PIC's first published decision: Worker and PIAWE

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Last updated: 22 Jun, 2021

Originally Published by Michael Poulos on Tuesday, March 16, 2021 8:52:12 AM


The Personal Injury Commission (PIC) has issued its first published workers compensation decision. The decision provides guidance in considering whether a claimant is a worker or a 'deemed worker'. The determination covers the hot topic of PIAWE, for injuries sustained from 21 October 2019. The calculation of PIAWE was complicated by the cash nature of the work and uncontested evidence, such that social media was relied on.


Author: Karl Maakasa
Judgment date: 2 March 2021
Citation: Sarcia v Workers Compensation Nominal Insurer (iCare) [2021] NSWPIC 1
Jurisdiction: Personal Injury Commission

Principles

  • In determining whether a claimant is a worker, the totality of the relationship remains paramount.
  • Whilst 'control' is key, it is not determinative and balanced considerations are required.
  • A claimant can be a worker despite taxation and superannuation not being deducted from pay.
  • Social security payments are not necessarily fatal to a finding of alleged PIAWE, particularly if the benefits have been provided in the midst of the COVID-19 pandemic.
  • Evidence from social media and business advertisements can be relied upon in determining PIAWE.


Background

On 25 August 2020, Ms Charli Rose Sarcia (the applicant) was physically assaulted whilst carrying out work at the premises of Riverwood Cougar Town (the first respondent).

During the assault, the applicant was pushed to the ground, kicked, punched in the face, and hit with the heel of a high-heel shoe. She claims she suffered a primary psychological injury together with physical injuries to her chest, back, shoulders and legs.

The first respondent was uninsured, and the workers compensation Nominal Insurer was joined to the proceedings (the second respondent).

On 10 September 2020, the applicant made a claim against the Nominal Insurer, and on 18 October 2020, the second respondent accepted liability for her claim.

The first respondent, however, maintained the applicant was not a worker and was instead an independent contractor.

The applicant alleged earnings of $4000 per week. The insurer calculated PIAWE at $759.10, based on weekly rates where no award existed.1

The first respondent did not produce records under a Notice to Produce as records had been destroyed.

Decision

On the issue of worker:

  • Member Burge considered that the applicant was a worker. In doing so, he referred to seminal cases, including High Court decisions containing the essential features for a contract of service.
  • Member Burge:
    • Applied the indicia in the High Court decision in Stevens2.
    • Noted control of the person carrying out the work is a key, but not the sole, criterion; and, the indica must be balanced.
    • Found the applicant was obligated to work set hours; was provided her equipment in the form of the room; the first respondent controlled the rate of remuneration; and, was responsible for the collection of money from clients.
    • Noted on balance, that the evidence favoured the applicant, despite income tax and superannuation not being deducted from her pay.

Member Burge said if he was wrong concerning the issue of 'worker', the claimant was a 'deemed worker'.

Regarding PIAWE, member Burge:

  • Accepted the applicant's evidence.
  • In doing so, Member Burge:
    • Noted the applicant's evidence was uncontested; there was no evidence advanced by the respondents concerning shifts and rosters.
    • Noted the applicant's statement sets out rates of pay and provided some social media and electronic verification of the applicant working at the first respondent's premises.

Member Burge said the evidence of social security payments were not fatal to the claim, particularly as a great deal of the payments arose from the COVID-19 pandemic and he awarded weekly benefits of compensation based on the statutory maximum.

Why this case is important

The workers compensation legislation provides that a worker is entitled to benefits. The first step is to determine whether a claimant is a 'worker' or a 'deemed worker' under the 1998 Act. It is often unclear whether a relationship is one of employment and the case illustrates the balancing of indicia. Whilst control is a key criterion, it is not determinative. The totality of the relationship must be considered. The decision, at [19], discusses essential elements to an employment contract.

Although the case concerned PIAWE for injuries sustained on or after 21 October 2019, it also provides guidance for the calculation of PIAWE for injuries sustained prior, particularly where the worker was paid in cash; there is no evidence of earnings (such as a contract, pay slips, tax records, bank statements, rosters or leave records). Social media or internet advertisements may assist in testing the veracity of the evidence.

It is not always possible to obtain all relevant information to PIAWE within the seven calendar days an insurer has to commence provisional payments; determine liability; or, issue a reasonable excuse and, an 'interim PIAWE', work capacity decision may be made on the best evidence available.

Expeditious attempts should be made to obtain the best available evidence and information from the respondent/s to a claimant's statement/evidence as delays may result in the incorrect PIAWE being calculated. Furthermore, depending on the earnings alleged, the maximum payable under section 34 may be awarded, with this risk heighted by an absence of competing evidence. The authorities do not require an applicant to admit having inflated their income before lost earning capacity can be calculated.3 


1 Schedule 6, Part 4, Clause 7 of the 1987 Act.

2 Stevens v Brodribb Sawmilling Co Pty Ltd [1986] HCA 1.

3 Movatjou v Morad Kajnie [2013] NSWCA 157, McColl JA at [55].