vila’s evidence was consistent with a verbal agreement that he would be paid $1,100 per week. While his bank statements showed he had only ever been paid $1,000 per week net, he consistently complained about the underpayment. He worked for only six weeks before the injury, then for another 7.5 weeks before injuring his neck and right shoulder. The Member was of the view that Mr Vila’s PIAWE should be calculated as the sum of the average of his ordinary earnings during the relevant period (s 44C(1)(a)), being the period of continuous employment before the injury (s 44D(1)(b)).
The Member noted the appellant’s submission that the evidence of both Messrs Vila and Silvestro was that Mr Vila was paid a flat rate per week which was not dependent on the number of hours worked, therefore, s 44E(1)(b) was applicable to the assessment of his ordinary earnings on the basis of “actual earnings paid or payable”,[16] and that the decisions of Speirs v Industrial Relations Commission of NSW[17] and Brassaud v Chubb Fire Safety Ltd[18] were instructive in understanding the meaning of “paid or payable”.
[16] Reasons, [41].
[17] [2011] NSWCA 206 (Speirs), [69]–[78].
[18] [2014] NSWWCC 202 (Brassaud).
The Member noted Mr Vila put that the words “is payable” mean a “contingent liability” and despite the different context, “or payable” should be given the same meaning as these words were given in Speirs and Brassaud. That meaning, the appellant submitted, was “entitlement to receive”,[19] and such interpretation was consistent with the purpose of the PIAWE provisions being beneficial – ensuring workers were compensated early in the process, and paid in keeping with both what they were paid and what they were promised to be paid. The Member also noted the appellant’s submission that this was also evident from the provision dealing with promotion in Sch 3 of the 1987 Act in 2013.
[19] Reasons, [42]–[43].
The Member noted Mr Vila also put the following. The relevant sections should be construed in a way which ensured workers subjected to wage theft or underpayment would be properly compensated; and an “early dispute with ESR’s insurer” about whether Mr Vila was full time or casual was resolved in his favour, and it was also determined that the amount deposited into his bank account was a net figure, based on gross pre-injury earnings received. The calculation ought to reflect what he was “entitled to receive”.
Mr Vila was also noted to submit that he should be accepted as a witness of credit, his account was consistent, and that there was contemporaneous evidence to support it. Mr Silvestro’s account should not be accepted because he had not complied with his taxation and superannuation obligations. Mr Vila’s earnings should be calculated on the basis that the amount payable to him was $1,000 per week for the first four weeks and $1,100 thereafter.
The Member summarised the submissions for the respondents as follows. The meaning of “or payable” was considered by Roche DP in Flying Solo Properties Pty Ltd t/as Artee Signs v Collet,[20] who determined that weekly compensation is payable when a worker has an entitlement to receive actual compensation because of a compensable work injury. In Hee v State Transit Authority of New South Wales[21] Keating P considered whether benefits were payable under s 38A of the 1987 Act where there is no other entitlement to weekly compensation, and after quoting the relevant passage in Flying Solo, stated that although it was in the context of a different provision within the same statute, where a word is used consistently in legislation it should be given the same meaning consistently. Accordingly, the words “the actual earnings paid or payable” mean “the actual earnings paid or entitled to be paid”.
[20] [2015] NSWWCCPD 14 (Flying Solo).
[21] [2018] NSWWCCPD 6 (Hee), [158].
The Member noted Mr Vila made complaints to a number of statutory bodies which have all determined that the weekly amount of $1,100 net was not payable. There is also no evidence to establish a binding contract that Mr Vila would be paid $1,100 after the first month. Mr Vila said in his statements of 1 May 2013 and 8 November 2021 that Mr Silvestro said that he would pay $1,000 in the hand for a month “to see how you work” and then would increase his pay to $1,100 per week. So, if there was to be any increase, it was at Mr Silvestro’s discretion. His statement shows he had a low regard for Mr Vila’s work. Rather than showing that the contract entitled him to an increase, he has shown that Mr Silvestro’s failure to exercise the discretion to increase his wages caused him to resign, as was his right.
The Member also noted the respondent’s submission that Mr Vila’s statutory declaration of 29 June 2016, when he said it was agreed he would be paid $1,100 net per week, was a false declaration; and his assertion that Mr Silvestro was an unreliable witness as he failed to comply with his obligations in respect of tax and superannuation is irrelevant.
The Member commenced her findings and reasons by noting that in Speirs, the Court of Appeal considered the meaning of “entitled to”, noting that throughout the 1987 and 1998 Acts, “liability to pay compensation and the entitlement to receive compensation are used to express rights or obligations short of those determined by a tribunal or court.”[22] She then set out part of the judgment of Giles JA, including the passage:
“The entitlement is a right subsisting in law when there has been injury satisfying ss 4 and 9A of the [1987] Act. It may be recognised and given effect without tribunal or court determination, as will commonly be the case”.[23]
[22] Citing Speirs, [64].
[23] Reasons, [53]–[54], citing Speirs, [85].
The Member also noted that it was held in Brassaud that “payable” in s 59A of the 1987 Act referred to a contingent liability – where there is an entitlement to receive compensation by reason of the injury.[24] She similarly considered the relevant passages in Flying Solo and Hee[25] and wrote:
“All of those cases deal with the question of whether compensation is payable because there is an entitlement to receive compensation on the basis that certain provisions of the legislation have been fulfilled. Section 44E(1)(b) refers to ‘earnings paid or payable’ which is arguably a different concept to ‘compensation paid or payable’.”[26] (emphasis added).
[24] Reasons, [55].
[25] Reasons, [56]–[58].
[26] Reasons, [59].
After noting the principles in Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (NT),[27] the Member noted that:
“The purpose of the sections is to calculate PIAWE which will be used to assess a worker’s entitlement to weekly compensation. They look at what has been paid in the past so that post-injury payments are consistent with past earnings”.[28]
[27] [2009] HCA 41; 239 CLR 27 (Alcan).
[28] Reasons, [61].
The Member noted that s 44E(1) defines “the ordinary earnings of the worker in relation to a week during the relevant period”, and that if a worker is not paid by reference to an hourly rate, ordinary earnings are calculated by reference to “actual earnings paid or payable … in respect of that week”. The Member then went on to observe the importance of all words in the section being considered, citing Project Blue Sky Inc v Australian Broadcasting Authority,[29] and found that “Mr Vila’s construction does not take account of the use of ‘actual’ in sub-s (b)(i). Actual connotes what did occur rather than what Mr Vila says should have occurred”.[30]
[29] [1998] HCA 28; 194 CLR 355 (Project Blue Sky).
[30] Reasons, [62]–[64].
The Member then stated that the words “that week” (in sub-s (b)(i)) refer back to “a week” at the beginning of s 44E(1) “so that it refers to an amount which is paid or is to be paid because of work which has been done or would have been done if the full week had been worked”. The Member then said she accepted that Mr Vila did discuss payment at the rate of $1,100, that Mr Silvestro agreed to increase his pay subject to “seeing how he went”, and that his pay was not increased at the expiry of the first month “and he may well have had a legitimate complaint about that and other employment entitlements. However, his actual earnings were $1,000 net throughout the period of his employment”.[31]
[31] Reasons, [65]–[66].
The Certificate of Determination issued on 20 April 2022 records:
“1. The applicant’s ordinary earnings for the purpose of s 44E(1)(b) of the Workers Compensation Act 1987 were $1,000 net per week.”

