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AET v GIO General Ltd [2019] NSWDRS MR 123

Overview

Jurisdiction: Merit reviews

Catchwords: Weekly payments of statutory benefits – pre-accident weekly earnings – PAWE – maternity leave – sick leave – earner

Legislation cited:

  • Anti-Discrimination Act 1977 (NSW) s 49T
  • Motor Accident Injuries Act 2017 (NSW) ss 7.12, 7.13,Schedule 1 cl 4
  • Motor Accident Injuries Regulation 2017
  • Motor Accident Guidelines effective 13 July 2018 cl 7.441

Parties:

  • AET – claimant
  • GIO General Ltd – insurer

Disclaimer: This decision has been edited to remove all unique personal identification including the name of the claimant.

Merit review certificate

View the certificate

Issued under section 7.13(4) of the Motor Accident Injuries Act 2017

The Claim
Claimant AET
Insurer GIO General Ltd
Claim Number Y05975800001
The Reviewable Decision
Reviewable decision‐makerZeba Shameem
Date of Reviewable decision 16 January 2019
Nature of Reviewable decisionWeekly payments of statutory benefits ‐ the amount of pre‐accident weekly earnings
The Merit Review
Our Reference10095356
Merit ReviewerTami O’Carroll
Date of this Certificate21 June 2019

Merit Reviewer's Determination

My determination of the merit review is as follows:

  • The reviewable decision is set aside and the following decision is made in substitution for the reviewable decision:
    • The amount of AET’s pre‐accident weekly earnings is $273.76.
    • Effective Date – This determination has effect from 2 June 2018.

Reasons

Background

1.  AET was injured in a motor vehicle accident on 1 June 2018. She was not working at the time of the accident as she had taken time off after the birth of her second child. Prior to that she had worked as a care worker/community services worker.

2.  AET worked with XXXXX Services up until 15 January 2017. She commenced employment with XXX Quality Care (Quality Care) on 29 November 2016 and worked with them up until August 2017. She also completed three shifts with the XXXXX Neighbourhood Centre in April 2018.

3.  On 16 January 2019, the insurer advised AETs that her the amount of her pre‐accident weekly earnings (PAWE) was calculated at $96.60.

4.  On 30 January 2019, the insurer advised AET that it determined she was not an “earner”. It therefore found that she had no entitlement to payments of weekly statutory benefits.

5.  AET sought review of those decisions.

6.  In an internal review decision dated 15 April 2019, the insurer determined that AET is an “earner” entitled to payments of weekly statutory benefits under Division 3.3. She demonstrated earnings for a 26‐week continuous period in the 2 years immediately prior to the accident. It calculated her PAWE at $96.33 per week.

7.  AET lodged an application for merit review with the Dispute Resolution Service (DRS) on 5 May 2019. She seeks review of the insurer’s decision regarding the calculation of her PAWE. I note that she does not contest the decision that she is an “earner” entitled to payment of weekly statutory benefits under Division 3.3.

8.  The application has been made in accordance with section 7.12(1) of the Act and the Motor Accident Guidelines (the Guidelines).

Documents and information

9.  I have considered all documents provided and submissions made with the application and the reply and any further information that has been provided to the DRS. I am satisfied that all information has been exchanged between the parties.

Submissions

10. In the application for merit review, AET submits:

* The insurer has not used the correct method of calculating her PAWE.
* At the time of the accident she was on maternity leave with her second child. She had additional time away from work during her pregnancy as it was high risk.
* She went off on sick leave from 27 August 2017 and was off until the birth of her second child on 10 January 2018. She was then on maternity leave, due to recommence her employment with Quality Care in October 2018. She would have worked 2 days per week, 10 hour shifts, earnings $25 per hour or $500 gross per week. She also had the option of working night shifts and it was her intention to slowly increase her hours of work over the following 12‐18 months.
* The insurer should have calculated her PAWE based on what she would have earned after returning from maternity leave or, alternatively, her earnings from when she was not on maternity leave.
* The method of calculation used by the insurer is in breach of section 49T of the Anti‐ Discrimination Act 1977 (NSW).
* She had been employed as a nurse for 13 years. In the three years prior to the accident, she had two periods of maternity leave.
* In the years prior to the accident she earned:
o 2012/2013 financial year ‐ $21,300 or an average of $409 per week;
o 2013/2014 financial year ‐ $27,000 or an average of $521 per week;
o 2014/2015 financial year ‐ $26,142 over 36.6 weeks (before going on maternity leave in mid‐March 2015) averaging $714.26 per week;
o 2015/2016 financial year –$21,070, over 24.4 weeks (she returned from maternity leave on 20 December 2015 and worked until 30 June 2016 earnings) averaging $863.21
o 2016/2017 financial year ‐ $8,806 over a 5‐week period (she only worked from July 2017 – August 2017 as she had time off sick) averaging $305 per week.
* Reference is made to subclause 4(2)(b) and 4(3) of Schedule 1 of the Act. The correct way to assess her PAWE is to examine the actual periods of time she was earning and not include the periods where she was on maternity or sick leave. Calculating wages earned from 30 June 2013 – 30 June 2016 her PAWE is $648.75.
* In the alternative, reliance is placed on subclause 4(2)(c) of Schedule 1 as she had been offered to return to her employment with Quality Care earnings $25 per hour for 20 hours or $500 per week.

