Spurr and Comcare [1999] AATA 43 (27 January 1999)

Last Updated: 9 February 1999

DECISION AND REASONS FOR DECISION [1999] AATA 43

ADMINISTRATIVE APPEALS TRIBUNAL )

) No T98/49

GENERAL ADMINISTRATIVE DIVISION )

Re AARON BOYD SPURR

Applicant

And COMCARE

Respondent

DECISION

Tribunal Deputy President A M Blow OAM, QC.,

Date 27 January 1999

Place Hobart

Decision The decision under review is set aside and the following decision is substituted:

(a) for the period 1 September 1997 to 23 September 1997 the applicant's rate of compensation is to be calculated by reference to the earnings he would have received if he had continued to be employed by the Commonwealth in Tasmania as a plumber at GSO 6 level; and

(b) for the period 24 September 1997 to 31 October 1997, the applicant's rate of compensation is to be calculated by reference to the earnings he would have received if he had continued to be employed by the Commonwealth in Antarctica as a plumber at GSO 6 level.

[Sgd A M Blow]

Deputy President

CATCHWORDS

Compensation - Commonwealth employee - plumber injured in Antarctica - periodical payments - whether entitled to Antarctic rate or Australian rate.

Safety, Rehabilitation and Compensation Act 1988 - ss.8(10)

Re Richards and Commission for the Safety, Rehabilitation and Compensation of Commonwealth Employees (1993) AATA 8735

Re Hadjitofi and Comcare Australia (1992) AATA 8473

Bortolazzo v Comcare (1997) 75 FCR 385

REASONS FOR DECISION

27 January 1999 Deputy President A M Blow OAM, QC.,

1. This is an application for the review of a decision made by a delegate of the respondent on 4 February 1998 as to the rate of the weekly payments payable to the applicant pursuant to s.19 of the Safety, Rehabilitation and Compensation Act 1988 ("the Act").

2. Prior to 9 September 1996 the applicant was employed in the private sector as a plumber. He took leave without pay, and went to work in Antarctica as a plumber in the employment of the Commonwealth for the summer of 1996/97. He commenced employment in the Assets Services unit of the then Department of Administrative Services in Hobart on 9 September 1996. After induction and training in Hobart he sailed for Antarctica on 27 September 1996. Whilst away from Tasmania, his gross weekly earnings comprised the following:-

Wage $564.10

Antarctica allowance $131.39

Allowance in lieu of overtime $282.06

Common duties allowance $148.51

Total $1,126.06

3. On 11 February 1997 the applicant suffered an ankle injury as a result of falling on an ice slope whilst on duty in Antarctica. On 29 March 1997 he returned to Australia. He ceased employment with the Commonwealth on that day. He remains unfit to return to work with his original employer.

4. On 15 September 1997 a delegate of the respondent made a determination that during the period 1 September 1997 to 31 October 1997 the applicant was entitled to receive weekly payments pursuant to s.19 of the Act at the rate of $691.72 per week. That represented the normal weekly earnings that would be paid to a plumber who was employed in Tasmania at the level at which the applicant was employed, namely GSO6 level. The applicant sought reconsideration of that decision, but it was affirmed on reconsideration on 4 February 1998. The applicant has sought review of that decision by this Tribunal.

5. It is now common ground that, but for his injury, the applicant would have returned to Antarctica and worked as a plumber at GSO6 level for the 1997/98 summer; that he would have received the allowances referred to above with effect from 24 September 1997; and that he should receive weekly payments calculated by reference to the wage for a GSO6 plumber and those allowances in respect of the period 24 September 1997 to 31 October 1997. However the parties remain in dispute as to the appropriate rate of compensation for the period from 1 September 1997 to 23 September 1997. The applicant contends that his weekly payments for that period should be calculated by reference to the earnings he would have received if working in Antarctica as a plumber at GSO6 level, or alternatively by reference to the earnings he would have received in the employment of his original employer. The original employer paid more than a pl! umber at GSO6 level would earn in Tasmania, but less than a plumber at GSO6 level would earn in Antarctica. Although only a period of 23 days is in dispute in these proceedings, the Tribunal's decision as to that period is likely to have significance for the duration of the applicant's period of incapacity, except for the 1997/98 Antarctica summer expedition period.

