Webb v Western NSW Local Health Network - [2012] NSWWCCPD 49

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:		Webb v Western NSW Local Health Network [2012] NSWWCCPD 49
APPELLANT:		Marilyn Webb
RESPONDENT:		Western NSW Local Health Network
INSURER:		Employers Mutual Limited – TMF
FILE NUMBER:		A1-10679/11
ARBITRATOR:	Ms Jennifer Scott
DATE OF ARBITRATOR’S DECISION:		25 May 2012
DATE OF APPEAL DECISION:		10 September 2012
SUBJECT MATTER OF DECISION:		Proper construction and application of ss 42 and 43 of the Workers Compensation Act 1987; determination of current weekly wage rate; calculation of average weekly earnings
PRESIDENTIAL MEMBER:		Deputy President Kevin O'Grady
HEARING:		3 September 2012
REPRESENTATION:		Appellant:	Messenger & Messenger
Respondent:	DLA Piper Australia
ORDERS MADE ON APPEAL:		1. The determination of the Arbitrator as found in paragraph one of the Certificate of Determination dated 22 May 2012 is revoked and the following order is made in its place: “1. Award of the Commission made 15 August 2005 is varied pursuant to s 55 of the Workers Compensation Act 1987 providing for an award in favour of the applicant from 1 January 2005 in the sum of $415.60 per week being the maximum statutory entitlement in respect of a totally incapacitated worker with a dependent spouse, pursuant to s 37 as adjusted to date and continuing.” 2. Paragraph two of the Certificate of Determination is confirmed. 3. The following further order is made: “3. The respondent is to have credit in respect of payments made to the applicant since 1 July 2005.” 4. The respondent is to pay the appellant’s costs of the appeal.

BACKGROUND

In proceedings conducted in 1999 before Bishop CCJ of the former Compensation Court of NSW, Marilyn Webb secured an award of compensation against her former employer, Central West Health Service, now known as Western NSW Local Health Network (the respondent). His Honour found that Ms Webb had received injury in the course of her employment to the right arm, and, as a result of different circumstances in the course of that work, to her left arm. The finding was also made that, as a result of those injuries, Ms Webb had experienced a depressive condition. His Honour found that Ms Webb was totally incapacitated for work.
The award made 30 June 1999 by Bishop CCJ made provision, inter alia, for an award for weekly payments pursuant to s 37 of the Workers Compensation Act 1987 (the 1987 Act) at the rate of $198.90 per week from 2 June 1997 to date and continuing. It is relevant to note that his Honour observed in the course of his reasons for judgment that “scant attention to economic aspects as far as the ascertainment of the current weekly wage rate and the like” had been given by the parties in the presentation of the case. A finding was made, notwithstanding the shortcomings in the evidence, that Ms Webb’s “current weekly wage rate and average weekly earnings” were each $221 per week.
Ms Webb, it is accepted by the respondent, has remained totally incapacitated to the present time. The award made in her favour has been varied by consent on two occasions since it was entered. On 20 August 2004 an order was made providing for payment to Ms Webb of “outstanding arrears”, and quantum of the weekly rate payable was varied in the following terms:
“$283.75 gross per week from 18 August 2004 until the next date of indexation and indexed thereafter in accordance with the [1987 Act]”.
A second variation to the award was made by consent on 15 August 2005 which provided for an increase in the quantum of the weekly award to allow for an additional weekly payment for Ms Webb’s dependent spouse. That variation commenced on 26 July 2004 and provided for such payments to continue “as indexed thereafter under [the 1987 Act]”.
Ms Webb had been employed, it is agreed, as a part-time Cook (Grade B) as defined by the Health Employees (State) Award (the Award).
A dispute arose between the parties concerning the computation of Ms Webb’s entitlement to weekly compensation. That dispute came before the Commission following filing of an Application to Resolve a Dispute (the Application) in November 2011.
The Application came before Arbitrator Scott for conciliation/arbitration on 27 March 2012. The matter proceeded to arbitration at which the only issue in dispute was the question as to the proper means of computing Ms Webb’s entitlement to weekly compensation from 1 January 2005.
The Arbitrator reserved her determination at the conclusion of the hearing after issuing a direction that the parties provide written submissions. Those submissions were provided and a Certificate of Determination, accompanied by a Statement of Reasons (Reasons), issued on 22 May 2012. The following orders were made:
“The Commission determines:
1. The respondent pay the applicant weekly compensation based on the Health Employees State Award for a Cook Grade B at 18 hours per week, being the current weekly wage rate, from 1 January 2005 to date and continuing under section 37 of the Workers Compensation Act 1987, as identified in the following table from the respondent’s written submission dated 27 April 2012.

