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Findings and recommendations on merit review 003/15

Merit Review Service decision reference: 003/15

Date of review: September 2015

Findings on review

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 work capacity decision.

  • The worker has a present inability arising from an injury such that they are not able to return work, either in their pre-injury employment or in suitable employment.
  • The worker has no current work capacity.
  • The worker meets the special requirements under section 38(2) of the Workers Compensation Act 1987 (the 1987 Act) to be entitled to weekly payments of compensation.
  • The worker’s pre-injury average weekly earnings equal the transitional amount, currently $985.40.

Recommendation based on findings

The following recommendation is binding on the Insurer and must be given effect to by the Insurer under section 44(3)(g) of the 1987 Act.

  • The worker is entitled to weekly payments of compensation under section 38(6) of the 1987 Act at the rate of $788.32.

Background

The worker has been receiving weekly payments of compensation for an incapacity for work resulting from an injury.

In June 2015, the Insurer made a work capacity decision to discontinue the worker’s weekly payments of compensation on the basis that they had “current work capacity” and did not meet the requirements under section 38(3) of the 1987 Act to be entitled to weekly payments.

The worker referred that decision for internal review by the Insurer. In July 2015, the Insurer made the same decision.

The application for merit review was received by the Authority in August 2015. The application was made in the approved form within time under section 44(3)(a) of the 1987 Act.

Legislation and guidelines

The legislative framework governing work capacity decisions and reviews is contained in the:

  • Workers Compensation Act 1987 (the 1987 Act);
  • Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act);
  • Workers Compensation Regulation 2010 (the Regulation);
  • Guidelines for work capacity decision Internal Reviews by Insurers and Merit Reviews by the Authority applicable from 11 October 2013 (the Review Guidelines); and the
  • WorkCover Work Capacity Guidelines as amended (the Work Capacity Guidelines).

Section 43 of the 1987 Act defines a “work capacity decision”.

Section 44 of the 1987 Act provides for merit review of a work capacity decision of the Insurer, by the Authority.

Documents considered

The documents I have considered for this review are the application for merit review form 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 parties.

Submissions

In the application for merit review, the worker’s legal representative submits:

  • The decision should be changed so that the worker continues to be paid weekly payments of compensation.
  • The “pre-injury earnings of the applicant exceed the gross average weekly earnings found in the assessment to be payable”.
  • The Insurer has breached section 38(4) of the 1987 Act.
  • The worker did not request the work capacity assessment referred to in section 38 of the 1987 Act.
  • The Insurer’s calculations are wrong.
  • “Time should run for the third entitlement period from May 2012 and that has not occurred”.

In summary, the Insurer submits in reply:

  • The worker has “current work capacity to work in suitable employment for up to 38 hours per week”.
  • Light retail sales/shop assistant and cashier/counter hand is suitable employment for the worker but companionship worker is not.
  • The worker is able to earn $985.72 as a light retail sales assistant and $864.70 as a cashier/counter hand.
  • The worker is an existing recipient of weekly payments.
  • The worker does not meet the special requirements under section 38(3) of the 1987 Act.

Reasons

Nature of merit review

This is a merit review of the Insurer’s work capacity decision. It is not a review of the Insurer’s procedures in making the work capacity decision. The review requires that I consider all of the information before me substantively on its merits and make findings and recommendations that, in light of the information before me, are most correct and preferable.

Current work capacity and suitable employment

On the information before me, the worker is not working. However, the weight of medical information before me supports that they are able to return to work in some capacity.

I note a Medical Assessment Certificate from November 2014 by an Approved Medical Specialist in orthopaedic surgery. I also note reports from a neurosurgeon from October 2014 and December 2014. I have considered these reports but they do not contain a direct opinion on the worker’s work capacity. I put more weight on the assessments that directly address the worker’s work capacity.

In December 2014, the worker attended a functional assessment with an exercise physiologist. The functional assessment report from December 2014 stated “the assessor recommends that the following medical considerations for the worker at this stage”:

  • restrictions of lifting/carrying 2kg
  • driving, sitting and standing as tolerated
  • avoid pushing/pulling and bending/twisting/squatting.

The exercise physiologist stated that “the worker would be capable of working up to full time hours (i.e. 38 hours per week)…A graduated return to work program is recommended”. In the context that this is expressed, I understand the recommendation for a “graduated return to work program” to mean that the worker should initially return to work on reduced hours and build-up to full-time work.

In March 2015, the worker had an independent medical examination with an orthopaedic surgeon. The orthopaedic surgeon considered “no specific restrictions are required” on the worker’s work capacity due to her injury in March 2005.

