What's New in Commonwealth Compensation - DibbsBarker

03 June 2010
What's New in Commonwealth
Compensation
by National Insurance team
Decisions for the week ending 28 May 2010:
Liability
Exclusions (reasonable administrative action)
Incapacity
Permanent impairment
Liability
Ezekiel and Comcare [2010] AATA 391 (26 May 2010) Sydney
In 1983, while on her way to work, the Applicant fell down the stairs at a railway station, landing on
her buttocks. The Respondent accepted liability for the injury and then purported to cease liability in
1988. In 1990, the Tribunal set aside that decision. The Respondent had continued to accept liability
for “injury to lower back and buttocks”. The Applicant had made some additional claims, all of which
had been rejected by the Respondent, and two of which concerned the Applicant’s entitlement to
compensation “an aggravation of C3/4 and C5/6 cervical spondylosis” as a result of an incident
occurring in April 1983 and the Applicant’s claim for aggravation of a neck and right arm condition
due to the nature and conditions of her employment.
One of the major issues for the Tribunal concerned the cause of the Applicant’s claimed neck and
shoulder condition. It was common ground that the Applicant did not complain of neck pain until
some 18 months after the fall in 1983. It was also common ground that the Applicant had suffered
cervical spondylosis in 1976. This was supported by the clinical notes of the Applicant’s general
practitioners. The preponderance of medical opinion was that the Applicant’s neck pain was
unrelated to the fall and this was supported by the majority of the medical opinion before the
Tribunal. On this basis, the Tribunal concluded that the Applicant’s neck condition was unaffected by
the fall.
An alternative claim was that the Applicant’s neck injuries were caused by the nature and conditions
of her employment where she commenced work in 1969. In the face of the expert evidence, the
Tribunal could not accept the contention that the nature and conditions of the Applicant’s
employment, which it noted were light and later modified, contributed to her neck and shoulder
conditions. The Tribunal found that the Applicant suffered from a degenerative condition that bore no
relation to either the fall in 1983 or the nature and conditions of her work.
The Tribunal affirmed these decisions under review.
Exclusions
Reasonable administrative action
McGee and Comcare [2010] AATA 386 (24 May 2010) Melbourne
In January 2008, the Applicant claimed compensation for a depressive condition for which he first
sought treatment inNovember 2007. He alleged that the work-related matters that caused his
condition were harassment and bullying by an officer investigating the arrest in 2004 of the
Applicant’s mentor; the complaint by a colleague about the behaviour of officers involved in an
operation in which the Applicant took part; and a proposed transfer to a workplace located with
investigators involved in the matter concerning his mentor. The Respondent refused the claim on the
grounds that the Applicant’s condition was the result of reasonable administrative action taken by his
employer in dealing with the matters.

There was no dispute that the Applicant suffered from a psychological condition which, on the
medical evidence, the Tribunal found was best characterised as “depressive disorder” which was an
ailment that was contributed to, to a significant degree, by his employment. Therefore the issue
before the Tribunal was whether the ailment was suffered as a result of reasonable administrative
action taken in a reasonable manner in respect of the Applicant’s employment such as to exclude
him from receiving compensation in accordance with s 5A(1) of the Safety, Rehabilitation and
Compensation Act 1988 (Cth) (“1988 Act”) because it would not constitute an “injury”.
The Tribunal firstly found that each of the matters raised in the Applicant’s claim were actions by
management which involved staff, and that each constituted “administrative action” for the purposes
of the 1988 Act. The Applicant alleged that the administrative action in relation to the three matters
was unreasonable. On the factual evidence before it, the Tribunal found that the administrative
action involving all three matters was reasonable and taken in a reasonable manner. Furthermore,
the Tribunal was satisfied that that the administrative action in the three matters was taken in
respect of the Applicant’s employment and those matters caused the depressive condition suffered
by the Applicant.
In view of its findings, the Tribunal was satisfied that the condition suffered by the Applicant resulted
from reasonable administrative action taken in a reasonable manner in respect of his employment,
so it did not come within the definition of “injury” in the 1988 Act. Although there may have been other
matters that contributed to the condition, no compensation was payable in accordance with the
principles espoused in Hart v Comcare [2005] FCAFC 16; (2005) 145 FCR 29.
The Tribunal affirmed the decision under review.
Wilson and Comcare [2010] AATA 396 (28 May 2010) Canberra
The Applicant submitted a claim for workers’ compensation in May 2008 for “anxiety” due to “ongoing
systemic unacceptable behaviour”, stress and bullying. In November 2008, the Respondent
determined that the Applicant was not entitled to compensation under section 14 of the Safety,
Rehabilitation and Compensation Act 1988 (Cth) (“1988 Act”) for “adjustment reaction with mixed
emotional features” on the basis that, although the Applicant’s condition was contributed to, to a
significant degree, by his employment, the condition was the result of “reasonable administrative
action” and thus not an “injury” within the meaning of section 5A of the 1988 Act.
