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Merit review WC023/18

Our Reference: 023/18
Date of review:

Findings on review

  1. The following finding is made by the State Insurance Regulatory Authority (“the Authority”) on review and is to be the basis for the Insurer’s review decision.
  2. The worker’s pre-injury average weekly earnings (PIAWE) are $1,387 (subject to any applicable indexation).

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 44(3)(g) of the Workers Compensation Act 1987 (“the 1987 Act”).
  2. The Insurer is to make the necessary adjustments to the worker’s weekly payment entitlement in accordance with the above findings on their PIAWE. This is to apply from the date of the work capacity decision (XX/02/2018), subject to any notice periods.


  1. The worker suffered an injury to their left shoulder in the course of their employment at the pre-injury employer.
  2. In February 2018, the Insurer made a work capacity decision which determined the worker’s PIAWE to be $155.00.
  3. In March 2018, the worker applied for an internal review.
  4. The Insurer advised that it failed to conduct the internal review within the 30-day timeframe as is required under section 44BB(1)(a) of the 1987 Act.
  5. Accordingly, the worker submitted an application for merit review in April 2018.

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 undertaking this review 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.


  1. The worker submits that their PIAWE has been incorrectly calculated as $180. They would like their “actual hours paid versus actual hours worked”. They have provided various emails which detail their account of the conversations with Director of their pre-injury employer.
  2. In reply, the Insurer does not make any specific submissions stating that it will be guided by the decision of the Merit Review Service.


Nature of merit review

  1. This matter involves a merit review of the work capacity decision/s of the Insurer in accordance with section 44BB(1)(b) of the 1987 Act.
  2. The review is not a review of the Insurer’s procedures in making the work capacity decision and/or internal review decision. The review requires that I consider all of the information before me substantively on its merits and make findings that, in light of the information before me, are most correct and preferable.

Pre-injury average weekly earnings (PIAWE)

  1. The worker commenced employment with the pre-injury employer in April 2016. They also worked in XX April 2016 and sustained a shoulder injury in XX April 2016. They were therefore employed by the pre-injury employer for 3 days before their injury.
  2. Following their injury, the worker continued to work until XX April 2016, which was their final day of employment at the pre-injury employer.
  3. The calculation of PIAWE for a worker that has been employed by the same employer for less than 4 weeks before the injury is contained in section 44C(2) of the 1987 Act:
  • If a worker has been continuously employed by the same employer for less than 4 weeks before the injury, pre-injury average weekly earnings, in relation to that worker, may be calculated having regard to:
  • (a) the average of the worker’s ordinary earnings that the worker could reasonably have been expected to have earned in that employment, but for the injury, during the period of 52 weeks after the injury expressed as a weekly sum, and
  • (b) any overtime and shift allowance payment that is permitted to be included under this section (but only for the purposes of the calculation of weekly payments payable in the first 52 weeks for which weekly payments are payable).
  1. The Director completed a PIAWE calculation form dated June 2016. She indicates that the worker’s ordinary hours of work per week are 32 with ordinary gross earnings of $1,168.00 per week.
  2. As the worker was injured on the third day of their employment, there is only one pay slip. The payslip indicates that the worker worked consecutive days in the lead up to their injury, plus consecutive days following their injury for a total of 7 days plus a half day in the pay week. The email information states that the Director expected the worker to work 8 hours per day. Given that the worker worked a total of 7 and a half days in their first week, their ordinary hours of work exceed the 32 hours as stated by the Director in the PIAWE calculation form.
  3. I therefore reject the PIAWE calculation form that the worker’s ordinary hours of work are 32.
  4. The worker submits that they were rostered for 14 days straight and had worked 16 hour days due to the nature of their role as an in-house carer.
  5. While the worker may have been rostered to work 14 days straight and worked 16 hour days due to short term business requirements, I do not view this to be the agreement reached between the worker and their employer when the worker was offered the role on XX March 2016. As the worker recounts in their emails, carers worked on a roster basis, working 8 hour shifts and no one was allowed to work more than five days consecutively.
  6. The payslip indicates base hourly hours of 38 which coincides with the prescribed number of hours in the Regulation.
  7. I am minded to find that the worker, although employed casually, would have expected to work at the pre-injury employer for at least the ordinary hours of work 38 hours per week and, but for the injury, would continue to do so in the 52 weeks after their injury.
  8. The reasons for this are that although the worker’s employment was casual, the nature of their employment required them to “live in” with the person for which they were providing care. The care provided was 24-hour care and the worker was required by their employer to work 8 hours per day as part of a roster with other staff. The importance of the care provided is highlighted by the requirement for the worker to notify and discuss with the person’s family members if they required to take longer breaks.
  9. In addition, according to the worker, their pre-injury employer requested that they work extra days due to “staffing issues”. This can only add weight to the finding that they were required to work 5 days per week for a total of at least 38 hours.
  10. I acknowledge that the worker’s average ordinary hours could have varied in the 52 weeks after their injury and they had only worked for their pre-injury employer for a matter of days before the injury. However, with the limited information available to me, I must make a determination based on that information and the application of section 44C(2) of the 1987 Act.
  11. I therefore find as follows:
  12. The worker’s base rate of pay for their ordinary hours of work is $36.50 per hour. Their ordinary earnings per week and their PIAWE are $36.50 x 38 = $1,387.

  13. This amount may be subject to indexation and is to apply from the date of the work capacity decision (XX February 2018) subject to any notice periods.

First PIAWE Factual Report

  1. I note that the Insurer indicates it would be guided by the decision of the Merit Review Service and has not made any specific submissions in response to the application for merit review.
  2. For the reasons above, I have determined that the worker’s PIAWE to be $1,387.
  3. However, I intend to address some of the findings made in the injury management consultancy’s “First PIAWE Factual Report” dated XX December 2017. The reason for this is that the injury management consultancy used different methodology in the calculation of the worker’s PIAWE and arrived at a different result.
  4. The injury management consultancy referred to the above provision in section 44C(2) of the 1987 Act above and stated:

    “We have taken the view that [The worker’s] earnings post date of injury with the Insured are all that they would have earned ‘in that employment’”.
  5. It appears this finding was based on the worker’s employment being terminated following their shift on XX April 2016 for “disciplinary reasons”.
  6. The injury management consultancy noted that the worker continued to work after the injury and found that the worker earned $1,256.20 from XX April 2016 to XX April 2016, when their employment was terminated. The Insurer then applied its interpretation of section 44C(2) and divided this figure by 52 which resulted at an “earnings per week” figure of $24.16 ($1,256.20/52).
  7. I disagree with the injury management consultancy’s interpretation of section 44C(2). I acknowledge that the worker no longer worked for the pre-injury employer after XX April 2016 and therefore $1,256.20 is all that they would have earned “in that employment” with the pre-injury employer.
  8. However the section relates to what the worker could have earned in the 52 weeks after the injury in their employment at the pre-injury employer “but for” the injury. The words “but for” are significant because they place emphasis on the injury date and requires an assessment of what the worker could have earned at the time of their injury. Thus, for the calculation of their pre-injury average weekly earnings (my emphasis), it matters not that the worker resigned from their role in the days after the injury or was terminated for reasons unrelated to the injury.
  9. Put in another way, the section, as I interpret it, seeks to forecast what the worker could have earned if the injury had not occurred, at the date of injury, expressed as a weekly amount.

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