2. The respondent pay the applicant’s costs as agreed or assessed. I certify this case to have a level of complexity for both the applicant and the respondent and uplift costs by 30 per cent.
A brief statement is attached to this determination setting out the Commission’s reasons for the determination.”

ISSUES IN DISPUTE

The one ground of appeal suggests error on the part of the Arbitrator in the manner of “interpreting and applying s 42 [of the 1987 Act]” (at [3.1] of Submissions).

HEARING

A hearing of the appeal was conducted on 3 September 2012 at which each party was represented by Counsel. Those proceedings were recorded and a transcript (TA) has been produced.

THRESHOLD MATTERS

There is no dispute between the parties that the threshold requirements as to quantum and time as found in the provisions of s 352(3) and s 352(4) of the Workplace Injury Managementand Workers Compensation Act 1998 (the 1998 Act) have been met.

THE ARBITRAL PROCEEDINGS

The proceedings before the Arbitrator, at which the parties were represented by counsel, was recorded and a transcript (T) has been produced and made available to the parties.
The facts relevant to the issue in dispute are agreed and may be summarised as follows:
(a)     Ms Webb remains totally incapacitated for work;
(b)     her remuneration was determined under the Award;
(c)     Ms Webb was employed as a part-time cook (Grade B) as defined by the relevant awards;
(d)     Ms Webb, before her injuries, was employed to perform 18 hours work each week;
(e)     work was performed by Ms Webb for six hours on a week day, six hours on Saturday and six hours on Sunday;
(f)     basic hourly award rate of pay was paid in respect of week day work; a 50 per cent shift penalty was payable in respect of Saturday work; and a 75 per cent shift penalty was paid in respect of Sunday work;
(g)     the basic hourly award rate at all relevant times was as fixed by the award;
(h)     the ordinary hours of work for day workers was 38 hours per week, and
(i)     Ms Webb’s husband has at all relevant times been dependent. No other claim of dependency is made in the proceedings.

Submissions before the Arbitrator
Ms Webb’s submissions

Counsel for Ms Webb stated that the Application before the Commission sought a determination of “what had been the applicable weekly sum payable pursuant to s 37 [of the 1987 Act] since 1 January 2005”.
The scheme of the 1987 Act concerning calculation of entitlement to weekly compensation of totally incapacitated workers (ss 36 and 37) and those provisions concerning the means of determining current weekly wage rate and average weekly earnings (ss 42 and 43) was addressed. It was put that, in the case of a part-time worker such as Ms Webb, the first task was to calculate the current weekly wage rate for a full week disregarding shift, overtime and penalties (s 42(6)), following which a determination of average weekly earnings as required by the legislation (s 43) must be made.
The argument proceeded that, in the event that the current weekly wage rate exceeded the average weekly earnings, the average weekly earnings are to be treated as the current weekly wage rate (s 42(4)). It is that figure which is then reduced by 10 per cent in accordance with s 37(1)(a). To that figure is added the statutory entitlement with respect to a dependent spouse. There is then a need to determine whether the resultant figure does or does not exceed the maximum statutory rate payable (s 37(1)(a)(i)) and, further, whether that figure exceeds the current weekly wage rate as determined by application of s 42 (s 37(2)).
Emphasis was placed upon the proper application of s 42(6). It was put that shift allowances, etc were not to be disregarded when determining average weekly earnings in accordance with s 43.

The respondent’s submissions

The primary submission put by the respondent concerning calculation of weekly compensation entitlement was that the relevant sections of the Act must “be read together”. It was put that there is “a third concept which is weekly payments, not just current weekly wage rate versus average weekly earnings” (T16.23). Counsel submitted that s 37(2), which provides that the total weekly payment under s 37(1) “shall not exceed the worker’s current weekly wage rate determined from time to time in accordance with s 42”, is “limited” by s 42(6), “that is that weekly payments have to be limited to the award rate as it were after the exclusion of shift and penalty rates”( at T16.25-30). It had earlier been argued that in the case of a part-time worker whose current weekly wage rate exceeds the average weekly earnings, the average weekly earnings are treated as the current weekly wage rate. Having regard to s 42(6) determination of that rate, on the facts, requires calculation of earnings for 18 hours “at the hourly rate excluding shift, penalty and overtime rates” (at T 15). It was also put that entitlement is “capped” to 90 per cent of that sum plus an entitlement in respect of dependency, subject to the resultant figure not exceeding the current weekly wage rate or the statutory maximum entitlement.
Following submissions, the Arbitrator directed that each party file and serve supplementary submissions together with a schedule of relevant figures. Those submissions re-stated those arguments put at the hearing. The schedule of the claim prepared by Ms Webb demonstrated that since 1 January 2005 the statutory maximum in respect of a worker and a dependent spouse was a figure lower than both the average weekly earnings (treated as the current weekly wage rate) and 90 per cent of average weekly earnings aggregated with the sum payable in respect of a dependent spouse. It was the statutory maximum rate, Ms Webb argued, that was payable throughout the relevant period.
The respondent, in supplementary submissions, relied upon those matters put in argument at the hearing and made available a schedule which was said to demonstrate the award rate for a cook (Grade B) throughout the period together with a calculation of that amount payable in respect of 18 hours work per week disregarding any shift, overtime and penalties. It was put that the amount so calculated was the sum for which it was liable in respect of weekly payments.

