Pennington v Return to Work SA [2016] SAET 21 SOUTH AUSTRALIAN EMPLOYMENT TRIBUNAL PENNINGTON, Donna v RETURN TO WORK SA JURISDICTION: Referral FILE NO: 7648 of 2015 HEARING DATE: 28 April 2016 JUDGMENT OF: His Honour Deputy President Judge BP Gilchrist His Honour Deputy President Judge PD Hannon Deputy President M Calligeros DELIVERED ON: 3 June 2016 Referral to Full Bench - Whether a non-seriously injured worker who was not in receipt of weekly payments in connection with an injury that was compensable under Workers Rehabilitation and Compensation Act 1986 has an entitlement to weekly payments under the Return to Work Act 2014 - Principles of statutory construction considered and discussed - Although the construction urged upon us by Return to Work SA produces a seemingly unfair outcome in this case the statute evinced an unequivocal intention of Parliament to draw a line in terms of the continued receipt of weekly payments in connection with workers injured under the WR&C Act - Held that cl 37(6) of sch 9 of the RTW Act makes it plain that if a worker before the designated day was not in receipt of weekly payments and was not then entitled to receive weekly payments on account of a discontinuance under s 36 of the WR&C Act that worker has no entitlement to weekly payments under cl 37 of sch 9 of the RTW Act or under the WR&C Act - Ss 33, 35B, 35C, 36 and 37 Workers Rehabilitation Act 1986; Cl 37 of sch 9 Return to Work Act 2014. Eylward v Select Staff Pty Ltd [2000] SAWCT 192 Harden v Return to Work SA [2015] SAET 3 Schouwenaar v Woolworths (SA) Pty Ltd [2015] SAET 5 Martin v Employers Mutual Limited [2012] SASFC 36 Seal v Transfield Services (Aust) Pty Ltd [2010] SASCFC 44 Kanoon v Cablemakers Australia Pty Ltd (1975) WCR (NSW) 268 WorkCover/Allianz Australia (OD & E Pty Ltd) v Steggall [2002] SAWCT 49
Pennington v RTW SA 2 Gilchrist DPJ REPRESENTATION: Counsel: Applicant: Respondent: Solicitors: Applicant: Respondent: Ms D Eszenyi Mr S Cole Duncan Basheer Hannon Sparke Helmore
Pennington v RTW SA 3 Gilchrist DPJ 1 This is yet another case that concerns the interplay between the Workers Rehabilitation Act 1986 (WR&C Act) and the Return to Work Act 2014 (RTW Act). 2 At issue is whether a non-seriously injured worker, who was not in receipt of weekly payments in connection with a WR&C Act injury when that Act was repealed, has an entitlement to weekly payments under the RTW Act. Background facts 3 Ms Donna Pennington is aged 49 years. On 24 June 2013 she injured her lower back in the course of her employment with Coast to Coast Services Pty Ltd. She sought and obtained compensation under the WR&C Act and began to receive weekly payments at the rate of $287.18 per week, based on her then average weekly earnings. After a brief period of total incapacity she became partially incapacitated for work, and has remained so ever since. 1 4 Pursuant to the RISE Scheme 2 Ms Pennington commenced employment with Zym Export on 1 September 2014. Whilst working for Zym, Ms Pennington earned more than her average weekly earnings for the purposes of the WR&C Act such that she had no entitlement to weekly payments under that Act, whilst so employed. 5 On 16 September 2014 the compensating authority issued a determination pursuant to s 36(1)(d) of the WR&C Act. That provision enables the discontinuance of weekly payments if a worker has obtained work as an employee, or as a self-employed contractor, that is providing remuneration equal to or above the worker s notional weekly earnings. There is no dispute that the compensating authority was lawfully entitled to do so. 6 At midnight on 30 June 2015 the WR&C Act was repealed and the RTW Act became the operative Act. As at that date Ms Pennington was not in receipt of weekly payments because she continued to be employed by Zym and she continued to earn more than her average weekly earnings. 7 Just over three weeks later, on 23 July 2015, Ms Pennington s employment with Zym was terminated because Zym had gone into liquidation and had ceased trading. 1 Agreed Statement of Facts and Issues [5] 2 This is an acronym for Re-employment Incentive Scheme
Pennington v RTW SA 4 Gilchrist DPJ 8 On 6 August 2015 Ms Pennington made a claim for compensation seeking weekly payments on account of her ongoing partial incapacity for work. 9 The compensating authority rejected that claim on the basis that on the proper construction of cl 37 of the sch 9 of the transitional provisions of the RTW Act Ms Pennington had no such entitlement. 10 The issue that has been referred to this Full Bench is whether the compensating authority was correct in so determining. The legislative provisions 11 Clause 37 of sch 9 provides as follows: (1) In this clause (a) the first transitional period is the period of 52 weeks from the designated day; and (b) the second transitional period is the period of 52 weeks beginning immediately after the end of the initial transitional period; and (c) a reference to an entitlement period is a reference to an entitlement period under Part 4 Division 4 of the repealed Act; and (d) a Category A worker is, in respect of an existing injury, a worker who, immediately before the designated day, was still entitled to receive a weekly payment during the first entitlement period in respect of any incapacity for work in respect of that injury; and (e) a Category B worker is, in respect of an existing injury, a worker who, immediately before the designated day, was still entitled to receive a weekly payment during the second entitlement period in respect of any incapacity for work in respect of that injury; and (f) a Category C worker is, in respect of an existing injury, a worker who, immediately before the designated day, was still entitled to receive a weekly payment during a period occurring after the end of the second entitlement period in respect of any incapacity for work in respect of that injury. (2) Subject to this Part, a worker who, in respect of an existing injury, is incapacitated for work at any time during the period beginning on the designated day and ending 104 weeks from the designated day, will be entitled to weekly payments in
