June 2018

Aggregation of permanent impairment – when is pathology considered the same or “identical”?

Permanent impairment resulting from separate injuries cannot be aggregated or combined to arrive at a higher whole person impairment (WPI), unless the pathology from each injury is identical.

A worker may seek to combine permanent impairment from different injuries to maximise the overall WPI to satisfy a threshold under the Workers Compensation Act 1987 for lump-sum compensation, medical expenses, weekly compensation beyond 5 years or work injury damages. 

The law on aggregation has largely been settled since the decision of Department of Juvenile Justice and Edmed [2008] NSWWCCPD 6 (“Edmed”).  This decision established that unless a worker suffers the same injury or pathology that is “identical” in each injurious event, the assessment of permanent impairment resulting from the separate injuries cannot be aggregated or combined.

The recent decision of Bukvic v Willoughby City Council [2018] NSWWCC 80 (26 March 2018) considered whether pathology arising from different injuries but involving the same body part was the same or identical in a permanent impairment claim involving two injuries.

Facts

The worker was a Council concreter.  On 28 August 2013, he slipped and twisted his knee walking across a concrete surface.  He suffered a medial collateral ligament strain and complex tear in the right medial meniscus.

He had a total right knee replacement on 3 June 2015.

It was also accepted he had a further injury to the right knee due to the “nature and conditions” of employment.  His work as a concreter involved repetitive twisting, turning and kneeling, often in tight or confined spaces, and loading of the knee joint.  This injury was characterised as an aggravation of degenerative or arthritic change or disease in the knee.  The injury date under the disease provisions was 14 November 2016 - the WPI claim date.

The worker submitted the lump-sum claim based on both injury dates, 28 August 2013 and 14 November 2016.  The parties agreed the total permanent impairment to the right lower extremity (right knee) was 20%.  Both medico-legal experts rated the outcome of the knee replacement as ‘fair’ under the permanent impairment assessment guides.

The worker sought lump-sum compensation for 20% WPI, arguing both injurious events gave rise to the same injury or pathology and, therefore, the permanent impairment resulting from each injury could be combined.

The Council argued the permanent impairment resulting from each injury should be assessed separately and could not be combined to calculate the lump-sum compensation entitlement.

The worker was referred to an Approved Medical Specialist (AMS).  He was asked to assess permanent impairment separately resulting from each injury.  He agreed the total right knee permanent impairment was 20% WPI.  He issued two Medical Assessment Certificates (MACs) as follows:

  • Right lower extremity (knee) permanent impairment resulting from injury on 28 August 2013 - 5% WPI

  • Right lower extremity (knee) permanent impairment resulting from injury on 14 November 2016 (deemed) - 15%

The insurer offered to resolve the claim by payment of lump-sum compensation for 15% WPI resulting from the 2016 injury, but made no offer for the 2013 injury because the permanent impairment resulting from this injury did not exceed 10% and, therefore, the section 66(1) threshold was not satisfied.

The offer was rejected by the worker and the dispute proceeded to arbitration.

Issues

The issues were:

  • Was it permissible to combine the permanent impairment resulting from each injury to calculate the worker’s lump-sum entitlement?

  • If aggregation was permissible:

    • Can aggregation be used to enable the worker to satisfy the section 66(1) threshold in respect of the 2013 injury, even though the WPI assessment for this injury was only 5%? The threshold was introduced for a reason, namely to limit access to lump-sum compensation.

    • What rate of lump-sum compensation applies to the 2013 injury? In this regard, the 2012 legislative reforms remove the lump-sum entitlement altogether for permanent impairment in the range of 0% to 10%.  No dollar figures are prescribed for permanent impairment within this range.

    • If the worker can combine the permanent impairment resulting from each injury, should the entitlement for the entire 20% WPI be calculated at the higher rates applicable to the 2016 deemed injury date, potentially resulting in a windfall to the worker?

The worker sought to combine the impairments resulting from the 2013 and 2016 injuries, arguing both injuries involved identical pathology; namely, osteoarthritis of the right knee. 

Outcome

After an extensive review of the medical evidence and, in particular, the opinion of the AMS; the arbitrator concluded the worker suffered a medial ligament sprain, tear of the medial meniscus of the posterior horn, and aggravation of pre-existing osteoarthritis of the knee joint in the 2013 injury. She also accepted the 2016 ‘nature and conditions’ injury contributed to the development of osteoarthritis in the knee.

The arbitrator, therefore, concluded there were significant differences in the damage or pathology produced by each injury.  Whilst both injuries contributed to the aggravation of osteoarthritis in the knee, the 2013 injury also occasioned medial ligament disruption.  She found the pathology arising from each injury was not the same or identical, identifying material differences in pathology.

The arbitrator ruled against the worker and did not permit aggregation of the permanent impairment resulting from each injury.  The worker was awarded lump sum compensation for 15% WPI resulting from injury on 14 November 2016 only.

Implications

The decision confirms the established law on aggregation; in order to combine permanent impairment resulting from different injuries, the pathology from each injury must be the same or identical.  It is not enough to show the pathology is similar in some respects.  In this case, it was not sufficient for the worker to demonstrate both injuries contributed to the osteoarthritis.  The fact the 2013 injury also caused ligament damage prevented the worker from establishing the pathology from each injury was identical. 

When dealing with permanent impairment and threshold issues, where there are multiple injuries, it is important to identify the structural or pathological damage or change caused by each injury to ensure any combination of permanent impairment is permissible.  Where aggregation is not permissible or challenged, it is vital to ensure any referral of permanent impairment to an AMS is on the basis of separate injury, with the requirement to issue a MAC in respect of each injury.

Authors: Mick Franco & Jessica Maiuolo