Our Reference: 048/18
Date of review:
- The Insurer’s decision to reduce the amount of the Worker’s weekly payments of compensation to $0.00 stands.
- The Authority may make binding recommendations to the Insurer based on the findings of this review. However, no recommendations are made for the reasons below.
- In June 2018, the Worker injured their back in a bathroom slip and fall incident at work as a customer service officer for a bank. The Insurer accepted their claim for workers compensation, including weekly payments for incapacity for work.
- In December 2017, the Insurer decided to reduce the amount of the Worker’s weekly payments to $0.00 on the basis that, among other things, they had current work capacity and was able to earn $657.68 a week in suitable employment.
- In February 2018, the Worker applied for an internal review of that decision. In March 2018, the Insurer affirmed its decision and notified the Worker of the outcome by email.
- In April 2018, the Worker made an application for merit review by the Authority. The Insurer says the application was invalid. For the reasons below, I consider the application was validly made.
- The legislative framework governing work capacity decisions and reviews is contained in the:
- Section 43 of the 1987 Act describes a ‘work capacity decision’. An injured worker may refer a work capacity decision for merit review by the Authority under section 44BB of the 1987 Act. The Authority is to notify the insurer and the worker of the findings of the review and may make recommendations to the insurer based on those findings under section 44BB(3)(e). Recommendations are binding on the insurer and must be given effect to by the insurer under section 44BB(3)(g).
- The documents considered for this review are the application for merit review and the Insurer’s reply form, the documents listed in and attached to those forms, and any further information provided to the Authority and exchanged between the Worker and the Insurer.
- I have read and considered the submissions made by the Worker and the Insurer. The relevant issues raised by those submissions are dealt with in the reasons below.
Validity of the application
- The Insurer submits that the Worker’s merit review application is invalid because:
- In my view, a failure to comply with section 44BB(2) does not mean that an application for review of a work capacity decision is invalid. I acknowledge that the sub-section uses the word ‘must’. However, neither the 1987 Act or the 1998 Act expressly state consequences for non-compliance.
- The subject matter of section 44BB concerns a worker’s right to have an insurer’s work capacity decision reviewed. Parliament designed it ‘to ensure that workers are treated fairly’: Workers Compensation Legislation Amendment Bill 2012 Second Reading Speech, NSW Legislative Assembly, 19 June 2012 (Mike Baird), page 4.
- The structure of section 44BB supports an intention for a worker to get the substance of a decision reviewed efficiently and effectively. The internal review and merit review stages come before the procedural review. An insurer is to notify a worker of an internal review decision ‘as soon as practicable after the review is conducted’. There are also time limits for on applying for later stages of review.
- The system objectives of the workers compensation scheme are set out in section 3 of the 1998 Act. They relevantly include:
(a) they did not notify the Insurer of their application for merit review as required by section 44BB(2).
(b) they did not make their application within the time required by section 44BB(3)(a).
- to provide injured workers and their dependents with income support during incapacity
- to be fair, affordable, and financially viable
- to deliver the above objectives efficiently and effectively
A notice required or authorised to be given to, or served on, a person by or under this Act or the 1987 Act must be in writing and must be given to, or served on, that person:
(a) personally or by post, or
(b) if a manner of giving or serving the notice is prescribed by or under this Act or the 1987 Act, in the manner so prescribed.
Nature of merit review
- The Worker has referred the Insurer’s decision to reduce the amount of their weekly payments of compensation to $0.00 for merit review. In a merit review, I consider the matter afresh and make findings on the most correct and preferable decision.
Current work capacity
- The Insurer’s decision to reduce the amount of the Worker’s weekly payments of compensation was based on its decision that they had current work capacity.
