Workers Compensation - Assessment and amount of compensation - Amount of compensation during incapacity - Calculation of weekly earnings - Generally - Normal weekly earnings - Meaning of "the period for which he or she was employed before the commencement of the period of incapacity" - Whether period of incapacity commenced only upon certification of incapacity.

Workers Rehabilitation and Compensation Act 1988 (Tas), s 69(14).

Judgment Number: [2023] TASSC 30

SCOTT BRADLEY MENZIES v HAYS SPECIALIST RECRUITMENT (AUSTRALIA) PTY LTD

1. This is an appeal from a decision of the Tasmanian Civil and Administrative Tribunal relating to a workers compensation dispute. The tribunal was constituted by a senior member, Ms L Jack. She made a decision refusing an application by a worker for interim weekly payments of compensation: M v Hays Specialist Recruitment (Australia) Pty Ltd [2022] TASCAT 114. The worker contends that she erred in law in making that decision, and that it should be set aside.
2. At the time of the hearing before the tribunal, the worker was receiving Centrelink payments. One of the findings relied on by the learned senior member when she decided to refuse the application was that the worker was likely to be better off receiving the Centrelink payments than receiving the appropriate rate of weekly workers compensation payments. There was a disagreement between the parties as to what that appropriate rate was. The worker had worked for the employer for about 11 weeks before becoming incapacitated, but had not obtained a medical certificate and claimed compensation until some 13 weeks later. The employer contended that the weekly rate should be calculated by dividing the earnings from the period of 11 weeks by 24. The worker contended that the rate should represent the average of what he earned during the period of about 11 weeks. The learned senior member adopted the employer's figure. For the reasons stated below, I have concluded that she erred in law in doing so.

1. The background to the appeal can be summarised as follows:
   • On 9 March 2021 the appellant, Scott Menzies ("the worker"), commenced employment with the respondent, Hays Specialist Recruitment (Australia) Pty Ltd ("the employer").
   • In late May 2021 the worker developed back pain. It became so bad that he decided to cease work. The last day that he worked for the employer was 23 May 2021.
   • On 23 August 2021, after an interval of some three months, the worker obtained an initial medical certificate. His doctor certified that he was incapacitated for work for the period from that day until 12 September 2021.
   • On 25 August 2021 the worker signed a claim form and made his claim for weekly payments of compensation.
   • Weekly payments were subsequently commenced, at a rate of $369.81 per week before tax.
   • A dispute arose as to whether the worker's incapacity was work-related. The employer's insurer obtained a report from a consultant neurosurgeon, Dr Jonathan, who said that it was not work-related. The worker's solicitors obtained reports from two specialists who said that it was work-related. The worker accepted that the employer had a reasonably arguable case for disputing his claim. As a result, the tribunal made orders by consent on 29 November 2021 determining, pursuant to s 81A(3)(c) of the Workers Rehabilitation and Compensation Act 1988 ("the Act"), that compensation was not to be paid by the employer.
   • In April 2022 the worker referred his claim back to the tribunal seeking a determination that the employer was liable to pay him compensation comprising weekly payments and medical expenses.
   • On 9 August 2022 the worker, pursuant to s 60A of the Act, filed a referral seeking orders from the tribunal requiring the employer to make weekly payments of compensation on an interim basis.
   • The senior member heard that application on 7 September 2022.
   • On 3 October 2022 she made the decision under appeal, dismissing the application for interim payments.
2. Section 60A contains the following relevant subsections:

"60A Power of Tribunal to make interim determinations, & c

(1) The Tribunal may make an interim determination, ruling or direction in respect of a claim for compensation referred to it, whether or not liability for the claim has been accepted or disputed.

(1A) The Tribunal may make an interim determination, ruling or direction in the following circumstances:

(a) where a delay by one side of the proceedings substantially prejudices the other side;

(b) where a party fails to comply with a direction of the Tribunal or a conciliator;

(c) where the Tribunal is otherwise satisfied that the interests of justice require it.

(2) Where the Tribunal makes an interim determination, ruling or direction it must make an order which gives effect to that interim determination, ruling or direction."