11.The insurer submits:

* AET has not submitted any additional evidence in support of her application that would alter the PAWE calculated by the insurer on internal review.
* In making its decision it complied with relevant sections of the Act and therefore was not in breach of section 49T of the Anti‐Discrimination Act 1977 (NSW).
* It affirms the findings and conclusion made regarding AET being determined as an earner and her gross PAWE calculation at $96.33.

Legislation

12.In conducting my review, I have considered the following:

* Motor Accident Injuries Act 2017 (NSW) (the Act)
* Motor Accident Guidelines effective 15 January 2019 (the Guidelines)
* Motor Accident Injuries Regulation 2017 (NSW) (the Regulation)

Pre-accident weekly earnings (PAWE) - Definitions

13. Clause 4 of Schedule 1 of the Act contains the following provisions relevant to the calculation of PAWE:

(1) “Pre‐accident weekly earnings”, in relation to an earner who is injured as a result of a motor accident, means the weekly average of the gross earnings received by the earner as an earner during the 12 months immediately before the day on which the motor accident occurred, unless subclause (2) applies.
(2) In the following cases,
"pre‐accident weekly earnings", in relation to an earner who is injured as a result of a motor accident, means:
(a)  if, on the day of the motor accident, the earner was earning continuously, but had not been earning continuously for at least 12 months‐‐the weekly average of the gross earnings received by the earner as an earner during the period from when the earner started to earn continuously to immediately before the day of the motor accident,
(a1) if the earner was employed or self‐employed during a period or periods equal to at least 26 weeks during the first year of the pre‐accident period, but was not obtaining earnings from any source at any other time during the pre‐accident period‐‐the average weekly gross earnings received by the earner as an earner during the first year of the pre‐accident period,
(b)  if subclause (3) applies‐‐the weekly average of the gross earnings received by the earner as an earner during the period from when the change of circumstance referred to in that subclause occurred to immediately before the day of the motor accident,
(c)  if the earner is an earner by reason of having entered into an arrangement with an employer or other person to undertake employment or to commence business as a self‐employed person‐‐the average weekly gross earnings that the earner could reasonably have been expected to earn, but for the injury, in employment under that arrangement
(2A) The "pre‐accident period”, in relation to a motor accident, is the period of 2 years immediately preceding the motor accident.
(3) This subclause applies if, during the 12 months immediately before the day of the motor accident, there was, as a result of any action taken by the earner, a significant change in his or her earnings circumstances that resulted in the earner regularly earning, or becoming entitled to earn, more on a weekly basis than he or she was earning before the change occurred.
(4) For the purposes of this clause, an earner earns continuously if he or she obtains earnings from permanent employment or from a source that, on the day of the motor accident, was likely to continue for a period of at least 6 months to provide earnings to the earner on the same, or a similar, basis to the basis on which the earnings were being provided as at that day.

14. AET submits that subclause 4(3) of Schedule 1 of the Act applies to her circumstances and therefore her PAWE should be calculated pursuant to subclause 4(2)(b) of Schedule 1 of the Act.

15. I acknowledge that there was a change in AET’s earning circumstances during the 12 months immediately before the day of the motor accident, that is that she stopped working after August 2017. AET appears to have not had any earnings after that time, there are no payslips before me dated after 13 August 2017. Further, A letter from JB, Managing Director at Quality Care dated 12 October 2017 states:

“[AET] was employed by XXXX Quality Care Pty Ltd … from 29 November 2016 to 13 August 2017. [AET] was unable to continue to work for Quality Care due to health issues”.

16. Whilst I am satisfied this was a significant change in AET’s earning circumstances during the 12 months immediately before the day of the motor accident, I am not satisfied that this change resulted in her earning regularly, or becoming entitled to earn, more on a weekly basis than she was earning before that change occurred.

