Last Friday the Supreme Court published its decision in Morris. In that case the Full Court found that a worker who is totally incapacitated for work can breach the obligation of mutuality.
The Supreme Court of Appeal finds a worker can breach mutuality even when there is a total incapacity for work – revisiting workers contractual obligations to establish an entitlement to compensation
DEPARTMENT FOR CHILD PROTECTION v MORRIS  SASCA 131 (15 December 2022)
The Supreme Court of South Australia has handed down its decision in Morris. The question of law arising from this matter was whether a breach of the “obligation of mutuality” referred to in s48(3)(g) of the Return to Work Act 2014 does not apply to a worker who has total incapacity for work for reason of a work injury.
Ms Morris had accepted claim for physical and psychological injuries. She was assessed as having 64% WPI and under the repealed act, Workers Rehabilitation and Compensation Act 1986 (SA) she received a lump sum of $318,990 for non-economic loss. Ms Morris was rendered unable to wok and received weekly payments.
As per the regulations, Ms Morris’ claim transitioned into the Return to Work Act 2014 and was deemed a seriously injured worker.
The Department for Child Protection discontinued Ms Morris’ weekly payments after she was found guilty on 1 December 2017 to trafficking meth and, in addition after she had pleaded guilty on 8 June 2018 to attempting to dissuade a witness from giving evidence. After each conviction the Department issued notices of discontinuance dated 1 March 2018 and on 19 April 2018 Ms Morris was terminated from her employment for serious and wilful misconduct. On 14 June 2018 the Department issued a further determination to discontinue Ms Morris’ weekly payments for a further breach of obligation of mutuality in respect of the witness tampering offending pursuant to ss48(2)(f) and 48(3)(g) of the Return to Work Act.
Ms Morris disputed these determinations and requested that weekly payment be re-instated. This was again rejected by the Department. Ms Morris sought a review of those decisions and the Full Bench of the South Australian Employment Tribunal held that these breached could not be relied upon where the worker has no work capacity at the time the notices of discontinuance are issued. The Full Bench held that the instances of the breach of mutuality in s48(3):
are mainly directed to managing claims and ensuring workers comply with reasonable claims management requests. Mutuality may be breached by not attending medical examinations or recovery/return to work plan appointments, not providing ongoing certification of incapacity and not seeking proper medical treatment. Subsections (3)(a) to (d) and (3)(f) do not appear to discriminate between total and partial incapacity. Subsection 3(e) only has application to a worker who has some current work capacity.
The Full Bench further held that subsection 3(e) only had application to a worker who has some current capacity. The Full Bench concluded that the obligation of mutuality referred to in s 48(3)(g) was confined to cases where a worker had some capacity for work. Further, the Full Bench held that there was no relevant breach within the meaning of s 48(3)(g) of the Act because the respondent was totally incapacitated.
The Department for Child Protection sought an appeal of that decision. The Court of Appeal held that breach of mutuality applies to a worker who has suffered a total, incapacity for work by reason of a work injury.
The Court considered the meaning and effect of s48(3)(g) of the Return to Work Act in the in the context of a discontinuance of weekly payments, rather than as part of a deeming provision, in circumstances where the obligation of mutuality is now explicitly referred to in the Act as something which may be breached by a worker.
The Court further considered the words used by Parliament, the objects of the Act and the importance placed on returning workers to work, rehabilitating injured workers regardless of whether they are deemed seriously injured or not and that the Return to Work Act is intended to have abroad reach.
In addition, the Court held:
Looked at broadly, the provisions in s 48(3) are concerned with circumstances associated with a worker’s effective participation in the compensation scheme established under the Act, including participation in and co-operation with examination (s 48(3)(a)), certification (s 48(3)(b)) or proper medical treatment (s 48(3)(c)). In addition, a worker is expected to
engage with recovery or return to work plans (s 48(3)(d)) and to participate in assessments which may be made of capacity, return to work progress or future employment prospects (s 48(3)(f)).
The Court held that the context in which mutuality may be relevant has now been very significantly expanded under the Return to Work Act. Their Honours opined that the obligation of mutuality imposes a range of obligations on a worker which are associated with the worker’s effective participation in the compensation scheme established by the Act, and regardless of whether the worker is employed or has a present capacity for work.
Their Honours held that there is nothing in the provisions or the terms of s 48(3)(g) which evinces any intention to circumscribe the conduct or circumstances which were formerly recognised as amounting to a breach of the obligation of mutuality.
Their Honours agreed that the legal authorities have shown the development of the obligation of mutuality in the context of provisions which were concerned with whether partial incapacity should be treated as total incapacity. Their Honours held that s 48(3)(g) now operates differently:
This provision is one aspect of a scheme which is designed to ensure that weekly payments can be discontinued where the worker’s conduct or circumstances are “inconsistent with the necessary degree of co -operation” as between worker and employer, and where the worker’s conduct “independent of any injury” is “inconsistent with the degree of co -operation that is essential to an effective working relationship”. Depending on the facts and circumstances of the particular case, those conclusions may be appropriate where the worker is totally incapacitated by a work injury and discontinuance is sought under s48(3)(g).
This is a significant decision in workers compensation case law and moves beyond the historical proposition that a worker must have mutuality to offer to be deprived of an entitlement to weekly payments.
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