appellant. In Hochbaum (2019/153561): orders of the President of the Workers Compensation Commission (18 April 2019) set aside; appeal from Senior Arbitrator dismissed; Senior Arbitrator's Certificate of...
Key principles
On the proper construction of s 39 of the Workers Compensation Act 1987 (NSW), the 260-week limit in s 39(1) never applies to a worker whose injury results in permanent...
The words 'to be assessed' in s 39(3) refer to the methodology and procedural mechanism for measuring impairment and resolving disputes under s 65 and Part 7 of Chapter 7 of the...
The degree of permanent impairment that 'results from the injury' is the final, singular degree of permanent impairment attributable to that injury, even if it is only...
A medical assessment certificate is conclusive evidence of degree of permanent impairment for proceedings, but it is not itself the source of liability; liability for permanent...
Issues before the court
Whether s 39(3) of the Workers Compensation Act 1987 requires that an approved medical specialist's assessment (and issuance of a medical assessment...
Plain English Summary
Two long-term recipients of weekly workers' compensation had payments stopped when a new law imposed a 260-week cap. Both were later medically certified as having more than 20% permanent impairment from their injuries and payments were resumed from the certificate dates. The insurers disputed liability for the gap between the cap expiry and the certificate dates. The Commission President held the exemption applied only from the assessment date. The NSW Court of Appeal unanimously held that the exemption applies to any injury that results in more than 20% permanent impairment regardless of when that is assessed; the assessment rules supply a method for measuring impairment and resolving disputes, not a precondition to entitlement. The Court restored the decisions awarding the disputed payments (Hochbaum: each party bears own costs; Whitton: respondent pays appellant's costs).
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Deep Dive
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Whether s 39(2) has a temporal element so that the exemption from the 260-week limit only applies from the date on which a worker is assessed as...
Cited legislation
5 cited instruments linked from this judgment.
What happened
Two long-standing workers, Frank Hochbaum and Dianne Whitton, each injured in 2000 and 1999 respectively, were receiving weekly workers' compensation payments before and after the commencement of the 2012 workers compensation amendments in New South Wales. The 2012 amendments substituted s 39 of the Workers Compensation Act 1987 (NSW), which imposed a cap: weekly payments cease after an aggregate period of 260 weeks (five years) (s 39(1)), but s 39(2) provides an exception, the 260-week cap does not apply where the worker's injury "results in" permanent impairment and the degree of permanent impairment resulting from the injury is more than 20%.
Because prior weekly payments made before 1 January 2013 do not count for the purposes of the new 260‑week calculation in these transitional cases, the 260‑week period for both appellants ran from 1 January 2013 and expired on or about 25 December 2017. Insurers ceased weekly payments on or about 26 December 2017. Later, in 2018, each worker obtained a medical assessment certificate from an approved medical specialist certifying whole-person impairment above 20% (Hochbaum 21% certified 16 July 2018; Whitton 32% certified 18 June 2018). Weekly payments were resumed prospectively from those assessment dates. The dispute concerned whether the workers were entitled to weekly payments for the interim period between 26 December 2017 (cessation) and the dates on which the assessments were certified.
A Senior Arbitrator (Bamber) held for the workers that they were entitled to weekly payments for the disputed gap. On appeal, the President of the Workers Compensation Commission overturned both decisions, concluding that s 39(2) only disapplied s 39(1) from the date of a formal assessment certifying more-than-20% impairment. The workers then appealed as of right to the New South Wales Court of Appeal.
The Court of Appeal (Brereton JA, White JA and Simpson AJA) allowed the appeals. The appellate court held that s 39(2) exempts from the 260-week limit any worker whose injury results in a degree of permanent impairment exceeding 20%, irrespective of when that degree is ascertained; s 39(3) does not make a formal assessment a precondition to the operation of s 39(2) but prescribes the methodology for assessing and resolving disputes about impairment. The Senior Arbitrator's determinations were reinstated. Orders for costs differed between the two matters (Hochbaum: by consent each party to bear its own costs; Whitton: respondent ordered to pay appellant's costs).
Why the court decided this way
Textual analysis formed the core of the Court's reasoning. Three key textual and legal points drove the result.
The meaning and structure of s 39.
Subsection (1) imposes the 260-week cap in absolute terms.
Subsection (2) creates an exception: "This section does not apply to an injured worker whose injury results in permanent impairment if the degree of permanent impairment resulting from the injury is more than 20%."
Subsection (3) declares: "For the purposes of this section, the degree of permanent impairment that results from an injury is to be assessed as provided by section 65" (which imports Pt 7 of Ch 7 of the 1998 Act).
Brereton JA concluded that s 39(2) identifies an exempt class by reference to the character of the injury (its result: the degree of permanent impairment), and that s 39(3)'s reference to assessment procedure supplies a methodology for measuring that result. It does not transform assessment into a constitutive prerequisite for the exemption. The words "is to be assessed" point to a process, not to a condition precedent that the process must have been completed before s 39(2) can operate [see Brereton JA at [2]-[3], [45]].
Contrast with other provisions where Parliament did require 'has been assessed'.
The Court emphasised that s 32A (definition of 'worker with high needs') uses the phrase "has been assessed" and provides express alternatives (pending assessment because maximum medical improvement not reached, or insurer's satisfaction that impairment is likely to exceed the threshold). That contrast shows Parliament knew how to make a prior assessment decisive when it wanted to; its omission in s 39(3) is significant [Brereton JA].
Legal meaning of 'permanent impairment' and temporal effect.
The Court relied on established authorities (e.g. Borovac) for the proposition that liability for permanent impairment dates from the injury; the measured degree may only be ascertainable later, but the injury is the source. Brereton JA reasoned that "permanent" denotes a single, ultimate degree of impairment that results from the injury; the statute's present-tense wording is descriptive rather than temporal (the 'simple present' describes character, not contemporaneity) [Brereton JA at [53]-[56]; Gaudron J in Re Dingjan cited].
Consequently, the relevant question under s 39(2) is what degree of permanent impairment results from the injury, the final, conclusive degree, not at what date that degree was certified. If the final degree is more than 20%, s 39(2) applies and s 39(1) never applies to that worker.
White JA emphasised the absurdity and administrative impracticality of construing the section so that an agreed, uncontested >20% impairment would nevertheless require the engineer of a 'medical dispute' and a formal Pt 7 assessment before the exemption could be engaged. Simpson AJA relied on the text alone and said nothing in s 39 ties the removal of the bar to the date of assessment [Simpson AJA at [14]].
The Court also observed the evidentiary role of a medical assessment certificate (s 326), conclusive evidence in proceedings, but reiterated that the certificate is not itself the source of liability; liability for impairment stems from the injury.
Before and after state of the law
Before this decision (and in the President's view below), a plausible construction of s 39 was that the 260-week bar operated but could be "lifted" only from the date that an approved medical specialist formally assessed the worker's degree of permanent impairment as exceeding 20%, in effect, a temporal, assessment-dependent exception.
After the Court of Appeal's decision:
The statutory exemption in s 39(2) is to be read as identifying, by reference to the injury's ultimate outcome, a class of workers who are never subject to the 260-week cap if their injury results in >20% permanent impairment.
A formal assessment is not a condition precedent to the exception; assessment procedures govern measurement and dispute-resolution but do not determine entitlement for the purpose of whether s 39 applies.
Practically, this means a worker ultimately found to have >20% impairment is entitled to be treated as having been within the exempt class from the time the injury produced that permanent impairment, and the 260-week cap did not in principle apply to them, assessing when the impairment 'resulted' is not the statutory inquiry. If an assessment occurs later, the assessment confirms what the injury produced.
This settles an interpretive question likely to affect many transitional or long-running cases where administrative or medical delay might otherwise produce a windfall to insurers.
Key passages with plain-English translation
Selected passages from the reasons and a plain-English restatement.
Brereton JA: "On the proper construction of s 39, the 260-week limit never applies to a worker whose degree of permanent impairment resulting from the relevant injury exceeds 20%..." ([1], [45]).
Plain English: If your injury ultimately causes more than 20% permanent impairment, the five-year cut-off simply does not apply to you. It does not matter whether that level of impairment is recognised by a formal certificate at the time the five-year mark passes.
Brereton JA: "The words 'to be assessed' in s 39(3) provide the methodology and process... they do not mandate that there must have been an assessment before s 39(2) is engaged." ([2]-[3]).
Plain English: The law tells us how to measure impairment and how to resolve disputes about it; it does not say that you first need the formal measurement before you can be part of the exempt group.
White JA: "It would be absurd if an assessment ... were required even if there were no dispute ... that the worker's injury resulted in permanent impairment of more than 20 per cent." ([3]).
Plain English: Requiring a formal dispute-driven assessment to access the exemption would be nonsense, it would force people to manufacture disputes to get what Parliament intended for seriously injured workers.
Simpson AJA: "Nothing in any of the three subsections of s 39 states... that removal of the subs (1) bar is dependent upon the date of the assessment..." ([90]-[91]).
Plain English: The statute does not tie the 260-week exemption to the day a doctor signs a certificate. It depends on whether the injury produced the impairment.
What fact patterns trigger this precedent
This decision will be triggered where:
A worker's claim pre-dates the 2012 amendments so that transitional counting of weeks (commencing 1 January 2013) produces a 260-week expiry date; and
The insurer stops weekly payments upon expiry; and
The worker later, after the 260-week expiry, obtains an approved medical specialist's certificate (or otherwise is shown) that the injury results in a degree of permanent impairment greater than 20%; and
The worker seeks retrospective weekly payments for the gap between cessation and the date of the certificate.
Under Hochbaum/Whitton a worker in that situation will not be defeated by the insurer's cessation of payments simply because the certificate issued later, if the final degree of impairment resulting from the injury is >20% the worker falls within the statutory exempt class and the 260-week cap never applied.
More broadly, the decision applies where entitlement depends on whether an injury results in a certain degree of permanent impairment and there is a question whether formal assessment timing creates or defeats the entitlement.
However, entitlement to weekly payments during the gap still requires that the worker had compensable incapacity during that period. The Court emphasised impairment and incapacity are distinct; retrospective payments require there to have been incapacity attributable to the injury during the period in question.
How later courts have treated it
As of this decision (17 June 2020), the Court of Appeal decisively overruled the approach taken by the President of the Workers Compensation Commission in the two decisions appealed (RSM Building Services v Hochbaum [2019] NSWWCCPD 15 and TAFE NSW v Whitton [2019] NSWWCCPD 27). The judgment expressly applies and cites authorities such as Borovac for the proposition that permanent impairment dates from the injury; it distinguishes arguments based on temporal readings of statute and on regulatory ameliorations (cl 28C) that are transitional rather than dispositive of statutory meaning.
Practitioners should expect the Court's textual approach to be followed in subsequent appeals where the same interpretive question arises, and to influence Commission practice: insurers cannot rely on the timing of a medical certificate alone to avoid liability for a period where the worker was incapacitated and the injury ultimately produced >20% impairment. The judgment also indicates appellate courts will prefer a straightforward textual construction and be wary of importing temporal glosses that produce anomalous administrative results.
