Recently at the Personal Injury Commission (PIC), a decision by Member Cameron Burge in the matter of Chand v Kincare Health Services Pty Ltd [2024] NSWPIC 6821 has displayed the interaction between an adverse work capacity decision (WCD) and section 38, 130 week, eligibility.
The claim
Ms Chand has a fully accepted claim for an injury that occurred on 3 July 2020 in thecourse of her employment. She injured her back and right knee in the accident and later developed an accepted (and severe 2 ) consequential psychological condition. For a significant period of time, Ms Chand had been certified with capacity for work for two hours per day, 2 days per week but had been upgraded to 15 hours per week in the lead up to the WCD.
The work capacity decision made
The insurer’s WCD determined Ms Chand had capacity for 15 hours per week of work in suitable employment as a library assistant, bakery assistant and in particular, as a florist assistant, earning $375.00 per week.
The insurer relied on a vocational assessment to assess suitable employment for their WCD. They believed florist assistant was suitable employment saying about the nature of the work that “…essentially, there were no real skills beyond general tidying up and moving items around required in the role.”3
The insurer assessed 15 hours per week relying on a certificate of capacity that had jumped from previously only 4 hours per week. This increase to 15 hours per week occurred at what looks like a case conference4 prior to the WCD being made.
The effect of the WCD
The effect of the WCD was to reduce Ms Chand’s payments of weekly compensation under the Workers Compensation Act NSW 1987.
Prior to the WCD Ms Chand was being paid 80% of her indexed PIAWE. After the expiry of the WCD, her weekly compensation would reduce to $216.20 per week (80% of indexed PIAWE less ability to earn of $375.00 per week).
The interaction with section 38
However, as Ms Chand had more than 130 weeks of weekly compensation paid when the WCD was made, section 38 of the Workers Compensation Act NSW 1987 also applied.
Section 38 creates eligibility requirements for an injured person to meet if weekly compensation is to continue at all after 130 weeks.
Section 38(3), for instance, requires that a worker who has been assessed as having “current work capacity”5 by the insurer must be working not less than 15 hours a week (section 38(3)(b)) to be eligible for further payments.
There are other requirements too in section 38(3) but as the insurer had assessed and communicated in the WCD that Ms Chand had capacity for suitable employment and she was not working 15 hours per week, her weekly compensation would not only reduce (the effect of the WCD) but would in fact cease altogether (section 38 in operation with the WCD).6
In summary, the combination of these provisions means that in an unemployed injured worker’s circumstances, like Ms Chand’s, due to the application of section 38, a WCD finding a “current work capacity” for “suitable employment”, reducing weekly compensation, has the effect of actually ceasing weekly compensation entirely.
The issue at the PIC
Member Burge boiled the issue right down, saying:
“The parties agree that the only issue for determination is whether the applicant is totally incapacitated for employment and likely to remain so indefinitely. 5 In the event there is a finding for the applicant on this issue, she will receive payments
as claimed pursuant to s 38. If there is a finding the applicant has residual capacity, there will be an award for the respondent on the claim for weekly benefits.” 7
If the Member found Ms Chand had capacity for suitable employment at all (whether on the 15 hours per week basis the insurer assessed or even some different amount of hours), then because of the combination of the WCD and section 38, Ms Chand would have nil entitlement to weekly compensation.
Of note too is if the Member found in the alternative that Ms Chand had no current capacity for work, for Ms Chand to have an entitlement under section 38(2), the Member would have to still be satisfied that Ms Chand was no capacity on an “indefinite basis.”
The finding on the work capacity decision
There was no doubt that Ms Chand had capacity for work written on her certificate ofcapacity.8
The Member explained for the insurer to be correct that Ms Chand had capacity for work in suitable employment, consideration of the definition of “suitable employment” was required:9
In order to assess an injured worker’s residual capacity for suitable employment, it is necessary to examine a number of considerations set out in s 32A of the 1987 Act. In doing so, it is necessary to have regard to the nature of the worker’s incapacity including but not limited to any certificate of capacity provided by their treating doctor; the worker’s age, education, skills and work experience; any return to work plan prepared; any occupational rehabilitation services that are being provided to the worker, and such other matters as the guidelines may specify.
