15 May 2017

Section 67 claims: a softly beating heart?

Will Murphy

The 2012 amendments (Workers Compensation Legislation Amendment Act 2012) abolished the entitlement to compensation for pain and suffering under section 67 of the Workers Compensation Act (WCA) from 19 June 2012.[1]

However, does a worker who made a claim for lump sum compensation before 19 June 2012 retain a right to recover compensation under section 67?

A recent Presidential decision has explored that issue. The Commission has held in some circumstances section 67 claims can still be made.

Woolworths Ltd v Wagg [2]

Cheryl Wagg (the “worker”) worked at a Woolworths deli. The facts of the claim are complex. We outline the most relevant ones:

The worker suffered compensable injury to her right knee in 2008 (the “first injury”). She subsequently underwent knee surgery.
In August 2010 the applicant was assessed by an independent medical practitioner, Dr Wallace, as suffering 7% WPI.
The worker reinjured her knee at work on 1 September 2010 (the “second injury”).
On 17 September 2010, the worker made a claim for lump sum compensation under section 66 based on 7% WPI relating to the first injury. She could not make a claim for compensation under section 67 at that time because she was under the old section 67 threshold of 10% WPI. Her section 66 claim was not pursued as she required further treatment.
The worker underwent further surgery to her knee in February 2011.
In January 2014 Dr Wallace assessed the worker suffered 19% WPI as a result of the first injury.
In February 2014 the worker made an amended permanent impairment claim relating to the first injury based on 19% WPI. Compensation was claimed under sections 66 and 67. Liability for the claim was disputed.
In August 2014 the worker underwent total knee replacement.
In November 2015 Dr Wallace assessed 20% WPI. His report referred to the first and second injuries.
In December 2015 the worker made a further amended permanent impairment claim relating to the first injury. This was also a claim for compensation under sections 66 and 67. Liability was declined. One ground on which liability was declined was that the worker did not have an entitlement to compensation under section 67 as a result of the 2012 amendments.
The worker filed an ARD in the Commission seeking lump sum compensation under sections 66 and 67. Ultimately that claim relied on both the first and second injuries.
The parties entered into a complying agreement under which the applicant recovered compensation under section 66 based on 19% WPI as a result of both the first and second injuries.
The questions were:
- Was the applicant entitled to section 67 compensation, having made a claim for compensation under section 66 relating to the first injury before 19 June 2012?
- If so, did she satisfy the section 67 threshold (10% WPI) in relation to the first injury?

Some Relevant Law

Clause 10(1) of Schedule 8 of the 2016 Workers Compensation Regulation 2016 (Regulations), says the 2012 amendments:

“…extend to a claim for compensation made before 19 June 2012, but not to a claim for compensation that specifically sought compensation under section 66 or 67 of the 1987 Act.” [3]

The appeal decision

President Judge Keating made the following findings:

As the worker had made a claim specifically seeking compensation under section 66, the 2012 amendments did not apply to her. That was because of Clause 10, Schedule 8 of the Regulations. That Clause only requires a claim be made for compensation under section 66 or section 67 before 19 June 2012.
Because of the operation of Clause 10, Schedule 8 of the Regulations, the 2012 amendments which abolished section 67 did not apply to the worker.
It was irrelevant that the worker did not satisfy the threshold entitling her to section 67 compensation (10% WPI) until after the 2012 amendments came into effect.
The worker suffered from 19% WPI due to both the first and second injuries. The employer argued the worker did not satisfy the section 67 threshold (10% WPI) due to the first injury, being the only injury subject of a lump sum claim made before the 2012 amendments came into effect. However, the President rejected that argument. He said the combined effect of both the first and second injuries had resulted in the knee pathology. That pathology then led to an impairment of 19% WPI. Therefore the section 67 threshold was satisfied.

Lessons

Woolworths v Wagg arose from unusual circumstances. It involved a claim for compensation under section 66 which had been made but was not finalised before the June 2012 amendments came into effect.

There were then two amended lump sum claims made after the 2012 amendments came into effect, by which time the worker had satisfied the old section 67 threshold.

However, what if the section 66 claim which had been made had been finalised before 19 June 2012 and the worker then brought a further lump sum claim?

In that case Clause 11, Schedule 8, of the Regulation would apply[4].

Clause 11 says nothing about section 67. However, we consider there’s a pretty strong argument that a worker who is making a second claim for lump sum compensation relying on Clause 11 would not be entitled to compensation under section 67.

So, there is a softly beating section 67 heart. However, it may only pump blood when a claim for compensation under section 66 or 67 had been made before 19 June 2012 but had not been finalised by that date.

Authors: Will Murphy and Stephen Ke

[1] http://www.legislation.nsw.gov.au/acts/2012-53.pdf

[2] http://www.austlii.edu.au/au/cases/nsw/NSWWCCPD/2017/13.html

[3] http://www.austlii.edu.au/au/legis/nsw/consol_reg/wcr2016346/sch8.html

[4] Clause 11 was introduced to ameliorate the 2015 decision of the NSW Court of Appeal in Cram Fluid Power v Green.