Still-open questions
Several points remain for future clarification or remain practically significant:
Interaction with incapacity: The Court emphasised that exemption from s 39(1) does not itself create entitlement to weekly payments; the worker must have had compensable incapacity during the disputed period. Where impairment is certified as >20% but incapacity for the particular retrospective period is contested, factual disputes will remain determinative. The judgment underlines that impairment ≠ incapacity; claimants still must show incapacity in the period for retrospective weekly payments.
Role of s 322(4) where maximum medical improvement is not reached: The regulation (cl 28C) and the statutory reference in s 32A cover cases where assessment is not possible because maximum medical improvement has not been reached. While the Court did not need the regulation to reach its decision and expressed reservations about using regulation to inform interpretation, administrative scenarios in which assessment is refused for being premature remain consequential for practice and may require further litigation over whether an insurer's satisfaction (or refusal) is reasonable.
Appeal and substitution effects: The Court accepted that an appeal panel's substituted certificate replaces the earlier certificate and that the final degree of impairment is the operative one dating to the injury. But practical questions of how substituted certificates operate for retrospective payments in complex fact patterns (for example where an initial certificate is lower and later appeal increases impairment) may require further elaboration in future cases to address discrete evidentiary or quantum questions.
Transitional counting and other technicalities: The judgment resolved the core interpretive issue, but many technical transitional points (what counts in the 260 weeks for differing claim cohorts, and application of other subdivisions of the Act) will continue to generate disputes across the scheme.
Administrative fairness and delay: The Court recognised the potential unfairness to workers caused by administrative delays in getting assessments, but felt bound by the statutory text. Legislative reform or regulatory adjustments (rather than judicial construction) remain the mechanisms to address systemic delay.
In sum, Hochbaum and Whitton settle that, for the statutory question whether s 39 applies, the governing test is the final degree of permanent impairment attributable to the injury. Assessment procedures are for measurement and dispute resolution; they do not temporally gatekeep the statutory exemption. Practitioners should therefore frame litigation and advice around (a) establishing that the injury resulted in the requisite degree of impairment, and (b) proving compensable incapacity for any period for which retrospective payments are sought.
Catchwords
ex parte Wagner (1995) 183 CLR 323[1995] HCA 16
Freeman v Secretary, Department of Social Security (1988) 19 FCR 342[1988] FCA 294
Hee v State Transit Authority of New South Wales (2019) 287 IR 200[2019] NSWCA 175
Hochbaum v RSM Building Services Pty Ltd [2019] NSWWCC 31
Hunter Quarries Pty Ltd v Mexon (2018) 98 NSWLR 526
Judgment (21 paragraphs)
[1]
cers' Association Amalgamated Union of New South Wales v Industrial Relations Secretary on behalf of the Department of Justice [2015] NSWCA 386
RSM Building Services Pty Ltd v Hochbaum [2019] NSWWCCPD 15
Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 31
Stevens v The Railway Commissioners for NSW (1930) 31 SR (NSW) 138
Technical and Further Education Commission t/as TAFE NSW v Whitton [2019] NSWWCCPD 27
TNT Australia Pty Ltd v Horne (1995) 11 NSWCCR 497
Whitehaven Coal Mining Ltd v Pain [2018] NSWCA 229
Whitton v Technical and Further Education Commission t/as TAFE NSW [2019] NSWWCC 27
Texts Cited: State Insurance Regulatory Authority, NSW Workers Compensation Guidelines for the Evaluation of Permanent Impairment (4th ed, 2016)
Category: Principal judgment
Parties: 2019/153561:
Frank Hochbaum (appellant)
RSM Building Services Pty Ltd (respondent)
State Insurance Regulatory Authority (amicus curiae)
[2]
2019/215243:
Dianne Whitton (appellant)
Technical and Further Education Commission t/as TAFE NSW (respondent)
State Insurance Regulatory Authority (amicus curiae)
Representation: Counsel:
2019/153561:
B McManamey (applicant)
M Allars SC w B Tronson (respondent)
J Emmett w J Brezniak (amicus curiae)
[3]
2019/215243:
D Hooke SC w E Grotte (applicant)
J Lucy (respondent)
J Emmett w J Brezniak (amicus curiae)
2019/215243:
Foye Legal (applicant)
Moray & Agnew (respondent)
Crown Solicitor for NSW (amicus curiae)
File Number(s): 2019/153561; 2019/215243
Decision under appeal Court or tribunal: Workers Compensation Commission
Jurisdiction: Presidential
Citation: [2019] NSWWCCPD 15
[2019] NSWWCCPD 27
Date of Decision: 18 April 2019
17 June 2019
Before: Judge Phillips, President
File Number(s): A1-4847/18
A1-4503/18
[6]
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
[7]
HEADNOTE
[This headnote is not to be read as part of the judgment]
The appellants were two workers who were injured in the course of their respective employment. Each made a claim for compensation, and was in receipt of weekly compensation payments, prior to the introduction of the new workers compensation regime introduced in 2012. The 2012 amendments replaced s 39(1) of the (NSW) Workers Compensation Act 1987 ("the 1987 Act"), which now provides that a worker has no entitlement to weekly payments of compensation after an aggregate period of 260 weeks, whether or not consecutive, in respect of which a weekly payment has been paid or is payable. However, s 39(2) provides that the section does not apply to an injured worker whose injury results in permanent impairment if the degree of permanent impairment resulting from the injury is more than 20%.
Pursuant to the commencement of the legislative regime, the respondents' insurers ceased paying weekly payments to the appellants with effect from 26 December 2017, being 260 weeks after 1 January 2013. Subsequently, the appellants were assessed as having a degree of permanent impairment resulting from their relevant work injury in excess of 20%. Weekly payments were resumed with effect from the date of the assessment; however, liability to make payments in respect of the period between 26 December 2017 and the date of the assessment was disputed.
In each case, an arbitrator held that the worker was entitled to weekly payments for the disputed period, but both decisions were overturned on appeal by the President of the Workers Compensation Commission, who held that the effect of s 39(2) was to displace s 39(1) only from the date when the worker was assessed to have a degree of permanent impairment resulting from the injury of more than 20%. The applicants, being aggrieved by the decisions of the President of the Commission in point of law, appealed from that holding, as of right, to this Court. The Court found there were two main limbs underlying the President's decision (which formed the two primary issues considered on appeal); first, that assessment is a precondition to liability given the words of s 39(3); and secondly, that s 39(2) has a temporal aspect as it operates on the state of affairs that obtains at the relevant date.
Held, allowing the appeal:
[8]
per Brereton JA (White JA agreeing)
On the proper construction of s 39, the 260-week limit never applies to a worker whose degree of permanent impairment resulting from the relevant injury exceeds 20%, regardless of when that threshold is crossed, and regardless of whether or when it is formally assessed as having been crossed: at [1], [45].
[9]
As to the first issue, per Brereton JA (White JA agreeing)
By incorporating Pt 7 of Ch 7 of the (NSW) Workplace Injury Management and Workers Compensation Act 1998, through s 65 of the 1987 Act, the words "to be assessed" in s 39(3) provide the methodology and process by which impairment is to be measured and any dispute about its existence or extent resolved; the words do not mandate that there must have been an assessment before s 39(2) is engaged: at [2], [3], [45], [46], [50], [82].
[10]
As to the second issue, per Brereton JA
The date on which an impairment threshold is crossed is not a relevant consideration in any question arising under s 39 of the 1987 Act, and the only relevant question is, what degree of permanent impairment has resulted from the worker's injury. For the purposes of s 39, while impairment may improve or deteriorate over time, or not be established until long after the injury, it is the final degree of permanent impairment that results from an injury that is determinative of whether the worker is in the exempt class. There can ultimately be only a single degree of permanent impairment that results from an injury; the contrary view is incongruous with the concept of permanency: at [53]-[56].
[11]
As to the second issue, per White JA
The degree of permanent impairment ultimately ascertained does not necessarily arise from the date of the worker's injury. In some cases the worker's degree of permanent impairment will date from the injury; but in others the ultimately assessed degree of permanent impairment would have been occasioned by later events, such as adverse results of surgery or psychological sequelae, that did not exist earlier: at [8], [9], [11], [12].
per Simpson AJA
It is necessary to go no further than the text of s 39 to resolve the present dispute. Nothing in any of the three subsections of s 39 states, explicitly or implicitly, that removal of the subs (1) bar is dependent upon the date of the assessment of the degree of permanent impairment as distinct from the existence of the degree of permanent impairment. The language of subs (2) points in the opposite direction: the foundation for the removal of the subs (1) bar lies in the existence of a degree of permanent impairment exceeding 20%. Subsection (3) does no more than specify the mechanism by which the degree of permanent impairment is to be assessed; nothing in subs (3) suggests that an assessment may only be prospective. If it were necessary to go beyond the text of s 39, resort to principles of statutory construction would support the same approach: at [90]-[91].
[12]
Judgment
WHITE JA: I have had the advantage of reading in draft the reasons for judgment of Brereton JA. I agree with the orders his Honour proposes and generally with his Honour's reasons. The following additional reasons assume familiarity with his Honour's judgment and the statutory provisions to which his Honour refers.
In particular, I agree with Brereton JA that the President erred in considering that subs (3) of s 39 of the Workers Compensation Act 1987 (NSW) gives meaning to the words "permanent impairment" in s 39(2) and supplies a "statutory definition" for the operation of s 39(2). Section 39(3) provides for the method of assessing the degree of permanent impairment that results from an injury. It does not define the meaning of "permanent impairment" or "permanent impairment resulting from the injury".
It would be absurd if an assessment pursuant to Pt 7 of Ch 7 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) ("the 1998 Act") of the degree of permanent impairment resulting from an injury were required even if there were no dispute between the insurer and the injured worker that the worker's injury resulted in permanent impairment of more than 20 per cent. Nor could there be such an assessment if there were no medical dispute.
Clause 28C in Sch 8 of the Workers Compensation Regulation 2016 (NSW) provides:
"28C 5 year limit on weekly payments
Section 39 of the 1987 Act (as substituted by the 2012 amending Act) does not apply to an injured worker if the worker's injury has resulted in permanent impairment and -
(a) an assessment of the degree of permanent impairment for the purposes of the Workers Compensation Acts is pending and has not been made because an approved medical specialist has declined to make the assessment on the basis that maximum medical improvement has not been reached and the degree of permanent impairment is not fully ascertainable, or
(b) the insurer is satisfied that the degree of permanent impairment is likely to be more than 20% (whether or not the degree of permanent impairment has previously been assessed)."
I agree with Brereton JA (at [68]) that this Regulation does not provide a sound basis for interpreting the principal provisions of the Act.
Although the Regulation can effect an amendment to the principal Act (Workers Compensation Act, Sch 6 Pt 19H cl 5(4)), it does not follow that it can be relied upon to show that the apparently absurd operation of s 39 (if construed as contended for by the respondents) should be discounted because of the amelioration of that position through the Regulation. Any inference as to the intention of the lawmaker is not as to the intention of Parliament in enacting s 39, but an inference of an apprehension by the Executive that, absent amendment, s 39 might not permit an insurer to continue to pay weekly benefits even though there was no dispute that the worker's injury had resulted in permanent impairment of 20 per cent or more. That inference does not justify a construction of s 39 that it is only if an assessment of permanent impairment of more than 20 per cent is made in accordance with Pt 7 of Ch 7 of the 1998 Act that from that assessment being made the worker is entitled to further weekly payments (AQO v Minister for Finance and Services [2016] NSWCA 248 at [142]-[143] per Basten JA.)