6. The period in dispute in these proceedings falls within the first 45 weeks during which the applicant was incapacitated. Accordingly his rate of compensation has to be calculated pursuant to s.19(2) of the Act, which reads as follows:-

"(2) Subject to this Part, Comcare is liable to pay compensation to the employee in respect of the injury, for each of the first 45 weeks (whether consecutive or otherwise) during which the employee is incapacitated, of an amount calculated under the formula:

NWE - AE

where:

NWE is the amount of the employee's normal weekly earnings; and

AE is the amount per week (if any) that the employee is able to earn in suitable employment."

7. The meaning of the term "normal weekly earnings" is dealt with in s.8 of the Act, the relevant parts of which read as follows:-

"8(1) For the purposes of this Act, the normal weekly earnings of an employee (other than an employee referred to in subsection (2)) before an injury shall be calculated in relation to the relevant period under the formula:

(NH x RP) + A

where:

NH is the average number of hours worked in each period by the employee in his or her employment during the relevant period;

RP is the employee's average hourly ordinary time rate of pay during that period; and

A is the average amount of any allowance payable to the employee in each week in respect of his or her employment during the relevant period, other than an allowance payable in respect of special expenses incurred, or likely to be incurred, by the employee in respect of that employment.

...

(9) If the minimum amount per week payable in respect of employees included in a class of employees of which the employee was a member at the date of the injury is increased or reduced on or after that date as a result of:

(a) the operation of a law of the Commonwealth or of a State or Territory; or

(b) the making, alteration or operation of an award, order, determination or industrial agreement, or of the during of any other act or thing, under such a law;

the normal weekly earnings of the employee before the injury, as calculated under the preceding subsections, shall be increased or reduced by the same percentage as the percentage by which that minimum amount was so increased or reduced, as the case may be.

(10) If the amount of the normal weekly earnings of an employee before an injury, as calculated under the preceding subsections, would exceed:

(a) where the employee continues to be employed by the Commonwealth or a licensed corporation - the amount per week of the earnings that the employee would receive if he or she were not incapacitated for work; or

(b) where the employee has ceased to be employed by the Commonwealth or a licensed corporation - whichever is the greater of the following amounts:

(i) the amount per week of the earnings that the employee would receive if he or she had continued to be employed by the Commonwealth or the licensed corporation in the employment in which he or she was engaged at the date of the injury;

(ii) the amount per week of the earnings that the employee would receive if he or she had continued to be employed by the Commonwealth or the licensed corporation in the employment in which he or she was engaged at the date on which the employment by the Commonwealth or the licensed corporation ceased:

the amount so calculated shall be reduced by the amount of the excess."

8. The meaning of the "the relevant period" in s.8 is dealt with by s.9 of the Act. The only relevant sub-section is s.9(1), which reads as follows:-

"(1) For the purposes of calculating the normal weekly earnings of an employee before an injury, a reference in section 8 to the relevant period is, subject to this section, a reference to the latest period of 2 weeks before the date of the injury during which the employee was continuously employed by the Commonwealth or a licensed corporation."

9. The effect of s.8(10) is to place a cap on the amount of an employee's "normal weekly earnings" in certain situations. Because the applicant ceased to be employed by the Commonwealth on 29 March 1997, s.8(10)(b) is applicable. The amount of the earnings he would have received if he had continued to be employed by the Commonwealth in the employment at which he was engaged at the date of the injury is identical to the amount he would have received if he had continued to be employed by the Commonwealth in the employment in which he was engaged on the date on which his employment by the Commonwealth ceased. Thus applying s.8(10)(b)(i) achieves the same result as applying s.8(10)(b)(ii). Each of those sub-paragraphs requires the employee's hypothetical earnings to be calculated by reference to an assumption that he or she would have continued to be employed in the employment in which he or she was engaged, either at the date of the injury or at the date on wh! ich the employment ceased. In order to determine the dispute between the parties, I need to decide what is meant by the words "in the employment in which he or she was engaged" in each of those sub-paragraphs. Was the employment in which the applicant was engaged employment as a plumber at GSO6 level, or employment as a plumber at GSO6 level in Antarctica?