The treating doctor issued a WorkCover NSW certificate of capacity in May 2015. The treating doctor diagnoses the worker with “soft tissue injuries to neck, back, bilateral upper limb pain” and certifies that they have capacity for some type of employment for 3 hours a day, 3 days a week with:

  • 2kg lifting/carrying capacity
  • sitting as tolerated
  • standing as tolerated
  • avoid pushing, pulling, bending, twisting, and squatting
  • driving as tolerated.

Section 32A of the 1987 Act defines “current work capacity” and “no current work capacity”:

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

I consider the treating doctor’s assessment of the worker’s work capacity holds decisive weight. I consider it should be preferred over the Independent Medical Examiner’s assessment because the treating doctor’s assessment is supported by the results of the functional assessment.

In line with the treating doctor’s certificate of capacity from May 2015, I find that the worker has a present inability arising from their injury in March 2005 such that they are able to return to work for 3 hours a day, 3 days a week with:

  • 2kg lifting/carrying capacity
  • sitting as tolerated
  • standing as tolerated
  • avoiding pushing, pulling, bending, twisting and squatting
  • driving as tolerated.

The worker’s pre-injury employment was as a process worker on a cake production line. The Medical Assessment Certificate from November 2014 reported that “their work duties involved different activities including folding pastries, putting cream on pastries, loading plates on trolleys, pushing and pulling trolleys stacked with trays of product, rolling pastries, rolling dough, lifting boxes of cheese and fruit, lifting boxes of icing, and making muffins”. In my view, the worker is not able to do such duties given their capacity to lift, push, and pull is now limited by their work injury in March 2005. I consider that view is supported by the treating doctor’s medical opinion given they have not certified the worker as “fit for pre-injury duties”.

I am satisfied that the worker has a present inability arising from an injury such that they are not able to return to their pre-injury employment.

To determine if the worker has current work capacity, I must consider if they are able to return to work in “suitable employment”. Suitable employment is defined in section 32A of the 1987 Act:

suitable employment, in relation to a worker, means employment 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 WorkCover 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.

A rehabilitation counsellor and vocational assessor prepared an earning capacity assessment report in May 2015. The rehabilitation counsellor assessed that the worker was able to return to work in light retail sales, as a cashier/counter hand, or a companion worker.

The job description, assessed physical demands, and employment market research for each of these roles contained in the rehabilitation counsellor’s report indicate that there is employment in these areas that are within the worker’s certified restrictions. In January 2015, the treating doctor gave signed approval for each of these vocational options as suitable for the worker on a part-time basis. The exercise physiologist also assessed that the worker had the physical capacity to work as a companion worker, light retail/shop assistant, or cashier/counter hand. In my view, the weight of information supports that there is employment in a light retail sales role, as a cashier/counter hand, or a companion worker that is suited to the nature of the worker’s incapacity.

The worker is age 58. The rehabilitation counsellor reported that the worker completed the Higher School Certificate overseas, moved to Australia in the 1990s and did 510 hours of English study at TAFE, and more recently completed an aged care certificate at TAFE in 2011. The rehabilitation counsellor assessed that the worker had transferrable skills in process work, aged care, customer service/communication, basic computer skills, and other interpersonal and general skills. The rehabilitation counsellor noted that the worker is able to speak in English but has basic reading and writing skills. The worker has work experience as a process worker, owner/operator of a cleaning company where their only duty noted by the rehabilitation counsellor was “assisted husband with location of job sites”, and as a cook for a few months overseas.

The worker has no work experience in retail sales. It is not apparent that their employment to date has exposed them to any significant direct or face-to-face customer service and selling, which are important skills for a retail sales assistant/shop assistant given that the duties reported by the rehabilitation counsellor include “advis[ing] customers on the location, selection, price, delivery, use and care of goods available from the store, with the aim of encouraging them to buy and return to buy in the future”. Also, there are other technical skills such as “operate cash registers and accept payment, or prepare finance arrangements (e.g. invoices and contracts)” in which the worker does not appear to have experience in. The worker’s education has not been directed to developing their knowledge or skill in retail sales. I am not persuaded that the worker has a suitable level of skill and experience for light retail sales/shop assistant. A rehabilitation closure report by an occupational rehabilitation provider from December 2011 indicates that the worker has had occupational rehabilitation services to improve their job-seeking ability. However, the information before me does not support that any such occupational rehabilitation services have been provided to the worker to assist them with relevant education, skills or work experience for employment in retail sales. Having regard to those matters, I am not satisfied that light retail sales/shop assistant is employment in work for which the worker is currently suited.

The worker also has no work experience as a cashier/counter hand. I have considered their previous employment and transferrable skills but I am not persuaded the worker has suitable skills in cash handling for employment as a cashier/counter hand given it requires a level of skill to be able to use an electronic cash register, process payments for accounts such as telephone or electricity bills and issue receipts, total cash and other taking and prepare for banking, and keep adequate records to check the cash balance against (as reported by the rehabilitation counsellor). Again, it is not apparent that the worker has had any occupational rehabilitation services to improve their skills or work experience in these areas. Having regard to those matters, I am not satisfied that cashier/counter hand is employment in work for which the worker is currently suited.