[13]
Mr Hochbaum
The appellant Frank Hochbaum suffered an injury to his right leg in the course of his employment with the respondent RSM Building Services on 1 September 2000. He made a claim for lump sum compensation and weekly payments. He received weekly payments from 15 December 2000, and in July 2004, Mr Hochbaum and the respondent's insurer entered into a "complying agreement", for the purposes of s 66A of the 1987 Act, resolving the claim for lump sum compensation, for a sum of $8,750. No medical assessment was obtained with respect to that claim.
When the new regime under the 2012 Amendment Act commenced on 1 October 2012, Mr Hochbaum was an "existing recipient of weekly payments". [5] On 2 April 2013, the respondent's insurer made a "work capacity decision" [6] that Mr Hochbaum had no current work capacity, and he continued to receive weekly payments.
By letter dated 7 February 2017, the respondent's insurer informed Mr Hochbaum of the effect of the 2012 Amendment Act, including that towards the end of 2017 he would reach the 260-week limit, and requesting that, to enable the insurer to determine whether he would be entitled to weekly payments after that period expired, he attend an appointment with Dr Breit. In a report dated 16 March 2017, Dr Breit expressed the opinion that Mr Hochbaum's degree of permanent impairment of the whole person for the injury below the right knee was 5%. By letter dated 11 May 2017, the insurer informed Mr Hochbaum about a transition plan to assist him to transition to financial independence. By letter dated 15 June 2017, the insurer arranged for an appointment with Associate Professor Myers, vascular surgeon, who reported on 20 July 2017 that Mr Hochbaum had no permanent impairment attributable to any relevant injury. On 2 August 2017, the insurer notified Mr Hochbaum that his weekly payments would cease on 25 December 2017 pursuant to s 39, because he would have been paid for 260 weeks since 1 January 2013. Mr Hochbaum was reminded of this by a further letter dated 2 September 2017. Weekly payments to Mr Hochbaum ceased on 25 December 2017.
On 3 April 2018, Dr Patrick examined the appellant and expressed the opinion that he had a 49% permanent impairment of the whole person - although this was not entirely attributable to the relevant work injury. The appellant's solicitors sought restoration of his weekly payments, which the insurer refused on 24 April 2018. On 1 May 2018, Mr Hochbaum applied to the Commission for referral for assessment by an approved medical specialist. There was a referral for assessment in respect of injuries for which liability was accepted, and on 16 July 2018, an approved medical specialist issued a medical assessment certificate certifying that Mr Hochbaum had a 21% permanent impairment referable to the relevant work injury.
[14]
Ms Whitton
The appellant Dianne Whitton suffered an injury to her right wrist in the course of her employment with the respondent TAFE NSW on 2 November 1999. Although she returned to light duties in 2000, those duties did not adequately accommodate her restrictions, and after three months she could not continue working; she ceased work in 2000 or 2001, and was paid weekly compensation. In 2005 Ms Whitton brought a claim for lump sum compensation, which was resolved by the parties entering into a "complying agreement" under s 66A of the 1987 Act to pay lump sum compensation in respect of a 20% permanent loss of efficient use of her right arm.
When the new workers compensation regime under the 2012 Amendment Act commenced on 1 October 2012, Ms Whitton was an "existing recipient of weekly payments". [9] On 4 November 2013, the respondent's insurer made a "work capacity decision" [10] that Ms Whitton had no current work capacity, and that it would pay her weekly compensation at the rate of $758.80.
On 10 August 2017, Dr Harbison, orthopaedic surgeon, who examined Ms Whitton at the insurer's request, expressed an opinion that Ms Whitton had a13% whole person impairment in respect of the injury to her right wrist. On 16 August 2017, the insurer notified Ms Whitton that her entitlement to weekly compensation would cease on 25 December 2017, pursuant to s 39 of the 1987 Act.
On 18 June 2018, an approved medical specialist issued a medical assessment certificate certifying that Ms Whitton's degree of whole person impairment resulting from the relevant injury was 32%. Weekly payments of compensation to her were resumed with effect from 18 June 2018, but her entitlement to weekly compensation for the period between 26 December 2017 and 18 June 2018 was disputed. Senior Arbitrator Bamber determined that dispute on 7 January 2019 in favour of Ms Whitton, holding that the respondent was liable to pay her weekly compensation for the period from 26 December 2017 to 18 June 2018 at the applicable rate for a worker with no current work capacity. [11] On appeal by the respondent, that decision was overturned by the President of the Commission on 17 June 2019, and an award for the respondent was substituted. [12]
[15]
The statutory provisions
Section 39 of the 1987 Act is to be construed in the context of the other provisions of that Act, and the provisions of the (NSW) Workplace Injury Management and Workers Compensation Act 1998 ("the 1998 Act"). [13]
Under s 9 of the 1987 Act, a worker who has received an injury is entitled to receive compensation from the worker's employer in accordance with the Act. For the purposes of the Act, by s 4, the term "injury" means "personal injury arising out of or in the course of employment". Part 3 of the Act makes provision in respect of the various types of compensation. If incapacity results from a work injury, the employer is liable, pursuant to s 33, to pay to the worker weekly compensation during the incapacity; and if permanent impairment of a degree greater than 10% results from a work injury, the employer is liable, pursuant to s 66, to pay lump sum compensation.
The eligibility criteria that entitle an injured worker to weekly compensation under s 33 differ across four periods: [14] the first entitlement period (meaning an aggregate period not exceeding 13 weeks, whether or not consecutive, in respect of which a weekly payment has been paid or is payable to the worker); the second entitlement period (meaning an aggregate period of 117 weeks after the expiry of the first entitlement period in respect of which a weekly payment has been paid or is payable to the worker); the period from the expiry of the second entitlement period (after an aggregate period of 130 weeks) until the expiry of 260 weeks (5 years); and the period after the expiry of 260 weeks.
By s 36, during the first entitlement period, an injured worker who has no current work capacity [15] is entitled to weekly payments at the rate of 95% of the worker's pre-injury average weekly earnings; while an injured worker who has current work capacity is entitled to weekly payments at the lesser of 95% of the worker's pre-injury average weekly earnings less the worker's current weekly earnings, and the maximum weekly compensation amount less the worker's current weekly earnings. By s 37, during the second entitlement period, an injured worker who has no current work capacity is entitled to weekly payments at the rate of 80% of the worker's pre-injury average weekly earnings; while an injured worker who has current work capacity and has returned to work for not less than 15 hours per week is entitled to weekly payments at the lesser of 95% of the worker's pre-injury average weekly earnings less the worker's current weekly earnings, or the maximum weekly compensation amount less the worker's current weekly earnings; and an injured worker who has current work capacity and has returned to work for less than 15 hours per week is entitled to weekly payments at the lesser of 80% of the worker's pre-injury average weekly earnings less the worker's current weekly earnings, or the maximum weekly compensation amount less the worker's current weekly earnings.
[16]
The decisions below
The President of the Commission held, and the respondents (and the State Insurance Regulatory Authority) contend, that s 39(2) contains a temporal element, and s 39(3), read with s 65, has the effect that a formal assessment under and in compliance with Pt 7 of Ch 7 of the 1998 Act, culminating in the giving of a medical assessment certificate, is a necessary precondition to the operation of s 39(2), so that s 39(2) does not operate unless and until there is such an assessment. In other words, s 39(2) "disapplies" s 39(1) for a worker whose degree of permanent impairment exceeds the 20% threshold only from the time when the degree of permanent impairment exceeds that threshold,, which occurs only when there has been an assessment, as provided by s 65, to that effect.
The reasoning that is relied on to support that conclusion may be summarised as follows:
1. The object of s 39 is that weekly compensation payments should ordinarily end after an aggregate period of 260 weeks, subject to the exception provided by s 39(2). [18]
2. Section 39 must be read as a whole, and the words "does not apply" in s 39(2) must be seen in the context of s 39(3), which provides not merely a method of assessment, but a detailed definition as to how s 39(2) is to operate. [19]
3. Section 39(2) contains a temporal element, the critical question being whether the criterion (of greater than 20% impairment) was or was not met at the relevant date. [20] To construe s 39(2) to mean that s 39(1) does not apply "at all" once permanent impairment has been assessed, in accordance with the prescribed assessment procedure, at greater than 20%, impermissibly reads into the section words that are not in the text; there is no warrant for the view that once "the bar" in s 39(1) is lifted, it is lifted for all purposes as if the provision were nugatory. [21]
4. Thus after an aggregate period of 260 weeks, a worker loses the entitlement to weekly compensation payments, but regains that entitlement when the degree of permanent impairment resulting from the injury exceeds 20%, which, by s 39(3), only occurs for the purpose of s 39(2) when an approved medical specialist has assessed the degree of permanent impairment as in excess of 20%, and only from the date of that assessment. [22]
[17]
The construction of s 39
Section 39(2) exempts from the application of s 39 a particular class of injured worker, namely those whose injury results in a degree of permanent impairment of more than 20%. In my opinion, for the reasons that follow, and contrary to the decisions of the President of the Commission, on the proper construction of s 39, the 260-week limit never applies to a worker whose degree of permanent impairment resulting from the relevant injury exceeds 20%, regardless of when that threshold is crossed, and regardless of whether or when it is formally assessed as having been crossed.
There are two main limbs to the reasoning relied on to support the construction adopted by the President of the Commission. The first is that assessment is a precondition to liability: the stipulation in s 39(3) that "the degree of permanent impairment that results from an injury is to be assessed as provided by section 65" has the effect of prescribing that, for the purposes of s 39(2), a worker will have an impairment greater than 20% only once he or she has been formally assessed as having such an impairment, in accordance with the assessment procedure prescribed in Pt 7 of Ch 7 of the 1998 Act, culminating in the giving of a medical assessment certificate. The second is that s 39(2) has a temporal aspect: s 39(2) operates on the state of affairs that obtains at the relevant date, and disapplies s 39 only if, at the date in question, the worker's impairment exceeds 20%. In my respectful opinion, neither of those propositions is correct.
[18]
Section 39(3) does not mandate formal assessment
As has been noted, s 39(3) provides that for the purposes of s 39, the degree of permanent impairment that results from an injury "is to be assessed as provided by s 65 (for an assessment for the purposes of Division 4)"; and s 65 in turn provides that the degree of permanent impairment that results from an injury is to be assessed as provided by s 65, and Pt 7 of Ch 7 of the 1998 Act; and that if a worker receives more than one injury arising out of the same incident, those injuries are together to be treated as one injury.
