July 2014

Weekly compensation payments - Court of Appeal clarifies Commission's jurisdiction

The Court of Appeal in Inghams Enterprises Pty Limited v Sok (7 July 2014), considered the Workers Compensation Commission’s jurisdiction to determine claims for weekly compensation payments under the 2012 Legislative Amendments.   

Background

Mrs Sok, (‘the worker’), was employed by Integrated Parramatta Services Pty Ltd (Integrated), a labour hire company. She was sent to work at Inghams Enterprises Pty Ltd (Inghams) in June 2001.  The work was physically demanding and she suffered injury to her back in October 2002 and a short time off work resulted.   

In November 2002, the worker became a full-time employee of Inghams.  She suffered further injury to her back in the course of employment with Inghams.

The worker filed an ARD seeking weekly payments of compensation from 10 May 2011.  Integrated and Inghams were each named as respondents.

Following an appeal from the arbitrator’s decision to a Deputy President of the Commission, the worker was awarded weekly payments of compensation under the new section 37 at the maximum statutory rate on the basis of total incapacity from 10 May 2011.

The worker was a not an existing recipient of weekly payments as at 1 October 2012.

Issue for Determination

As part of its appeal to the Court of Appeal, Inghams argued the Commission did not have power to make an award for weekly compensation under the new weekly compensation regime from 1 January 2013, being the date the worker became subject to the new weekly scheme.    

In challenging the Commission’s jurisdiction, Inghams argued section 43 of the 1987 Act, (as amended), should be interpreted so as to deprive the Commission of jurisdiction to determine matters which could be the subject of a work capacity decision. 

The Decision

The Court of Appeal unanimously held the Commission retained jurisdiction to award weekly payments of compensation after 1 January 2013, in circumstances where:

  • Insurers have not made a work capacity decision; and
  • Where weekly payments to the worker have not exceeded 130 weeks.

Inghams, in submitting the Commission had acted outside its jurisdiction in making an order for the award of weekly payments after 1 January 2013, essentially sought to broaden the meaning of the term “work capacity decision”, (see section 43A of the 1987 Act), arguing its meaning should be extended to include matters which may be the subject of a work capacity decision.  That is, if a work capacity decision could be made relating to a worker’s entitlement to weekly compensation under the new scheme from 1 January 2013, (the date when non existing recipients became subject to the new scheme), the Commission had no jurisdiction to make an order for the payment of weekly compensation. 

In dismissing this argument, the Court of Appeal essentially focused on the interpretation of section 43A of the 1987 Act.

Put simply, the Court held the nature of the language adopted by the Legislature in section 43(3), did not convey the meaning Inghams contended.  The language used means the Commission only loses jurisdiction to make orders up to the end of the first 130 weeks of incapacity if a work capacity decision has been made.

Further, it was held, were the appellant’s submissions accepted, this would result in an inconsistency between section 43 and section 44(5) of the 1987 Act.  Section 44(5) is clear in stating the Commission’s jurisdiction in relation to making decisions concerning weekly payments is curtailed only in circumstances where a work capacity decision has been made

Additionally, acceptance of the appellant’s submissions would render redundant the relevant savings and transitional provisions contained in Part 19H of Schedule 6.

What does this mean?

In the absence of a work capacity decision by an insurer, the Commission retains jurisdiction over disputes relating to a worker’s entitlements to weekly compensation payments. 

However, this jurisdiction is limited due to the operation of the new section 38.  Once a worker has received 130 weeks of weekly payments, any further entitlement must be assessed under section 38.  Section 38 makes it abundantly clear, workers’ entitlements to weekly payments beyond 130 weeks must be determined by the insurer making a work capacity decision. (See: Lee v Bunnings Group Limited [2013] NSWWCCPD 54).