1. The worker contended that it was in the interests of justice for the tribunal to make an interim order, relying on s 60A(1A)(c) alone. There was no suggestion of delay or non-compliance with any direction.
2. The senior member, at [8], took the view that the tribunal was required to determine whether interim relief ought to be granted in the interests of justice by considering whether there was a serious question to be tried between the parties as to whether the worker had a good case for final relief, and whether the balance of convenience favoured the making of an interim order. She relied on two decisions relating to comparable provisions in other jurisdictions: C & S Insulation Services Pty Ltd v Copley (1997) 136 FLR 317; Virgin Enterprises Ltd v Virgin Star Pty Ltd [2005] FCA 1846, 67 IPR 557. It is common ground that her approach was correct.
3. The senior member considered the medical evidence and concluded, at [32], that there was a serious question to be tried. She also concluded that neither party's case was demonstrably stronger than the other party's case. There is no suggestion that she erred in those conclusions.
4. She went on to examine the evidence concerning the worker's personal and financial situation. It appears that there were undisputed facts as follows. The worker had had no income since his weekly payments ceased in November 2021. His partner was working as a nurse. They had four children. They were living in rented accommodation. Because he had no income, he and his partner had depleted their savings from a starting point of approximately $20,000 to $25,000 to a level of approximately $3,000 at the time of the hearing. The worker's relationship with his partner had broken down and they were living separately under the same roof. As from 9 August 2022 the worker was receiving from Centrelink a job seeker allowance of $690.05 per fortnight. He was also receiving from Centrelink a carer's payment of $136.50 per fortnight in relation to the care of one of his children.
5. The worker contended that he was totally incapacitated for work at all material times. He sought interim payments at the rate of $645.48 gross per week. The employer contended that the rate at which payments had been made in 2021, namely $369.81 gross per week, was the appropriate rate, if any payments were to be made at all. The senior member appears to have accepted that that figure was correct.
6. The evidence before the tribunal established that the worker earned $8,875.42 gross, excluding overtime and travel allowance payments, while working for the employer between 9 March 2021 and 23 May 2021. The employer took the view that the rate of weekly payments should be calculated by treating that amount as the amount that the worker earned between the commencement of his employment and the first certification of his incapacity for work. That was a period of 24 weeks. The weekly rate of $369.81 represented the gross earnings of $8,875.42 divided by 24.
7. However the worker contended that his weekly rate should be calculated by reference to the date he commenced employment and the date when he became incapacitated, which was said to be 23 May 2021. On that basis, the earnings were referrable to a period of 76 days. In written submissions to the tribunal, the solicitors for the worker argued that, but for his injuries, he would have "reasonably earned" an average of at least $806.85 gross per week after deductions for overtime and allowances. The claim for weekly payments in the sum of $645.48 gross per week was apparently intended to represent 80% of the full rate of weekly payments, in accordance with s 69B(1)(c) of the Act. Under that provision, only 80% of the full weekly payment is payable by way of compensation more than 78 weeks after the date of the initial incapacity.
8. In fact the application to the tribunal was made and heard less than 78 weeks after the date of the initial incapacity, at a time when the appropriate percentage would have been 90% pursuant to s 69B(1)(b). The worker's solicitor/counsel told the senior member that the figure claimed represented 90%, when that was arithmetically incorrect. However those matters are of no present significance.
9. The rate of weekly payments for a totally incapacitated worker is required to be calculated in accordance with s 69(1)(a) of the Act. That provision reads as follows:

"(1) Subject to this section, where total or partial incapacity for work results from an injury suffered by a worker and where the existence of such total or partial incapacity is supported by a certificate in a form approved by the Board signed by a medical practitioner or accredited person, the compensation payable to him under this Act is-

(a) in the case of the total incapacity of the worker for work, weekly payments equal to-

(ii) the ordinary time rate of pay of the worker for the work in which, and for the hours during which, the worker was engaged immediately before the period of incapacity-

1. Section 69(14) of the Act provides as follows:

normal weekly earnings, in relation to a worker who is incapacitated for work, means the average weekly earnings of the worker during the relevant period;

(a) if the worker has been continuously employed by the same employer for 12 months or more, the 12 months immediately before the commencement of the period of incapacity; or

(b) if the worker has been continuously employed by the same employer for less than 12 months, the period for which he or she was employed before the commencement of the period of incapacity."

1. In both his written and oral submissions to the tribunal, the worker's then solicitor/counsel relied primarily on these provisions, arguing that the worker's weekly payments were equal to his average weekly earnings for the period from the commencement of his employment to the commencement of the incapacity on 23 May 2021. However he muddied the waters somewhat by also referring in his written submissions to the following provisions in the Act:
   • Section 69(8), which permits a worker, if of the opinion that an amount of weekly payments calculated in accordance with s 69 is insufficient, to refer the matter to the tribunal.
   • Section 69(9), which empowers the tribunal then to determine "the amount of weekly payments which appears to it to be reasonable and appropriate in the circumstances" having regard to, amongst other things, "the earnings that the worker might reasonably have earned during the period of incapacity".
   • Section 69(11), which provides that an amount determined under s 69(9) shall be the amount of weekly payments payable to the worker, even if it is a greater or lesser amount than the compensation otherwise payable under s 69.
2. At the conclusion of the oral submissions to the tribunal, the worker's solicitor/counsel argued to the effect that s 60A gave the tribunal a discretion to determine a rate of interim weekly payments if it was unable to determine the appropriate rate under s 69. He relied on s 60A(2C) of the Act. That sub-section reads as follows:

"(2C) In determining a rate of weekly payments for the purposes of an order under this section, the Tribunal may have regard to the basic salary if a rate cannot be reasonably determined by reference to section 69 ."