Some of the provisions of Pt 7 of Ch 7 of the 1998 Act (such as ss 321, 321A, and 325) provide the procedural apparatus for the resolution of medical disputes, while others (such as s 322, which covers the assessment of the degree of permanent impairment "for the purposes of the Workers Compensation Acts") provide the methodology for measuring the degree of impairment. These are the only provisions in the legislation that say how impairment is to be measured, and are relevant not only for the purposes of s 39 of the 1987 Act, but also for the purposes of ss 32A, 38A, 59A and 66. In that way, Pt 7 provides the methodology for measuring impairment, and the procedural apparatus for resolving disputes about its measurement. By incorporating Pt 7, through s 65, the words "to be assessed" in s 39(3) provide the methodology and process by which impairment is to be measured and any dispute about its existence or extent resolved.
This does not mean that those provisions mandate that there must have been an assessment before s 39(2) is engaged. The words "is to be assessed" in s 39(3) stand in marked contradistinction to the words "has been assessed" in the definition (in s 32A) of "worker with high needs" which informs eligibility under s 38 for weekly payments after 130 weeks, and which defines such a worker as one with permanent impairment in respect of whom:
1. the degree of permanent impairment has been assessed for the purposes of Div 4 as being more than 20%;
2. an assessment of the degree of permanent impairment is pending and has not been made because an approved medical specialist has declined to make the assessment on the basis that maximum medical improvement has not been reached and the degree of permanent impairment is not fully ascertainable; or
3. the insurer is satisfied that the degree of permanent impairment is likely to be more than 20%. [23]
[19]
There is no temporal element in s 39(2)
Section 39(2) provides that the 260-week cap does not apply to a worker whose "injury results in permanent impairment if the degree of permanent impairment resulting from the injury is more than 20%". The phrase "injury results in permanent impairment if the degree of permanent impairment resulting from the injury is more than 20%" describes an injury which has a particular result, namely permanent impairment of the specified degree. It is the injury, rather than the impairment, that attracts s 39(2), albeit only if the injury has a particular result in terms of impairment. The "injury" referred to in s 39(2) is the injury defined in s 4, in respect of which a worker is entitled, pursuant to s 9, to compensation in accordance with the Act.
Injury and impairment are not necessarily concurrent, and it is well-established that entitlements to compensation such as those created by s 9(1) of the 1987 Act vest upon the occurrence of the injury, even though those entitlements may not be immediately ascertainable. [27] Liability for permanent impairment dates from the injury, regardless of when it is ascertained. In Borovac v Corporate Ventures Pty Ltd t/as Bowsers Ashphalt ("Borovac"), [28] the worker had suffered injuries to his back in a work accident, and claimed compensation for permanent impairment of his back and for pain and suffering. The degree of permanent impairment was ascertained only after a surgical procedure was performed. The primary judge had awarded interest on the lump sum only from the date of the procedure when the degree of permanent impairment was ascertained, and had regard only to pain and suffering experienced after that date. In overturning this, Clarke JA, with whom Meagher JA agreed, held that the worker's permanent impairment resulted and dated from the time of the injury, notwithstanding that its degree was not determined until some later time: [29]
His Honour assessed the compensation at $10,000 upon the basis that, as the loss assessed under section 66 was the loss after the ameliorating effects of the operation, the pain and suffering should be assessed from the time at which the permanent impairment was determined. To put it another way, his Honour's view proceeded upon the basis that the appellant's pain and suffering resulting from the employment injury was not compensable in respect of the period prior to the time when the Court was able to assess the degree of permanent injury. In my opinion this approach was too narrow. The relevant loss suffered by the appellant was a permanent impairment to his back. That loss was suffered as a result of the employment injury. Prior to the operation, the degree of permanent impairment could not be assessed. It was only after the beneficial effects of the operation that it could be said that all of the impairment was permanent. Nonetheless, there was, as his Honour's factual finding made clear, a permanent impairment of his back caused by the employment injury which caused pain and suffering from the time of that injury. The fact that it was not possible to measure the extent of the permanent impairment prior to the operation presents no reason for denying compensation for pain and suffering at the earlier time.
In those circumstances, it seems to me that his Honour was obliged to base his award on the pain and suffering resulting from the permanent impairment which resulted, and dated, from the time of the employment injury. This obligation existed notwithstanding that the degree of that permanent impairment was not determined until after the operation.
[20]
Conclusion and costs
My conclusions may be summarised as follows:
Section 39(2) exempts from the 260-week cap otherwise imposed by s 39 a particular class of injured worker, namely those whose injury results in a degree of permanent impairment of more than 20%.
The words "to be assessed" in s 39(3) point to provisions that contain the methodology and process for measuring impairment and resolving any dispute about it; they do not mandate that there must be a formal assessment before s 39(2) is enlivened. The function of s 39(3) is not to make assessment a precondition to the engagement of s 39(2), but to provide a mechanism for measuring and determining the degree of permanent impairment that results from an injury, so as to resolve any dispute about whether or not a worker is within the exempt class.
There is no "temporal element" in s 39(2). Ultimately, there can be only one degree of permanent impairment resulting from an injury, even though it may not be immediately ascertainable. Permanent impairment, once ascertained, dates from the injury. Section 39(2) poses the simple question, what degree of permanent impairment results from the injury; if that degree is greater than 20%, the worker is in the exempt class, and s 39 never applies to him or her.
It follows that the President of the Commission erred in point of law in construing s 39 as he did, and consequentially in holding that each appellant was not entitled to compensation for the period 26 December 2017 to the date on which weekly payments were resumed. In each matter, the appeal should be allowed, and the determination of the Senior Arbitrator reinstated.
In Hochbaum, the appellant and the respondent agreed that each would bear their own costs of the appeal. There was no such agreement in Whitton, in which each party sought costs, and no apparent reason why the unsuccessful respondent should not pay the successful appellant's costs. It has not been suggested that this Court is deprived of the jurisdiction to award costs in respect of an appeal under s 353 of the 1998 Act by s 341 of that Act which, since the 2012 Amendment Act, has provided as follows:
341 Costs
(1) Each party is to bear the party's own costs in or in relation to a claim for compensation.
(2) The Commission has no power to order the payment of costs to which this Division applies, or to determine by whom, to whom or to what extent costs to which this Division applies are to be paid.
[21]
Endnotes
(NSW) Workers Compensation Regulation 2016, Sch 8 (Savings and transitional provisions), cl 4; see formerly (NSW) Workers Compensation Regulation 2010, Sch 8 (Savings and transitional provisions), cl 4.
Hochbaum v RSM Building Services Pty Ltd [2019] NSWWCC 31; Whitton v Technical and Further Education Commission t/as TAFE NSW [2019] NSWWCC 27.
RSM Building Services Pty Ltd v Hochbaum [2019] NSWWCCPD 15 ("Hochbaum"); Technical and Further Education Commission t/as TAFE NSW v Whitton [2019] NSWWCCPD 27 ("Whitton").
See (NSW) Workplace Injury Management and Workers Compensation Act 1998 ("the 1998 Act"), s 353.
As defined in the 1987 Act, Sch 6, Pt 19H, Div 1, cl 1.
For the purposes of the 1987 Act, Pt 3, Div 2, Subdiv 3, ss 43-44B.
Hochbaum v RSM Building Services Pty Ltd [2019] NSWWCC 31.
Hochbaum [2019] NSWWCCPD 15.
As defined in the 1987 Act, Sch 6, Pt 19H, Div 1, cl 1.
For the purposes of the 1987 Act, Pt 3, Div 2, Subdiv 3, ss 43-44B.
Whitton v Technical and Further Education Commission t/as TAFE NSW [2019] NSWWCC 27.
Whitton [2019] NSWWCCPD 27.
The 1987 Act is to be construed as if it formed part of the 1998 Act: s 2A(2) of the 1987 Act.
See 1987 Act ss 36, 37, 38, 39.
Pursuant to s 32A(2) and Sch 3, cl 9, an injured worker has current work capacity if the worker has a present inability arising from the injury such that the worker is able to return to the worker's pre-injury employment, or is able to return to work in suitable employment, but the weekly amount that the worker has the capacity to earn in any such employment is less than the weekly amount that the worker had the capacity to earn in that employment immediately before the injury; and an injured worker has no current work capacity if the worker has a present inability arising from an injury such that the worker is not able to return to work, either in the worker's pre-injury employment or in suitable employment. Thus "current work capacity" refers to a residual diminished work capacity: see Hee v State Transit Authority of New South Wales [2019] NSWCA 175.
With effect from 1 January 2019, "a dispute concerning permanent impairment of an injured worker" was excluded from s 321, and sub-ss (3) and (4) were omitted. Section 321A(1)(a) now provides that "[t]he regulations may make provision for or with respect to- the circumstances in which a medical dispute concerning permanent impairment of an injured worker is authorised, required or not permitted to be referred for assessment…". No such provision has yet been made by the regulations.
In Hochbaum (2019/153561): orders of the President of the Workers Compensation Commission (18 April 2019) set aside; appeal from Senior Arbitrator dismissed; Senior Arbitrator's Certificate of Determination dated 7 January 2019 reinstated; no order as to costs (each party to bear own costs). In Whitton (2019/215243): orders of the President of the Commission (17 June 2019) set aside; appeal from Senior Arbitrator dismissed; Senior Arbitrator's Certificate of Determination dated 7 January 2019 reinstated; respondent to pay appellant's costs.
I agree with Brereton JA that although the degree of impairment of an injured worker may change, the degree of permanent impairment resulting from the injury is stable and final, albeit that the assessment of the degree of permanent impairment may not be evident or ascertainable and may not be established for many years (at [54]).
That is not to deny that a later assessment of the degree of permanent impairment may show a change in the degree of permanent impairment from a previous assessment. That is a ground of appeal against a medical assessment under s 327(3)(a) of the 1998 Act. If the first assessment cannot be re-opened then the assessment will be conclusive evidence of the worker's degree of permanent impairment. If it can be re-opened pursuant to s 327 of the 1998 Act, then any substituted decision on appeal will be the conclusive evidence of the degree of the worker's permanent impairment. It does not necessarily follow (although on the facts of the case it may do) that at all times from the date of the injury the worker was permanently impaired to the degree ultimately ascertained.
In some cases the worker's degree of permanent impairment will date from the injury. But in others the ultimately assessed degree of permanent impairment would have been occasioned by later events, such as adverse results of surgery or psychological sequelae, that did not exist earlier. Although there is a temporal element in each of ss 36, 37, 38 and 59A, and arguably s 38A when applied to those provisions, there is no temporal element in s 39(2). The inquiry directed by s 39(2) is whether the injury "results in" permanent impairment where the degree of permanent impairment "resulting from the injury" is more than 20 per cent. The only question under s 39(2) is what degree of permanent impairment resulted from the injury. It is unnecessary to enquire whether the impairment resulting from the injury was always present or was present at the expiry of the 260 week period referred to in s 39(1), to the degree of the permanent impairment as ultimately assessed. The date from which the injured worker's degree of permanent impairment arose is not a relevant consideration for the purposes of s 39.