In these proceedings, the parties agreed that since the Applicant had conceded that the Applicant’s
condition had been contributed to, to a significant degree, by his employment, the sole issue was
whether the Applicant’s condition was suffered as a result of reasonable administrative action taken
in a reasonable manner in respect of his employment.
The Tribunal found that the relevant administrative actions included: the Applicant not receiving
Additional Responsibility Pay (“ARP”) at the level he expected; the informal counselling session in
September 2007; the steps taken relating to the Applicant’s Performance Agreement 2006-2007; the
processes surrounding the imposition of a Performance Improvement Process (“PIP”); and the
meetings relating to the PIP in November and December 2007.
The principal issue was whether the examples of administrative action taken by the employer that
affected the Applicant were “reasonable” for the purposes of section 5A(2) of the 1988 Act. In relation
to the first administrative action, the Tribunal noted that although the Applicant complained about not
receiving ARP at the expected level, and that there were delays in implementing the arrangement,
when offered the opportunity to pursue the matter the Applicant chose not to do so. In the
circumstances, and given the absence of evidence from the Applicant on key issues, the Tribunal
was not able to be satisfied as to whether the Applicant had a legitimate grievance on this issue and
made no findings accordingly.
As to the second example of administrative action, the Tribunal found there was nothing “untoward”
about the calling or conduct of the meeting, nor was it “irrational, absurd or ridiculous”. The action
did not fall within “bullying” or “abuse of power”. Given that the Applicant’s work errors were clearly
not acceptable behaviour, to arrange a meeting with the Applicant to discuss the matter and counsel
him was appropriate, and to do so informally complied with the employer’s policies and principles. It
followed that the Tribunal found that taking this step was lawful, and was reasonable administrative
action taken in a reasonable manner.
Regarding the steps taken relating to the Applicant’s Performance Agreement 2006-2007, the
Tribunal considered that decisions made by management in this regard were both lawful and
reasonable administrative action. In terms of the imposition of the PIP, the Tribunal held that this
process was instituted in a reasonable manner. With respect to the meetings held with the Applicant
in November and December 2007, the Tribunal held that the holding of the meetings and how they
were conducted was not unfair and in those circumstances, the action taken was not unreasonable,
nor were they taken out with a “deliberate desire to hurt, threaten or frighten someone with words or
actions”. Given that the actions did not constitute bullying, they were not undertaken in an
unreasonable manner.
The Tribunal highlighted that whilst some of the interactions between the Applicant and his manager
concerned the taking of administrative action, and on their own would not be reasonable, in the
circumstances, and given that reasonable action does not have to be perfect, provided it was
“tolerable and fair”, the Tribunal did not find that these issues were an unreasonable manner of
undertaking various administrative actions involving the Applicant. In conclusion, the Tribunal upheld

the finding that the administrative action taken in relation to the Applicant, in particular by his regional
manger, were reasonable administrative actions being lawful and appropriate in the circumstances
and they were not taken in an unreasonable manner.
The Tribunal affirmed the decision under review.
Incapacity
Ezekiel and Comcare [2010] AATA 391 (26 May 2010) Sydney
One of the applications brought by the Applicant concerned her claim for incapacity payments for
her accepted back condition under section 19 of the Safety, Rehabilitation and Compensation Act
1988 (Cth) (“1988 Act”).
The Tribunal considered that the preponderance of medical evidence was that in 1995
the Applicant was partially incapacitated for work and was able to perform clerical duties for four
hours per day for five days per week. At the time she left, she had suitable work of that kind and for
those hours was available to her. The Tribunal considered, on the basis of the balance of expert
medical evidence, that it was not reasonable in all of the circumstances for the Applicant to have not
continued in that suitable employment. In reaching this conclusion the Tribunal was mindful of the
Applicant’s stated difficulty in continuing to work, however, it did not consider that her difficulty was
so great that she was unable to continue to work or that she had “no choice”, as it has been put on
her behalf, but to take voluntary redundancy.
The Tribunal noted that there was no direct medical evidence of marked deterioration over the last
15 years. The Tribunal accepted that advancing age would generally affect any person’s capacity to
some greater or lesser extent but in the absence of any objective evidence of diminished capacity to
work, or any current assessment of her current capacity to perform the type of employment she
undertook in 1995, the Tribunal could not be satisfied that the work the Applicant left in 1995 was no
longer suitable employment.