1. The senior member rejected the submissions as to s 60A(2C) and s 69(8), (9) and (11), saying the following, at [63]-[66]:

"63 I am not able to accept what appears to be a submission from counsel for the worker that, effectively, the Tribunal would have carte blanche to order interim weekly payments under s60A in an amount that it considered to be appropriate and reasonable.

1. Although it is true that the Tribunal may determine a rate of weekly payments for the purposes of an order under s60A, the wording of s60A(2C) makes it clear that the Tribunal must have regard to s69 in doing so. The calculations by which the rate at which weekly payments are to be paid to a worker are set out s69 of the Act. On the face of calculations properly undertaken in accordance with s69, a worker's entitlement to weekly payments is for weekly payments so calculated.
2. There is, of course, a right for an party to refer to the Tribunal, under s69(8), the question of the amount of appropriately calculated under s69, if the part is of the view that the payments are either insufficient or excessive. However, in determining the amount of weekly payments that the Tribunal considers to be reasonable and appropriate, the Tribunal is required to have regard to the matters set out in s69(9), including the weekly earnings of a comparable worker, the earnings the worker might reasonably have earned and any other relevant matter. The questions for the Tribunal under s69(9) are different questions to those before the Tribunal where a worker seeks interim payments under s60A.
3. Having regard to the words of s60A(2C) and s69, this is not a situation where I consider I could make any order for weekly payments of compensation at a rate in excess of the rate determined by the calculations in accordance with s69."
4. She went on to compare the worker's payments from Centrelink with the rate of compensation calculated by the employer without considering whether the employer's calculations were consistent with the requirements of s 69(1) and (14). Her reasoning for dismissing the worker's application proceeded as follows:

"70 The worker is presently receiving in benefits, an amount that exceeds the weekly payments of compensation he would be receiving if his claim had not been disputed. If I was to make an order for interim payments, the worker would likely be worse off than he is now, and the employer would be making weekly payments to him that it would have no means of recovering if the worker was unable to successfully prosecute his claim. This would be particularly the case if orders were to be made that would continue interim payments until the worker's back condition was stable and stationary.

1. The issues between the parties are the nature of the injury, and whether the injury occurred in compensable circumstances. Counsel for the worker submitted in the course of the s60A hearing that the worker has a strong case as to liability. The interests of justice would potentially best be served by the worker's case progressing to hearing.
2. The worker's application for interim weekly payments of compensation is dismissed."
3. The senior member arrived at those conclusions without addressing the argument advanced for the worker to the effect that his period of incapacity commenced on or about 24 May 2021, and not on the date of first certification, and that his weekly payments should have been calculated accordingly, as argued by his solicitor/counsel. She appears to have accepted the employer's contentions as to this issue, without addressing the primary contentions of the worker. In her reasons at [59], she said the following:

"59 The worker commenced work with the employer on 9 March 2021. The last day that he actually worked with the employer was 23 May 2021, but he remained employed. His claim for compensation was made on, or about, 25 August 2021, and was accompanied by an initial workers compensation medical certificate that certified him to be wholly incapacitated from 23 August 2021 to 13 September 2021. In calculating the rate of weekly payments of compensation, the employer's workers compensation insurer applied s69(14) of the Act, and assessed the worker's average weekly earnings (and thus, normal weekly earnings) by averaging the total amount earned by the worker in the course of his employment over the number of weeks that he had been in employment. Because the worker had only been earning between March and May 2021, but had been employed between March and August 2021, the weekly payments of compensation to which he was entitled under the Act were significantly less that the amounts he had been earning each week between March and May 2021."(Emphasis added.)