Where the degree of permanent impairment resulting from the injury has not been ascertained after 260 weeks by an assessment under Pt 7 of Ch 7 of the 1998 Act it does not follow that the worker is to be taken as not then having had a 20 per cent or greater degree of permanent impairment resulting from the injury. If the insurer and the worker are agreed that the worker has suffered that degree of permanent impairment resulting from the injury, then there is no need for an assessment. If they are not agreed, then there will be a medical dispute that can be determined under Pt 7 of Ch 7 of the 1998 Act. If the degree of permanent impairment cannot then be ascertained, then s 39 does not provide for the continuation of payment of weekly benefits, although cl 28 of the Workers Compensation Regulation 2016 does. If the worker's degree of permanent impairment is later assessed to be more than 20 per cent then it will have been ascertained that the worker was always entitled to the confirmation of weekly benefits. Even if the worker did not suffer a degree of impairment of 20 per cent or more at the expiry of the 260-week period in s 39(1) such a later assessment will have determined that the degree of permanent impairment resulting from the injury was more than 20 per cent.
For these reasons I agree with the orders proposed by Brereton JA.
BRERETON JA: Two workers - the appellants Mr Hochbaum and Ms Whitton - were injured in the course of their employment with the respondents RSM Building Services and Technical and Further Education Commission ("TAFE NSW"), in 2000 and 1999 respectively. Each made a claim for compensation, and was in receipt of weekly compensation payments, before 1 October 2012, when the new workers compensation regime introduced by the (NSW) Workers Compensation Legislation Amendment Act 2012 ("the 2012 Amendment Act") commenced. Section 39(1) of the (NSW) Workers Compensation Act 1987 ("the 1987 Act"), which in its present form was substituted by the 2012 Amendment Act, provides that a worker has no entitlement to weekly payments of compensation after an aggregate period of 260 weeks, whether or not consecutive, in respect of which a weekly payment has been paid or is payable. However, s 39(2) provides that the section does not apply to an injured worker whose injury results in permanent impairment if the degree of permanent impairment resulting from the injury is more than 20%.
For the purposes of the application of s 39, in respect of claims for compensation made before 1 October 2012, no regard is to be had to any weekly payment paid or payable before 1 January 2013; [1] accordingly, in such cases, weekly payments made before 1 January 2013 do not count towards the 260 weeks, which commenced to run from 1 January 2013, and expired on or about 25 December 2017. The respondents' insurers ceased paying weekly payments to the appellants with effect from 26 December 2017, being 260 weeks after 1 January 2013. Subsequently, the appellants were assessed as having a degree of permanent impairment resulting from their relevant work injury in excess of 20%. Following those assessments, weekly payments were resumed with effect from the date of the assessment; however, liability to make weekly payments in respect of the period between 26 December 2017 and the date of the assessment was disputed. In each case, an arbitrator held that the worker was entitled to weekly payments for that period, [2] but both decisions were overturned on appeal by the President of the Workers Compensation Commission, [3] who held that the effect of s 39(2) was to displace s 39(1) only from the date when the worker was assessed to have a degree of permanent impairment resulting from the injury of more than 20%, with the consequence that the appellants were not entitled to compensation for the period between the expiry of the 260 weeks and the date on which they were assessed as impaired to an extent greater than 20%. Mr Hochbaum and Ms Whitton, being aggrieved by the decisions of the President of the Commission in point of law, appeal from that holding, as of right, to this Court. [4]
Weekly payments were resumed from 16 July 2018, being the date of the medical assessment certificate. However, Mr Hochbaum claimed weekly payments for the period between 26 December 2017 and 15 July 2018, liability for which was disputed. On 7 January 2019, Senior Arbitrator Bamber held that Mr Hochbaum was entitled to weekly payments from the date on which they had ceased. [7] On appeal by the respondent, the President of the Commission on 18 April 2019 overturned that decision, and substituted an award for the respondent. [8]
Under s 38, a worker's entitlement to compensation in the form of weekly payments ceases on the expiry of the second entitlement period unless:
1. the worker is assessed by the insurer as having no current work capacity and likely to continue indefinitely to have no current work capacity; or
2. the worker (not being a worker with high needs) is assessed by the insurer as having current work capacity, and has applied to the insurer in the approved written form for continuation of weekly payments after the second entitlement period, and has returned to work for a period of not less than 15 hours per week and is in receipt of current weekly earnings of at least $155 per week, and is assessed by the insurer as being, and as likely to continue indefinitely to be, incapable of undertaking further additional employment or work that would increase the worker's current weekly earnings; or
3. the worker (being a worker with high needs) is assessed by the insurer as having current work capacity, and has applied to the insurer in the approved written form for continuation of weekly payments after the second entitlement period.
By s 32A, "worker with high needs" means a worker whose injury has resulted in permanent impairment and (a) the degree of permanent impairment has been assessed for the purposes of Division 4 to be more than 20%, or (b) an assessment of the degree of permanent impairment is pending and has not been made because an approved medical specialist has declined to make the assessment on the basis that maximum medical improvement has not been reached and the degree of permanent impairment is not fully ascertainable, or (c) the insurer is satisfied that the degree of permanent impairment is likely to be more than 20%.
Section 39 - the provision which is at the centre of these appeals - provides that a worker, other than one whose injury results in permanent impairment to a degree greater than 20%, is not entitled to weekly payments in respect of an injury after an aggregate period of 260 weeks of weekly payments:
39 Cessation of weekly payments after 5 years
(1) Despite any other provision of this Division, a worker has no entitlement to weekly payments of compensation under this Division in respect of an injury after an aggregate period of 260 weeks (whether or not consecutive) in respect of which a weekly payment has been paid or is payable to the worker in respect of the injury.
(2) This section does not apply to an injured worker whose injury results in permanent impairment if the degree of permanent impairment resulting from the injury is more than 20%.
Note. For workers with more than 20% permanent impairment, entitlement to compensation may continue after 260 weeks but entitlement after 260 weeks is still subject to section 38.
(3) For the purposes of this section, the degree of permanent impairment that results from an injury is to be assessed as provided by section 65 (for an assessment for the purposes of Division 4).
Section 65, referred to in s 39(3), provides that the degree of permanent impairment that results from an injury is to be assessed "as provided by this section and Part 7 (Medical assessment) of Chapter 7 of" the 1998 Act, and that if a worker receives more than one injury arising out of the same incident, those injuries are together to be treated as one injury:
65 Determination of degree of permanent impairment
(1) For the purposes of this Division, the degree of permanent impairment that results from an injury is to be assessed as provided by this section and Part 7 (Medical assessment) of Chapter 7 of the 1998 Act.
(2) If a worker receives more than one injury arising out of the same incident, those injuries are together to be treated as one injury for the purposes of this Division.
Note. The injuries are to be compensated together, not as separate injuries. Section 322 of the 1998 Act requires the impairments that result from those injuries to be assessed together. Physical injuries and psychological/psychiatric injuries are not assessed together. See section 65A.
Part 7 of Ch 7 of the 1998 Act comprises ss 319 to 331. Section 319 relevantly provides the following definitions:
319 Definitions
In this Act -
approved medical specialist means a medical practitioner appointed under this Part as an approved medical specialist.
medical dispute means a dispute between a claimant and the person on whom a claim is made about any of the following matters or a question about any of the following matters in connection with a claim -
(a) the worker's condition (including the worker's prognosis, the aetiology of the condition, and the treatment proposed or provided),
(b) the worker's fitness for employment,
(c) the degree of permanent impairment of the worker as a result of an injury,
(d) whether any proportion of permanent impairment is due to any previous injury or pre-existing condition or abnormality, and the extent of that proportion,
(e) the nature and extent of loss of hearing suffered by a worker,
(f) whether impairment is permanent,
(g) whether the degree of permanent impairment of the injured worker is fully ascertainable.
Section 320 makes provision for the appointment of approved medical specialists. At the relevant time, s 321 provided for the referral of medical disputes for assessment by an approved medical specialist, [16] while s 322 provided guidance relating to the assessment of impairment:
321 Referral of medical dispute for assessment
(1) A medical dispute may be referred for assessment under this Part by a court, the Commission or the Registrar, either of their own motion or at the request of a party to the dispute. The Registrar is to give the parties notice of the referral.
(2) The parties to the dispute may agree on the approved medical specialist who is to assess the dispute but if the parties have not agreed within 7 days after the dispute is referred, the Registrar is to choose the approved medical specialist who is to assess the dispute.
(3) The Commission may not refer for assessment under this Part a medical dispute concerning permanent impairment (including hearing loss) of an injured worker.
(4) The Registrar may not refer for assessment under this Part:
(a) a medical dispute concerning permanent impairment (including hearing loss) of an injured worker where liability is in issue and has not been determined by the Commission, or
(b) a medical dispute other than a dispute concerning permanent impairment (including hearing loss) of an injured worker, except when dealing with the dispute under Part 5 (Expedited assessment).
322 Assessment of impairment
(1) The assessment of the degree of permanent impairment of an injured worker for the purposes of the Workers Compensation Acts is to be made in accordance with Workers Compensation Guidelines (as in force at the time the assessment is made) issued for that purpose.
(2) Impairments that result from the same injury are to be assessed together to assess the degree of permanent impairment of the injured worker.
(3) Impairments that result from more than one injury arising out of the same incident are to be assessed together to assess the degree of permanent impairment of the injured worker.
Note. Section 65A of the 1987 Act provides for impairment arising from psychological/psychiatric injuries to be assessed separately from impairment arising from physical injury.
(4) An approved medical specialist may decline to make an assessment of the degree of permanent impairment of an injured worker until the approved medical specialist is satisfied that the impairment is permanent and that the degree of permanent impairment is fully ascertainable. Proceedings before a court or the Commission may be adjourned until the assessment is made.
Section 322A provides that (subject to rights of appeal under ss 327 and 352) there is to be only one assessment of an injured worker's degree of permanent impairment: [17]
322A One assessment only of degree of permanent impairment
(1) Only one assessment may be made of the degree of permanent impairment of an injured worker.
(2) The medical assessment certificate that is given in connection with that assessment is the only medical assessment certificate that can be used in connection with any further or subsequent medical dispute about the degree of permanent impairment of the worker as a result of the injury concerned (whether the subsequent or further dispute is in connection with a claim for permanent impairment compensation, the commutation of a liability for compensation or a claim for work injury damages).
(3) Accordingly, a medical dispute about the degree of permanent impairment of a worker as a result of an injury cannot be referred for, or be the subject of, assessment if a medical dispute about that matter has already been the subject of -
(a) assessment and a medical assessment certificate under this Part, or
(b) a determination by the Commission under Part 4.
(4) This section does not affect the operation of section 327 (Appeal against medical assessment) or 352 (Appeal against decision of Commission constituted by Arbitrator).
Section 325 requires that a medical specialist to whom a medical dispute is referred is to give a certificate (called a medical assessment certificate) as to the matters referred for assessment:
325 Medical assessment certificate
(1) The approved medical specialist to whom a medical dispute is referred is to give a certificate (a medical assessment certificate) as to the matters referred for assessment.
(2) A medical assessment certificate is to be in a form approved by the Registrar and is to -
(a) set out details of the matters referred for assessment, and
(b) certify as to the approved medical specialist's assessment with respect to those matters, and
(c) set out the approved medical specialist's reasons for that assessment, and
(d) set out the facts on which that assessment is based.
(3) If the Registrar is satisfied that a medical assessment certificate contains an obvious error, the Registrar may issue, or approve of the approved medical specialist issuing, a replacement medical assessment certificate to correct the error.
(4) An approved medical specialist is competent to give evidence as to matters in a certificate given by the specialist under this section, but may not be compelled to give evidence.
