Wang and Secretary, Department of Employment and Workplace Relations

[2007] AATA 1591

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2007] AATA 1591

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2007/0315

GENERAL ADMINISTRATIVE DIVISION		)
Re		WEI WANG

Applicant

And

SECRETARY,
DEPARTMENT OF EMPLOYMENT

AND WORKPLACE RELATIONS

Respondent

DECISION

Tribunal Regina Perton

Date26 July 2007

PlaceMelbourne

Decision The Tribunal sets aside the decision under review and substitutes the decision that Mr Wang is not subject to an 18 per cent administrative breach penalty between 7 July 2006 and 6 August 2006.

(sgd) Regina Perton

Member

SOCIAL SECURITY – Newstart allowance – activity agreement – applicant recorded as arriving late – activity agreement breach – 18 per cent breach rate reduction imposed – reasonable steps to comply - decision set aside 

Social Security Act 1991 ss 604, 605, 626, 644AE

REASONS FOR DECISION

26 July 2007 Regina Perton, Member

1.      Wei Wang has been receiving Newstart Allowance (NSA) for many years.  Longer term NSA recipients are generally required to enter into a written Newstart Activity Agreement (the agreement) with Centrelink, which administers NSA for the respondent. On 28 February 2006, Mr Wang entered into such an agreement which included an obligation upon Mr Wang to attend his Job Network Member (the provider) weekly over a six month period.  Mr Wang agreed to attend the provider at its premises at a specified time each week to search for and apply for jobs.  While Mr Wang attended the premises, he was late on a number of occasions.  The provider informed Centrelink that Mr Wang had not complied with the terms of the agreement because of an ongoing failure to be punctual.

2.      The Social Security Act 1991 (the Act) allows Centrelink to apply a reduction in the rate of the allowance to an NSA recipient who fails to comply, or fails to take reasonable steps to comply, with an agreement.  On 23 June 2006, Centrelink imposed a breach rate reduction of 18 per cent for an eight week period, from 7 July 2006 to 31 August 2006.  On 7 August 2006, Centrelink waived the balance of the breach rate reduction period as Mr Wang had commenced a vocational rehabilitation program with the Commonwealth Rehabilitation Service (CRS). 

3.      Mr Wang sought review of the decision to impose a breach rate reduction, by an authorised review officer (ARO) of Centrelink.  On 19 October 2006, the ARO affirmed the decision to impose the breach rate reduction.  Mr Wang then sought a review of the decision by the Social Security Appeals Tribunal (SSAT). On 2 January 2007, the SSAT affirmed the ARO’s decision.  On 7 February 2007, Mr Wang lodged an application for review of the SSAT decision with the Tribunal.

4.      The issue before the Tribunal is whether the breach rate reduction in NSA should have been applied to Mr Wang in relation to alleged breaches of the agreement.

What led to Centrelink issuing a penalty?

5.      Centrelink records indicate that, on 28 February 2006, Mr Wang entered into an agreement that required him, amongst other things, to attend an Assisted Job Search every Thursday from 11am until 12pm at the provider’s premises located in central Melbourne.  At Mr Wang’s request, the provider changed the day of his attendance to Monday.  

6.      The agreement sets out the following information about what could happen if the NSA recipient does not comply with its provisions: 

What happens if I don’t do the right thing?

You could lose all or part of your payment if you don’t do what you have been asked to do. This is called being breached.  There are two types of breaches (administrative and activity test) and different rules apply to each. 

You could get an administrative breach if you:

·don’t go to an appointment with Centrelink or your Job Network member that you have been advised of by phone, letter, email or appointment card, including requests to change or negotiate a new activity agreement;

·don’t contact Centrelink when asked

·don’t tell Centrelink when you have a change in your circumstances.

You could get an activity test breach if you:

·don’t do what you have agreed to do in your Activity Agreement;

·don’t actively look for suitable work;

·leave your job voluntarily;

·refuse a job offer or don’t go to a job interview;

·fail to declare correct income from employment;

·don’t meet your Participation Record requirements;

·fail to engage in a programme when asked to do so;

·don’t agree to requests from Centrelink to accept suitable paid work;

·don’t attend approved training courses;

·fail to participate in approved activities when asked to do so;

·don’t enter into and comply with an Activity Agreement if you are asked to do so; or

·don’t contact your Job Network member, Community Work Coordinator or Programme Provider when asked.

7.      On 19 June 2006, Mr Wang’s case manager at the provider submitted a report to Centrelink.  She stated that Mr Wang’s attitude and attendance had been poor over the previous six weeks.  She stated that Mr Wang had continually failed to attend these appointments on time without a valid excuse.   