17. A single payslip was provided by the Insurer which indicates that AET completed work with the XXXXX Neighbourhood Centre during the period from 9‐13 April 2018. As there was limited information before me regarding this employment, and no submissions were made on the basis of earning from this employment or even referring to this employment, the DRS sought further information and submissions from the parties regarding both the period of employment and as to whether there were any other earnings from this source during the relevant 12‐month period.

18. AET legal representative advised on 16 June 2019:

“I confirm that the claimant was employed on a casual basis and only had two pay periods 29 March 2018 and 23 April 2018.”

19. The DRS again sought clarification of the period of employment and copies of payslips for the above mentioned two pay periods.

20. On 19 June 2019, AET’s legal representative provided a copy an email from “JM – Director” which attached the above‐mentioned payslip and states:

“[I] have attached 1 pay slip for AET, she only worker [sic] 3 shifts with us.”

21. I consider that the information above, taken together with the single payslip from XXXXX Neighbourhood Centre, support that AET was only employed by and had earnings from XXXXX Neighbourhood Centre for a short period, namely 9‐13 April 2018. There is no information before me which indicates ongoing employment with that organisation.

22. Therefore, whilst AET’s earnings circumstances changed in that she did receive some earnings for this work on 13 April 2018 after a period of not earning, as this appears to have been a one‐off, I am not satisfied that the change in her earnings circumstances resulted in her regularly earning, or becoming entitled to earn, more on a weekly basis than he or she was earning before the change occurred.

23. In light of the above, I am not satisfied that subclause 4(3) of Schedule 1 of the Act applies and I do not accept the submission that AET’s PAWE should be calculated pursuant subclause 4(2)(b) of the Act.

24. AET submits in the alternative that her PAWE should be calculated pursuant to subclause 4(2)(c) of Schedule 1 of the Act as she had been offered to return to her employment with Quality Care earning $25 per hour for 20 hours or $500 per week. For the reasons that follow, I also do not accept this submission.

25. Subclause 4(2)(c) applies where “an “earner” is an “earner” by reason of having entered into an arrangement with an employer …to undertake employment…” Pursuant to 4(2)(b)(i) a claimant is an “earner” if before the motor accident they entered into an arrangement (whether or not an enforceable contract) with an employer to undertake employment at a particular time and place.

26. On 30 May 2019, the DRS wrote to AET seeking documentation or information to support her submission that she had entered into an arrangement with Quality Care to undertake employment for 20 hours per week. No further information was provided.

27. There is no evidence before me which supports that AET had entered into an arrangement with Quality Care to undertake employment. The letter of 12 October 2017 indicates that AET was employed by them, however, that employment had ceased. There is nothing in this letter or in the other information before me that supports that there was an agreement for AET to undertake or recommence her employment with Quality Care. I am therefore not satisfied that subclause 4(2)(c) of Schedule 1 of the Act applies.

28. For the following reasons, I am also not satisfied that subclauses 4(2)(a) or (a1) of Schedule 1 of the Act apply.

29. Subclause 4(2)(a) of Schedule 1 of the Act applies if AET was on the day of the accident, earning continuously…. Subclause 4(4) of Schedule 1 of the Act sets out what “earning continuously” means for the purposes of clause 4 of Schedule 1. AETs was not, on the day of the motor evidence, earning continuously. The information before me indicates that she was not receiving any earnings at that time. Therefore 4(2)(a) of Schedule 1 of the Act does not apply.

30. Subclause 4(2)(a1) of Schedule 1 of the Act also does not apply. For this to apply, AETs needs to have been employed for periods equal to at least 26 weeks during the first year of the “pre‐accident period” (that is the 2 years immediately preceding the motor accident) and not obtaining earnings from any source at any other time during that period. The information before me indicates that AET received earnings at “other” times as she received earnings in the second year of the pre‐accident period. Therefore, this subclause does not apply.

31. I acknowledge that AETs submits that her earnings should be calculated over the years where she was not on maternity leave and she proposes a PAWE figure based on her earnings in the financial years 2013 – 2017. However, there is no legislative basis to support this approach. As explained above, the approach mandated by clause 4 is that PAWE is to be calculated pursuant to subclause 4(1) of Schedule 1 of the Act, which looks at earnings in the 12 months before the day of the accident, unless subclause 4(2) applies. For the reasons set out above, subclause 4(2) does not apply.

