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Findings and recommendations on merit review 029/18

Our Reference: 029/18
Date of review:

Findings

  1. The following are findings made by the State Insurance Regulatory Authority (the Authority) on review and are to be the basis for the Insurer’s review decision.
  2. The Worker is entitled to an additional four (4) days of weekly payments for the period XX April 2013 to XX July 2013.
  3. From March 2017, the Worker had “no current work capacity” as defined in section 32A of the Workers Compensation Act 1987 (the 1987 Act).

Recommendation based on findings

  1. The following recommendation made by the Authority is binding on the Insurer and must be given effect to by the Insurer in accordance with section 44BB(3)(g) of the 1987 Act.
  2. The Insurer is to determine the Worker’s entitlement to weekly payments of compensation in accordance with my findings above.

Background

  1. The Worker sustained an injury to their right hip while in the course of their employment as a Saw Operator at the pre-injury employer.  The accepted date of injury is XXXXXXXX.
  2. The relevant Insurer at the time of the injury, accepted liability and commenced weekly payments of compensation to the Worker.
  3. In August 2017, the Authority was advised that the Insurer is now managing the claim and has been forwarded all relevant documents.
  4. The Insurer made a number of work capacity decisions in April 2013. The outcome of these decisions was the cessation of the Worker’s entitlement to weekly payments of compensation under section 38(3) of the 1987 Act.  This cessation was to take effect in July 2013.
  5. In June 2017, over 4 years since the work capacity decision, the Worker lodged an application for internal review by insurer. The Worker referred for review issues regarding their current work capacity and the notice period provided by the Insurer.
  6. In June 2017 the Insurer wrote to the Worker advising that an internal review will not be undertaken although the Insurer did address the Worker’s submissions regarding the notice period.
  7. The Worker’s current work capacity, the Insurer’s calculation of the notice period and its refusal to undertake an internal review are the subject of the present application for merit review and will be dealt with in detail below.
  8. The application for merit review was received by the Authority in July 2017.

Legislation and guidelines

  1. The legislative framework governing work capacity decisions and reviews is contained in the:
  2. Section 43 of the 1987 Act describes a ‘work capacity decision’.
  3. Section 44BB of the 1987 Act provides for merit review of a work capacity decision of the Insurer, by the Authority.

Information considered

  1. The information that I have considered in making this decision is the information attached to the application for merit review and the Insurer’s reply and any other information that has been supplied by the parties, which I am satisfied has been exchanged between them.

Submissions

  1. In the application for merit review, the Worker submits:
    • They are entitled to reinstatement of weekly payments from XX March 2017 on the basis of WorkCover NSW Certificates of Capacity issued by their treating doctor.
    • “The required period of notice was not given as to when the WCD was to take effect. A period of 3 months + 5 days is required. In this instance, only 3 months notice was provided with the WCD taking effect on XX.7.2013. This decision is therefore invalid and my weekly benefits ceased unlawfully. I am entitled to reinstatement of my weekly payments, backdated to XX.7.2013 until such time as a valid WCD has been issued.”
  2. In reply, the Insurer submits:
    • “the Insurer noted that as there was no request for a review of any other part of the Work Capacity Decision, an internal review was not undertaken. No further information was received until the application for Merit Review was received by MRS on XX/07/2017 via email.”