8.      In her report to Centrelink, the case manager stated that Mr Wang had arrived half an hour late for his 11am appointment on 22 May 2006.  She indicated that Mr Wang has told her that he had missed the last bus just before 11 o’clock and that catching an earlier bus would have required him to leave home 40 minutes earlier.  The case manager stated that Mr Wang’s home was approximately 10 to 15 minutes walk from the nearest railway station and he could walk to the station and take a train, if the bus was not at convenient times.  Mr Wang was counselled that he should be arriving at the provider’s premises at 11am rather than leaving home at that time.  The case manager stated that Mr Wang was late again on 29 May 2006 and when asked why he was late, had said that he was just running late.  The case manager stated that she again reminded him of the requirement to be on time.  On 5 June 2006, he was recorded as arriving an hour late.   The case manager reported Mr Wang as saying that he had been up early studying that morning, his preferred time for study.  On 19 June 2006, the provider’s receptionist recorded Mr Wang as being 45 minutes late. 

9.      The case manager stated that Mr Wang had failed to take reasonable steps to comply with the job search training activity to which he had been assigned by failing to arrive on time for his appointments.  She stated that he had also failed to provide a valid excuse for each occasion. 

10.     On 23 June 2006, Centrelink wrote to Mr Wang to advise him that:

Your Newstart Allowance has been stopped from 23 June 2006 because you did not comply with the terms of your Job Search Plan due to your unsatisfactory attendance or attitude on the program. 

This has also resulted in an activity test breach.

The breach occurred on 19 June 2006 and as you had no other activity test breaches in the 2 years immediately prior to this date, your rate will be reduced by 18% from 7 July 2006 until 31 August 2006. 

You need to lodge your Application for Payment form by the due date or your Newstart Allowance will be stopped. 

Mr Wang’s response

11.     Mr Wang promptly sought review of the decision to impose a breach rate reduction.  In his request for the review, Mr Wang stated that he was 20 minutes late on 19 June 2006 and did not sign in at the front desk on arrival as there was a queue.  He therefore went to the computer room before signing in.  He provided a certificate of attendance at the Emergency Department of The Royal Dental Hospital of Melbourne on 17 June 2006.

12.     On 18 October 2006, the ARO conducting the review telephoned Mr Wang.   Mr Wang reiterated that he had only been 20 minutes late on 19 June 2006 and that the residual impact of his dental treatment had been a factor in his late arrival.  He stated that he had been unaware of the requirement to report to the reception desk on arrival.  He said that he was aware of the need to be punctual and that he had twice been counselled about it by his case manager. 

13.     The ARO noted that Mr Wang had commenced a new vocational rehabilitation program with CRS on 7 August 2006 as a result of which, the balance of the breach rate reduction period had been waived.  The ARO affirmed the decision that an 18 per cent rate reduction applied from 7 July 2006 to 6 August 2006. 

14.     In applying for review of this decision to the SSAT, Mr Wang stated that the provider’s report was incorrect.  He stated that he had only been late twice and that his lateness on 19 June 2006 was due to inflamed gums after dental filling. 

15.     However, in his evidence to the Tribunal, Mr Wang provided explanations as to why he was late on three occasions.  He said that his usual bus was cancelled on 22 May 2006 without notice.  It takes him about 17 minutes to walk to the railway station.  He did so after the bus failed to arrive and therefore arrived late at the provider’s premises on 22 May 2006.  He acknowledged being late on two subsequent occasions although his and the case manager’s assertions about the actual time of arrival on 19 June 2006 differed.  

16.     Mr Wang said that May and June 2006 were particularly busy and stressful months for him.  He was required to complete two assignments for his Monash University studies including a group project.  Mr Wang had changed enrolment from the Royal Melbourne Institute of Technology to Monash University that semester.  Mr Wang said that on 5 June 2006, he had been late because of his involvement in the group project.  He said that he had telephoned the provider and left a message to say that he would be late. 

17.     Mr Wang said that he did not always sign in immediately on arrival at the provider’s office.  Sometimes he did so when there was no queue at reception.  Mr Wang said that he was not aware at the time of the significance of signing in at the appointed time.  It was his understanding that the requirement to sign in was just to verify his attendance on that date. He said that he had not been told about the importance of the actual time he started.  If he was late, he stayed later and was often there for longer than the hour.   Mr Wang said that he used the computer at the provider’s premises to look for and apply for jobs.  He was competent in using the computer and in job searching and so did not need to be instructed by his case manager.  He said that many of the other people, who came in at the same time as he did, needed significant assistance.  

18.     Mr Wang said that he had been using the provider’s computer to search for positions since 2004.  In the past, as long as he came in and undertook his research, there had been no concern about the exact time of his arrival.  He said that he knew it was his responsibility to attend.  However, he was unaware that there could be financial penalties imposed for late arrival.  He said he spent more than the specified minimum time on job research once he was there. 

19.     Mr Wang said that he did not have a particularly good relationship with the case manager supervising him at the time of the reporting of the breach of the activity agreement.  They had clashed over whether he was entitled to have his enrolment fee at Monash University, for his part-time studies, paid for by the provider.  He said that he believed he was entitled to the payment and he had not accepted her decision that he was not entitled to the payment.  He said he had gone to someone higher in the organisation and eventually the payment was made.    Mr Wang said that there were other communication problems between them after she took over from his previous case manager.