On this basis, the Tribunal considered that the Applicant’s failure to continue to engage in suitable
employment was not reasonable and that any calculation of payments under section 19 of the 1988
Act should have incorporated earnings in suitable employment of 20 hours per week. The Tribunal
noted that the Applicant received a lump sum superannuation payment and thus the relevant
provisions of the 1988 Act concerning the effect of such payments on the calculation of weekly
incapacity payments were also applicable.
To the extent that the reviewable decision in question stated that the Applicant had no current
entitlement to incapacity payments, the Tribunal set aside the decision and remitted it to the
Respondent with directions that the Applicant was partially incapacitated for work in that she was
able to earn in suitable employment of 20 hours per week and, in respect of calculating a weekly
incapacity payment, if any, she was retired from her employment and had received a lump sum
benefit under a superannuation scheme.
James and Comcare [2010] AATA 393 (27 May 2010) Canberra
The Applicant had two accepted injuries to his left knee – a strain to the cruciate ligament and
aggravation of osteoarthrosis. In February 2008, he underwent left knee replacement surgery and he
claimed compensation for two periods of incapacity. The Applicant’s entitlement to incapacity during
these periods was determined in the negative in two separate decisions, and this was affirmed upon
reconsideration.
The issue for determination was whether the Applicant was entitled to compensation for incapacity
during these periods. Essentially, to be so entitled, the Tribunal noted it must have been established
that the periods of incapacity resulted from an “injury” under the Safety, Rehabilitation and
Compensation Act 1988 (Cth) (“1988 Act”). The Applicant asserted that the periods of incapacity
resulted from one or more compensable injuries to his left knee.
Based on the medical evidence before it, the Tribunal was reasonably satisfied, that the work-related
incidents in March 2006, May 2006 and September 2007 caused minor traumas that were
consistent with minor frank injuries, and those minor injuries caused the Applicant’s pseudogout
symptoms to flare for a short period. It could be accepted that the injuries caused incapacity for
work during those short periods, however, once the elevated symptoms diminished, the Applicant’s
left knee condition returned to a state involving persistent and increasing symptoms and ongoing
incapacity for work, in varying degrees.
The Tribunal was reasonably satisfied that these persistent symptoms and degrees of incapacity for
work were attributable to the progress of his pre-existing degenerative disease and not to the minor
injuries and related elevation of symptoms in March 2006, May 2006 and September 2007.
Therefore, in conclusion, the Tribunal found that the claimed periods of incapacity were not the result
of an “injury” for the purposes of the 1988 Act.
The Tribunal affirmed the decision under review.
Permanent impairment
Dean and Military Rehabilitation and Compensation Commission [2010] AATA 388 (25 May
2010) Canberra

In terms of the Applicant’s back condition, it was common ground that, pursuant to section 124 of
the Safety, Rehabilitation and Compensation Act 1988 (Cth) (“1988 Act”), liability for permanent
impairment of the Applicant’s back would only arise if the impairment became permanent after 1
Liability was accepted under the Safety, Rehabilitation and Compensation Act 1988 (Cth) (“1988
Act”) for the Applicant’s “minor annular tear of the L5/S1 disc resulting in degenerative changes at
the L4/L5 and L5/S1 level” with effect from 10 June 1991. Subsequently, liability was accepted for
conditions of chronic adjustment disorder, pain disorder and major depressive disorder. The
Respondent initially decided in April 2009 that the Applicant was assessed as having a whole person
impairment of 15 per cent under Table 5.1 of the first edition of the Comcare Guide for his chronic
adjustment disorder only. That decision was affirmed on reconsideration. In June 2009 on further
reconsideration, the delegate varied the decision to assess whole person impairment of 15 per cent
for major depressive disorder and pain disorder instead of chronic adjustment disorder.
The following issues were relevant to these proceedings:
Whether the Applicant’s conditions were permanent
Whether the assessment of whole person impairment under the Comcare Guide for one or more
of the Applicant’s conditions should have been higher than 15 per cent
What were the appropriate scores under Division 2 of the Guide for any non-economic loss
suffered by the Applicant for all or any of his accepted conditions
Whether the Applicant was entitled to a further payment of compensation and, if so, the amount of
the additional compensation
Whether the Respondent was entitled to deduct an overpayment of incapacity payments from an
award of lump sum compensation
Whether some or all of the deduction of the overpayment should have been waived
In terms of the first issue, the Tribunal considered that the overwhelming medical evidence enabled
it to find that the Applicant’s condition was permanent. That did not preclude the possibility of some
relief in his symptoms should the Applicant have agreed to take anti-depressants at some stage and
undergo a pain management program. However, these possibilities, for practical reasons and in the
face of the Applicant’s attitude to taking medication, appeared to be remote.