- Section 32A of the 1987 Act defines ‘current work capacity’ and ‘no current work capacity’:
- An orthopaedic surgeon examined the Worker for the Insurer in February 2017. His report is dated February 2017. He noted reduced lateral and forward flexion in the thoracolumbar spine as well as ‘very little true extension of their lumbar spine’. He said ‘with regard to work, they tell me that they are currently working three days a week, six hours a day. On the basis of the examination today, I would think they should be able to reach their pre-injury hours of 22.5 hours per week’. He also said ‘Overall, they told me that their normal work was three days a week, eight hours a day and they are just a few hours short of this at this point in time. If this is their pre-injury duties then I think there is some chance that they could get back to that level. They will, however, continue to experience variable back pain as has happened over the last two years’. The orthopaedic surgeon essentially reiterated his opinion in a report in July 2017.
- An injury management consultant examined the Worker and made a report in May 2017. He noted ‘slight asymmetric loss of movement in the lumbar spine with end range stiffness. There was about half normal rotation in the thoracic spine. There was no spasm’. On work capacity, he said that the Worker’s ‘pre-injury job involves significant sitting and if that cannot be remedied, they would struggle to do their pre-injury duties’. He said that the Worker ‘would be better suited to a back office role, wherein they can alter their posture according to their level of symptoms, notionally being able to change their posture every 15 minutes. They will benefit from a sit/stand desk, which your documents indicate is available’. He continued ‘I see no reason why they would not be able to work full time in a role such as this where they have maximum flexibility to alter their posture. Any job should not involve any significant manual demands’.
- The Worker says that the orthopaedic surgeon and the injury management consultant did not consider injury to their upper back so their reports do not hold weight. I do not accept that submission. The examination findings in the reports support that the orthopaedic surgeon and the injury management consultant examined the Worker’s thoracic spine. The injury management consultant specifically noted that the Worker has ‘persistent interscapular pain’. I am satisfied that both doctors, but particularly the injury management consultant, considered the Worker’s upper back condition in forming opinions about their work capacity.
- Since November 2017, the treating doctor consistently certified that the Worker has capacity to work for five hours a day, three days a week with a 30-minute sitting tolerance and 30-minute standing tolerance. In the most recent certificate of capacity before me dated May 2018, the treating doctor has certified that the Worker has capacity to work for five hours a day, four days a week with a 30-minute sitting tolerance and 30-minute standing tolerance. This certificate specifically refers to ‘Lower back disc injury, upper back pain’ in the diagnosis of work injury.
- I put decisive weight on the injury management consultant’s opinion. He is an accredited injury management consultant. He has had regard to the full extent of the Worker’s condition, including their upper back pain. The injury management consultant’s opinion on the Worker’s work capacity is firm and clear. On the other hand, the orthopaedic surgeon’s opinion is less certain and primarily addresses future likelihoods rather than the circumstances at the time. I prefer the injury management consultant’s opinion over the treating doctor’s certificates of capacity. The injury management consultant’s report gives a detailed explanation of his examination findings and reasons for his opinion about the Worker’s work capacity. On the other hand, the treating doctor’s certificates of capacity only give very limited information. I am persuaded that the Worker could work full-time in work which did not involve significant manual demands and allows the Worker to alter their posture as needed.
- In any event, the medical evidence together supports that the Worker can work at least 20 hours a week. The orthopaedic surgeon’s prognosis was that the Worker ‘should be able to reach’ working 22.5 hours a week. That prognosis adds weight to the treating doctor’s current opinion that the Worker can work 20 hours a week. The injury management consultant’s opinion also supports that the Worker can work at least 20 hours a week (even full time) in a job that allows the Worker to alter their posture as needed and does not involve significant manual demands. So, as the reasons below show, even on the most conservative assessment of the Worker’s work capacity based on the current medical evidence (20 hours a week), the amount of their weekly payments would still be $0.00.
- The Worker has a present inability arising from an injury such that they are not able to return to their pre-injury employment. The injury management consultant said that the Worker would ‘struggle’ to do their pre-injury duties due to the ‘significant sitting’ involved. The treating doctor has also not certified that the Worker is fit for pre-injury duties.