32. As subclause 4(2) of Schedule 1 of the Act does not apply, AET’s PAWE is to be calculated pursuant to 4(1) of Schedule 1 of the Act. Her PAWE will therefore be the weekly average of the gross earnings, received as an earner, during the 12 months immediately before the date on which the motor accident occurred – that is in the period 31 May 2017 – 31 May 2018.

Earnings received "as an earner"

33. The Insurer found that AET is an “earner” pursuant to clause 2(a)(ii) of the Act, this states:

“A person who is injured as a result of a motor accident is an ‘earner’ if the person is at least 15 years of age and who:

(a) Was employed or self‐employed (whether or not full time):

(iii) during a period of periods equal to at least 26 weeks during the 2 years immediately preceding the motor accident,

And, at the date of the motor evidence, had not retired permanently from all employment…”

34. There is no dispute regarding the insurer’s findings in this regard and I do not propose to review this. However, the above definition of PAWE in clause 4(1) requires consideration of the weekly average of the gross earnings received by AET as an earner during the 12 months immediately before the day on which the motor accident occurred (in the period 31 May 2017 – 31 May 2018).

35. I acknowledge AET’s submission that the correct way to assess her PAWE is to examine the actual periods of time when she was earning and not include periods where she was on maternity or sick leave. I consider that the correct construction of clause 4(1) when read together with the above definition of “earner” requires consideration of the average gross earnings received during periods within the relevant 12‐month period where AET was “an earner” (that is employed or self‐employed); there appears to be no legislative basis to exclude periods where she was employed or self‐employed but not receiving earnings.

36. AET commenced employment with Quality Care on 29 November 2016. She submits that she was on maternity leave at the time of the accident.

37. The letter from Quality Care indicates that she was employed by them up until 13 August 2019:

“[AET] was employed by XXXX Quality Care Pty Ltd from 29 November 2016 to 13 August 2017.”

38. She last received payment from Quality Care on 15 August 2017 and this was for the period ending 13 August 2017. I consider that the information before me indicates that she was an “earner” employed by XXX Quality Care from 31 May 2017 to 13 August 2017, a period of 10 and 5 days.

39. There is a single payslip from XXXXX Neighbourhood Centre which indicates that AET received earnings for the pay period 9 April 2018 – 13 April 2018 on 14 April 2018. As indicated above, I consider that the information provided by AET’s legal representative and the pay slip support that AET was employed by XXXXX Neighbourhood Centre for the period 9‐ 13 April 2018 (5 days).

40. I am therefore satisfied that in the 12 months immediately before the day on which the motor accident occurred, AET received earnings as an earner during the periods 31 May 2017 to 13 August 2017 and 9‐13 April 2018, a total of 11 weeks and 3 days. Under clause 4(1) of the Act, her PAWE is the weekly average of the gross earnings received by her during these periods.

Calculating PAWE under clause 4(1) of the Act

41.  Payslips issued by Quality Care indicate that in the period from 31 May 2017 to 13 August 2017, AET’s received a total of $2,793.25 in gross earnings. A breakdown of those earnings is provided in the below:

Paid date Gross amount
6-Jun-17 262.09
13-Jun-17 553.36
27-Jun-17 451.46
4-Jul-17 291.62
18-Jul-17 287.81
25-Jul-17 152.87
1-Aug-17 333.83
8-Aug-17 300.29
15-Au-17 159.92
Total $2,793.25

42. In the 12 months immediately before the day on which the motor accident occurred AET received a total of $3,128.73 gross earnings as an earner: being $2,793.25 in earnings from Quality Care + $335.48 in earnings from XXXXX Neighbourhood Centre.

43. I found above that under clause 4(1) of the Act, AET’s PAWE is the weekly average of the gross earnings received by her during the periods 31 May 2017 to 13 August 2017, and 9‐13 April 2018, a total of 11 weeks and 3 days.

44. I therefore find that amount of AET’s PAWE to be $273.76 (rounded to the nearest cent): $3,128.73 divided by 11 week and 3 days.

Determination

My determination of the merit review is as follows:

  • The reviewable decision is set aside and the following decision is made in substitution for the reviewable decision:
    • The amount of AET’s PAWE is $273.76.
    • Effective Date – The insurer’s decision about PAWE is a decision which is relevant to the calculation of weekly payments of statutory benefits payable from the day after the day of the motor accident. It is the function of the DRS on merit review to arrive at the correct and preferable outcome in respect of the weeks covered by the reviewable decision that is referred for review. Accordingly, this determination has effect from 2 June 2018.

Tami O’Carroll
Dispute Resolution Service
Merit Reviewer