Under s 326, a medical assessment certificate is, in proceedings before a court or the Commission, conclusive evidence as to various matters referred to in it, including relevantly "the degree of permanent impairment of the worker as a result of an injury":
326 Status of medical assessments
(1) An assessment certified in a medical assessment certificate pursuant to a medical assessment under this Part is conclusively presumed to be correct as to the following matters in any proceedings before a court or the Commission with which the certificate is concerned -
(a) the degree of permanent impairment of the worker as a result of an injury,
(b) whether any proportion of permanent impairment is due to any previous injury or pre-existing condition or abnormality,
(c) the nature and extent of loss of hearing suffered by a worker,
(d) whether impairment is permanent,
(e) whether the degree of permanent impairment is fully ascertainable.
(2) As to any other matter, the assessment certified is evidence (but not conclusive evidence) in any such proceedings
Thus the certificate is not an adjudication, but merely evidence, albeit conclusive evidence; it is not an award or determination which of itself operates to establish liability.
Schedule 6 of the 1987 Act includes provisions authorising the making of saving and transitional regulations, both generally, and specifically consequent on the enactment of the 2012 Amendment Act. Part 20 (Savings and transitional regulations) of that Schedule provides, by cl 1(1), that the regulations may contain provisions of a saving or transitional nature consequent on the enactment of the 1987 Act and the cognate Acts, various specified amending Acts between 1988 and 2010, and "any other Act that amends this Act". By cl 1(2), such a provision may, if the regulations so provide, take effect as from the date of assent to the Act concerned or a later day. Clause 1(5) purports to authorise regulations which have the effect of amending the 1987 Act, the cognate Acts or the Acts amended by the cognate Acts; however, by sub-cl (6)(c), such regulations are deemed to be revoked on 31 December 1999, and no such regulation may be made or published after that date.
Additional provision is however made, in respect of the 2012 Amendment Act, by cl 5 of Pt 19H (Provisions consequent on enactment of the Workers Compensation Legislation Amendment Act 2012) of Sch 6, which is as follows:
5 Savings and transitional regulations
(1) Regulations under Part 20 of this Schedule that contain provisions of a saving or transitional nature consequent on the enactment of the 2012 amending Act may, if the regulations so provide, take effect as from a date that is earlier than the date of assent to the 2012 amending Act.
(2) Clause 1(3) of Part 20 does not limit the operation of this clause.
(3) A provision referred to in subclause (1) has effect, if the regulations so provide, despite any other provision of this Part.
(4) The power in Part 20 to make regulations that contain provisions of a saving or transitional nature consequent on the enactment of the 2012 amending Act extends to authorise the making of regulations whereby the provisions of the Workers Compensation Acts are deemed to be amended in the manner specified in the regulations.
Relevantly, there is no such limitation on the power in sub-cl 5(4) of Pt 19H as there is on that imposed on sub-cl 1(5) of Pt 20 by sub-cl 1(6) of Pt 20. Pursuant to sub-cl 5(4) of Pt 19H, the (NSW) Workers Compensation Regulation 2016 provides, by cl 28C of Pt 2A of Sch 8, that s 39 does not apply to an injured worker if the worker's injury has resulted in permanent impairment and an assessment of the degree of permanent impairment is pending but an approved medical specialist has declined to make the assessment on the basis that maximum medical improvement has not been reached and the degree of permanent impairment is not fully ascertainable, or the insurer is satisfied that the degree of permanent impairment is likely to be more than 20% (whether or not the degree of permanent impairment has previously been assessed):
28C 5 year limit on weekly payments
Section 39 of the 1987 Act (as substituted by the 2012 amending Act) does not apply to an injured worker if the worker's injury has resulted in permanent impairment and-
(a) an assessment of the degree of permanent impairment for the purposes of the Workers Compensation Acts is pending and has not been made because an approved medical specialist has declined to make the assessment on the basis that maximum medical improvement has not been reached and the degree of permanent impairment is not fully ascertainable, or
(b) the insurer is satisfied that the degree of permanent impairment is likely to be more than 20% (whether or not the degree of permanent impairment has previously been assessed).
In other words, that provision distinctly requires that there has been an assessment, unless an assessment has not been made because maximum medical improvement has not been reached and the degree of permanent impairment is not fully ascertainable, or the insurer is satisfied, without assessment, that the impairment is likely to exceed 20%. It thus requires either that there has been an assessment, or that assessment cannot yet be made, or is not required because the insurer is satisfied without assessment. The different language of s 39 - using "to be assessed" rather than "has been assessed", and the absence of provision for circumstances where assessment cannot yet be made or is not required - is a powerful indication that s 39(3) was not intended to require that there have been an assessment before s 39(2) is engaged. Rather, s 39(3) points to the mechanism to be used when measuring the degree of permanent impairment resulting from an injury and, where necessary, resolving any dispute about it.
The construction urged by the respondents, and adopted by the President of the Commission, would mean that s 39(2) could be engaged only upon formal assessment by an approved medical specialist and issue of a medical assessment certificate. This would have the extraordinary result that the issues tendered by s 39 could not be resolved consensually, so that a worker whose degree of impairment was undisputed and in excess of 20% would be denied the benefit of s 39(2) unless and until he or she obtained an assessment and medical assessment certificate. In the context of a scheme which was intended to reduce disputation and litigation, this would be anomalous. Moreover, it is at least opaque what mechanism is available for obtaining an assessment under Pt 7 of Ch 7 of the 1998 Act where there is no dispute about the degree of impairment, as in those circumstances there can be no "medical dispute" within the meaning of Pt 7 of the 1998 Act, [24] and thus nothing to be referred to an approved medical specialist for assessment. [25] It would be not only anomalous but extraordinary if it were necessary to engineer a "medical dispute" where there otherwise was none in order to create a foundation for a referral for assessment in order to engage s 39(2).
It was submitted that the legislature chose to make the operation of s 39(2) dependent on the degree of permanent impairment as assessed, and that because an assessment under cl 1.6(a) of the NSW Workers Compensation Guidelines for the Evaluation of Permanent Impairment [26] is necessarily carried out as at the day of the assessment, and, as a medical matter, impairment can only be assessed as at the date of assessment, s 39(3) has the effect that it is only when a worker is assessed as having a degree of permanent impairment that is more than 20% that s 39(2) is engaged, so as to entitle the worker to compensation beyond the 260-week period. This was said to represent a legislative choice to adopt a "bright line" providing greater certainty of operation, in that both the worker and the insurer have a "bright line" identifying when the entitlement exists and when it does not exist, albeit at the cost of some flexibility. However, s 39(2) does not refer to assessment, and it does not follow from the fact that an assessment is necessarily carried out on the day of the assessment that the worker only becomes one whose injury results in the assessed degree of impairment as of that date. As elaborated below, it is an injury which results in the relevant degree of permanent impairment that engages s 39(2), not its assessment or certification.
I therefore reject the submission that s 39(3) has the effect that there must be a medical assessment certificate before a worker is exempted from the operation of s 39(1). The words "to be assessed" in s 39(3) point to the methodology and process for measuring impairment and resolving any dispute about it; they do not mandate that there must be a formal assessment before s 39(2) is enlivened. The effect of s 39(3) is that if there is a dispute as to whether a worker is within the exempt class, then the question, what degree of permanent impairment resulted from the injury, can be referred for assessment, as it was in these cases. The function of s 39(3) is not to impose assessment as a precondition to the engagement of s 39(2), but to provide a mechanism for measuring and determining the degree of permanent impairment that results from an injury, so as to resolve any dispute about whether or not a worker is within the exempt class.
The date on which an impairment threshold is crossed is not a relevant consideration in any question arising under s 39, and the only relevant question is, what degree of permanent impairment has resulted from the worker's injury. The date on which an impairment threshold exists or is exceeded is not within the definition of a "medical dispute". That is because the date of impairment (as distinct from injury, and incapacity) is not a question which is relevant to liability to pay compensation under the scheme; as just explained, liability for permanent impairment dates from the injury, regardless of when the degree of impairment is ascertained. The relevant question is simply what degree of permanent impairment results from the injury, and the legislation provides a mechanism (assessment) for answering that question - while it does not for the irrelevant question, when that degree results.
The notion of permanent impairment as used in the 1987 Act involves a diminution in function experienced by a worker which is lasting or enduring. [30] In the context of s 39 of the 1987 Act, the reference to "the degree of permanent impairment resulting from the injury" is a reference to the ultimate degree of impairment that is stable and final, even if it is not immediately evident or ascertainable, and even if it is achieved only after a deterioration.
This is reflected in s 322A of the 1998 Act, to the effect that there is to be only one assessment of an injured worker's degree of permanent impairment. It is true, as was emphasised for the respondents, that the legislation recognises that impairment from workplace injuries may improve or deteriorate over time, and that there may be periods during which the degree of permanent impairment is not ascertainable. Under s 322(4) of the 1998 Act, an approved medical specialist may decline to make an assessment of the degree of permanent impairment until satisfied that the impairment is permanent and that the degree of permanent impairment is fully ascertainable, which indicates that it may not be fully ascertainable at the outset. Moreover, s 322A(4) allows for the possibility that the degree of permanent impairment might be re-assessed on an appeal (under ss 327 or 352 of the 1998 Act). One of the grounds of appeal permitted by s 327 is "deterioration of the worker's condition that results in an increase in the degree of permanent impairment", [31] which indicates that impairment can deteriorate.
However, none of this detracts from the proposition that there can ultimately be only a single degree of permanent impairment that results from an injury; the contrary view is incongruous with the concept of permanency. If assessment is deferred and there is an improvement in the worker's condition, it is the lower degree that is the permanent impairment. If there is a deterioration after initial assessment, and a higher degree is substituted on appeal, it is the higher degree of impairment that is the permanent impairment. While it is true that an assessment can be altered on appeal or reconsideration, the final determination - whether the original decision or on appeal or reconsideration - will establish conclusively what is the degree of permanent impairment which results from the relevant injury. For the purposes of s 39, it is the final degree of permanent impairment that results from an injury that matters, although it may not be established until long after the injury, or the expiry of the 260 week period. That degree will either be greater than 20%, or not. If, ultimately, it is, the worker is in the exempt class and s 39 does not apply, and never has.
In this connection, it was argued that if a worker successfully appeals on the basis of deterioration, it would make no sense to treat the new medical assessment certificate as applying in respect of the period after the expiration of the 260 weeks but before the new certificate is given, and that the new certificate would operate only from the date of its issue. That argument is incorrect, for two reasons. The first reason is that that is not how appeals operate; ordinarily, a judgment or award made on appeal is substituted for the original judgment or award, with effect from the date of that original judgment or award. That ordinary operation of an appeal is reflected in the provisions governing appeals from medical assessments. Such an appeal is determined by an Appeal Panel of two medical specialists and an Arbitrator, [32] and the Appeal Panel may either "confirm the certificate of assessment given in connection with the medical assessment appealed against, or may revoke that certificate and issue a new certificate as to the matters concerned". [33] Notably, this does not envisage that the original certificate remains on foot and effective up to the date on which the new certificate is issued, but contemplates that the original certificate is revoked and the new one substituted for it. That accords with the view that there is only one degree of permanent impairment that results from an injury. The second reason is that it is contrary to the principle that emerges from the authorities referred to above, including Borovac, that when the degree of permanent impairment is finally and correctly ascertained (including after any correction on appeal), it dates from the injury.