THE ARBITRATOR’S DECISION

The Arbitrator noted that the only issue that had been raised for her determination was the question of quantum of weekly compensation to which Ms Webb was entitled from 1 January 2005 pursuant to s 37 of the 1987 Act.
Matters which were not in dispute were noted by the Arbitrator at [8] of Reasons. Following a summary of submissions put on behalf of each party, the Arbitrator considered the terms of ss 37, 42 and 43 of the 1987 Act. The Reasons, as expressed by the Arbitrator, suggest that a determination of the appropriate weekly payment is a five step process (between [17] and [21] of Reasons). The Arbitrator had earlier (at [16] and [17]) attempted a further summary of the parties’ submissions. It appears, as is discussed below, that the Arbitrator had misapprehended the arguments advanced by Ms Webb.
The Arbitrator concluded that “the total weekly payments (sic) Mrs Webb is entitled to, based on the Award, reduced for an 18 hour week, is in accordance with the respondent’s written submissions ... ” (at [21] of Reasons).
When summarising her findings the Arbitrator stated (at [23]):
“The current weekly wage rate is defined in s 42(6) of the 1987 Act and requires the removal of penalties and overtime. It is also based on the hours worked and not a full time award”.
An award was entered in terms as noted at [8] above in favour of Ms Webb.

RELEVANT LEGISLATION

Section 33 of the 1987 Act provides that compensation payable by an employer in the case of total or partial incapacity of an injured worker shall include a weekly payment during the incapacity.
The provisions of the 1987 Act relevant to the issues raised on this appeal, which concern the proper computation of the quantum of such weekly payments, are as follows:
“36   Weekly payment during total incapacity—first 26 weeks
(cf former s 9 (1) (a))
(1)    The weekly payment of compensation to an injured worker in respect of any period of total incapacity for work during the first 26 weeks of incapacity shall be the amount of the worker’s current weekly wage rate.
(2)    In this section:
current weekly wage rate, in relation to a worker, means the worker’s current weekly wage rate determined from time to time in accordance with section 42.
37   Weekly payment during total incapacity—after first 26 weeks
(cf former s 9 (1), (4))
(1)    The weekly payment of compensation to an injured worker in respect of any period of total incapacity for work (not being a period during the first 26 weeks of incapacity) shall be:
(a)     90 per cent of the worker’s average weekly earnings, except that:
(i)      the payment shall not exceed $235.20 per week,
(ii)  in the case of a worker who is over 21 years of age at the time of payment—the payment shall not be less than $187.10 per week, and
(iii)  in the case of a worker whose average weekly earnings do not exceed $170 per week—the payment shall be 100 per cent of those earnings or $153, whichever is the lesser amount,
(b)     in addition, $62 per week in respect of:
(i)      a dependent wife or dependent husband of the worker, or
(ii)  if there is no dependent wife or dependent husband at any time during which weekly payments are payable—any one dependent de facto spouse or other family member of the worker, and
(c)     …
(2) The total weekly payment under subsection (1) shall not exceed the worker’s current weekly wage rate determined from time to time in accordance with section 42.
…
42   Current weekly wage rate
(cf former s 9 (8)–(13))
(1)    Subject to this section, a reference in this Division to the current weekly wage rate of a worker, being a worker who is incapacitated for work and who, immediately before being incapacitated:
(a)  was remunerated under an award fixing or providing for the fixing of a rate for a weekly or longer period (not being a worker who belongs to a class of workers prescribed by the regulations for the purposes of paragraph (c))—is, at any time during the incapacity, a reference to the rate of remuneration under that award at that time for 1 week in respect of the work being performed by the worker immediately before being incapacitated,
(b) …
…
(4)     Subject to subsections (6) and (7), if the amount of a part-time worker’s current weekly wage rate, as determined under subsection (1), exceeds the worker’s average weekly earnings, a reference in this Division to that worker’s current weekly wage rate is a reference to those average weekly earnings.
…
(6)    In determining a worker’s current weekly wage rate in accordance with subsection (1) (a) or (b) or (4), any amount paid or payable to the worker:
(a)  in respect of shift work, 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 by the worker, or
(c)  to cover special expenses incurred by the worker because of the nature of the worker’s employment,
is, except in so far as the regulations otherwise provide, to be disregarded.
(7)     A reference in this Division to the current weekly wage rate of a worker, being a worker who:
(a)at the time of the worker’s injury, was employed under 2 or more contracts of service under which the worker worked at one time for one employer and at another time for another employer, and
(b)is incapacitated from performing work under any 2 or more of those contracts,
is a reference:
(c)except as provided in paragraph (d)—to the sum of the current weekly wage rates applicable to the worker under subsection (1) or (4) as a worker employed by each of the employers by whom the worker was employed under the contracts referred to in paragraph (b), or
(d)where the total of the worker’s ordinary weekly hours of work under the contracts referred to in paragraph (b) exceeded 40—to an amount that bears to the sum referred to in paragraph (c) the same proportion as 40 bears to that total,
and the current weekly wage rate of such a worker, as determined under this section, shall be deemed to be the worker’s current weekly wage rate as a worker in the employment of the employer for whom the worker was working at the time of the worker’s injury to the exclusion of any other employers.
…