GROUNDS OF APPEAL

The appellant relies upon two grounds of appeal as follows:
(a) The Member failed to apply the principles of statutory construction correctly and thereby misconstrued the meaning of the phrase in s 44E(1)(b)(i) “the actual earnings paid or payable to the worker”.
(b) The Member failed to address, engage with, or respond to, a substantial, clearly articulated argument relying on established facts that was put before her regarding the meaning of the phrase “or payable to the worker”, thereby denying the appellant procedural fairness/failing to accord the appellant natural justice and that failure constituted a constructive failure to exercise jurisdiction.

SUBMISSIONS

The appellant’s submissions

The appellant submitted on appeal that the Member erred in fact and law by making the following findings:
(a)     “Mr Vila’s construction does not take account of the use of ‘actual’ in sub-s (b)(i)” (at [64] of the reasons);
(b)     “‘[A]ctual’ connotes what did occur rather than what Mr Vila says should have occurred” (at [64] of the reasons);
(c)     The word ‘It’ (referring to ‘week’, at [65] of the reasons) suggests an amount which the worker earns in ordinary circumstances on a week-to-week basis and the amount which he has been receiving.
(d)     The appellant does not challenge the finding (at [66] of the reasons) that the Member accepted “Mr Vila did discuss payment at the rate of $1,100 and that Mr Silvestro agreed to increase his pay subject to ‘seeing how he went’”.[32]
[32] Appellant’s submissions, [7.4.1]–[7.4.3].

Ground One

As to Ground One, the appellant submits the Member erred in construing the word “actual” at [64] of the reasons, that this construction fails to take all the words in the phrase into account and fails to give the words “is payable” any work to do. The appellant then says the Member’s statement of the meaning of the word “actual” is wrong, and that the ordinary dictionary meaning of this word is “true” or “existing in fact”.
The appellant argues that “once the Member found, as she did, that there was an agreement regarding the amount payable to be deposited to Mr Vila for his work week to be $1,100, it must follow that that is the amount that ‘is payable’ to him for the weeks he has worked prior to the injury.”[33]
[33] Appellant’s submissions, [9.8].
Mr Vila puts that the Member’s interpretation of the word “actual” is in effect what “was received” for that work which he did, rather than what he was “entitled to receive”, and the Member gave primacy to a qualifying or descriptive word over the words it was meant to qualify, being both “paid” and “payable”; and that she also gave primacy to the word “week”, and in doing so, has focused entirely on what Mr Vila was in fact “paid” rather than what was “payable” to him based on the agreement. The words “is payable” must have some work to do. The purpose of the provision includes ensuring that injured workers are paid appropriate compensation based on the agreed wages between the worker and the employer.

Ground Two

As to Ground Two, Mr Vila says the finding of the Member (at [66] of the reasons) that Mr Vila did have a conversation with Mr Silvestro who agreed to pay him $1,100 into his bank account after he saw how we went after the first four weeks of employment was an established fact. He also says that he submitted to the Member that the words “is payable” ought be construed in a way that takes account of a promised payment by Mr Silvestro (the $1,100 per week), and such is consistent with Sch 3 of the 1987 Act, dealing with circumstances where an injured worker was promoted, but the promotion and its concomitant higher wages had not materialised prior to the injury.
Mr Vila also puts that the Member’s sole focus on the word “actual” in s 44E(b)(i) and its qualification of “paid”, meant that she did not respond to, deal with or engage with the submissions on the issue of a promise of future payment that had not materialised – because Mr Silvestro unscrupulously failed to honour his promise. The Member accepted Mr Vila’s version and once that finding is made, he was entitled to receive $1,100 per week.

The respondents’ submissions

Ground One

The following submissions were made for the respondents. As to Ground One, the respondents say that the appellant’s submission that the Member failed to address the term “is payable” is in error. While this phrase is repeated throughout the submissions, the word “is” is not relevantly used in the legislation. Rather, the relevant phrase is “actual earnings paid or payable”.
The respondents also put that Mr Vila’s submissions are based on the erroneous assumption that the finding of the Member (at [66] of the reasons) was that there was an agreement of payment of $1,100 per week. There was only a finding of a discussion between Mr Vila and Mr Silvestro that the pay would be increased subject to “seeing how he went”. The respondents say this does not equate to a finding that the pay should have been increased. Nor does it amount to a fact that Mr Vila was underpaid, and that such a finding was not made either.
The respondents submit that the Member’s reasoning and interpretation of the word “actual” is correct. Also, the respondents assert that contrary to Mr Vila’s submissions, the Member’s reasoning informing the view that “earnings paid or payable” is arguably a different concept to “compensation paid or payable”[34] is correct and has followed the “correct principles of statutory construction”.
[34] At reasons [52] and [59].

Ground Two

As to Ground Two, the respondents reiterate their submissions in relation to the Member’s findings at [66] of the reasons. A finding of a discussion regarding future wages based upon a condition precedent is not a finding of a promise to pay as has been submitted for Mr Vila. As to his submission that “or payable” meant “entitled to receive”, the Member dealt with that and determined that it was an arguably different concept.[35] On this basis, the respondents say the Member clearly and succinctly dealt with the appellant’s submission and there has been no denial of natural justice or procedural fairness.
[35] At reasons, [59].