The notion of a singular degree of permanent impairment resulting from an injury is inconsistent with there being any temporal element in s 39(2), which poses the simple question, what degree of permanent impairment results from the injury. While the subsection speaks in the present tense, in providing that the section does not apply to an injured worker whose injury results in permanent impairment if the degree of permanent impairment resulting from the injury is more than 20%, that does not mean that the question is to be answered as at the expiration of the 260-week period, or at any other particular time; the question is simply what is the degree of permanent impairment that results, and that means the ultimate degree of permanent impairment. The use of a verb in the present tense does not necessarily connote a temporal element, and the present tense of the verb "to be" not uncommonly specifies the character of something. [34] The word "is" is used descriptively, not to indicate contemporaneity, as explained by Gaudron J in Re Dingjan; ex parte Wagner: [35]
The present tense may be used descriptively or it may be used to signify contemporaneity. Although there is no fixed rule, the use in a statute of the present tense, simpliciter, indicates that it is being used descriptively (the "simple present"), whereas "is" followed by a present participle (the "continuous" or "progressive" present) usually indicates contemporaneity [See Quirk et al, A Comprehensive Grammar of the English Language (1985) pp 179-180, 197-198]. The descriptive use of the present tense can be seen in s 127B(4) where the words "takes effect" do not indicate that an order then takes effect but, rather, describe and, thus, prescribe the way in which an order must take effect.
In s 39(2), the word "is" is used to specify the character of the relevant injury, in terms of the resultant degree of permanent impairment, rather than to connote contemporaneity.
Conformably with the view that there is no such "temporal" element, s 39(2) does not provide that the section "ceases to apply" once a worker is assessed as having a permanent impairment above the 20% threshold. Nor is it expressed in terms of restoring or re-enlivening an entitlement of which the worker is otherwise deprived; it simply provides that the deprivation does not apply. It does not, in the case of such a worker, leave s 39 to operate unless and until he or she is assessed has having a permanent impairment above the threshold; rather, it ousts s 39(1) in the cases which fall within it, namely where the worker's injury is one which results in permanent impairment of more than 20%. The characterisation advanced by the respondents and accepted by the President of the Commission, that s 39(1) applies a bar, which is lifted once s 39(2) is engaged, is inapt. The so-called "bar" in s 39(1) simply does not apply to a worker who is in the exempt class. It may not be possible to say immediately whether or not a worker is in the exempt class. However, if he or she is in that class - regardless of when that is ascertained - s 39 does not apply to him or her.
This does not involve reading into s 39(2) any additional words, such as "at all", as the President of the Commission thought. [36] The words "This section does not apply" are absolute in their terms, and do not admit of some residual partial application. Indeed, the submissions for the respondent TAFE NSW tend to illustrate this, by demonstrating that it is the construction for which it contends that requires the reading in of additional words (emphasis added): [37]
The better construction of s 39(2), which is supported by both the text and the context, is that it disapplies s 39(1) for a worker who meets the statutory description of a worker with more than 20% permanent impairment from the time that the worker does so. This occurs when the worker has been assessed, as provided by s 65, as having such a degree of permanent impairment.
The President of the Commission referred to Shi v Migration Agents Registration Authority [38] in aid of the view that sub-ss 39(2) and (3), together, contained a temporal element, and that "the critical statutory question is whether a criterion was met or was not met at a particular date". [39] In Shi, in the passage referred to by the President, Hayne and Heydon JJ said:
[101] Nothing in the provisions of the Migration Act fixed a particular time as the point at which a migration agent's fitness to provide immigration assistance was to be assessed. Unlike some legislation providing for pension entitlements [See, eg, Freeman v Secretary, Department of Social Security (1988) 19 FCR 342], in which the critical statutory question is whether a criterion was met or not met at a particular date, such as the date of cancellation of entitlements, the provisions of s 303 of the Migration Act contained no temporal element. It follows that when the Tribunal reviews a decision made under s 303, the question which the Tribunal must consider (is the Tribunal satisfied that the person concerned is not a fit and proper person to give immigration assistance?) is a question which invites attention to the state of affairs as they exist at the time the Tribunal makes its decision.
Thus Shi itself was expressly not a case in which "the critical statutory question is whether a criterion was met or not met at a particular date". That phrase was used in connection with Freeman v Secretary, Department of Social Security, [40] which was an appeal from a decision cancelling a widow's pension (entitlement to which was excluded in the case of "a woman who is living with a man as his wife on a bona fide domestic basis although not legally married to him"). [41] The Administrative Appeals Tribunal upheld the decision of the Secretary of the Department of Social Security, finding that that was indeed the factual situation at the date of the cancellation, although the man had at a later date moved out and the relationship had since ceased to be a de facto marriage. On further appeal to the Federal Court, in which it was contended that on the basis of that finding the pension should have been restored from when the man moved out, Davies J held that the question for the Tribunal was whether the decision to cancel the pension was the correct or preferable one at the time at which it was taken, and that once the Tribunal decided that the decision to cancel the pension was the correct or preferable decision at the date at which it was taken, it had no jurisdiction to consider changes in circumstances since that date. The reference to this case in Shi was to the point that the pension entitlement from time to time depended upon whether the widow was "a woman who is living with a man …" - the "continuous" present as referred to by Gaudron J in Re Dingjan. In my view, Shi provides no assistance in respect of the statutory formula in s 39(2); while Freeman, if anything, assists in distinguishing the use of the "continuous present" to denote contemporaneity in (CTH) Social Security Act 1947, s 43(1), from the descriptive "simple present" used in s 39(2) of the 1987 Act.
The construction which I prefer does not mean that a worker whose degree of impairment ultimately exceeds 20% is necessarily entitled to weekly payments at all times, but only that he or she is not subject to the 260-week limit. As the note to s 39(2) observes, "entitlement after 260 weeks is still subject to section 38". Relevantly, this means that the worker is entitled to compensation only if he or she has no (or at least reduced) work capacity. In other words, entitlement to weekly payments is always dependent on there being a deficit in work capacity. Impairment and incapacity are different concepts. Impairment does not necessarily equate to incapacity, and absent incapacity there is no entitlement to weekly payments. Before a belated assessment of impairment in excess of 20% would have any practical effect in terms of an entitlement to retrospective weekly compensation, the "injury" would have to have resulted in compensable incapacity for work during the relevant period. Thus there is no "windfall" for a worker who is belatedly determined to have an impairment in excess of 20%; the most favourable outcome for the worker is the receipt of compensation for a period of incapacity for work resulting from their work injury.
Although the Second Reading Speech delivered by the Treasurer on introduction of the 2012 Amendment Act was invoked on all sides of the argument, in my view, insofar as it evidences the intention of the legislature, it shows that while the objects of s 39 included reducing the cost of the scheme and incentivising the return to work of those who had the capacity to do so, one object was to preserve the entitlements of workers who had a whole person impairment greater than 20%, so that such workers should continue to be entitled to weekly compensation until retirement age (emphasis added): [42]
The Workers Compensation Legislation Amendment Bill represents a fundamental shift towards properly meeting the needs of the most seriously injured workers in the scheme while strongly incentivising return to work for those workers who have the capacity to return to work. The Government is committed to ensuring that the income, support and treatment needs of seriously injured workers are met, and the Bill will increase the weekly benefits paid to the most seriously injured workers while ensuring such workers have benefits until retirement if they cannot return to work. The Government is taking steps also to ensure insurers direct more resources to support injured workers to improve their return-to-work outcomes and will focus on reducing the costs of insurers, which also are impacting on the scheme.
In the context of the various entitlement periods for weekly compensation, the Treasurer referred to reducing disputation in the system by streamlining the determination of eligibility, [43] and continued (emphasis added): [44]
For workers with permanent impairment of more than 20 per cent the bill provides that weekly benefits will not cease after five years provided they have no capacity to work or have work capacity and are working 15 or more hours a week.
… Consistent with the recommendation of the parliamentary joint committee, seriously injured workers whose whole-person impairment is more than 30 per cent will not be required to have work capacity assessments. However, those workers may wish to request an assessment to explore their return-to-work options. One of the key goals of the Government is to ensure seriously injured workers receive improved benefits if they cannot work and all possible assistance and support to return to work.
Workers whose whole-person impairment is more than 20 percent who have total incapacity will receive a benefit of up to 80 per cent of the pre-injury average weekly earning until retirement age. Seriously injured workers who are able to work more than 15 hours per week will also receive a weekly benefit that when combined with what they are earning will be up to 80 percent of their pre-injury average weekly earnings.
Thus, hand-in-hand with the object of reducing of the costs of the workers compensation scheme and incentivising return to work for those who are capable (achieved by limiting the entitlement of most injured workers to weekly compensation to 260 weeks), was the object of preserving benefits, until retirement age, for seriously injured workers (achieved by exempting them from that limitation). There is nothing here to indicate that it was intended that the weekly benefits cease until the degree of permanent impairment is determined, rather simply that if the degree of permanent impairment is in excess of 20%, weekly benefits will not cease after five years.
I have not found it necessary to resort to cl 28C of Pt 2 of Sch 8 of the (NSW) Workers Compensation Regulation 2016 (a transitional provision, which provides for the continuation of weekly compensation payments after 260 weeks if "the insurer is satisfied that the degree of permanent impairment is likely to be more than 20%", and was said to indicate that an assessment by an approved medical specialist and the issue of a medical assessment certificate are not necessary for the engagement of s 39(2) of the 1987 Act), or to s 66A of the 1987 Act (which provides for agreement as to the degree of impairment, and for registration of a "complying agreement" recording such agreement with the Commission, which may then enter an award in accordance with it). Clause 28C is a transitional provision, made under statutory authority to make regulations which may have the effect of amending the principal Act, and I doubt provides a sound basis for interpreting the principal provisions of the Act. Section 66A operates in the different territory of lump sum compensation for permanent impairment. I have also found it unnecessary and unhelpful to endeavour to characterise s 39(2) as beneficial or remedial (as the appellants urged), or exceptional (as the President of the Commission found and the respondents submitted): in the context of a provision which has, as the Second Reading Speech reveals, multiple objects, such characterisation is not possible, and does not assist.
Sub-section (2) indicates that the provision is directed to proceedings in the Commission, and not to proceedings on appeal from the Commission to this Court. Although there does not appear to be any decision in which the point has been considered, this Court has consistently made costs orders in appeals from the Commission since the 2012 amendments. [45]
I propose that in each matter the appeal be allowed, and that:
1. In proceedings 2019/153561 (Hochbaum v RSM Building Services):
1. the orders made by the President of the Workers Compensation Commission on 18 April 2019 be set aside,
2. in lieu thereof, the appeal from the decision of the Senior Arbitrator be dismissed and the Senior Arbitrator's Certificate of Determination dated 7 January 2019 be reinstated, and
3. by consent, there be no order as to costs, to the intent that each party bear its own costs.