I acknowledge the Insurer’s submission that employment as a companion worker is not suitable employment for the worker. I consider that submission holds weight. In my view, the Insurer correctly observed that the worker’s “past work experience does not really relate to this role” which is a significant factor weighing against its suitability for the worker. I acknowledge that the worker did complete a TAFE Certificate in aged care which is relevant, however the level of that certification is unclear from the rehabilitation counsellor report. In my view, that limits the weight that can be put on that aspect of the worker’s education in assessing if they are suited to employment as a companion worker. Further, as the Insurer submits the worker was “unable to complete the worker experience component” of the TAFE course which emphasises the point that the worker’s education has not assisted them with work experience or an opportunity to test any skills they learned in a practical work environment. Having regard to those matters, I am not satisfied that companion worker is employment in work for which the worker is currently suited.

I acknowledge that the worker signed a document in December 2014 stating “yes – I can try” each of the above jobs. In my view, the fact that the worker is willing to “try” these jobs does not support in any significant way that any of them are employment in work for which the worker is currently suited. That is particularly so after having had regard to the relevant matters of their age, education, skills and work experience.

Earlier I found that the worker was able to return to work in some capacity. However, I am not satisfied on the information before me that they are able to return to work in “suitable employment” as defined by section 32A of the 1987 Act.

I find that the worker has a present inability arising from an injury such that they are not able to return to work, either in their pre-injury employment or in suitable employment. I find the worker has “no current work capacity” as defined by section 32A of the 1987 Act.

Entitlement periods for ongoing weekly payments

The following provisions of the 1987 Act provide the basis for determination and calculation of a worker’s weekly payments entitlement:

  1. Weekly payments in the first 13 weeks are to be determined under section 36 of the 1987 Act (“the first entitlement period”)
  2. Weekly payments in weeks 14–130 are to be determined under section 37 of the 1987 Act (“the second entitlement period”)
  3. Weekly payments after the second entitlement period (after week 130) are to be determined under sub-sections 38(6) or (7), but only if the special requirements for continuation of weekly payments after the second entitlement period are met under section 38 of the 1987 Act.

The Insurer’s reply form from August 2015 states that 130 plus weeks of weekly payments of compensation have been made to the worker. Without information to the contrary, I accept that more than 130 weeks of weekly payments of compensation have been paid to the worker.

I am satisfied that the worker is after the second entitlement period and their entitlement to weekly payments of compensation must be determined under section 38 of the 1987 Act.

Special requirements for continuation of weekly payments after second entitlement period

A worker with “no current work capacity” is only entitled to weekly payments of compensation under section 38(2) of the 1987 Act if the following requirement is met:

A worker who is assessed by the Insurer as having no current work capacity and likely to continue indefinitely to have no current work capacity is entitled to compensation after the second entitlement period.

I have found that the worker has no current work capacity. I consider that the worker is likely to continue indefinitely to have no current work capacity because, on the information before me, there is no suitable employment for them to return to work in for the foreseeable future.

I find the worker meets the special requirements under section 38(2) of the 1987 Act and is entitled to weekly payments of compensation under section 38(6) of the 1987 Act:

The weekly payment of compensation to which an injured worker who has no current work capacity is entitled under this section after the second entitlement period is to be at the rate of:

(a)  (AWE × 80%) − D, or

(b)  MAX − D,

whichever is the lesser.

Calculation of entitlement

“AWE” means the worker’s pre-injury average weekly earnings. I accept the Insurer’s submission that the worker is an “existing recipient of weekly payments” as defined by clause 1, part 19H of schedule 6 of the 1987 Act because they were in receipt of weekly payments of compensation immediately before the commencement of the weekly payments amendments on 1 October 2012. As an existing recipient of weekly payments the worker’s AWE is equal to the transitional amount under clause 9(3), part 19H of schedule 6 of the 1987 Act:

(3)  For the purposes of the application under this clause of the weekly payments amendments to a worker, the worker’s pre-injury average weekly earnings are deemed to be equal to the transitional amount.

I find the worker’s AWE equals the transitional amount, currently $985.40.

“D” is the value of all “non-pecuniary benefits” as defined by section 44F of the 1987 Act.  As the worker is not employed, the value is $0.00.

Therefore, the worker is entitled to weekly payments of compensation under section 38(6) of the 1987 Act at the rate of:

(AWE x 80%) – D
= ($985.40 x 80%) – $0.00
= $788.32 – $0.00
= $788.32