1. The worker contends that his weekly payments of compensation, if he is entitled to any, were to be equal to his "normal weekly earnings" pursuant to s 69(1)(a)(i); that they were his average weekly earnings in accordance with par (b) of the definition of "relevant period", namely the period for which he was employed before the commencement of the period of incapacity; that that period commenced when he became unfit for work, not at the time of first certification; and that the senior member therefore erred in law in the reasoning that led her to reject his application.
2. The worker was employed on a casual basis. He did not have an ordinary time rate of pay to which s 69(1)(a)(ii) applied. See Scott v Sun Alliance Australia Ltd [1993] HCA 46; (1993) 178 CLR 1 at 5. His rate of compensation must therefore be equal to his "normal weekly earnings" by virtue of s 69(a)(i).
3. The worker was continuously employed by the same employer for less than 12 months. His normal weekly earnings therefore have to be calculated in accordance with par (b) of the definition of "relevant period". That period ended upon "the commencement of the period of incapacity". The employer contends that those words refer to the commencement of the period of certified incapacity. The worker contends that they refer to the commencement of the period of actual incapacity.
4. It is quite clear from the opening words of s 69(1) that, for weekly compensation to be payable, there needs to be not only an incapacity for work but also a medical certificate supporting the existence of such incapacity. As counsel for the employer has pointed out, that has been made clear in a long line of authority. See State of Tasmania v Parsons [2002] TASSC 59, 11 Tas R 26 at [77] and cases cited there: Federal Hotels Ltd v Webb [2013] TASSC 36, 22 Tas R 283 at [7].
5. In his submissions as to the meaning of "the commencement of the period of incapacity", counsel for the employer relied on the structure of s 69(1) and (14), and on the decision of Underwood J (as he then was) in Allison v James [1994] TASSC 122; (1994) 3 Tas R 304. However neither the structure of the two subsections nor that case give any support to the interpretation contended for.
6. The introductory words of s 69(1) draw a distinction between the existence of a total or partial incapacity for work and the supporting of the existence of such an incapacity by a certificate. The wording of the subsection is entirely consistent with the proposition that an incapacity will not entitle a worker to weekly payments until certification takes place. There is nothing in the definition of "relevant period" to suggest that the "period of incapacity" referred to must be the period of certified incapacity.
7. Such an interpretation would be inconsistent with the scheme of the legislation as discussed in Scott v Sun Alliance (above) at 1, namely that "compensation is payable for the loss of the worker's capacity to earn in the future". It would also be inconsistent with the principle that workers compensation legislation, as beneficial legislation, should be interpreted favourably to workers: Wilson v Wilson's Tile Works Pty Ltd (1960) 104 CLR 328; Bird v Commonwealth (1985) 165 CLR 1 at 9_._
8. The case of Allison v James supports the worker's suggested interpretation, not that of the employer. That case concerned the interpretation of the words "the work in which...the worker was engaged immediately before the period of incapacity" in s 69(1)(a)(ii). It concerned a worker who had become incapacitated, recovered, returned to work, resigned, suffered a recurrence of symptoms, and become totally incapacitated for work. Underwood J held that the words in question did not always denote the last work in which the worker was engaged before a particular period of incapacity. The case is relevant only because of some comments made by his Honour at 308, where he said the following:

"The only 'period of incapacity' that makes weekly payments payable is that prescribed by the opening words of the subsection viz, 'where total or partial incapacity for work results from an injury suffered by the worker.' Although the existence of a medical certificate is a condition precedent to entitlement to receipt of weekly payments in the case of either incapacity, such certificate does no more than 'support' - ie, evidence - the incapacity. Thus, the time of commencement of any period of incapacity resulting from a compensable injury for the purpose set out in s 69(1)(a)(ii), is a question of fact which may or may not be evidenced by a prescribed medical certificate."

1. Where, as in this case, a worker delays in obtaining a medical certificate and earns no income during the period of delay, the interpretation contended for by the employer cannot result in the worker receiving appropriate compensation for the loss of the capacity to earn. In their ordinary meaning, the words "total or partial incapacity for work" in s 69(1) have nothing to do with certification.
2. The interpretation of the words, "the commencement of the period of incapacity", contended for by the worker is supported by the context and ordinary meaning of the words of s 69, the adoption of an interpretation beneficial to workers, and the adoption of a purposive interpretation. Those words must be taken to refer to the commencement of the period when the worker was in fact incapacitated for work, not the commencement of any period of certification.

1. For these reasons, I reject the employer's contentions as to the meaning of "the period for which he or she was employed before the commencement of the period of incapacity" in par (b) of the definition of "relevant period" in s 69(14) of the Act. The worker's contentions as to the meaning of those words was correct. The learned senior member erred in accepting the employer's contentions as to that point, and its calculations as to the applicable rate of weekly payments. She also erred by failing to afford the worker procedural fairness, in that she did not address his primary argument as to the rate of weekly payments.
2. At the time of the hearing the worker was receiving some $826.55 per fortnight from Centrelink. If he had been receiving weekly payments under the Act they would have been close to the claimed rate of $645.48 gross per week, not $369.81 per week. The learned senior member might well have reached a different conclusion as to the outcome of the application if she had not erred as to the quantum of weekly payments.
3. For these reasons I allow the appeal, I set aside the determination of the tribunal, and I remit the matter for redetermination by a differently constituted tribunal.