10. There is nothing in the Act that could possibly warrant measuring the applicant's normal weekly earnings by reference to what he would have been earning in the private sector if he had not been injured. I therefore reject the submission, which was only ever advanced in the alternative, that his normal weekly earnings should measured by reference to what he would have been earning in the private sector in his original employment.

11. In the unreported decision of Re Richards and Commission for the Safety, Rehabilitation and Compensation of Commonwealth Employees (1993) AATA 8735, Deputy President McMahon took the view that the word "employment" in s.8(10) did not mean "duties". That case concerned a carpenter employed at GSO6 level who had been injured in Antarctica. It can be distinguished from this case on the basis that there was no finding that the carpenter would have returned to Antarctica. That remained a mere possibility. Deputy President McMahon decided that the carpenter's normal weekly earnings had to be assessed by reference to the earnings of a carpenter employed at GSO6 level in Australia.

12. Senior Member Kiosogolous took the opposite view in another unreported case, Re Hadjitofi and Comcare Australia (1992) AATA 8473. That case concerned a casual Commonwealth employee who was injured while doing catering work for parliamentarians. He was working approximately full-time when he was injured, but the hours of such workers were subsequently reduced, so that they only worked when the Senate was sitting, and for some twenty hours per week. Senior Member Kiosogolous held that the applicant was entitled to weekly payments calculated "on the basis of his pre- injury weekly earnings unadjusted to reflect any subsequent changes in the terms and conditions of his former employment." He attached particular significance to the words, "the amount of the normal weekly earnings of an employee before an injury"! at the beginning of s.8(10), and concluded that that subsection was "intended to limit the amount of money that a person is to receive by way of compensation in reference to the applicant's normal weekly earnings pared of additional fringes, which are specifically excluded by sub-s.8(1)".

13. I respectfully disagree. What s.8(10) does is to require a comparison between "the amount of the normal weekly earnings of an employee before an injury" and a hypothetical later figure. It refers to the pre-injury figure only for the purpose of requiring a comparison, and not to the intent that the pre-injury figure is to prevail. If that had been Parliament's intention, the enactment of s.8(10) would have been unnecessary. If Hadjitofi were correctly decided it is difficult to see whether s.8(10) could ever have had any practical application.

14. In accordance with s.15AA of the Acts Interpretation Act 1901, in the interpretation of s.8(10) of the Act, a construction that would promote the purpose or object underlying the Act must be preferred to a construction that would not promote that purpose or object. Heerey J said the following as to the purpose of the Act in Bortolazzo v Comcare (1997) 75 FCR 385 at 388:-

"The underlying policy is that an injured employee should not be worse off during the period of incapacity as a result of work-related injury. However, it follows conversely that the injured employee should not be better off."

15. The clear purpose of s.8(10) is to prevent an injured employee from being better off as a result of being incapacitated. As Parliament sought to achieve that purpose by enacting a provision requiring only a comparison with hypothetical earnings as an employee of the Commonwealth, and not requiring the actual or estimated earnings that an employee who would have moved to the private sector would have received, Parliament adopted a regime that was less than perfect, but perhaps had the advantage of administrative simplicity. Given underlying purpose of the relevant provisions as explained by Heerey J, I believe that s.8(10)(b) requires a decision-maker, in assuming that an employee would have continued to be employed by the Commonwealth in the employment in which that employee was engaged, first to assume that the employee would have continued in the same occupation and at the same level, and then conside! r what circumstances resulting in the payment of allowances, overtime or the like would have existed from time to time. As this case well illustrates, making the additional assumption that an employee's duties would have remained unchanged could have an absurd and obviously unintended result.

16. Counsel for the applicant, Mr. McTaggart, submitted that the Act is beneficial legislation which ought to be interpreted liberally in favour of injured employees. That principle is relevant when provisions in the Act are ambiguous: McDermott v Owners of SS Tintoretto [1911] AC 35; Wilson v Wilson's Tile Works Pty Ltd (1960) CLR 328 at 335. But I do not consider that that principle has any application in this case, since s.8(10) is not ambiguous in my view.