Pennington v RTW SA 5 Gilchrist DPJ respect of that incapacity in accordance with the following principles: (a) if any incapacity for work occurs within the first transitional period (i) in the case of a Category A worker the worker is entitled to weekly payments under section 39(1)(a)(i) or (ii) of this Act as if references to the first designated period in section 39(1)(a) were references to the first transitional period; and (ii) in the case of a Category B worker the worker is entitled to weekly payments under section 39(1)(b)(i) or (ii) as if references to the second designated period in section 39(1)(b) were references to the first transitional period and as if references to 80% in section 39(1)(b)(i) or (ii) were substituted with 90% ; and (iii) in the case of a Category C worker the worker is entitled to weekly payments under section 39(1)(b)(i) or (ii) of this Act as if references to the second designated period in section 39(1)(b) were references to the first transitional period; (b) if any incapacity for work occurs within the second transitional period the worker is entitled to weekly payments under section 39(1)(b)(i)(ii) of this Act as if references to the second designated period in section 39(1)(b) were references to the second transitional period. (3) Subject to subclauses (4) and (5), a worker has no entitlement to weekly payments under this Act or the repealed Act in respect of an existing injury after the end of the second transitional period (and this subclause will apply instead of section 39(3) of this Act in relation to existing injuries). (4) An entitlement under this clause has effect subject to any other provision of this Act (including any provision that applies under or subject to this Part) that provides for the suspension, reduction or discontinuance of weekly payments. (5) Subclause (3) does not apply in relation to a seriously injured worker. (6) To avoid doubt, a person who, before the designated day, has ceased to have an entitlement to weekly payments on account of a discontinuance under section 36 of the repealed Act is
Pennington v RTW SA 6 Gilchrist DPJ not entitled to weekly payments under this clause (or under the repealed Act). The parties submissions 12 Ms Eszenyi, counsel for Ms Pennington, submitted that Ms Pennington was a Category C worker and that immediately before the designated day she had a continuing potential entitlement to weekly payments under cl 37 of sch 9. 13 She submitted that the determination made pursuant to s 36(1)(d) of the WR&C Act did not cease Ms Pennington s entitlement to weekly payments. She said that all that it did was suspend them whilst the facts underpinning the determination remained. She said that it is instructive that after the words immediately before the designated day in cl 37(1)(f) Parliament used the expression was still entitled to receive a weekly payment rather than the expression was in receipt of weekly payments. Further, it was put that the concept of a worker with an underlying incapacity for work going in and out of periods of entitlement to weekly payments was consistent with the introductory paragraph to cl 37(2), and with the approach endorsed by the Full Tribunal in Eylward v Select Staff Pty Ltd. 3 14 As we understand her argument, Ms Eszenyi contended that the phrase was still entitled to receive a weekly payment is broad enough to include was potentially still entitled to receive a weekly payment. She said that on the facts here, immediately before the designated day, Ms Pennington had a potential entitlement to receive a weekly payment because her non receipt of weekly payments was contingent upon her continuing to work and earn more than her average weekly earnings as calculated by reference to her compensable injury. 15 Ms Eszenyi took us to the objects clause of the RTW Act and noted that as with the objects of the WR&C Act, there is an emphasis on providing for the effective rehabilitation of disabled workers and their early return to work, and the provision of fair compensation for employment related disabilities. 16 The effect of these submissions was to rhetorically ask: How could Parliament have intended to foster those objects by creating a transitional provision that meant that those workers who, following the objects of the Act and doing the right thing, returned to work, only to have any future entitlement to weekly payments cease as at the designated day, when if they had not returned to work and had remained in receipt of weekly payments, those payments could have continued for up to a further two years. 3 [2000] SAWCT 192 at [22].
