Adderton v Workcover/Royal & Sun Alliance

4 On 18 September 1998 the worker was retrenched by the employer. On 20 October following he made a further claim for compensation as a result of the subject injury and on 3 December 1998 WorkCover wrote to the worker in the following terms insofar as relevant for present purposes:-

"This letter is to let you know that Royal & SunAlliance Workers Compensation (SA) Ltd, acting as claims agent on behalf of the WorkCover Corporation, have determined that, as you have continued to be partially incapacitated whilst working full time from 9/1/97 to 18/9/98, the date you were retrenched, that your incapacity is deemed to be total and you are entitled to income maintenance payments from 19/10/98.

We advise that pursuant to Section 35(2)(c) of the Workers Rehabilitation and Compensation Act 1986, as amended that we have determined to reduce your entitlement to income maintenance payments on the basis of your demonstrated earning capacity as a Production Supervisor with Rising Sun Imports. You were working on a full time basis in this capacity from 9/1/97 to 18/9/98. Your entitlement is calculated as follows:

Therefore on this basis you have no entitlement to ongoing weekly payments of income maintenance."

I shall hereafter refer to that letter as "the determination".

5 The determination was disputed by the worker and that dispute is now before me for judicial determination.

6 S 35 of the Act provides insofar as relevant for present purposes:-

35. (1) Subject to this Act, where a worker suffers a compensable disability that results in incapacity for work, the worker is entitled to weekly payments in respect of that disability in accordance with the following principles:

(c) after the end of the first two years of the period of incapacity, if -

(i) suitable employment is in fact not available to the worker; and

(ii) the worker establishes that the worker is, in effect, unemployable because employment of the relevant kind is not commonly available for a person in the worker's circumstances irrespective of the state of the labour market,

partial incapacity for work will also be treated as total incapacity, but otherwise an assessment of the weekly earnings the worker could earn in suitable employment after the end of the first two years of the period of incapacity must be made on the basis that employment of the relevant kind is available to the worker."

7 The essence of the argument of counsel for the worker Mr Kernot was that although clumsily drawn (and this much was conceded by Mr Preston of counsel for WorkCover) the effect of the determination was to concede that the worker was entitled to income maintenance on the basis of partial deemed total incapacity for work from 19 October 1998 to the date of the notice but thereafter to effectively discontinue the payments purportedly pursuant to s 35(2)(c) of the Act. He contended that the purported discontinuance fell foul of the provisions of the Act as was made clear by the decision of the Full Supreme Court in Workers Rehabilitation and Compensation Corporation (Mitsubishi Motors Australia Ltd) v Frank Sosa, unreported S5084 delivered 8 June 1995.

8 Whilst I was initially attracted to Mr Kernot's argument on reflection I consider that a broad construction of the determination in the context of the circumstances of this case does not support the construction for which he contends. In particular it must be borne in mind that the determination was made in response to the worker's fresh claim for compensation made on 20 October 1998 at which time weekly payments of compensation to him were not in train. Moreover no payments of compensation have been made to him since his retrenchment. In essence I construe the document as notice in writing of a determination (and I agree that it was clumsily drawn) pursuant to s 53 of the Act rejecting the worker's claim. In effect the notice states that although prima facie the worker is entitled to weekly payments of compensation on the basis of partial deemed total incapacity for work, WorkCover was entitled to reject his claim for continuing compensation on the basis that he had been incapacitated for work for more than two years and in WorkCover's opinion he had a demonstrated capacity to earn more than his notional weekly earnings. This entitled WorkCover to reject his claim pursuant to s 35(2)(c) of the Act. As I construe the notice in total (which I have not reproduced in these reasons) it complies with the provisions of s 53(6) of the Act.

9 In the circumstances the preliminary point fails.

Parties are advised that if a party wishes to appeal against any part of this decision which is appealable pursuant to s 86(1) of the Act such appeal must be filed with the Registrar in accordance with Form 11 within 14 days of the delivery of this decision and must be served on all parties.