Relevant Legislation

20. The provisions of the Act concerning agreements and activity test breaches have been amended since Centrelink’s decision in this matter. The pertinent legislation is that which was in place at the time of the original decision. Section 604 of the Act empowered Centrelink to require a person to enter into an agreement. Section 605 of the Act allowed Centrelink to enter into a replacement agreement. Mr Wang entered into an agreement in February 2004 and a replacement agreement in February 2006.

21. Section 626 of the Act set out the circumstances in which activity test penalties were imposed for failure to comply with an agreement.

626(1) Subject to subsection (2), if:

(a) a person is required to take reasonable steps to comply with the terms of a Newstart Activity Agreement in order to qualify, or to continue to qualify, for a newstart allowance; and

(b) the person fails to take reasonable steps to comply with the terms of the Newstart Activity Agreement (the failure);

a newstart allowance is not payable to the person because of the failure.

626(1A) If a newstart allowance becomes payable to the person after the time it ceases to be payable under subsection (1), then:

(a) if the failure is the person’s first or second activity test breach in the 2 years immediately before the day after the failure—an activity test breach rate reduction period applies to the person; or

(b) if the failure is the person’s third or subsequent activity test breach in the 2 years immediately before the day after the failure—an activity test non-payment period applies to the person.

22. Section 644AE set out how to calculate a person’s rate of NSA where there had been an activity test breach. If the recipient’s breach was the first in the two years immediately preceding the breach, the applicable reduction was 18 per cent.

Did Mr Wang take reasonable steps to comply with the agreement?

23. Section 626(1)(b) imposes an activity test breach if the NSA recipient fails to take reasonable steps to comply with the agreement.  In this case, Mr Wang went to the provider’s premises and undertook Job Search activities but did not arrive at the designated starting time.  He conceded that he was late on three occasions but provided explanations why he was late.  He stated that on one of the three occasions he was late, but not as late as recorded on the provider’s files.  He told the SSAT and the Tribunal that he did not know that it was important to obtain his file and sign in immediately on arrival. 

24.     Mr Wang is a long-term NSA recipient who is also studying part-time at university. The Tribunal has no reason to doubt his evidence that he works independently when he uses the provider’s computer facilities to search for possible employment opportunities.  He gave evidence that he has been doing so for some years.  He indicated that he neither needs nor seeks the assistance of the case manager in undertaking job searches, unlike others less familiar with the process who attend at the same time and are given guidance by the case manager.  Mr Wang told the Tribunal that he was not told that his NSA would be affected if he arrived late for his designated job search activity.  It was his belief that it was undertaking the activity for the period of time specified that was of critical importance rather than the actual time of arrival.  He said that he sometimes obtained his personal file from the receptionist some time after he had started his job search session if there was a queue.

25.     The Tribunal notes that the agreement does not specifically state that late arrival at an activity may result in an activity test breach although it does state that if a person does not do what he has agreed to do in his activity agreement, or fails to participate in approved activities when asked to do so, he may be breached.The Tribunal also notes that Mr Wang believes that there was a lack of rapport between his case manager and himself in the months preceding the issue of the breach rate reduction.  The Tribunal was not presented with a copy of the file kept by the provider in relation to Mr Wang’s activities; nor was there oral or written evidence from the case manager herself beyond her electronic note to Centrelink.  There is no indication in the material before the Tribunal that Mr Wang failed to keep the undertakings he gave in relation to his February 2004 agreement or that he failed to meet any of the other obligations set out in  the agreement he signed in February 2006.

26.     Mr Wang maintains that he took reasonable steps to comply with the agreement.  The Tribunal believes his excuses for failing to register his attendance on time on the three occasions cited by the case manager are reasonable and genuine.  On the first occasion, a regularly scheduled bus failed to arrive.  Mr Wang then walked to the station and took the train to the city, arriving late for his session.  On the second occasion, he said he rang the provider’s office to advise he would be late but it appears that the message did not make it to the case manager or the file.  He had been delayed due to a meeting of a study group for one of his university subjects.  Even though he arrived very late, he still attended the provider’s premises and undertook the required job search exercise.  On the third occasion, 19 June 2006, he had experienced overdue and extensive dental work two days earlier and was not feeling well.  Nonetheless, he did attend at the provider’s premises, albeit late.  He gave evidence that May and June 2006 were particularly difficult times for him with regard to his study. 

27.     While Mr Wang’s lateness is not to be condoned, he appears to have been unaware of the importance of keeping to the designated session times for his computer job searches.  He attended weekly as required by the agreement.  The Tribunal is satisfied that Mr Wang took reasonable steps to comply with the agreement.  Therefore, the breach rate reduction from 7 July 2006 to 6 August 2006 should not be applied.

DECISION

28.     The Tribunal sets aside the decision under review and substitutes the decision that Mr Wang is not subject to an 18 per cent administrative breach penalty rate reduction between 7 July 2006 and 6 August 2006.

I certify that the twenty-eight [28] preceding paragraphs are a true copy of the reasons for the decision of:

Regina Perton, Member

(sgd)       Dianne Eva

Clerk

Date of hearing:  1 June 2007

Date of decision:  26 July 2007
Advocate for the applicant:          Self-represented

Advocate for the respondent:       Mr M Pike, Principal Legal Officer, Centrelink Legal Services Branch