Reasons

Nature of merit review and jurisdiction

Current work capacity

  1. From the outset, it is necessary to briefly address whether I have jurisdiction to conduct a merit review on the Worker’s current work capacity, given the Insurer’s submission that it did not conduct any internal review.
  2. The Worker lodged with the Insurer an application for internal review in June 2017.  In the application, the Worker submitted that as a result of deterioration of their injury, the treating doctor certified them “totally unfit for work as at XX.03.2017”.  The Worker states that the change in circumstances meant that their weekly payments should recommence from XX March 2017.
  3. The Worker further stated that the treating surgeon recommended a total hip replacement which was subsequently approved by the Insurer.
  4. In a letter to the Worker dated June 2017, the Insurer acknowledged receipt of the application for internal review. The Insurer stated that the matter “has been referred to an independent Internal Decision Review Consultant who is responsible for carrying out an independent review of the work capacity decision made on XX/04/2013”.
  5. Further into the letter, the Insurer states that because the Worker’s solicitor did not request a review on any other part of the work capacity decision, “an internal review will not be conducted”.
  6. In a letter dated XX July 2017, the Worker’s solicitor acknowledged that the Insurer made a decision under section 41 of the 1987 Act that the Worker is entitled to weekly payments after the Worker undergoes hip surgery.  However it was pointed out that the Worker is yet to undergo that surgery.
  7. The Worker’s solicitor reiterated that the Insurer should make a decision regarding whether the Worker is entitled weekly payments “from XX March 2017 to date and continuing” under section 38 of the 1987 Act.  Their solicitor states that the Worker is entitled because WorkCover NSW Certificates of Capacity issued from XX March 2017 indicates that they have no current work capacity for any employment.
  8. From my reading of the application for internal review it is clear that the Worker specifically requested a review of their current work capacity in light of the new WorkCover NSW Certificates of Capacity.  Given that the Insurer did not conduct an internal review of its work capacity decision in this regard, I find that I have jurisdiction to conduct a merit review on the Worker’s current work capacity under section 44BB(3)(b) of the 1987 Act.

Notice period

  1. The Worker has referred for review the Insurer’s calculation of the notice period in relation to the work capacity decision dated XX April 2013. They submit:

      “The required period of notice was not given as to when the WCD was to take effect.  A period of 3 months + 5 days is required. In this instance, only 3 months notice was provided with the WCD taking effect on XX.7.2013.  This decision is therefore invalid and my weekly benefits ceased unlawfully. I am entitled to reinstatement of my weekly payments, backdated to XX.7.2013 until such time as a valid WCD has been issued.”

  1. In the work capacity decision dated XX April 2013, the Insurer made a decision that the Worker had current work capacity and that under section 38 of the 1987 Act, their entitlements would cease.
  2. As to when this decision would come into effect, the Insurer stated:

      “…In line with the notice period the Insurer is required to give under Section 54, your weekly benefits will continue at the current rate ($450) for 3 months to XX July 2013…”

  1. Following an application by the Worker for an internal review, in June 2017, the Insurer wrote to the Worker stating:
    1. “Your solicitor has requested a review of the Work Capacity Decision based on the assumption that the decision did not have the correct effective date (XX/07/2013). The Insurer had not allowed for 5 days notice to allow for delivering of the decision.

      On review of the dates (XX/04/2013 – XX/07/2013) it is confirmed that this represents a period of 13 weeks and 1 day.”

  2. Section 43(1)(a)-(e) of the 1987 Act sets out the decisions of the insurer that are categorised as work capacity decisions. The Worker relies on section 43(1)(f) which states:
    1. Any other decision of an insurer that affects a worker’s entitlement to weekly payments of compensation, including a decision to suspend, discontinue or reduce the amount of the weekly payments of compensation payable to worker on the basis of any decision referred to in paragraphs (a)-(e).

  3. I note that the Insurer’s decision on XX April 2013 found that the Worker had current work capacity and was no longer entitled to weekly payments of compensation under section 38(3) of the 1987 Act.  Accordingly, the Insurer’s decision was a decision that is captured by paragraphs (a)-(e) of section 43 of the 1987 Act.
  4. Contained within that decision was the Insurer’s application of the stay provision, which is provided in section 44BC of the 1987 Act.  Central to this dispute is the Insurer’s alleged failure in the calculation of the number of days for which the stay applied.  As the duration of a stay could reduce the amount of weekly payments payable to a worker, I am satisfied I have jurisdiction under section 43(1)(f) for which to conduct a merit review regarding the notice period.