LEGISLATION

The relevant sections of the 1987 Act, now repealed but in force at the date of the injury, are set out below. They remain in force for the purposes of injuries received before 21 October 2019 by operation of Sch 6, Pt 19L, cl 7 to the 1987 Act.
“44C Definition – pre-injury average weekly earnings
(1)    In this Division, pre-injury average weekly earnings, in respect of a relevant period in relation to a worker, means the sum of:
(a)the average of the worker’s ordinary earnings during the relevant period (excluding any week during which the worker did not actually work and was not on paid leave) expressed as a weekly sum, and
(b)any overtime and shift allowance payment that is permitted to be included under this section (but only for the purposes of the calculation of weekly payments payable in the first 52 weeks for which weekly payments are payable).
(2)    If a worker has been continuously employed by the same employer for less than 4 weeks before the injury, pre-injury average weekly earnings, in relation to that worker, may be calculated having regard to:
(a)the average of the worker’s ordinary earnings that the worker could reasonably have been expected to have earned in that employment, but for the injury, during the period of 52 weeks after the injury expressed as a weekly sum, and
(b)any overtime and shift allowance payment that is permitted to be included under this section (but only for the purposes of the calculation of weekly payments payable in the first 52 weeks for which weekly payments are payable).
(3)    If a worker:
(a)was not a full-time worker immediately before the injury, and
(b)at the time of the injury was seeking full time employment, and
(c)had been predominantly a full-time worker during the period of 78 weeks immediately before the injury,
pre-injury average weekly earnings, in relation to that worker, means the sum of:
(d)the average of the worker’s ordinary earnings while employed during the period of 78 weeks immediately before the injury (excluding any week during which the worker did not actually work and was not on paid leave) (the qualifying period), whether or not the employer is the same employer as at the time of the injury expressed as a weekly sum, and
(e)any overtime and shift allowance payment that is permitted to be included under this section (but only for the purposes of the calculation of weekly payments payable in the first 52 weeks for which weekly payments are payable).
(4)    ...”.
“44D Definitions applying to pre-injury average weekly earnings-relevant period
(1)    Subject to this section, a reference to the relevant period in relation to pre-injury average weekly earnings of a worker is a reference to:
(a)in the case of a worker who has been continuously employed by the same employer for the period of 52 weeks immediately before the injury, that period of 52 weeks, or
(b)in the case of a worker who has been continuously employed by the same employer for less than 52 weeks immediately before the injury, the period of continuous employment by that employer.
(2)    The relevant period, in relation to pre-injury average weekly earnings of a worker who, during the 52 weeks immediately before the injury, voluntarily (otherwise than by reason of an incapacity for work resulting from, or materially contributed to by, an injury that entitles the worker to compensation under this Act):
(a)alters the ordinary hours of work, or
(b)alters the nature of the work performed by the worker, and, as a result, the worker’s ordinary earnings are reduced, does not include the period before the reduction takes effect.
(3)    If, during the period of 52 weeks immediately before the injury, a worker:
(a)is promoted, or
(b)is appointed to a different position, (otherwise than on a temporary basis) and, as a result, the worker's ordinary earnings are increased, the relevant period in relation to the worker begins on the day on which the promotion or appointment takes effect.”
“44E Definitions applying to pre-injury average weekly earnings – ordinary earnings
(1)    Subject to this section, in relation to pre-injury average weekly earnings, the ordinary earnings of a worker in relation to a week during the relevant period are:
(a)if the worker’s base rate of pay is calculated on the basis of ordinary hours worked, the sum of the following amounts:
(i)the worker’s earnings calculated at that rate for ordinary hours in that week during which the worker worked or was on paid leave,
(ii)amounts paid or payable as piece rates or commissions in respect of that week,
(iii)the monetary value of non-pecuniary benefits provided in respect of that week, or
(b)in any other case, the sum of the following amounts:
(i)the actual earnings paid or payable to the worker in respect of that week,
(ii)amounts paid or payable as piece rates or commissions in respect of that week,
(iii)the monetary value of non-pecuniary benefits provided in respect of that week.
(2)    A reference to ordinary earnings does not include a reference to any employer superannuation contribution.”

STATUTORY CONSTRUCTION PRINCIPLES

In Project Blue Sky, the majority stated:
“The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined ‘by reference to the language of the instrument viewed as a whole’ …”.[36] (footnotes omitted)
[36] Project Blue Sky, [69].
In Alcan, Hayne, Heydon, Crennan and Kiefel JJ stated:
“… the task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language which has actually been employed in the text of the legislation is the surest guide to legislative intention. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy.”[37] (footnotes omitted)
[37] Alcan, [47].
In 2 Elizabeth Bay Road Pty Ltd v The Owners – Strata Plan No. 73943,[38] Leeming JA (Basten and Barrett JJA agreeing) stated that:
“It is axiomatic that (a) the words in a sentence are not building blocks whose meaning is unaffected by the rest of the sentence, (b) the sentence is the unit of communication by which language works, and (c) the significance of individual words is affected by other words and the syntax of the whole sentence.”[39]
[38] [2014] NSWCA 409; 88 NSWLR 488 (Elizabeth Bay Road).
[39] Elizabeth Bay Road, [82].