16. I think the proper way to apply s.8(10)(b) to the facts of this case involves assuming that the applicant would have continued in employment with the Commonwealth as a plumber at GSO 6 level, and assuming that he would have been paid the allowances appropriate to an Antarctic expeditioner only during periods when, but for his injury, would have in fact been an Antarctic expeditioner. I therefore conclude that the applicant should receive compensation for the period 1 September 1997 to 23 September 1997 calculated by reference to the earnings of a plumber employed by the Commonwealth at GSO 6 level in Tasmania, not Antarctica.

17. At the conclusion of the hearing I told counsel that I proposed to make a decision to that effect. There was disagreement as to whether I should set aside the reviewable decision and remit the case for re-determination, or alternatively set aside the reviewable decision and substitute a decision of my own. If I were to take the former course, I would be required to order the respondent to pay the applicant's costs of the entire proceedings before the Tribunal pursuant to s.67(9) of the Act.

18. Counsel for the respondent submitted that I should take that course, even though it would remove any discretion I had as to costs, for reasons which he expressed in writing as follows:-

"1. There is no evidence before the Tribunal as to the appropriate amount for the period 24 September 1997 to 31 October 1997. Therefore Comcare are going to need to make a determination in any event as to the appropriate amount.

2. Following the applicant's request to the respondent that it reconsider other determinations to award incapacity benefits i.e. other than the determination under review it was agreed between the applicant and respondent that they would abide the terms of review in respect of the period 1 September 1997 to 31 October 1997 in respect of those other determinations. Therefore there will need to be a redetermination by Comcare in any event for the period 1 November 1997 to 24 February 1998 i.e. that further period that the applicant should have been in Antarctica. The Tribunal varying or substituting a decision will not resolve all issues between the applicant and respondent unless the respondent determines the determinations for the period 1 November 1997 to 24 February 1998.

3. If the respondent wishes to avoid those costs ordered pursuant to Section 67 (9) Safety Rehabilitation & Compensation Act 1988 it could have made a decision upon reconsideration pursuant to Section 62 (1) in respect of the period 24 September 1997 to 24 February 1998 or sought a consent decision be made by the Tribunal."

19. As to the first of these arguments, I see no reason why the Tribunal should not make a decision as to the basis upon which compensation is to be calculated leaving the respondent to make a subsequent determination as to the precise figures. Taking such a course would not preclude the respondent from "abiding the terms of review in respect of the period 1 September 1997 to 31 October 1997" in respect of other determinations. Given the agreement to use the months of September and October 1997 to obtain a ruling from the Tribunal, I do not think it is appropriate to make a decision that would give the Tribunal no discretion as to costs solely because the respondent neither made a reconsideration decision pursuant s.62(1) in respect of the period 24 September 1997 to 24 February 1998 in accordance with the concession I have referred to in paragraph 5 above nor sought a consent decision. I think the preferable course is! for me to formulate my decision in such a way that any dispute as to costs can be resolved according to the merits of the parties' arguments.

20. I have therefore decided to set aside the decision under review and substitute a decision that:-

(a) for the period 1 September 1997 to 23 September 1997 the applicant's rate of compensation is to be calculated by reference to the earnings he would have received if he had continued to be employed by the Commonwealth in Tasmania as a plumber at GSO 6 level; and

(b) for the period 24 September 1997 to 31 October 1997, the applicant's rate of compensation is to be calculated by reference to the earnings he would have received if he had continued to be employed by the Commonwealth in Antarctica as a plumber at GSO 6 level.

I certify that this and the 10 preceding pages are a true copy of the decision and reasons for decision herein of

Deputy President A M Blow OAM, QC.,

Signed: .....................................................................................

Personal Assistant

Date/s of Hearing 16 December 1998

Date of Decision 27 January 1999

Counsel for the Applicant Mr B McTaggart

Solicitor for Applicant Jennings Elliott

Counsel for the Respondent Mr G Loughton

Solicitor for the Respondent Australian Government Solicitor