Pennington v RTW SA 7 Gilchrist DPJ 17 Ms Eszenyi submitted that in the context of remedial legislation and a statutory mandate for us to interpret the RTW Act in the light of its objects 4 this is a construction that we should strive to avoid. 18 Mr Cole, counsel for Return to Work SA, submitted that the expression was still entitled to receive a weekly payment meant just that, in the sense of meaning an actual entitlement to be paid that benefit. He said that there was no reason to read into the provision potential entitlement which is what was required to achieve the outcome that Ms Pennington seeks. 19 Mr Cole submitted that the effect of the lawfully issued determination made pursuant to s 36(1)(d) of the WR&C Act was to end Ms Pennington s entitlement to weekly payments and that unless something happened before the designated day that could have revived that entitlement, as at immediately before the designated day, she had no such entitlement. Consideration 20 It has to be said that the construction urged upon us by Return to Work SA produces a seemingly unfair outcome in this case. If Ms Pennington s employment had been terminated a month earlier, she would have had a potential entitlement to weekly payments for up to a further two years, if there was a continuing incapacity for work. If she had resisted attempts to be rehabilitated and was in receipt of weekly payments throughout her incapacity for work she also would have had a potential entitlement to weekly payments for up to another two years. 21 It seems odd that her successful rehabilitation and the timing of her employer s demise have bought about such an unfortunate outcome. 22 However, as was noted by the majority in Harden v Return to Work SA: Whilst the unfairness of the outcome produced by a particular construction may in some circumstances be taken into account in construing legislation, it is an approach that must be used with great caution. The risk in focussing on the outcome produced by a particular construction and measuring it by notions of fairness is that it may lead judges to put their own ideas of justice or social policy in place of the words of the statute. 5 (Footnotes omitted.) 23 We now turn to consider the provisions in question. Clause 37(1) of sch 9 deals with the transition of workers from three entitlement periods 4 See s 3(3) RTW Act 2014. 5 [2015] SAET 3 at [48]-[49].
Pennington v RTW SA 8 Gilchrist DPJ under s 35(8) of the WR&C Act to two designated periods under s 39 of the RTW Act. Clause 37(2) provides that workers who were in their first entitlement period under s 35(8) of the WR&C Act as at 1 July 2015 are treated as being within the first designated period under s 39(1)(a)(i) or (ii) of the RTW Act, and workers who were in their second or third entitlement period under the WR&C Act as at 1 July 2015 are treated as being within the second designated period under s 39(1)(b)(i) or (ii) of the RTW Act. 24 Read together, cl 37(1) and 37(2) of sch 9 mean workers who prior to 1 July 2015 were still entitled to receive a weekly payment in an entitlement period in respect of any incapacity for work in respect of that injury are entitled to weekly payments in respect of that incapacity in accordance with the principles of cl 37(2). Clause 37(2)(a) describes what the entitlement to weekly payments is for each of Category A, B and C workers where any incapacity for work occurs within the first transitional period. Clause 37(2)(b) describes what the entitlement to weekly payments is where any incapacity for work occurs within the second transitional period. 25 The definition of each of the three entitlement periods in s 35(8) of the WR&C Act describes the length of the particular entitlement period. The definitions require that the worker has an incapacity for work and is entitled to the payment of compensation under this Act for that incapacity. It seems to us this phrase does not mean a notional or theoretical entitlement to a weekly payment. It refers to an entitlement to receive an actual weekly payment. Thus each of the entitlement periods of 13 weeks and 104 weeks respectively may have spanned a period of more than 13 or 104 calendar weeks, as an entitlement week must have both incapacity for work and an entitlement to receive compensation on account of that incapacity. 6 26 Clause 37(1) of sch 9 of the RTW Act adopts the language of s 35(8). This is not surprising as cl 37(1) is designed to manage the transition of weekly payments from one Act to the other. Clause 37(1) also requires there must be an entitlement to receive a weekly payment in respect of incapacity for work as a result of an injury. Again, the criterion is the entitlement to receive an actual weekly payment, not to receive a notional, theoretical or future weekly payment. 27 Clause 37(6) is expressed to be for the avoidance of doubt. It provides that if weekly payments have been discontinued pursuant to s 36 of the WR&C Act prior to 1 July 2015, there is no entitlement to weekly payments under either the RTW Act or the WR&C Act. It is trite law that an entitlement to a weekly payment can be revived after a discontinuance 6 See s 35(8) WR&C Act