LEGISLATIVE HISTORY

In Lismore City Council v Garland,[40] Kirby P (as his Honour then was), detailed the legislative history relating to the “provision for the calculation of weekly compensation for a worker incapacitated for work as a result of a compensable injury” in the Workers Compensation Act 1926 (the 1926 Act) and 1987 Act before the 2012 amendments (1987 Act pre-2012). It is sufficient for present purposes to note the conclusion that the:
“… policy which lay behind the introduction of the present approach to the requirement under s 36 of the Act [is] that, during the first twenty-six weeks of incapacity, the worker should be paid his or her ‘current weekly wage rate’ as defined by s 42. That policy I take to be that the worker should, during such incapacity, be paid the ordinary rate which would have been paid as wages had there been no compensable injury”.[41]
[40] (1992) 26 NSWLR 542 (Garland).
[41] Garland, 549.
Garland involved an issue arising under s 42(6) of the 1987 Act (s 42(6)) as it then stood. The issues were stated by Mahoney JA[42] to be whether an industry allowance under an award was to be included in calculating “the rate of remuneration under” the award to which the worker was entitled, and whether there was otherwise in s 42 any provision excluding the allowance in relation to determining the worker’s current weekly wage rate (CWWR). Relevantly, s 42(6) provided:
“In determining a worker’s [CWWR], … any amount paid or payable to the worker: (a) in respect of shiftwork, overtime or other penalty rates, (b) under the terms of the worker’s employment in excess of the ordinary rate fixed by any award for the work performed … (c) to cover special expenses incurred by the worker because of the nature of the … employment … shall be disregarded.” (emphasis added)
[42] Garland, 552.
The term “paid or payable” is the same term appearing in s 44E(1). But this term is closer in context to, and shows s 42(6) to be, a more relevant ancestor of s 44I than s 44E(1). This will be developed later. Another term – average weekly earnings (AWE) – needs also to be read when considering the 1987 Act pre-2012. While s 36 pre-2012 amendments based the weekly payment of compensation on the CWWR, the calculation of a weekly payment of compensation under s 37, after the initial 26 weeks of incapacity was, for present purposes, based on a worker’s AWE. This was computed, relevantly, under s 43(1)(a) which stated:
“[AWE] shall be computed in such manner as is best calculated to give the rate per week at which the worker was being remunerated …”.
In Pratt v Claydon,[43] Priestley JA, with Powell and Beazley JJA agreeing, stated that: “The words ‘best calculated’ seem to me to import an element of judgmental evaluation into the computation process”.
[43] (1996) 14 NSWCCR 86, 92D.
Section 43(1) of the previous 1987 Act made various rules for that process including:
“…
(c) Employment by the same employer shall be taken to mean employment by the same employer in the grade in which the worker was employed at the time of the injury, uninterrupted by absence from work due to illness, strikes, lockouts, bad weather or any other unavoidable cause.
…
(f) If a worker is a worker to whom paragraph (e) applies or has been absent from work by reason of illness, strikes, lockouts, bad weather, intermittency of employment, slackness of trade or any other reasonable is, the [AWE] of the worker shall …
(i) in the case of a worker who is 21 years of age or over, be deemed to be not less than the full wage for a full normal working week of that worker or the basic wage, whichever is the greater …”.
Section 44E of the 1987 Act first appeared in the Workers Compensation Legislation Amendment Act 2012 (the 2012 amendments). In Cram Fluid Power Pty Ltd v Green,[44] Gleeson JA (Beazley ACJ and Emmett JA agreeing), observed (at [122]) that:
“It should be accepted that the 2012 amendments disclose a cost saving objective …
The Treasurer’s Second Reading Speech on 19 June 2012 announced that the amending legislation was to deliver urgently needed reforms to the New South Wales Workers Compensation Scheme. The Treasurer said that ‘[w]ith a deficit in excess of $4 billion, the scheme is currently unsustainable’”.[45]
[44] [2015] NSWCA 250 (Cram Fluid).
[45] Cram Fluid, [122], [125].
In Adco Constructions Pty Ltd v Goudappel,[46] the High Court was dealing with the 2012 amendments relating to limitations on lump sum compensation. French CJ, Crennan, Kiefel and Keane JJ (Gageler J agreeing) stated [at 29]:
“It can be accepted … that the [1987 Act’s] remedial character reflects a beneficial purpose which requires a beneficial construction, if open, in favour of the injured worker. But to accept the beneficial purpose of the [1987 Act] as a whole does not mean that every provision or amendment to a provision has a beneficial purpose or is to be construed beneficially. The purpose of the provision must be identified. The evident purpose of cl 5 was to expand the regulation-making power so as to allow regulations to be made which could affect pre-existing rights. The purpose of cl 11 … was clear enough … Its purpose was patently not beneficial.”[47]
[46] [2014] HCA 18 (Goudappel).
[47] Goudappel, [29].
Care needs to be taken in relation to drawing analogies between the present case with Goudappel and Cram Fluid, which involved claims for lump sum compensation. The provisions of the 2012 amendments relating to limitations on lump sum compensation were not beneficial. The position is not so clear in relation to the provisions of the 2012 amendments relating to weekly income compensation under discussion here. However, “the critical question is what the section means”.[48]
[48] Theoret v Aces Incorporated [2021] NSWCA 3,[44]–[45] per McCallum JA, Leeming JA and Garling J agreeing.
The explanatory note to the amendment bill for the 2012 amendments relevantly states that its object was to amend the 1987 and 1998 Acts, with the “following significant changes”:
“(i) The calculation of weekly payments will be based on the worker’s [PIAWE] rather than on the worker’s current weekly wage rate at the time of injury …”.
Relevantly, the Treasurer continued the Second Reading Speech on 19 June 2012 to say:
“Based on the Victorian model, in the initial period, that is the first 13 weeks of the claim, workers who have no work capacity will receive up to 95 per cent of their [PIAWE] …
The bill also adopts a similar model to Victoria of calculating [PIAWE] by basing the calculation on average weekly earnings of the worker rather than the current method of the worker’s current weekly wage rate at the time of injury and removing the distinction between award and non-award workers. This method of calculation is based on what a worker has actually been earning which is inclusive of specified allowances and will result in fairer and more generous payments to injured workers, particularly in the early weeks of an injury when it is important that workers are able to focus on recovery.”
In Hochbaum v RSM Building Services Pty Ltd; Whitton v Technical and Further Education Commission t/as TAFE NSW,[49] Brereton JA (White JA and Simpson AJA agreeing) stated the following in relation to the weekly payment provisions of the 2012 amendments, in particular, s 39 of the 1987 Act:
“I have also found it unnecessary and unhelpful to endeavour to characterise s 39(2) as beneficial or remedial … in the context of a provision which has, as the Second Reading Speech reveals, multiple objects, such characterisation is not possible, and does not assist”.[50]
[49] [2020] NSWCA 113 (Hochbaum).
[50] Hochbaum, [68].

Given the above observations about the introduction of the legislation including s 44E(1), the purpose of the PIAWE provisions of the 2012 amendments was to significantly change the existing scheme for the payment of weekly incapacity benefits to simplify it by basing the calculation of those benefits on a worker’s PIAWE rather than the current weekly wage rate at the time of injury. More broadly, as noted in Hochbaum at [68] (see [59] above), there were multiple objects in the 2012 amendments, some beneficial and some non-beneficial. Accordingly, care needs to be taken in identifying a general purpose or object in the context of dealing with a specific provision.