Findings on current work capacity

  1. Section 32A of the 1987 Act defines “current work capacity” as:
    1. current work capacity, in relation to a worker, means a present inability arising from an injury such that the worker is not able to return to his or her pre-injury employment but is able to return to work in suitable employment

  1. “No current work capacity” is defined in section 32A of the 1987 Act as:
    1. no current work capacity, in relation to a worker, means a present inability arising from an injury such that the worker is not able to return to work, either in the worker’s pre-injury employment or in suitable employment

  2. The only information I have before me regarding the Worker’s capacity for work are WorkCover NSW Certificates of Capacity issued by the Worker’s treating doctor.
  3. The certificates are dated XX March 2017, XX May 2017 and XX June 2017 and all indicate that the Worker has no current work capacity for any employment for the period XX March 2017 to XX September 2017.
  4. The treating doctor states that the Worker has ongoing pain in their left hip region which is long term and stable. He also stated that he did not need to see the Worker before XX September 2017 as the condition was chronic and pending surgery.
  5. In August 2017, the Authority requested the Insurer to provide additional information in the form of any treating doctor or specialist reports, functional assessment reports or independent medical reports for the past 12 months. The Insurer did not provide any additional information.
  6. The Worker’s treating doctor appears to have treated the Worker for a prolonged period of time. He would have a good understanding of the Worker’s symptoms, injury progression and effect of any treatment or surgery. I accept that the treating doctor’s opinion would be an accurate reflection of the Worker’s current work capacity.
  7. In the circumstances, I find that the Worker does not have current work capacity for any employment and did not from XX December 2016.

Findings on notice period

  1. Subsection (2) of section 54 states that before the termination of a worker’s weekly payments, the required period of notice (emphasis retained) is 3 months.
  2. Subsection (4) of section 54 provides:
    1. The notice referred to in this section is to be given to the worker personally or by post and (if the regulations so require) be in such form or contain such information as may be prescribed by the regulations.

  1. As it appears the work capacity decision of XX April 2013 was sent to the Worker by post, section 76 of the Interpretation Act 1987 provides that if an Act authorises or requires any document to be served by post, service of the document is taken to have been effected on the fourth working day after the letter was posted, “unless evidence sufficient to raise doubt is adduced to the contrary (my emphasis)”.
  2. I note that I do not have any information before me to doubt that service of the work capacity decision should be deemed to be effected on the fourth working day.
  3. A “working day" means a day that is not a Saturday or Sunday, or a public holiday or a bank holiday in the place to which the letter was addressed: section 76(2) of the Interpretation Act 1987.
  4. The work capacity decision is dated XX April 2013.  Service is taken to have been effected on the fourth working day which is XX April 2013. Three (3) months from this date is XX July 2013.
  5. Accordingly, I find that the required period of notice to be given to the Worker (before the cessation of weekly payments) was until XX July 2013.
  6. I therefore disagree with the Insurer’s calculation of the period of notice as 13 weeks and 1 day. The Insurer did not factor in the requirement of section 76 of the Interpretation Act 1987 and the wording of sub-section (2) of section 54 of the 1987 Act which refers to “months” and not the weeks and days as stated by the Insurer.
  7. I find that the Insurer has given less than the required period of notice and the Worker is entitled to an additional four (4) days of weekly payments (see section 54(3)(b)).  They are not, however entitled to weekly payments backdated to XX July 2013 as, with the exception of an incorrect calculation of the notice period, there is nothing before me to suggest the Insurer’s work capacity decision from XX July 2013 to XX March 2017 (i.e the date from which the Worker was found to have no work capacity as per the certificates of the treating doctor) did not apply.

Calculation of Entitlement

  1. The Insurer is to determine the Worker’s entitlement to weekly payments of compensation in accordance with my findings above.

Merit Reviewer
Merit Review Service
Delegate of the State Insurance Regulatory Authority