(8)    In this section:
appropriate period, for the purposes of the calculation of “average weekly earnings” in relation to a worker, means the period of 12 months or, if the worker has been employed with the employer concerned for less than 12 months at the time of the injury, that lesser period.
average weekly earnings, in relation to a worker, means the average weekly earnings of the worker determined in accordance with section 43 during the appropriate period before whichever of the following times produces the higher average weekly earnings:
(a)     the time of the injury concerned,
(b)     the time at which the relevant weekly payment of compensation is due,
with the determination under paragraph (b) made on the assumption that the worker had been earning the wage or salary which the worker would probably have been earning if the worker had remained uninjured and continued to be employed in the same or some comparable employment.
award means:
(a)an award in force under the Industrial Arbitration Act 1940 or an award or industrial agreement, within the meaning of the Conciliation and Arbitration Act 1904 of the Commonwealth, that is in force,

(b)  an industrial agreement or enterprise agreement in force under the Industrial Arbitration Act 1940 or the Industrial Relations Act 1991,
(c)  an agreement made under the Public Service Act 1979 or an agreement with respect to wages or salaries entered into under the provisions of any other Act by an employer constituted by that other Act with any association or organisation representing any group or class of employees, or
(d)  an award made by the Coal Industry Tribunal under the Coal Industry Act 1946,
(e)  (without limiting the above) includes a State industrial instrument,
and includes any such award, industrial agreement or other agreement or instrument as from time to time amended.

prescribed proportion means 80 per cent or, if the regulations prescribe some other percentage for the purposes of this section, that other percentage.

43   Computation of average weekly earnings
(cf former s 14)
(1)    For the purposes of the provisions of this Act relating to “earnings” and “average weekly earnings” of a worker, the following rules shall be observed:
(a)  Average weekly earnings shall be computed in such manner as is best calculated to give the rate per week at which the worker was being remunerated, except that if, because of the shortness of the time during which the worker has been in the employment of the employer or the terms of the employment, it is impracticable at the date of the injury to compute the rate of remuneration, regard may be had to the average weekly amount which, during the 12 months previous to the injury, was being earned:
(i)by a person in the same grade, employed at the same work, by the same employer, or
(ii)  if there is no person so employed, by a person in the same grade employed in the same class of employment, and in the same district.

(b)…
(c)…

(d)If the employer has been accustomed to pay to the worker a sum to cover any special expenses incurred by the worker because of the nature of the employment, the sum so paid shall not be reckoned as part of the earnings.