DISCUSSION

While I acknowledge that the respondents submit on appeal that the Member has correctly applied the principles of statutory construction, and that the interpretation of s 44E(1)(b)(i) in the reasons should not be disturbed, their submissions to the Member were that “the actual earnings paid or payable” meant “the actual earnings paid or entitled to be paid”.[51] The respondents also submitted to the Member, after discussing the statements in Flying Solo and Hee, that they “in general [agree] with the [appellant’s] assessment of the case law”.[52]
[51] Reasons, [47].
[52] Respondent’s submissions before the Member dated 28 March 2022, [4].
However, the Member still had a duty to construe the section and was not bound by the submissions. Nevertheless, in my respectful opinion, the submissions are correct and the concessions by the respondents were appropriate. More importantly, I agree with the appellant’s submission that the Member erred in law in failing to correctly apply the principles of statutory construction and thus misconstrued s 44E(1)(b) of the 1987 Act. My reasons for finding such error essentially arise from the reasons failing to properly take into account the word “payable” in s 44E(1)(b)(i), thereby failing to apply the principles of statutory construction correctly. My reasons, including reasons for the correction of error (pursuant to s 352(7) of the 1998 Act) follow.

As to Ground One

I respectfully disagree with the Member’s construction of s 44E(1). Firstly, the terms “that week” and “a week” have been erroneously misconstrued at [65] of the reasons. Consistent with the passage in Elizabeth Bay Road (at [48] above) they need to be read in this fuller context: “… in relation to [PIAWE], the ordinary earnings of a worker in relation to a week during the relevant period are … the actual earnings paid or payable to the worker in respect of that week”. The reference to “a week” in s 44E(1)(b)(i) refers to a week during the relevant period (in this case the period of Mr Vila’s continuous employment with ESR).
This assists the identification of the temporal aspect of the PIAWE calculation required by s 44C and springs from the reference to these relevant words in s 33: “If … incapacity … results from an injury, the compensation payable … shall include a weekly payment during the incapacity” (my emphasis).
In Hee v State Transit Authority of New South Wales[53] Meagher JA at [33] (also White JA at [45]) noted:
“Section 33 does not provide for the calculation of any ‘weekly payment’ to which the worker is entitled for partial or total incapacity. It is the other provisions of Div 2, Subdiv 2 that do so … the reference to a ‘weekly payment’ in s 33 is to a payment determined in accordance with those operative sections [ss 36, 37, 38; and per White JA, ss 44C and 44I]”.
[53] [2019] NSWCA 175.
The provisions in Div 2, Subdiv 4 of the 1987 Act contribute to the determination (by s 35 of the 1987 Act) and calculation of a weekly payment rate. This is consistent with the reference to these words in s 44C(1)(a):
“… [PIAWE] in respect of a relevant period … means … the average of the worker’s ordinary earnings during the relevant period (excluding any week during which the worker did not actually work and was not on paid leave) expressed as a weekly sum …” (my emphasis).
Section 44D of the 1987 Act defines “the relevant period” in relation to PIAWE for a worker “who has been continuously employed by the same employer for less than 52 weeks immediately before the injury” (Mr Vila’s case), as “the period of continuous employment”.
Section 35 is also relevant, providing for various factors “used to determine the rate of weekly payments payable to an injured worker in respect of a week”. It is in that context that s 44E sets out the factors to determine the ordinary earnings aspect of the PIAWE factor to assist the determination of the rate of weekly payments.
The finding at [61] of the reasons that “[the sections] look at what has been paid in the past so that post-injury payments are consistent with past earnings” is erroneous. The error lay in the words “paid in the past” having application to the words “or payable”. There is also no explanation of how the word “payable” has been interpreted, given any work to do, or otherwise taken into account. The word “or” in s 44E(1)(b)(i) is clearly disjunctive.
The finding at [61] of the reasons (second sentence) is a conclusion. The reasons follow at [64]–[65]. But I also find error in the construction of s 44E(1) in those paragraphs. The reasons at [64] find: “Actual connotes what did occur rather than what Mr Vila says should have occurred”. Again, the words “or payable” have not been taken into account or are erroneously construed. This finding is essentially a conclusion with the reasons following (at [65]).
There is also error in the finding at [65] that the words “that week” and “a week” together result in the sub-section referring to an amount which is paid or is to be paid “because of work which has been done or would have been done if the full week had been worked”. There is no reference in the text of s 44E(1) to “work” which would have been done if the full week had been worked, nor is there any clear reason why such words should be read in. It is also unclear what is meant by all these words: although it seems that the reference to an amount which “is paid” is intended to relate to “work which has been done”, with the reference to an amount which is “to be paid” intended to relate to “work which … would have been done if the full week had been worked” (emphasis added). This is erroneous because there is no reference in the text to these words, with no apparent reason to read them in. To do so would produce too much tension between s 44E(1) and the terms of s 44C(1)(a). The latter relevantly states (with emphasis added):
“[PIAWE], in respect of a relevant period … means the sum of … the average of the worker’s ordinary earnings during the relevant period (excluding any week during which the worker did not actually work and was not on paid leave) expressed as a weekly sum …”.
I have considered whether these (emphasised) words in s 44C(1) (the s 44C(1) exclusion) might be consistent with the reference at [65] of the reasons to work which “would have been done if the full week had been worked”. If so, it has not been explained in the reasons. It would also be straining the text of both ss 44C(1) and 44E(1) to find any such consistency.
In my opinion, the purpose of the s 44C(1) exclusion is to avoid an excluded week skewing the ordinary earnings aspect of the PIAWE calculation by producing an incongruous amount for that week. The s 44C(1) exclusion of ordinary earnings during the relevant period is still a different concept to “actual earnings paid or payable to the worker in respect of that week”. For example, even if an exclusion applies to “any week”, this only means such week is excluded from the calculation of ordinary earnings. It does not necessarily mean, or apply to, the “actual earnings payable” in respect of non-excluded weeks. The words “or payable” would remain otiose on this construction.
Also, and contrary to the reasons at [65], the text of ss 44C(1) and 44E(1) does not refer to, or suggest, “the amount which he has been receiving”, even if it be considered on the basis of what the worker earns “in ordinary circumstances on a week to week basis” – except in relation to the word “paid” only, and I so find. Again, this is because the words “or payable” would be rendered otiose by such a construction.
The focus of the submissions by both parties was on individual words such as “actual” and “paid or payable”. The Member also (at [64]–[65] of the reasons) erroneously considered these words in isolation. However, while one must strive to give meaning to every relevant word of the provision,[54] “the significance of individual words is affected by other words and the syntax of the whole sentence”.[55] The relevant words to consider in s 44E(1)(b) are:
“… in relation to [PIAWE], the ordinary earnings (emphasis in original) of a worker in relation to a week during the relevant period are … the actual earnings paid or payable to the worker in respect of that week” (emphasis added).
[54] Project Blue Sky, [71].
[55] Elizabeth Bay Road, [82]–[83].
The appellant says the ordinary meaning of “actual” is “true” or “existing in fact”. The respondents do not dispute that. I accept these definitions represent the ordinary and natural meaning of the word; although the meaning in the statutory context is what really matters. Nevertheless, it is my opinion that these definitions, taking into account the text, context and purpose of the 2012 amendments, are essentially the same. But the noun “earnings” requires more consideration.
There was no relevant definition of “earnings” in the 1987 Act, nor in the 1987 Act pre-2012, nor in the 1926 Act. It is used in various places in all those Acts. In the 1987 Act it is used in many different contexts, for example, s 35 (“AWE means the worker’s [PIAWE]”), in relation to both PIAWE and current weekly earnings (s 32A and s 44G base rate exclusions), AWE in the context of indexation of weekly payments (Div 6A) and past/future loss of earnings in Part 5 – Common law remedies. These examples are not exhaustive.