- The issue is then if the Worker is able to return to work in ‘suitable employment’ as defined by section 32A of the 1987 Act:
- As part of the return to work planning process, an occupational rehabilitation provider prepared an earning capacity assessment report dated October 2016 (‘ECA’). The following was identified as suitable employment for the Worker:
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
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
Suitable employment, in relation to a worker, meansemployment in work for which the worker is currently suited:
(a) having regard to:
(i) the nature of the worker’s incapacity and the details provided in medical information including, but not limited to, any certificate of capacity supplied by the worker (under section 44B), and
(ii) the worker’s age, education, skills and work experience, and
(iii) any plan or document prepared as part of the return to work planning process, including an injury management plan under Chapter 3 of the 1998 Act, and
(iv) any occupational rehabilitation services that are being, or have been, provided to or for the worker, and
(v) such other matters as the Workers Compensation Guidelines may specify, and
(b) regardless of:
(i) whether the work or the employment is available, and
(ii) whether the work or the employment is of a type or nature that is generally available in the employment market, and
(iii) the nature of the worker’s pre-injury employment, and
(iv) the worker’s place of residence.
- Customer service specialist
- Administration officer
- Contact care consultant
- Customer service officer
- Contact centre consultant
Calculation of weekly payments
- The Insurer accepted, and the Worker does not dispute, that they meet the special requirements under section 38 of the 1987 Act to be entitled to ongoing weekly payments. I go on the basis that the only issue in dispute is the amount of weekly payments payable to the Worker.
- The amount of weekly payments of compensation payable to the Worker is determined by section 38(7) of the 1987 Act:
- The factors used to determine the rate of weekly payments of compensation are defined by section 35 of the 1987 Act.
- ‘AWE’ means the worker’s pre-injury average weekly earnings. There is no dispute in this case that the Worker’s AWE is $657.68.
- ‘E’ is the amount to be taken into account as the worker’s earnings after the injury, calculated as whichever of the following is the greater amount:
- The Worker earned $657.68 working 22.5 hours a week prior to their injury. This equates to an hourly rate of $657.68 ÷ 22.5 = $29.23. The ECA states on page 8 that ‘the current average wage for a Customer Service Specialist in the open labour market is $27.00 per hour’. I have found that the Worker is able to work at least 20 hours a week. I find that the Worker is able to earn at least 20 x $27.00 = $540.00 per week in suitable employment.
- The hourly rates of pay for a customer service officer and contact centre consultant stated in the LMA are more than $27.00. That fortifies that the Worker is able to earn $540.00 per week in suitable employment as either a customer service specialist, customer service officer or contact centre consultant. If I calculated the Worker’s ability to earn in suitable employment based on the injury management consultant’s opinion about their capacity (which is what I ultimately accepted) then the value of ‘E’ would be based on full-time rates of pay and would only be higher. However, taking the value of ‘E’ as $540.00 at a minimum, it still results in the amount of weekly payments of compensation being reduced to $0.00.
- ‘D’ is the sum value of non-pecuniary benefits provided by the employer to the Worker, which is $0.00 in this case.
- ‘MAX’ is the maximum weekly compensation amount. It does not apply in this case because the formula (AWE x 80%) – (E + D) results in a lesser amount.
- The Worker is entitled to weekly payments of compensation at the rate of:
- This is the same outcome as the Insurer’s work capacity decision. I do not consider that a recommendation to the Insurer is necessary. The Insurer’s work capacity decision stands.
(7) The weekly payment of compensation to which an injured worker who has current work capacity is entitled under this section after the second entitlement period is to be at the rate of:
(a) (AWE × 80%) − (E + D), or
(b) MAX − (E + D),
whichever is the lesser.
(a) the amount the worker is able to earn in suitable employment,
(b) the worker’s current weekly earnings.
(AWE x 80%) – (E + D)
= ($657.68 x 80%) – ($540.00 + $0.00)
= $526.14 – $540.00
Merit Review Service
Delegate of the State Insurance Regulatory Authority