…
(1A) Any relevant rules provided by this section are also to be observed in determining the average weekly amount that a worker would be able to earn in suitable employment for the purposes of section 40. If there is an ordinary weekly rate of pay generally applicable to employment of that kind under industrial law, the average weekly amount is to be determined by reference to that rate of pay together with any other likely weekly payments which it would be proper to include in the circumstances of the case (such as overtime or other amounts payable under common industry or other practice).
(2)…”

SUBMISSIONS, DISCUSSION AND FINDINGS

The error suggested on this appeal concerns the Arbitrator’s reasoning as to computation of weekly entitlement in respect of total incapacity from 1 January 2005. It was stated by the Arbitrator (at [16] of Reasons) that:
“The first step in determining Mrs Webb’s weekly entitlement is to calculate her average weekly earnings in accordance with section 43 of the 1987 Act. The applicant claims that this calculation should be based on a 38-hour week rather than the 18 hours for which the worker was employed. The applicant provides no authority for this interpretation. I accept the respondent’s assessment that the correct interpretation is remuneration for an 18-hour week, so as to ‘give the rate per week at which the worker was being remunerated’.”
It is clear that the Arbitrator has misapprehended the argument advanced by Ms Webb concerning calculation of average weekly earnings. As was stated before the Arbitrator by counsel (at T4) the calculations of the relevant average weekly earnings (as appeared in a schedule provided) were to be “calculated by reference in those years by the award rates paid with six hours ordinary time, six hours at time and a half and six hours at time and three quarter [sic] have been the normal work pattern of [Ms Webb]”. That submission asserted that Ms Webb’s average weekly earnings were to be calculated having regard to hours worked (18 each week) at the hourly rate fixed from time to time and were to include any shift, etc allowance.
The Arbitrator had earlier, when summarising Ms Webb’s submissions (at [9(c)]) stated that it had been put that “the average weekly earnings should be based on a 38 hour week and not the 18 hours per week undertaken by [Ms Webb]”. Again it may be seen from the summary of submissions (at [14] to [17] and above) that the Arbitrator has misconceived the argument as put by counsel.
The argument advanced by Ms Webb at the hearing (which seems to have given rise to the Arbitrator’s misapprehension) and on this appeal, concerned determination of the current weekly wage rate. It is asserted that where there is, as in the present case, an award fixing a rate for a weekly period, s 42 provides that the “current weekly wage rate” is a reference to the rate of remuneration for one week under that award. It is further put, that when making that calculation, which is to be in respect of the work being performed by the worker, in this case the work of a cook (Grade B), s 42(6) applies so that amounts paid in respect of shift work, overtime or penalties, etc, are to be disregarded.
Leaving aside the apparent misstatement by the Arbitrator of Ms Webb’s argument, the primary complaint made on this appeal is that, in accepting the respondent’s argument concerning the relevance to calculations of s 42(6), the Arbitrator has erred. The respondent’s argument, as summarised at [18] and [20] above, asserted that, as in the present case, where the current weekly wage rate exceeded the average weekly earnings, those average weekly earnings are treated as the current weekly wage rate and s 42(6) requires that such are calculated at the relevant hourly rate excluding shift penalty, overtime, etc rates.
It is clear that no determination may be made as to which is the higher figure until both the current weekly wage rate and average weekly earnings are calculated in accordance with the Act. Having regard to the scheme of the Act to be found in Div 2 of Pt 3, those weekly amounts (current weekly wage rate and average weekly earnings) must be determined as a preliminary step. It is abundantly clear that at this stage of the calculation the current weekly wage rate is to be determined disregarding the shift and other allowances (s 42(6)). The rate here, having regard to the Award, is to be fixed having regard to a 38 hour week. It should be emphasised, given the arguments raised by the respondent, that the words “in respect of the work being performed by the worker immediately before being incapacitated” in s 42(1)(a) refer to the worker’s classification and not the hours performed. The latter is of no relevance given that reference to the Award is made to determine “remuneration under that award [at any time during the incapacity] for one week…” (emphasis added). The words “at any time during the incapacity” appearing in the sub-subsection enables appropriate calculation over time during which incapacity persists and such rates are varied. That variation is the circumstance relied upon by Ms Webb which grounds her application for review (s 55).
It is also clear in my view that shift and other allowances may properly be taken into account when a part-time worker’s average weekly earnings are being determined having regard to the definition of that term in s 42(8), and having regard to those matters provided by s 43. That last mentioned section stipulates that payments by the employer to the worker to “cover any special expenses incurred by the worker because of the nature of employment shall not be reckoned as part of the earnings” (s 43(1)(d)). The section is otherwise silent as to exclusion of any other emoluments received by the worker. As stated by Priestley JA (with whom Powell and Beazley JJA agreed) in Pratt v Claydon (1996) 14 NSWCCR 86 (at 92):
“The primary rule in s 43(1)(a) requires ‘average weekly earnings’ as defined in s 42(8) to ‘be computed in such manner as is best calculated to give the rate per week at which the worker was being remunerated’, presumably at the time of the incapacitating injury. The words ‘best calculated’ seem to me to import an element of judgmental evaluation into the computation process.”