Ultimately the Member found Ms Chand to have no capacity for work in part noting the comments of the vocational assessment obtained for Ms Chand by her lawyer which recorded:10
After assessing Ms Chand and reviewing the documents available to me, I conclude that Ms Chand is not suitable for employment in any new pathways currently and requires the following:
a. Ongoing psychological therapy to help her manage and cope with her severe psychological injuries, which have so far not been adequately treated.
a. Ongoing physical treatment to assist with her lower back and right knee injuries.
a. Appropriately tailored vocational support, retraining, and return to work planning as opposed to general vocational suggestions and labour market assessments that do not benefit Ms Chand or fit within her vocational profile.
a. Facilitation of an appropriate work trial placement with a suitable employer when ready.
a. A thorough assessment of her current transferable skills and retained abilities to accurately reflect suitable employment avenues where appropriate.
Concerning the insurers’ reliance on the capacity for work upgrade at the case conference the Member commented on how it had come about:
“…altered the applicant’s certified capacity from a mere two hours per day for two days per week to 15 hours per week after a discussion with the vocational rehabilitation report writer. I do not criticise either practitioner for undertaking that discussion or for their approach, however, it does appear that given Dr de Mel provided no explanation for the alteration in capacity, his doing so was something of an artifice brought about by the vocational capacity report and his interaction
with its author.” 11
and
“…that capacity is unexplained and appears to have been decided upon in order to support the work capacity decision and provide avenues for the applicant to return to work in jobs which, in my view, she is unsuited for and incapacitated for.” 12
The finding about the issue of ‘indefinitely’
The Member accepted that Ms Chand was no capacity for work “indefinitely” finding that she was entitled to weekly compensation under section 38. 13
Summary
This is as usual a helpful decision from Member Burge. Section 38 is complex and has a lot of moving parts, but the facts of this case and the decision itself put a human face on the provision.
For section 38 to even apply we are seeing people who have been on weekly compensation for at least 2.5 years or even more. For an injury to still be plaguing an injured worker at that time, the injury is usually significant, and it is all too common to see people in Ms Chand’s circumstances where the injury has had a ‘severe’ impact on their mental health and well-being too.
The scheme has mechanisms to help injured people to return to work in new employment after an injury such as work trials, 14 retraining 15 and subsidies such as the job cover placement program, 16 some of which were discussed for consideration in the circumstances of this case.
Anecdotally our firm notices it is exceedingly difficult to secure retraining to be approved and paid for by an insurer. SIRA’s open data under the “payment type” heading suggests that payments for “SIRA funded programs”, such as the ones mentioned above, have been reducing over the last three years with this year appearing to be considerable lower then the prior financial year, albeit not complete. 17 The high level data seems to match our experience at the coal face?
If you have had a WCD or a section 38 eligibility decision made please reach out to our team.
1 https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/nsw/NSWPIC/2024/682.html
2 Para 28
3 Para 28
4 Para 14
5 Clause 8, Schedule 3 of the Workers Compensation Act NSW 1987 https://www.austlii.edu.au/cgi-
bin/viewdoc/au/legis/nsw/consol_act/wca1987255/sch3.html
6 Para 3 for instance
7 Para 4 and 5
8 Para 14
9 Para 20
10 Para 24
11 Para 15
12 Para 36
13 Para 38
14 https://www.sira.nsw.gov.au/resources-library/workers-compensation-resources/publications/help-with-
getting-people-back-to-work/work-trial-guidelines2
15 https://www.sira.nsw.gov.au/resources-library/workers-compensation-resources/publications/help-with-
getting-people-back-to-work/sira-training-program-guidance-material
16 https://www.sira.nsw.gov.au/resources-library/workers-compensation-resources/publications/help-with-
getting-people-back-to-work/jobcover-placement-program-guidelines
17 https://www.sira.nsw.gov.au/open-data/payments-data