Regarding the second issue, the Tribunal noted that there was less uniformity among the medical
experts as to the Applicant’s assessment of whole person impairment for his conditions under Table
5.1 of the Comcare Guide. Nor did all the experts provide such an assessment. Having undertaken a
detailed analysis of the requirements under the Comcare Guide, in conjunction with the provisions of
the 1988 Act and relevant case law, the Tribunal found that, based on the predominant medical
evidence and its own findings, the Applicant’s level of permanent impairment for his major
depressive disorder met the criteria of 25 per cent under the Comcare Guide. The evidence also led
to a finding that the assessment for the Applicant’s pain disorder should also be set at 25 per cent.
The Tribunal noted that if it was in error in attempting to apportion the impairment between the two
conditions, it made a finding that the Applicant was entitled to 25 per cent for both conditions in
combination.
With respect to the third issue, the Tribunal noted that there was little evidence at the hearing on this
issue. In the absence of further evidence on this issue the Tribunal was not in a position to make an
assessment and accordingly it remitted the matter to the Respondent for that purpose.
In terms of whether the Applicant was entitled to a further payment of compensation and, if so, the
amount of the additional compensation, the Tribunal observed that there was no argument at the
hearing in support of this issue and accordingly the Tribunal made no findings.
In terms of whether the Respondent was entitled to deduct an overpayment of incapacity payments
from an award of lump sum compensation, the Respondent adopted the following principles for
deciding whether to waive any or all of an overpayment. These were whether the Respondent or, it
was assumed, an agency, made an error, whether the payment was received in good faith by the
debtor, and any other reasonable grounds, including severe financial hardship or exceptional
circumstances. Again, little evidence or argument was provided to the Tribunal on this issue. In
these circumstances, although there had been a degree of departmental error, and the Applicant
received an extra amount in good faith, the Tribunal did not consider there were sufficiently strong
grounds for the exercise of the waiver power.
The Tribunal set aside the decision under review and in substitution the Tribunal found that the
Applicant had a 25 per cent permanent impairment for each of his major depressive disorder and his
pain disorder. The Tribunal remitted the question of the appropriate score under Division 2 of the
Comcare Guide for any non-economic loss suffered by the Applicant for each of his conditions to the
Respondent.
Ezekiel and Comcare [2010] AATA 391 (26 May 2010) Sydney
One of the issues for the Tribunal in these proceedings concerned the time at which the
impairments to the Applicant’s back, legs, neck and shoulders, if any, became permanent.

December 1988. In relation to her back, the Applicant’s evidence was that since the date of the fall in
1983 she had suffered constant low back pain and stiffness. Early reports and clinical notes of
treating doctors supported that evidence. Of the various medical opinions, only one of the doctors
maintained that the impairment did not become permanent until after 1 December 1988. On the
background of this evidence, the Applicant sought to establish permanence of that impairment only
after December 1988 by urging the Tribunal to regard a referral to a pain clinic in 1989 and a
discussion in 1990 with one of her treating doctors about a possible spinal fusion as indications of
the time at which the Applicant had undertaken “all reasonable rehabilitative treatment for the
impairment”.
With reference to the other factors mentioned in section 24(2) of the 1988 Act, the duration of the
impairment had been more than five years since the fall. The Tribunal noted that the likelihood of
improvement, the other listed factor in section 24(2), tended to diminish as time went by and, given
the medical evidence about the significance of one of the doctor’s raising the possibility of a spinal
fusion in 1990, the Tribunal did not think that the mere existence of the possibility of an alternate
course of treatment about which medical opinion was divided was sufficient to render a longstanding
condition not permanent. On this basis, the Tribunal considered that any impairment of the
Applicant’s back was permanent before 1 December 1988.
In relation to the impairment to the Applicant’s legs, it was submitted for the Applicant that the
contested impairment to her legs should be “bundled together” with that of her back; that the time at
which her back impairment became permanent was the same point at which her leg impairment
became permanent. On this basis, and given the conclusion relation to the Applicant’s back, it
followed that any impairment to her legs became permanent prior to 1 December 1988. The Tribunal
indicated that there was comparatively little medical evidence of any discrete impairment of the
Applicant’s legs.
In light of the Tribunal’s findings regarding liability for the Applicant’s neck and shoulders condition
outlined above under “Liability”, it was unnecessary for the Tribunal to consider the issue of
permanence in relation to those conditions.
The Tribunal affirmed these decisions under review.
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