On the present facts, adopting the approach which I have attempted to outline above, relevant calculations demonstrate that the current weekly wage rate exceeded Ms Webb’s average weekly earnings. Ms Webb was a part-time worker and the current weekly wage rate, calculated upon the basis of a 38 hour week disregarding shift, etc allowances, clearly exceeds her average weekly earnings calculated upon the basis of 18 hours per week including shift, etc allowances. The question raised on this appeal is whether the Arbitrator has erred in her approach to the required computation having particular regard to her view as to the proper application of s 42(6).
As earlier noted, the Arbitrator concluded “that the current weekly wage rate is based on the award rate [of the relevant award for Cook (Grade B)] and reduced from 38 hours per week to 18 hours per week” (at [18]).
It may be seen that the Arbitrator appears to have accepted the respondent’s submission put at the hearing that Ms Webb’s weekly entitlement is not to exceed the current weekly wage rate which is calculated having regard to “the part time wage rate” (per the Arbitrator at T19.30, acceded to by counsel). The Arbitrator seems also to have accepted the supplementary submission put in writing by the respondent that “s 42(6) … applies and therefore the current weekly wage rate would be the ordinary earnings for 18 hours per week (ie with no allowance for [shift etc rates])”.
At the hearing of the appeal counsel for the respondent submitted that s 42(6) was “central to [the decision of Keating P in Woolworths Ltd v Sterrett [2012] NSWWCCPD 24 (Sterrett)”]. That authority had been, it was submitted, properly relied upon by the Arbitrator in the course of her Reasons. Counsel sought to emphasise those matters stated by his Honour at [58] of his decision as follows:
“The task required by s 42(6) is to exclude from the calculation any amounts paid or payable to the worker in respect of ‘shift work, overtime or other penalty rates’ (emphasis added) under the terms of the worker’s employment in excess of the ordinary rate fixed by any award for the work he or she performed. Thus, in my view, the requirement of s 42(6) is to exclude from the calculation the loading (the penalty rate) payable to Mr Sterrett for the Sunday work, that is, to adjust the rate so that any additional loading in excess of the ordinary rate is excluded, but it does not require, as Woolworths submits, that the work itself be disregarded in circumstance where the evidence establishes that the work performed on Sundays was part of the worker’s regular working week and was not ‘overtime’.”
It was put by counsel that in Sterrett his Honour’s observations were “much more than an obiter-type situation” and that such would bind the Commission in the present case or, at least, comity required that a consistent approach be adopted within the Commission to the legislation.
Ms Webb argued, both in written submissions and at the hearing of the appeal, that the decision of Sterrett may be distinguished from the present matter on the facts and, further, that the observations made by Keating P concerning s 42(6) may be characterised as obiter dicta and would not, in any event, be authority binding the outcome of the present appeal. These conflicting arguments are addressed below.
There is a conveniently summarised statement of the respondent’s argument concerning the proper application of s 42(6) found at [4] and [5] of written submissions put in opposition to this appeal:
“Section 42(4) is clearly to be interpreted ‘subject to’ section 42(6) and section 42(7) of the 1987 Act. Section 42(6) provides that in determining the relevant rate of weekly payments, no regard should be had to any shift or penalty payments. The Respondent therefore submitted at Arbitration hearing and again in this appeal, that weekly payments are to be calculated by reference to the ordinary rate for 18 hours work per week. That is, the hourly rate not including penalty or shift allowances.
The Arbitrator concurred with the Respondent’s submissions in issuing the Certificate of Determination dated 25 May 2012. The Arbitrator cited a recent decision of President Judge Keating in Woolworths Limited v Sterrett [2012] NSWWCCPD 24 (Woolworths). The Arbitrator indicated any approach to the calculation of weekly benefits as proposed by the Appellant would offend that decision.”
The respondent is correct in asserting that s 42(4) is to have application, as stated in the subsection, “subject to subsections (6) and (7)”. Those provisions are set forth at [27] above. Section 42(7) has no relevance to the present facts. The parties differ in their approach to the construction of s 42(4) in that Ms Webb argues that her entitlement must be determined by reference to average weekly earnings without any deduction in respect of shift, etc rates. The respondent’s argument suggests that once the lower average weekly earnings become the current weekly wage rate, shift and other rates are to be disregarded.
The scheme of this Division of the Act, in part, makes provision to prevent overcompensation. Of fundamental significance is that the legislation prescribes as a starting point a calculation of the relevant current weekly wage rate and of the worker’s average weekly earnings. I have attempted to summarise my view as to the proper application of the provisions concerning this preliminary step at [33] above.
Once it is established, as is the present circumstance, that the current weekly wage rate exceeds the average weekly earnings, s 42(4) provides that “a reference in this division to that worker’s current weekly wage rate is a reference to those average weekly earnings” (emphasis added).
It is my view that the work to be done by s 42(6), when applying that section and s 42(4) to the facts, is to ensure that shift, etc rates are disregarded when the preliminary step is taken of determining whether current weekly wage rate exceeds average weekly earnings.
Once it is established that the current weekly wage rate does in fact exceed the average weekly earnings, those average weekly earnings as calculated are, in my view, to be treated as the relevant current weekly wage rate. Nothing in the legislation, as put on behalf of Ms Webb, requires that there be “any further deduction” (TA 15) from the figure as calculated in accordance with s 43. It follows that I reject the respondent’s argument as outlined above and conclude that the Arbitrator has erred in her acceptance of the approach suggested in the respondent’s submissions and as reflected in the table which forms part of her determination as to weekly entitlement.
