Catlow v. Accident Compensation Commission

[1989] HCA 43
167 CLR 543

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(Judgment by: Dawson J)

Catlow
vAccident Compensation Commission

Court:

Judges: Brennan J
Deane J

Dawson JGaudron J
McHugh J

Subject References:
Workers' Compensation (Vict.)
Accident compensation
Amount of compensation
Rate of pay for 'normal number of hours per week'
Whether actual hours worked or core hours fixed by industrial agreement
Whether number of hours 'fixed' by agreement
Accident Compensation Act 1985 (Vict.), s. 95.

Legislative References:
Interpretation of Legislation Act 1984 (Vict.) - s 35

Hearing date: 2 May 1989
Judgment date: 5 October 1989

Victoria

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Judgment by:
Dawson J

I agree with McHugh J., for the reasons given by him, that in s.95(1) of the Accident Compensation Act 1985 (Vict.) the words "calculated at the worker's ordinary time rate of pay for the worker's normal number of hours per week" exclude from the required calculation hours worked by way of overtime. I would add only the following observations.

2. The same formula is used in s.94(10) and s.95(1) as part of the method for arriving at, in the case of s.94(10), current weekly earnings and, in the case of s.95(1), pre-injury average weekly earnings. Section 94(10) is concerned with the calculation of weekly payments of compensation where the worker is partially incapacitated and remains employed. Section 95(1) is, on the whole, concerned with the calculation of weekly payments of compensation where the worker is totally or partially incapacitated and has ceased to be employed. In both cases the weekly earnings are to be calculated "at the worker's ordinary time rate of pay for the worker's normal number of hours per week".

3. "Current weekly earnings" in s.94 are defined in sub-s.(10) as "the earnings of the worker during the week in respect of which a weekly payment is made calculated at the worker's ordinary time rate of pay for the worker's normal number of hours per week or, if there is no such ordinary time rate, the actual earnings of the worker during the week".

4. Now it is perfectly plain that the effect of that definition is to exclude hours worked by way of overtime from the "normal number of hours per week". The definition cannot mean that, in order to calculate the earnings of a worker during an actual week worked, the ordinary time rate of pay should be multiplied by a "normal number of hours" which includes, in some way, overtime. It cannot mean that because, if it did, the final figure could exceed the actual weekly earnings of the worker during the week in question and that is something which the sub-section, referring as it must to actual and not notional earnings, does not contemplate.

5. The appellant concedes that the "ordinary time rate of pay" is the rate of pay for the standard hours worked, the standard being fixed objectively in some manner such as by an award or industrial agreement. In making such a concession the appellant seems to me to concede the argument in relation to both s.94(10) and s.95(1), for the formula for calculating weekly earnings proceeds upon the basis, which is axiomatic, that if there is to be an ordinary time rate of pay it must be ordinary in relation to something. Clearly the thing selected is the normal, or standard, number of hours worked per week. It cannot include overtime hours because they are extraordinary and incompatible with an ordinary time rate of pay. Moreover, for overtime hours to be included, they would have to be averaged over some selected period and s.94 selects no period. But, in any event, as I have said, because current weekly earnings under s.94(10) cannot exceed actual earnings, the phrase "normal hours per week" must in that sub-section exclude overtime.

6. Section 95(1) defines "pre-injury average weekly earnings" principally for the purpose of calculating weekly payments where the worker does not remain employed. It is, therefore, not possible, as it is with s.94(10), to refer to actual weekly earnings. It is necessary to provide a period over which prior weekly earnings may be averaged. The sub-section does this by providing for a period of up to twelve months preceding the injury. Otherwise the formula for calculating the average weekly earnings remains the same as in s.94(10). The same words are used: "the worker's ordinary time rate of pay for the worker's normal number of hours per week". To give the formula one meaning in s.94(10) and another in s.95(1), the context being no different, would be to depart from the basic rules of construction. Since s.94(10) must exclude overtime, s.95(1) must do the same. I agree with McHugh J. that in calculating the average weekly earnings during the period preceding the injury under s.95, as that section stood at the time of the appellant's injury, a weighted average should be used.

7. The proper order is that the appeal should be dismissed with costs.