The recent Personal Injury Commission decision of Member Wright in Wilson v Ascott Sales Integration Pty Ltd [2024] NSWPIC 579 (Wilson)1 considered how pre-injury average weekly earnings (PIAWE) was to be calculated for a casual worker who at the time of the injury was in a different casual arrangement to when she had first commenced employment a few years before.
Would the PIAWE be calculated over just the more recent, discrete, casual arrangement or would it be averaged out over the entire allowable 52 weeks before the injury?
If it was the full 52 weeks the PIAWE would have been approximately $375. If the PIAWE was calculated over the discrete period before the injury, it would be $740.19. A significant difference!
The facts in Wilson
The chronology in Wilson is thoroughly set out by the Member2 and can be briefly summarised as follows:
| Date |
Event |
| October 2012 |
Ms Wilson commenced employment with YourHealth (employer #1) on a part-time, 32 hours per week basis. |
| 7 November 2017 |
Ms Wilson sustained a thumb injury at employer #1. |
| November 2018 |
Ms Wilson commenced concurrent casual employment with the respondent employer in this case, Ascott (the Respondent). The role is described initially as ‘intermittent and irregular shifts dependent on demand’. |
| 10 October 2019 |
Ms Wilson commenced additional concurrent casual employment with another company, Nature Care (employer #3). |
| At this time Ms Wilson is in employment with employer #1, the Respondent and employer #3. |
| 15 December 2020 |
Employer #1 closes down. Ms Wilson increases her hours at employer #3. |
| Ms Wilson now is in two sets of casual employment working for the Respondent and employer #3. |
| 17 May 2021 |
Ms Wilson stops accepting shifts at employer #3 due to the pain in her hands becoming unbearable, associated with the original 2017 injury. |
| June 2021 |
Ms Wilson stops taking shifts with the Respondent for the same reason. |
| At around this time Ms Wilson’s average earnings with the Respondent were $93.00 per week3. |
| 19 July 2021 |
Ms Wilson has surgery on her thumb. She has no capacity for work following the surgery and was in receipt of weekly compensation from the insurer handling the original 2017 claim. |
| 31 October 2021 |
Ms Wilson returns to work. Due to the Respondent being very busy with work, Ms Wilson only worked for the Respondent and did not return to her other casual employment with employer #3. |
| Ms Wilson is now engaging in only the casual employment with the Respondent. |
| 22 April 2022 |
Ms Wilson sustains an injury working at the Respondent. |
| Ms Wilson’s average income from 31 October 2021 to the injury on 22 April 2022 with the Respondent is $740.19 per week4. |
The PIAWE calculation in Wilson
When calculating the PIAWE the insurer noted Ms Wilson only employment at the time of the injury was with the Respondent.
The insurer calculated the PIAWE off Ms Wilson’s earnings over the maximum allowable period of 52 weeks before the injury.
This meant Ms Wilson’s PIAWE included the period of employment with the Respondent where her average earnings were only $93.00 per week.
It also meant that a significant portion of the relevant earning period had the weeks included for the calculation of PIAWE but not the payments as the only payments included were weekly workers compensation payments resulting from incapacity from the original injury with Employer #1. These compensation payments are expressly prohibited from inclusion in the calculation of PIAWE.5
The decision doesn’t explicitly state the PIAWE rate determined by the insurer. Considering that the insurer definitely used the full 52 weeks as the relevant earning period, noting the periods considered by the Member for earnings6 and also noting the workers compensation payments whilst incapacitated from the original injury with Employer # 1 from approximately 1 June 2023 until 30 October 2023 were not able to be included, the likely PIAWE was approximately $375.71.7
In cases like these, consulting with a personal injury lawyer can provide clarity and guidance to ensure fair treatment under the law.
Adjusting the ‘relevant earning period’
The starting point for calculating PIAWE for most injured worker’s claims is a ‘relevant earning period’ of 52 weeks. Clause 2 of Schedule 3 of the Workers Compensation Act 1987 allowed for the making of Regulations that can adjust the ‘relevant earning period’ under certain circumstances.
Clause 8C of the 2016 Workers Compensation Regulation is an important provision that provides:
8C Adjustment for financially material change to earnings--Schedule 3, clause 2(3)(a) of 1987 Act
(1) The relevant earning period for a worker is to be adjusted in accordance with this clause if, during the unadjusted earning period, there was a change of an ongoing nature to the employment arrangement resulting in a financially material change to the earnings of the worker (for example, a change from full-time to part-time work).