While great care needs to be taken with the use of dictionary definitions (if such use is to occur at all), it was observed by Bell P (as the Chief Justice then was) in Will v Brighton[56] that “it has been said that ‘[t]o refuse to look at a dictionary risks a judge proceeding on the basis of a vague and imprecise understanding of the ordinary meanings of a word’ …”. The Macquarie Dictionary 8th ed defines “earning” as “noun. 1. The act of someone who earns … 2. (plural) Money earned; wages; profits”. The Australian Concise Oxford Dictionary 4th ed also defines “earnings” as “Money earned”. Again though, much care needs to be taken with relying on bare dictionary definitions.
[56] [2020] NSWCA 355, [55].
The word “actual” is used as an adjective in s 44E(1), describing its noun “earnings”. It cannot be read in isolation and at least needs to be read with “earnings”. The term “actual earnings” only appears in two places in the 1987 Act, ss 44E(1) and 44I(b). The latter provides the definition of “current weekly earnings”. In Pira Pty Ltd t/as Langdon & Bartley v Tucker,[57] Beazley JA (as her Excellency then was) stated:
“In Aitkin,^[[58]] Jordan CJ held that the test to be applied in determining the rate of compensation … under s 11 [of the 1926 Act] for partial incapacity was, prima facie, the person’s actual earnings unless it is proved that the worker’s actual earnings are not a proper test, because there is some reason unconnected with the worker's earning power which makes them lower than they should be”. (emphasis added)
[57] [1996] NSWSC 569, [31]–[32].
[58] Aitkin v Goodyear Tyre & Rubber Company (Australia) Limited [1945] NSWStRp 29; 46 SR (NSW) 20 (Aitkin).
The successor to s 11 of the 1926 Act was s 40 of the 1987 Act pre-2012 which, like the 1926 Act, did not use the precise term “actual earnings”, but which relevantly provided for the determination of “the average weekly amount that the worker is earning or would be able to earn in some suitable employment” (s 40(2)(b)). Still, the term “actual earnings” has been consistently and extensively used in the context of determining issues relating to partial incapacity. Section 40(2)(b) is commonly referred to as Step 2 of the ‘Mitchell Steps’.[59] Step 2essentially requires the determination of “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…”. Step 1 is “to determine the weekly amount the worker would probably have been earning but for the injury …” (s 40(2)(a)).
[59] After Mitchell v Central West Health Service (1997) 14 NSWCCR 526 (Mitchell), 529–30.
Section 44I, dealing with current weekly earnings, is more analogous to the definition of “actual earnings” in the 1926 Act and the 1987 Act pre-2012 amendments. It relevantly reads that “… current weekly earnings of a worker in relation to a week means … the worker’s actual earnings in respect of that week but not including any amount that is a base rate of pay exclusion unless it is: (i) paid or payable for overtime or shift allowances in respect of that week, or (ii) paid or payable as piece rates or commissions in respect of that week”.
Whether or not the reference to “actual earnings” in s 44I is relevantly analogous to the meaning of this term in the context of the 1926 Act and the 1987 Act before the 2012 amendments is unnecessary to decide in this case. But it is clear, and I do decide, that this term in s 44E(1) is a significantly different concept, and has a significantly different meaning to, the term “actual earnings” as referred to in authorities such as Aitkin and Mitchell. This is mainly because the provisions of the two earlier Acts did not include the critically important words appearing in s 44E(1) – actual earnings paid or payable.
The words “any amount paid or payable to the worker” do relevantly appear in the 1987 Act pre-2012 amendments, but this was in s 42(6), dealing with amounts to be disregarded when determining a worker’s current weekly wage rate. Again, this provision is more analogous to s 44I of the 1987 Act. I do not find it of direct assistance in construing s 44E(1). The latter is a subtle yet significantly different concept, serving a different purpose, defining ordinary earnings, with the latter defining current weekly earnings. On the other hand, s 44I does refer, amongst other things, to “actual earnings in respect of that week but not including any amount that is a base rate of pay exclusion unless it is … paid or payable for overtime or shift allowances in respect of that week, or … paid or payable as piece rates or commissions in respect of that week”. Therefore, similar language is employed albeit for a slightly different purpose. I see no reason why the word “payable” in s 44I should not have the same meaning as it does in s 44E(1) but treat this as a neutral factor.
The PIAWE provisions are also markedly different from the pre-existing scheme providing for the rate of compensation payable under the 1987 Act. The principal provision in that regard with respect to the first 26 weeks of total incapacity under s 36 was s 42 – “Current Weekly Wage Rate”. That provision focused heavily on the identification of an award or industrial instrument under which a worker was remunerated.
In my opinion, “earnings” means “money earned”, not only in accordance with its ordinary and natural meaning, but also the text, context and purpose of “earnings” in s 44E(1) and the 1987 Act more generally. But in the context of this statutory provision, money earned does not necessarily equate to money received. Firstly, the word “received”, or anything resembling it, does not appear in the relevant text. Secondly, “earnings” should not be read in isolation. It should be read in the context of the sentence as a whole, but with particular importance on the phrase “actual earnings paid or payable … in respect of that week” (emphasis added and noting [63]–[73] above as to “in respect of that week”). It does not matter whether “payable” is an adjective or a noun. If an adjective, it also (with “actual”) modifies the noun “earnings” or is a noun itself. Either way, it is an important word in the text and should be employed.
Prior to the 1987 Act, the term “actual earnings” was usually referred to in the context of partial incapacity, contrasting an amount a worker “is earning” with what the worker “is able to earn” post injury. But it appears in a different context in s 44E(1)(b). In my opinion, it is clear enough that it is used to contrast “actual earnings” in s 44E(1)(b) with the “amounts paid or payable as piece rates or commissions in respect of that week” in sub-s (b)(ii), and, even more clearly, the reference to “the monetary value of non-pecuniary benefits provided …” in sub-s (b)(iii), and I so find. There is a clear difference between actual money earnings and non-pecuniary benefits, such difference creating a need to delineate the modes of remuneration. This is also the case, although less clearly seen, with respect to piece rates or commissions.
It can be accepted that the word “payable” has work to do by reference to a worker’s actual earnings which are not yet paid but are due to be paid in respect of a week. But again, not in the sense of the worker having received money earned. The section does not say that. It suggests the contrary, by using the words “or payable”. I also do not read the provision as limiting “payable” only to a situation where a worker’s actual earnings are not yet paid but are due to be paid in respect of a week. In my opinion, “payable”, taking into account the text, context and purpose of the statute, also is capable of meaning an amount of money earned which is still owed, or due to be paid because the correct amount of actual earnings payable remains payable and due, even if an incorrect amount has already been paid in respect of that week. In my view, that also conforms with the ordinary and natural meaning of the word “payable”. The reference in the text to actual earnings which are payable clearly contemplates situations where such earnings have not been received. In these situations, the ordinary earnings are clearly enough not limited to, contrary to the reasons, “what has been paid in the past” (at [61] of the reasons), or “what did occur rather than what … should have occurred” (at [64] of the reasons), or “… the amount which he has been receiving” (at [65] of the reasons). Therefore, the reasons in this respect (at [65]) are erroneous, including because there was no or no adequate analysis of the critically important word “payable”. This relates to an absence of such analysis in the reasons generally, not only at [65].
There is no significant conflict or tension between “actual earnings paid” and “actual earnings payable” with my construction of s 44E(1)(b)(i). In contrast, attempting to reconcile the notion of actual earnings payable and “earnings”, in the sense of money received, produces too much tension to allow such construction to be preferred as the legislative intention.
My construction is at least not inconsistent with the purpose of the statute. I appreciate that in the Second Reading Speech, the Minister stated, inter alia, that “this [PIAWE] method of calculation is based on what a worker has actually been earning which is inclusive of specified allowances”. But this statement is not clear as to whether “earning” necessarily meant money received. There was no reference to PIAWE being calculated only on amounts of money or wages received or paid. Also, the speech went on to add “and will result in fairer and more generous payments to injured workers, particularly in the early weeks of an injury when it is important that workers are able to focus on recovery”. When one sees, in those contexts, the words “or payable” then appearing in the text of the statute, it displays an intention to not only include actual earnings already paid, but also amounts of money the worker has earned and is still owed or due to be paid.