I am fortified in this view having regard to the following observations of the majority in the High Court’s decision in Rizzi v Grazcos Co-operative Ltd [1981] HCA 37; (1981) 153 CLR 669 (at 675) made when considering argument advanced concerning the proper assessment of compensation having regard to s 9 of the former Workers Compensation Act 1926 (the former Act) which was, relevantly, in similar terms to the provisions presently under consideration:
“The statement that in the assessment of compensation under s 9(1) for the first twenty-six weeks of the incapacity the worker's actual earnings are no longer relevant is not correct; if the worker's current weekly wage rate calculated under s 9(8) exceeds the average weekly earnings, the latter earnings are to be taken to be the worker's current weekly wage rate (s 9(10)).”
It may be seen that the High Court, by inference, accepted that the preliminary step referred to at [33] above is required by the terms of the Act and, further, that in the case of the current weekly wage rate exceeding average weekly earnings “the latter earnings are to be taken to be the worker’s current weekly wage rate (s 9(10))”. It is important in my view to note that the former Act had a provision in terms similar to s 42(6), being s 9(11).
The provisions of the former Act were also considered, in a different context to the present, by Burke CCJ in Taylor v Vorback (1985) 1 NSWCCR 114, which is cited by Ms Webb, where it was stated by his Honour when considering s 9(10) of the former Act which concerned part-time workers (at 121):
“In essence, in the case of a part time worker, substitute average weekly earnings for current weekly wage rate.”
As earlier noted the respondent has placed significant reliance upon the decision in Sterrett. The factual circumstances of Sterrett may, in my view, readily be distinguished from the present case. It should also be noted that the worker in Sterrett had acquiesced in the Arbitrator’s approach to the means of determining the current weekly wage rate and that question was not agitated on appeal.
The facts in Sterrett concerned a dispute as to the calculation of the worker’s weekly entitlement to compensation. Mr Sterrett, a part-time worker, worked 25 “core hours” per week (five hours per day Wednesday to Sunday) and routinely worked 32 or 33 hours which included working Sundays, for which he was paid a higher hourly rate. His Honour stated that the issue before the Arbitrator:
“concerned whether the additional hours, that is, those hours worked in excess of the core hours, should be excluded from the calculation of [Mr Sterrett’s] ‘current weekly wage rate’ under s 42(6) of the 1987 Act, or whether the correct application of s 42(6) required that the uplift in the hourly rate for work regularly performed on Sundays is to be excluded from the calculation of the current weekly wage rate” (at [4] of the President’s Reasons).
The Arbitrator had determined as a matter of fact that Mr Sterrett “worked 32 hours per week immediately before incapacity at the rate of $18.13 per hour or $580.39 per week”. He proceeded to determine the current weekly wage rate as being that figure of $580.39. It may be seen that the Arbitrator’s approach differs to the analysis of the manner of application of s 42(1)(a) which I have set forth at [33] above. However the Arbitrator did determine that the hours performed in addition to the “core hours” were not caught by s 42(6).
The Arbitrator further found that, on the facts, the current weekly wage rate as calculated was lower than Mr Sterrett’s average weekly earnings which had been agreed by the parties as being $601.24 per week (subsequently increasing to $689.21 per week). In the circumstances it was found that s 42(4) did not arise for consideration.
The award secured by Mr Sterrett before the Arbitrator was determined upon the basis that relevant calculations did not require the exclusion of earnings, determined at the hourly rate of $18.13, during those hours worked in excess of the “core hours”.
On appeal before the President, no challenge was raised by Mr Sterrett concerning the Arbitrator’s approach to the determination of the current weekly wage rate. That matter was never the subject of debate. The issue in the present matter, namely the relevance or otherwise of s 42(6) to calculation of the average weekly earnings (which must subsequently be treated as the current weekly wage rate) did not arise for determination given, firstly, that the figure had been agreed and, secondly, that the average weekly earnings were not relevant to the resolution of the dispute given that those average weekly earnings exceeded the current weekly wage rate as determined by the Arbitrator. The issue determined on appeal concerned the proper construction of the relevant industrial agreement (the 2007 Agreement) which had been agreed as being an award fixing a rate of pay for the purposes of s 42 (at [21] of the President’s Reasons).
The Arbitrator’s findings were upheld by the President following an analysis of the facts in light of the terms of the 2007 Agreement. Those observations made at [58] of the President’s decision correctly, with respect, state that certain rates are to be excluded (s 42(6)) when a calculation of current weekly wage rate is made. Accordingly a finding was made on appeal that additional loading in excess of the ordinary rate (for Sunday work) is to be excluded. Nothing stated by his Honour at [58] or elsewhere in his decision touches on the Arbitrator’s approach which I have noted at [52] above.
In summary I conclude that the decision of Sterrett may be distinguished from the present having regard to the following matters:
(a)     in Sterrett the average weekly earnings had been agreed by the parties;
(b)     no challenge to the Arbitrator’s method of calculation of the current weekly wage rate had been raised by the worker before the Arbitrator nor on appeal;
(c)     the dispute in Sterrett concerned the proper construction of terms of the 2007 Agreement concerning the hours worked by Mr Sterrett, and
(d)     the average weekly earnings in Sterrett exceeded the current weekly wage rate and thus the issue raised in the present appeal was not addressed.

