Kezich v Leighton Contractors Pty Ltd

High Court of Australia|1974-07-01|Before: Mason JJ, Menzies J, Gibbs J, Mason J

For the reasons I have given, I consider that the questions in the case stated should have been answered as follows:

On the facts as found did the Board err in law in holding that the applicant was entitled to an award of weekly payments from 27th December 1973 at the rate of $167.50?

On the facts as found did the Board err in law in holding that from 27th December 1973 the applicant was entitled to weekly payments at a higher rate than $91.40 per week?

For the reasons stated in the judgments of my brothers Gibbs and Mason I would grant special leave, allow this appeal and answer in the negative both of the questions asked in the case stated.

This application for special leave to appeal from a decision of the Full Court of the Supreme Court of Western Australia on a case stated by the Workers' Compensation Board relates to s. 13 of Act No. 96 of 1973, which came into operation on 27th December of that year. What the section did was to substitute a new cl. 2 in the 1st Sch. of the Workers' Compensation Act, 1912 W.A., as amended, thereby introducing a new definition of the expression "weekly earnings". The expression is of importance because the entitlement to weekly compensation which the Act confers upon an injured worker who is totally or partially incapacitated for work is necessarily calculated by reference to his weekly earnings "computed in accordance with clause 2".

For the purposes of this Act, "weekly earnings" means the amount of the ordinary wage or salary (including any over award payment) the worker would have received for the ordinary hours he would have worked, if he were not incapacitated for work as a result of the injury. Formerly the clause had contained a series of provisions prescribing rules to be observed in calculating the "earnings" and "average weekly earnings" of a worker by reference to which entitlement to weekly compensation was calculated. Broadly speaking, the repealed cl. 2 was so expressed that an injured worker's entitlement to weekly compensation was calculated by reference to the rate per week at which the worker was being remunerated.

The facts recited in the case are that the applicant commenced employment with the respondent as a builders' labourer at Mt Newman on 21st September 1973. He was continuously so employed until 3rd December 1973 when he sustained an injury at work which has since totally incapacitated him. The applicant was engaged by the respondent on the basis that he would normally work sixty hours per week whilst employed by them, his hours being worked as to ten hours on each of six days in the week. His employment was subject to the Building Construction Employees and Builders' Labourers' Award, 1973. This award provided a rate of pay of $2.15 per ordinary hour of work, being $86 for forty such hours. Clause 14 of the award describes as the ordinary hours of work the hours between 7.30 a.m. and 5.30 p.m. from Monday to Friday inclusive, not exceeding eight hours per day.

It is accepted that the respondent remunerated the applicant as to forty hours at the ordinary rate and as to varying hours at a rate equal to time and a half, double time, and double time and a half, in accordance with the provisions of the award as to overtime. If he had not sustained injury on 3rd December 1973 his employment would have continued on the same basis at least until 17th April 1974. It is conceded that the amount of $167.50 should be accepted as the amount ordinarily earned by the applicant in the employment of the respondent prior to the accident.

Compensation was paid by the respondent up to and including the week ending 31st December 1973 at the rate fixed by the Act then in force.

On the facts as found, did the Board err in law in holding that the applicant was entitled to an award of weekly payments from 27th December 1973 at the rate of $167.50?

On the facts as found, did the Board err in law in holding that from 27th December 1973 the applicant was entitled to weekly payments at a higher rate than $86 per week?

The figure of $86 in question 2 was altered by consent to $91, the alteration being occasioned by a more recent amendment to the award. By a majority decision the Full Court answered each question in the affirmative.

The applicant's case was that "weekly earnings" as defined means "the amount of wage or salary (including any over award payment) the worker would have received if he were not incapacitated for work by the injury" - an amount calculated in this case by ascertaining the hours which the worker had ordinarily been working in the employment before the injury, at least until 17th April 1974, and the ordinary amount which he would have received or would receive after the injury for those hours of work had he not been incapacitated.

This approach was criticized by Burt J. in the Supreme Court. His Honour pointed out that the applicant reads "the ordinary hours he would have worked" as "the hours ordinarily worked", thereby giving no effect to the apparent limitation introduced by the word "ordinary" where it governs "wage or salary" and "hours he would have worked". To overcome this criticism the applicant now says that the presence of the word "ordinary" serves to exclude from consideration some extraordinary rate of remuneration which the worker might receive on special occasions; likewise, it excludes from consideration additional hours which he might work on particular occasions over and above the hours ordinarily worked. It must be acknowledged that the applicant's approach does involve a change in the syntax of the clause, but this seems to be of little importance when other matters are taken into consideration.

A second criticism is that the applicant's construction gives to cl. 2 the same meaning as had formerly been assigned to the provision which it replaced. In my view this is not a valid ground of criticism, for the old provision consisted of a complex series of rules the effect of which differed, no matter how slightly, from the new provision on the interpretation for which the applicant contends.

The respondent's suggested construction which found favour with the majority in the Full Court produces more formidable problems. According to this view the compensation payable is referable to the ordinary (standard) rate of pay for the ordinary (non-overtime) hours of work in the particular occupation, whether the employment is regulated by an industrial award or not. Where the employment is regulated by such an award it will fix what are the ordinary hours of work and what is the ordinary rate of pay. Where the employment is not so regulated, other evidence will be required to establish what is standard in the relevant occupation.

This approach reads the word "ordinary" in the expression "ordinary hours that he would have worked" as referring to hours which attract no additional payment, i.e. for which overtime is not payable; it thereby avoids the conversion from "ordinary" to "ordinarily". This approach has the attraction of providing a measure of compensation easily calculated when the worker is working the ordinary hours each week under an industrial award. It is, however, a very different story when one moves away from this routine situation.

Special problems arise in the case of a casual or shift worker whose hours of work are remunerated otherwise than by reference to the ordinary rate of pay. Assuming that such a worker intended to continue casual or shift work it could not be said that, if he were not incapacitated, he would have worked any "ordinary hours" in the sense which the respondent gives to that expression. An endeavour was made to vault this yawning chasm by saying that the hours which would have been worked not exceeding the number in a week stipulated in the award should be treated as ordinary hours. However, there is no warrant for this course in the basic interpretation put forward by the respondent.

Faced with a choice between the two alternatives I prefer that advocated by the applicant. It is subject to grammatical criticism, but this so it seems to me is of less importance than the serious criticism that the competing construction does not enable one to calculate compensation for certain classes of workers, except by deserting that construction when that difficulty arises.

In reaching this conclusion I am influenced also by the fact that cl. 2 refers to the amount of the "ordinary wage or salary" which the worker would have received, that is, the aggregate amount of wage or salary payable for a week's work. It makes no reference to ordinary rates of pay, a concept which lies at the foundation of the respondent's argument.

For these reasons I would grant special leave and allow the appeal and answer the questions asked in the negative.

High Court of Australia Menzies, Gibbs, Stephen and Mason JJ. Kezich v Leighton Contractors Pty Ltd [1974] HCA 50

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