The relevant purpose of the 2012 amendments was to simplify the calculation of a worker’s weekly incapacity payments by basing it on the PIAWE rather than the current weekly wage rate because the latter method was overly complex and productive of too many disputes. But the question in this case is about identifying something anterior and more fundamental, the correct rate of pay upon which to start the calculation of PIAWE. This is far from the classical dispute about whether an industry allowance, as in Garland, or some other special expenses benefit is to be included. The purpose of the statute did not likely include a legislative intention to obviate the ability of the Commission to determine situations such as the contract issue in this case. Otherwise, the words “or payable” would likely not have appeared in s 44E(1)(b)(i); or alternatively it would have been made clear that “earnings” equated to a worker receiving remuneration or the like.
I also accept Mr Vila’s submission[60] with respect to the terms of Sch 3, Item 9 of the 1987 Act (Item 9) being harmonious with his construction of the word “payable” appearing in s 44E(1)(b)(i). This item provides that for a worker who, in the 52 weeks before injury, receives written advice from the employer that he/she is to be promoted or appointed to a new position with a resulting increase in ordinary earnings, but has not been so promoted or appointed, the PIAWE are to be calculated by reference to the average of the weekly earnings the worker could reasonably expected to have earned after the promotion or appointment had taken effect, as if it had taken effect 52 weeks before the injury. Mr Vila’s situation does not directly enliven Item 9. But the point is that Item 9 is more harmonious with Mr Vila’s construction, compared to the construction in the reasons. Item 9 clearly displays a legislative intention to ensure a worker is compensated in accordance with what he or she could reasonably be expected to have earned even though he/she had not been promoted or appointed, without limiting reasons why the promotion/appointment did not occur before the injury. Although such clear intention relates to circumstances which fit within its terms, it nevertheless shows substantial coherence with a construction of s 44E(1) of the word “payable” as including an entitlement to the true or real terms of an employment contract existing at the time of injury.
[60] Appellant’s submissions, [9.12]–[9.13].
The Member noted that s 44E(1)(b) “refers to ‘earnings paid or payable’ which is arguably a different concept to ‘compensation paid or payable’”.[61] I agree with this, to the extent of the approach to analysing the question – but not the conclusion. The conclusion is not totally clear – except to the extent that these two concepts were “arguably … different”. The resulting interpretation appears at [61] and [64]–[65] of the reasons but then apparently left the word “payable” stranded with no work to do. This, with respect, is also erroneous and contributed to the misconstruction of s 44E(1)(b).
[61] Reasons, [59].
In the context of the 1987 Act generally, in particular Pt 3, Subdiv 4, and more particularly, s 44E(1)(b)(i), I do not think it likely that the word “payable” only refers to earnings “because of work which has been done or would have been done if the full week had been worked”, nor do I think it likely that it only suggests “the amount which he has been receiving” (on a week to week basis) for reasons already given above. I find an error of law in this construction because no or no sufficient regard was paid in the statutory interpretation process to the word “payable”, and s 44E(1)(b)(i) has been misconstrued.
Because “compensation payable” is a different concept to “actual earnings payable”, it may be reasonably said that reliance on the analysis of the term “compensation payable” in Speirs is not apposite. But in my respectful view, it is reasonably analogous. The relevant comparison is between “compensation payable” and “actual earnings payable”. In my opinion, the word “payable” is the most important one in each case. In any event I do not think it likely makes a difference in the context of construing s 44E(1)(b)(i). In other words, whether the meaning of “payable” in the context of “actual earnings paid or payable … in respect of that week” means “entitlement to receive” (whether or not under a subsisting contract of employment) or means “still owed” and/or “due to be paid” is a moot point. Either way, my construction of s 44E(1)(b)(i) is the same. What really matters is whether or not the proper construction of this subsection involves the notion of receipt of actual earnings. For the reasons already given, I find that it does not.
The comment that “[a]ctual connotes what did occur rather than what Mr Vila says should have occurred”[62] focuses on the past tense with respect to the words “actual earnings paid”, then differentiates between “what did occur” and what “should have occurred”. The Member appears to be implying that actual does not include something that “should have occurred”. The only such matter that could be relevant would be the contract. This also constitutes error. If the parties did come to an agreement as is alleged by the appellant, it would have been made or competently varied before the injury. So, if the Member is implying that the word “actual” does not contemplate what “should have occurred”, this would be at odds with an agreement existing already. Alternatively, if the Member is referring to a payment or receipt of earnings which “should have occurred”, that would be consistent with the appellant’s argument that such construction fails to fully or properly take into account the words “is payable”.
[62] Reasons, [64].
Mr Beran correctly submits that the appellant’s submissions erroneously proceed on the basis that the Member failed to address the term “is payable”. These submissions do refer to is (payable). But these are inconsequential errors in the context of discussion about various concepts such as “is not entitled [to be compensated]” in Speirs, and “[compensation] is payable” in Brassaud. The appellant also submitted to the Member that although not in the same context as s 44E(1), the words “or payable” in s 44E “ought to be given the same meaning as given in Speirs and Brassaud, that is, an ‘entitlement to receive’”.[63]
[63] Appellant’s submissions before the Member dated 18 March 2022, [34].
If one assumes that the position of the appellant in relation to the contract issue is the true and correct construction of the contract, then he is entitled to have his PIAWE calculated on the basis of the actual amount of pay which reflected his earnings – but which had not yet been paid – and which were still payable. But if the position of the respondents is the true and correct construction of the contract, the appellant has no such entitlement.
For all the above reasons, I find the Member erroneously misconstrued s 44E(1)(b)(i) of the 1987 Act. Accordingly, Ground One of the appeal succeeds.