(2) The relevant earning period is to be adjusted by excluding from the period
any period before the change to the earnings of the worker occurred.
Ms Wilson suggested the PIAWE should be calculated off an adjusted relevant earning period. Ms Wilson took the view that her more recent, discrete, period of employment in the lead up to the injury had seen a financially material change and that clause 8C should be activated.
The decision
In submissions the Respondent seemed to argue that there had been no change of an ongoing nature to the employment arrangement8 . Ms Wilson was employed as a casual and was still a casual at the time of the injury and from the Respondent’s perspective it seems that the arrangement hadn’t been altered to enable the activating of Clause 8C.
Dismissing the approach of the Respondent, the Member agreed Clause 8C applied.
The Member affirmed that there was evidence of a financially material change saying:
“In my view, the payslips of 5 November 2021 and 11 November 2021 provide strong support for a financially material change in earnings. As the applicant submitted, her wages with the respondent prior to 19 July 2021 were in the order of $93 per week, whereas her wages after 30 October 2021 were $740 per week.” 9
The Member was also satisfied that there had been a change to the employment arrangement saying:
There was also a change of an ongoing nature to the employment arrangement, in that there was more than a seven-fold increase in her wages with the respondent, which I infer, from that increase in wages and from the applicant’s statement, as being the result of a significant increase in the applicant’s workload due to a substantial increase in the number of patients.
This in my view is well outside the applicant’s initial employment arrangement of intermittent and irregular shifts.10
Ultimately the Member noted that whilst there was one contract of employment for Ms Wilson with the Respondent, there also was a change to the employment arrangement in the lead up to the injury saying:
The applicant in written submissions argued that there were two discrete casual engagements. The respondent in written submissions took issue with this submission. When considered with the applicant’s oral submissions, and consistent with argument put in oral submissions, I do not understand that the use of the word “engagement” means a separate period of employment. Rather, I understand it to refer a distinction between periods to which there was a difference in employment arrangements. In my view, the employment arrangement from 30 October 2021, other than being on a casual basis, was a different employment arrangement from that entered into in November 2018. This was a change of an ongoing nature to the employment arrangement. As noted above, there was no suggestion that there were two distinct contracts of casual employment.11
Member Wright carefully explained his take on Clause 8C towards the very end of the decision:
In my view, the example provided in reg 8C does not limit the nature and extent of circumstances and arrangements which may come under consideration, and potentially come within its operation. The example was expressed to be no more than that. It was not expressed to be exhaustive or limiting. Reg 8C is in my view beneficial, and it exists within beneficial legislation. 12
Summary
This is a valuable decision concerning the calculation of PIAWE and the application of Clause 8C. Member Wright has written a number of decisions on the issue including, but not limited to, Cain v Tamworth Aboriginal Medical Service [2021] NSWPIC 19313 , and this decision in Wilson is another valuable one. In our firm’s experience if the injured worker is a casual employee at the time of the injury, the PIAWE is calculated by the insurer using the entire available ‘relevant earning period’ being up to 52 weeks before the injury.
There often is little analysis as to whether there is a change to the ‘employment arrangement’ in the casual employment during the allowable 52 weeks of employment before the injury.
Sometimes, as was the case in Wilson, a carte blanche approach from the insurer leads to a minimised PIAWE and one that does not reflect the ‘employment arrangement’ the worker is engaged in at the time of the injury.
In times of a cost of living crisis, this valuable decision of Wilson emphasises the care to be taken when calculating PIAWE and the need to carefully consider the work done by an worker injured in the midst of casual employment during the ‘relevant earning period’ to consider whether there are separate ‘discrete casual engagements.’14
If you have any questions about the calculation of your PIAWE please reach out.
1 https://www8.austlii.edu.au/cgi-bin/viewdoc/au/cases/nsw/NSWPIC/2024/579.html
2 Para 1-11
3 Para 44
4 Para 44
5 Clause 6(2)(c) Schedule 3 Workers Compensation Act NSW 1987
6 Para 52
7 For the math enthusiasts it is ((12.29 weeks (21/04/2023 to 15/07/2023) X $93.00 per week) + (24.85 weeks (31/10/23 to 21/04/24) x $740.19)) / 52
8 Para 20, 38, 39
9 Para 44
10 Para 44
11 Para 51
12 Para 54
13 http://www6.austlii.edu.au/cgi-bin/viewdoc/au/cases/nsw/NSWPIC/2021/193.html
14 Para 51
