Casey v Workcover/Mercantile Mutual

3 The parties were then unable to agree on the quantification of average weekly earnings and the matter proceeded to arbitration on this issue. Following arbitration the respondent sought judicial determination, the parties remaining at odds over the methodology of calculating average weekly earnings.

4 It is not in dispute that the worker was unemployed for at least 12 months prior to gaining employment with Minson. It is not in dispute that he was, on 14 May 1998, told by his employer that his services were no longer required due to completion of the contract in respect of which he had been engaged. The evidence indicates that other employees engaged on this particular contract were also given notice on or about this date.

5 The respondent submits that the worker's services would have been terminated when they were irrespective of any work injury and that in fixing his average weekly earnings regard must be had to this fact and also the fact that he had not held down any other employment for at least the preceding 12 months. Accordingly, it was submitted, the worker's average weekly earnings should be calculated by adding up his earnings from Minson over the 7 weeks he worked there and dividing this by 52 weeks.

6 The applicant submits that this approach to the fixing of average weekly earnings is misconceived and wrong in law. Moreover, the applicant says, s 4(7) of the Workers Rehabilitation and Compensation Act ("the Act") is applicable, and given that the worker's entitlement under the applicable industrial agreement would result in average weekly earnings of more than twice State average weekly earnings, the worker's average weekly earnings should be fixed at this prescribed maximum.

7 The submissions put forward on behalf of the respondent are seemingly based on a misconception about the setting of average weekly earnings under s 4 of the Act. The task is not to determine what the worker would likely have earned had he not been disabled. S 4(1) defines average weekly earnings as "the average amount that the worker could reasonably be expected to have earned for a week's work if the worker had not been disabled" (my emphasis). This statutory formula presumes, for the purposes of fixing the rate of average weekly earnings, the availability of work. The task is to determine the amount that the worker could reasonably be expected to have earned for a week's work. Whether the worker remains incapacitated for one day, one week or one year matters nothing to the quantification of his average weekly earnings.

8 Accordingly, it is not relevant to the task at hand that the worker was unemployed for most of the 12 months preceding his injury or that his employment was terminated, or was about to be terminated, soon after he became incapacitated by his compensable disability. These are not factors relevant to the determination of the amount that the worker could reasonably be expected to have earned for a week's work had he not been disabled.

9 It is the applicant's primary contention that s 4(7)(a) applies and that the worker's average weekly earnings are to be fixed at not less than the weekly wage to which he was entitled under the applicable industrial agreement (the AWU/AMWU Cooper Basin Construction Contractors Agreement July 1995 hereinafter referred to as "the Agreement") save for the limitation imposed by s 4(7)(c). S 4(7) of the Act states:-

"(7) Notwithstanding the foregoing provisions of this section -

(a) where a disabled worker's remuneration was, at the relevant date, covered by an award or industrial agreement, the worker's average weekly earnings shall not be less than the weekly wage to which the worker was then entitled under the award or industrial agreement;

(b) if, but for this paragraph, the average weekly earnings of a worker (not being a self-employed worker) would be less than the prescribed amount, the average weekly earnings shall be fixed at the prescribed amount;

(c) the average weekly earnings of a worker shall in no case be fixed at more than twice State average weekly earnings."

10 It is not disputed that the worker's remuneration was covered by the Agreement and that pursuant thereto the worker's normal work hours were 70 per week over days 2 to 22 of a four week cycle, with days 1 and 23 being paid travel days, day 24 a paid day off and days 24 to 28 accumulated off site days. Appendix C of the Agreement explains the hours of work and remuneration applicable to a four week cycle.

11 Mr Sargent, for the respondent, submitted that in considering the application of s 4(7)(a) of the Act there should be taken into account the short term of the worker's contract of employment. However, there is nothing in s 4(7)(a) or in any other part of s 4 to require that this be done. The submission seems to be founded on the misconceived notion that in fixing a worker's average weekly earnings regard is to be had to what the worker would likely have earned had he not been disabled as opposed to what he would likely have earned for a week's work if he had not been disabled.

12 I am satisfied that s 4(7)(a) is applicable, and that the worker's average weekly earnings should not be less than his entitlements under the Agreement. Moreover, having regard to the submissions of counsel, I am of the view that the worker's average weekly earnings should be determined by reference to his entitlements under the Agreement.

13 I find that the worker's normal hours of work pursuant to his contract of employment were 70 hours per week and that there was no component of overtime, as understood by the Act, in those hours. It is clear that the worker also worked occasional overtime hours, but I understand that it is not sought to include those earnings in the reckoning of his average weekly earnings. If I am wrong in this assumption, I will give the parties an opportunity to be heard on this aspect of the matter.

14 Mr Martin's original submission was that the worker's entitlements under the Agreement were more than twice State average weekly earnings and so therefore his average weekly earnings should be fixed at this prescribed maximum. Mr Martin's calculations did not allow for any recreation days. It is in my view appropriate that the worker's earnings be averaged over the four weeks of his work cycle. This appears to give a figure less than the applicable prescribed maximum of twice State average weekly earnings.

15 The calculation of the weekly wage to which the worker was entitled under the Agreement is not easily made, and in any event, I have not heard from both parties on this aspect. I therefore adjourn further consideration of this judicial determination to give the parties an opportunity to consider these reasons and attempt to reach agreement on the quantification of the worker's average weekly earnings. In default of agreement I will relist the matter so that the figure can be determined in accordance with these reasons.

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.