Pennington v RTW SA 9 Gilchrist DPJ issued under s 36. 7 Despite that, Parliament has chosen to rely on the status of the entitlement to weekly payments as at 1 July 2015. That is arbitrary, but the preference appears to have been for certainty rather than flexibility or equity. 28 Ms Eszenyi sought to draw support from the decision in Schouwenaar v Woolworths (SA) Pty Ltd. 8 That case concerned a worker whose weekly payments were ceased under s 35B of the WR&C Act prior to 1 July 2015. However, prior to 1 July 2015, the worker had applied for weekly payments to continue to be made under s 35C of the WR&C Act and a Medical Panel had certified that the worker was entitled to continue to receive weekly payments as he fulfilled the criteria of s 35C(2). As such, the statutory pre-condition to continue to receive weekly payments beyond the end of the third entitlement period had been met before the designated day. In Martin v Employers Mutual Limited, 9 White J held that a worker s entitlement to weekly payments does not cease if weekly payments are continued under s 35C. As such, Schouwenaar concerned a very specific and quite atypical scenario where the worker s entitlement to weekly payments had not ceased. 29 Ms Eszenyi also relied upon the judgment of Kourakis J as he then was in Seal v Transfield Services (Aust) Pty Ltd. While his Honour pointed out that s 36 does not disentitle a worker to weekly payments but rather confers a power to discontinue weekly payments in prescribed circumstances, he also noted there are circumstances where the giving of notice under s 36 will necessarily mean there is no further entitlement to weekly payments. 10 It is the context of the discontinuance which must be considered just as in this case, it is the context of the phrase entitlement to weekly payments which falls to be considered. 30 In making the observation in Seal that, if some of the circumstances encompassed by s 36(1) are found to exist, the worker will necessarily be disentitled to weekly payments, Kourakis J gave an example of the circumstance arising in this case, namely a notice grounded on the allegation that the worker has obtained work providing a remuneration equal to or above his or her notional weekly earnings. 11 This weighs against one of Ms Eszenyi s submissions. She pointed out that none of sub-paras (a) (g) of s 36(1) refer to a cessation of the entitlement to weekly payments, whereas sub-paras (h) and (i) of s 36(1), which were inserted by amendments to the WR&C Act in 2008, expressly do so. 7 Kanoon v Cablemakers Australia Pty Ltd (1975) WCR (NSW) 268, WorkCover/Allianz Australia (OD & E Pty Ltd) v Steggall [2002] SAWCT 49, Seal v Transfield Services (Aust) Pty Ltd [2010] SASCFC 44 at [177]. 8 [2015] SAET 5. 9 [2012] SASFC 36 at [40] and [42] [43]. 10 [2010] SASCFC 44 at [178]. 11 [2010] SASCFC 44 at [178].
Pennington v RTW SA 10 Gilchrist DPJ Thus, the argument went, only a discontinuance effected by a notice under either sub-para (h) or (i) of s 36(1), being provisions introduced in accordance with a revised entitlement scheme from 2008, could be taken to result in a cessation of the underlying entitlement to weekly payments. 31 We do not consider that the 2008 amendments to s 36 brought a new approach to the question whether an entitlement to weekly payments survived an uncontested s 36 notice by reference to the basis upon which the notice was issued. Before the 2008 amendments, the Corporation had the right under s 38A of the WR&C Act, as it then was, to issue a notice of discontinuance if a worker s entitlement to weekly payments ceases. After the 2008 amendments, that right was effectively retained under s 36(1)(h). The 2008 changes did not introduce a new discontinuance regime whereby some notices ceased an entitlement, and others did not, depending on the particular provision of s 36 upon which the notice was based. In any event, the submission is inconsistent with the underlying assumption of Division 4 of Part 4 of the WR&C Act, which is that where an entitlement to weekly payments arises under s 35(1), it remains unless and until lawfully ceased by reference to s 36 or some other provision of the Act which authorises cessation. 32 Given the context of cl 37 of sch 9 of the RTW Act, we consider Parliament intended that workers who were not in receipt of weekly payments as at 1 July 2015 due to those weekly payments being discontinued under s 36 of the WR&C Act, are not entitled to receive weekly payments under either the RTW Act or the WR&C Act. 33 We interpret cl 37(1) to provide that for a worker to come within Category A, B or C, the worker must have an actual entitlement to receive a weekly payment during the relevant entitlement period. On that approach, Mrs Pennington does not come within Category C. Even if she did, the words of cl 37(6) evince an unequivocal intention of Parliament to draw a line in terms of the continued receipt of weekly payments by a worker in her position. Clause 37(6) makes it plain that if a worker before the designated day was not in receipt of weekly payments and was not at that time entitled to receive weekly payments on account of a discontinuance under s 36 of the WR&C Act, that worker has no entitlement to weekly payments under cl 37 of the RTW Act or under the WR&C Act. Conclusion 34 Because weekly payments to Ms Pennington had been discontinued pursuant to s 36 of the WR&C Act prior to the designated day, RTW SA was correct to have rejected her claim dated 6 August 2015.