1. In proceedings 2019/215243 (Whitton v Technical and Further Education Commission t/as TAFE NSW):
1. the orders made by the President of the Workers Compensation Commission on 17 June 2019 be set aside,
2. in lieu thereof, the appeal from the decision of the Senior Arbitrator be dismissed and the Senior Arbitrator's Certificate of Determination dated 7 January 2019 be reinstated, and
3. the respondent pay the appellant's costs.
SIMPSON AJA: I have had the advantage of reading in draft the judgments of Brereton JA and White JA. I agree with the orders proposed by Brereton JA. As the relevant facts and background circumstances are comprehensively set out by his Honour, my reasons may be stated briefly. I particularly rely on his Honour's extracts of the relevant legislation and his summary, at [44], of the reasoning of the President of the Workers Compensation Commission. It is necessary only to emphasise those facts most relevant to my reasoning to the same result.
Mr Hochbaum suffered injury in September 2000. In accordance with then provisions of the Workers Compensation Act 1987 (NSW), he received weekly payments of compensation until 25 December 2017. (The significance of that date is explained in the judgment of Brereton JA.) On 2 April 2013 Mr Hochbaum was found (by his employer's insurer) to have "no current work capacity". That was a finding that he was, by reason of his injury, unable to return to his previous employment, or to suitable employment: Workers Compensation Act 1987 (NSW), Sch 3. It did not entail a finding (or concession) of any degree of permanent incapacity. However, (according to a chronology provided by the respondent) in July 2004 Mr Hochbaum had settled a claim for lump sum compensation under s 66 of the Workers Compensation Act. Lump sum compensation under s 66 is not payable in respect of a workplace injury unless the injury results in permanent impairment greater than 10%.
Ms Whitton was injured on 2 November 1999. She, too, received weekly payments of compensation (although not continuously) until 25 December 2017. In 2005 Ms Whitton and the insurer settled a claim by her for lump sum compensation under s 66 on the terms that she suffered a degree of permanent impairment of 20%. On 4 November 2013 she also was found to have "no current work capacity".
The introduction of s 39 into the Workers Compensation Act altered the position of both Mr Hochbaum and Ms Whitton. Thereafter, payments of weekly compensation would cease after 260 weeks (5 years) from 25 December 2017, unless the degree of permanent impairment exceeded 20%.
The purpose (and the effect) of s 39 is narrow. By subs (1) it imposes a 260 week limit on the entitlement to weekly payments of compensation for which ss 36, 37 and 38 of the Workers Compensation Act make provision. By subs (2) it removes that limit in cases where the injury in respect of which the compensation is payable results in a degree of permanent impairment exceeding 20%. By subs (3) it specifies, by reference to s 65, the manner in which the degree of permanent impairment is to be assessed.
Section 65 directs attention to the detailed provisions for medical assessment of work injuries, and permanent impairment resulting therefrom, contained in Ch 7, Pt 7 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) ("the WIM Act"). Application of those provisions depends upon the existence of a medical dispute between the injured worker and the employer (or the employer's insurer) (s 319). A medical dispute is defined in s 319 to include a dispute about the degree of permanent impairment of a worker resulting from a (workplace) injury.
A medical dispute may be referred (s 321) for assessment by an approved medical specialist (s 324). There appears to be no other provision for medical assessment: that is, assessment under the WIM Act depends on the existence of a medical dispute.
Following the commencement of s 39, Mr Hochbaum and Ms Whitton were both advised, by their employers' respective insurers, that their weekly payments would cease on 25 December 2017, the 260-week period expiring on that date. In each case that triggered a medical dispute that was finally resolved with the issue of a medical certificate certifying (in the case of Mr Hochbaum) 21% permanent impairment, and (in the case of Ms Whitton) 32% permanent impairment.
The process that led to the issue of the medical certificates was protracted. It was necessary for Mr Hochbaum and Ms Whitton to seek, from the insurers, ongoing weekly payments. Those claims had to be supported by medical reports. It was when the claims were rejected by the insurers that, in each case, a medical dispute came into existence. The procedures mandated by the WIM Act then had to be implemented. These may take some time. The certificates were issued on 16 July 2018 (Mr Hochbaum), and 18 June 2018 (Ms Whitton).
It was not suggested anywhere that either of the assessments was inapplicable to the condition of the relevant applicant existing as at 25 December 2017. That is, it may be taken that, on 25 December 2017, Mr Hochbaum suffered a permanent impairment resulting from his work injury of 21%, and Ms Whitton suffered a permanent impairment as a result of her work injury of 32% and, in each case, that permanent impairment continued to the date of assessment. If it were thought that the degree of permanent impairment had arisen at some time after 25 December 2017, it was open to the approved medical specialist to make a finding to that effect.
It may be accepted, also, that had the assessments been undertaken at an earlier time, Mr Hochbaum and Ms Whitton would have been entitled to continuing weekly payments of compensation. On the interpretation of s 39 by the President, the delay in the issue of the medical assessment certificates thus operated to the benefit of the insurers.
Delay in seeking or obtaining medical assessment certificates may come about for a variety of reasons, including dilatoriness on the part of either party (or both), congestion in the administration of medical assessment in accordance with Ch 7, Pt 7 of the WIM Act, or others. Such delays may be beyond the control of the injured worker and may, plainly, operate unfairly to applicants for continuing weekly compensation payments, and particularly so if an entitlement to compensation depends on the date of assessment rather than the date of injury or the date at which permanent impairment is suffered.
Adverse or unintended consequences may not, however, be a sufficient reason to construe s 39 in the way for which the appellants contend if the language of the section supports the interpretation given by the President.
In my opinion, the language of the section does not support that interpretation. It is necessary to go no further than the text of s 39 itself: see Alcan (NT) Aluminium Pty Ltd v Commissioner of Territory Revenue (Northern Territory) (2009) 239 CLR 27; [2009] HCA 41 at [47]. Nothing in any of the three subsections of s 39 states, explicitly or implicitly, that removal of the subs (1) bar is dependent upon the date of the assessment of the degree of permanent impairment as distinct from the existence of the degree of permanent impairment. The language of subs (2) points in the opposite direction: the foundation for the removal of the subs (1) bar lies in the existence of a degree of permanent impairment exceeding 20%. Subsection (3) does no more than specify the mechanism by which the degree of permanent impairment is to be assessed. Nothing in subs (3) suggests that an assessment in accordance with s 65 of the Workers Compensation Act may only be prospective: in each of the present cases, it is a clear inference that the assessment was of a long standing, on-going and continuing condition which existed in the 6 months between 25 December 2017 and the date of assessment, and which, therefore, (by the assessment) entitled the appellants to continuing weekly payments of compensation.
If it were necessary to go beyond the text of s 39, resort to principles of statutory construction would support the approach I take. The unfairness of the result, in the event that delays (however caused) prevented assessment before the expiration of the 5-year period would suggest that the legislature did not intend to make entitlement of a worker suffering the relevant degree of permanent impairment resulting from a work injury subject to the vagaries of processes and procedures in the system of assessment or obstacles that might be thrown in the way of assessment.
I have not had resort to the different terminology in s 32A of the Workers Compensation Act to support my conclusion. It is not, in my opinion, necessary to contrast "to be assessed" as those words appear in s 39(3), with "has been assessed" as those words appear in s 32A (in the definitions of "worker with high needs" and "worker with highest needs"). There is nothing in the collocation of words "is to be assessed" that implies that the assessment is to be made in the future. Rather, the words express, mandatorily, the procedures by which the assessment must be made.
For these reasons I agree with the orders proposed by Brereton JA.
Subsection (1A) was inserted with effect from 1 January 2019: "(1A) A reference in subsection (1) to an assessment includes an assessment of the degree of permanent impairment made by the Commission in the course of the determination of a dispute about the degree of the impairment that is not the subject of a referral under this Part."
See Hochbaum [2019] NSWWCCPD 15 at [151]; Whitton [2019] NSWWCCPD 27 at [169]-[170].
See Hochbaum [2019] NSWWCCPD 15 at [141]-[142]; Whitton [2019] NSWWCCPD 27 at [106], [113]-[117], [119], [122].
See Hochbaum [2019] NSWWCCPD 15 at [143]; Whitton [2019] NSWWCCPD 27 at [126], [141], citing Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 31 at [101] (Hayne and Heydon JJ), discussed below.
See Hochbaum [2019] NSWWCCPD 15 at [70], [121], [141]-[142]; Whitton [2019] NSWWCCPD 27 at [108], [127], [135]-[138].
See Whitton [2019] NSWWCCPD 27 at [141]-[143], citing Hochbaum [2019] NSWWCCPD 15 at [144]-[147].
See also the definition of "worker with highest needs" in the same section (s 32A), which is in similar terms but refers to 30% rather than 20% impairment.
1998 Act, s 319.
1998 Act, ss 321, 321A.
State Insurance Regulatory Authority, NSW Workers Compensation Guidelines for the Evaluation of Permanent Impairment (4th ed, 2016).
Stevens v The Railway Commissioners for NSW (1930) 31 SR (NSW) 138; Kraljevich v Lake View and Star Ltd (1945) 70 CLR 647 at 652 (Dixon J); Bresmac Pty Ltd v Starr (1992) 29 NSWLR 318 at 327 (Priestley JA), 334 (Handley JA), 334-5 (Sheller JA); TNT Australia Pty Ltd v Horne (1995) 11 NSWCCR 497 at 507-8 (Kirby P), 515 (Priestley JA); Hunter Quarries Pty Ltd v Mexon (2018) 98 NSWLR 526; [2018] NSWCA 178 at [67] (Payne JA).
1998 Act s 327(3)(a). I do not accept the submission that an assessment by an approved medical specialist of the degree of permanent impairment may be subject to reconsideration under s 350(3); that provision is concerned with decisions of the Commission constituted by an Arbitrator or a Presidential member, not assessment by approved medical specialists. While a decision of an Appeal Panel in respect of a medical assessment certificate can be reconsidered under s 378, that does not mean that the degree of permanent incapacity changes; it means that, upon reconsideration, the correct degree is determined and substituted. Section 329 (Referral for further assessment) does not extend to permanent impairment, because of s 322A.
1998 Act s 328(1).
1998 Act s 328(5).
Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Industrial Relations Secretary on behalf of the Department of Justice [2015] NSWCA 386 at [9] (Basten JA), [55] (Emmett AJA, with whom Ward JA agreed).
See Whitton [2019] NSWWCCPD 27 at [141] and fn 114.
(1988) 19 FCR 342; [1988] FCA 294.
(CTH) Social Security Act 1947, s 43(1)
New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 19 June 2012, at 13015.
New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 19 June 2012, at 13016.
New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 19 June 2012, at 13016.
See, for example, Hee v State Transit Authority of New South Wales (2019) 287 IR 200; [2019] NSWCA 175; Pacific National Pty Ltd v Baldacchino (2018) 98 NSWLR 483; [2018] NSWCA 281; Whitehaven Coal Mining Ltd v Pain [2018] NSWCA 229; Jaffarie v Quality Castings Pty Ltd [2018] NSWCA 88; Inghams Enterprises Pty Ltd v Belokoski [2017] NSWCA 313.
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Decision last updated: 17 June 2020