As to Ground Two

I do not accept Mr Vila’s submissions. The Member carefully recorded the submissions for Mr Vila in this respect – particularly at reasons [42]–[43]. Also, contrary to the submission for Mr Vila,[64] I believe the Member did address, engage with or respond to the meaning of the phrase “or payable to the worker”. This occurred in the findings and reasons at [52]–[58] in the context of examining the case law, including the principles, mainly put for Mr Vila, in Speirs. Then, under the heading “Consideration”, the Member noted that “all those cases” dealt with the question of whether compensation was payable because of an entitlement to receive compensation on the basis of certain provisions of the legislation having been fulfilled; and contrasting that with the reference in s 44(E)(1)(b) to earnings paid or payable, and then noting “which is arguably a different concept”.
[64] Appellant’s submissions, [8.2].
The Member then continued her analysis of the construction of the subsection. I do not think this was procedurally unfair to the appellant. However, in my respectful opinion, such construction is erroneous for all the reasons given above. Ground Two fails.

Was there a finding on the contract issue?

The appellant has submitted that “the Member accepted Mr Vila’s version” but has not developed that submission by identifying how or why that occurred. I agree with the submission for the respondents that there was no finding by the Member of an agreement to pay $1,100 per week. I also accept the submission for the respondents that there was only a finding of a discussion between Mr Vila and Mr Silvestro that Mr Vila’s pay would be increased subject to “seeing how he went”, and that this does not equate to a finding that his pay should have been increased, nor does it amount to any finding that Mr Vila was underpaid. The respondents also submitted that a finding of a discussion regarding future wages based on a condition precedent is not a finding of a promise to pay. I also accept this submission.
The Member did note that Mr Vila’s “pay was not increased at the expiry of the first month and he may well have had a legitimate complaint about that and other employment entitlements”. But this clearly falls far short of the resolution of the substantive issue.

CONCLUSION

Having found the errors of law in the reasons that are referred to above in the present determination, I revoke the Member’s decision and the Certificate of Determination. Section 352(5) of the 1998 Act provides that “an appeal under this section is limited to a determination on whether the decision appealed against was or was not affected by any error of fact, law or discretion, and to the correction of any such error. The appeal is not a review or new hearing”.
There were only two grounds of appeal in this case. The first, in essence, was that the Member misconstrued s 44E(1)(b)(i). The second, in essence, alleged procedural unfairness and constructive failure to exercise jurisdiction because the appellant’s submissions regarding the phrase “or payable to the worker” were not addressed. Neither party raised, in this appeal, any matter or submission going to the contract issue – except as to whether or not that issue was determined by the Member.
Mr Vila’s submissions in this respect[65] were limited to pointing out that he did not challenge the “finding” that he “did discuss payment at the rate of $1,100 per week and that Mr Silvestro agreed to increase his pay subject to ‘seeing how he went’”,[66] and that this amounted to a finding of an agreement to pay $1,100 per week. The respondents only submitted that there was no finding of agreement to pay $1,100 per week (as noted at [101] above).
[65] Appellant’s submissions, [7.5], [10.2].
[66] Reasons, [66].
My finding that the contract issue was not decided is a separate matter to the contract issue itself. The parties did not otherwise raise the contract issue, either in the appeal grounds or their submissions. In these circumstances, I do not have jurisdiction to decide the substantive issue.[67]
[67] Ballina Shire Council v Knapp [2019] NSWCA 146.
In the result, I remit the matter to another non-presidential member for determination of the contract issue pursuant to s 352(7) of the 1998 Act in accordance with these reasons.

DECISION

The Member’s Certificate of Determination dated 20 April 2022 is revoked.
The matter is remitted for re-determination by a different Member.

Michael Perry
Acting Deputy President

22 June 2023