It follows that the respondent’s submissions founded upon the decision in Sterrett must be rejected. I note in passing that it seems, having regard to the Arbitrator’s Reasons in Sterrett, that the decision of the Court of Appeal in Woolworths Ltd v Lister [2004] NSWCA 292 (Lister) had been raised in the course of argument and that the Court of Appeal’s decision in that matter had some influence upon Mr Sterrett’s approach in argument concerning calculation of the current weekly wage rate. That decision of Lister had been brought to the attention of the parties by the Commission before conduct of the hearing of this appeal. However no argument was advanced by the respondent founded upon the short reasons stated by Handley JA concerning a point of contention raised by the worker in that appeal. Ms Webb submitted that “factual matters” (that is the evidentiary material concerning earnings) before the Court in Lister were unknown and further that the point raised in the present appeal was not clearly raised before the Court of Appeal. Thus, it was argued, nothing said in Lister would bind the Commission in deciding the present point.
I accept Ms Webb’s submissions concerning the decision in Lister. It is clear from exchanges between the bench and counsel as recorded during the unsuccessful special leave application made in Lister before the High Court, that the evidence concerning the circumstances in which the worker in that matter was working during the year before injury was less than satisfactory. In those circumstances I accept Ms Webb’s argument that the manner in which the point of contention was so briefly addressed in the Court of Appeal would not constitute an authoritative decision concerning the issue presently being considered.
In the circumstances I conclude that the Arbitrator’s error concerning the manner of determination of the current weekly wage rate constitutes an error of law and that her decision must be revoked. I consider that it is appropriate that a new decision be made in its place on this appeal as is permitted by the terms of s 352(7) of the 1998 Act.
Having accepted the arguments advanced by Ms Webb it follows that an award in substitution of the Arbitrator’s award should be made on this appeal in terms as they appear below. The quantum of her entitlement is founded upon my acceptance of the supplementary submissions put to the Arbitrator noted at [19] above.
In the circumstances it is unnecessary to consider the apparent application made by the respondent seeking a “refund” pursuant to s 55 of the 1987 Act as appears in submissions which accompany the table which formed part of the Arbitrator’s determination.

DECISION

Paragraph one of the Certificate of Determination dated 22 May 2012 is revoked and the following order is made in its place:
“1. The award of the Commission made 15 August 2005 is varied pursuant to s 55 of the Workers Compensation Act 1987 providing for an award in favour of the applicant from 1 January 2005 in the sum of $415.60 per week being the maximum statutory entitlement in respect of a totally incapacitated worker with a dependent spouse, pursuant to s 37 as adjusted to date and continuing.”
Paragraph two of the Certificate of Determination is confirmed.
The following further order is made on this appeal:
“3. The respondent is to have credit in respect of payments made to the applicant since 1 July 2005.”

COSTS

The respondent is to pay Ms Webb’s costs of the appeal.

Kevin O'Grady

Deputy President
10 September 2012

I, PARNEL McADAM, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF KEVIN O'GRADY, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE