3.2.1 SRCA
NWE is determined by reference to Section 8 and 9. Section 8 prescribes how the NWE is to be calculated and section 9 determines the period of pre-injury employment (the 'relevant period') from which the NWE is to be averaged. NWE is based upon earnings at the date of injury, and not necessarily when incapacity for work first arises from the injury.
For a discharged member NWE will be taken to be the higher amount of earnings at:
date of injury; or
date of discharge from the ADF.
3.2.1.1 Person has discharged from the service that gave rise to the injury but later re-enlists in the same service type
Periods of service that are the same type i.e. permanent forces or reserves are considered a single period of service. When a person has re-enlisted in the same service type and attains a higher rank and pay (and higher earnings) in a period of service after the period the injury arose from, NWE should be based on the higher amount of earnings at discharge.
If the person re-enlists and is discharged at a lower rank and pay, then NWE is based on the person’s earnings from the earlier period.
3.2.2 MRCA
NE is determined by reference to subsection 89(3) and 132(2). Subsection 89(3) prescribes the method to calculate normal earnings for current serving members and subsection 132(2) prescribes the method to calculate normal earnings and normal weekly hours for former serving members.
3.2.3 Meaning of the term ‘former employee’ under the SRCA
The term “former employee” under the SRCA refers to a certain group of people under section 123 who were in receipt of incapacity payments on 1/12/88 (this is discussed in Chapter 9).
3.2.4 Meaning of the term “former member” under the MRCA
Section 5 of the MRCA defines a former member as “a person who has ceased to be a member” and notes that “A cadet or a part-time Reservist who is unlikely to be able to perform his or her duties in the future as a result of an incapacity might be taken to be a former member (see section 10).”
The simplest/most common example of a former member is person who has discharged from all forms of ADF service (including the Standby Reserve service). The person’s ADF service record will confirm this.
Under section 10 the Chief of the Defence Force (CDF) may advise the Commission in writing if the Reservist or cadet is unlikely to be able to perform their duties in the future as a result of his or her incapacity. If a determination is made by the CDF under section 10 then the person is taken to have ceased to be a member for the purposes of the MRCA. This does not imply that person has been discharged from the ADF as the ADF still retain the ability to recall the member to active service.
A person for whom a section 10 determination has been made, should not be referred to as being discharged from the ADF. Instead this person is ‘being taken to have ceased to be a member for the purposes of the MRCA’.
3.2.4.1 Implications of being a former member or having a determination under section 10
Being a former member or being taken to have ceased to be a member for the purposes of the MRCA has the following effect:
DVA becomes the person’s rehabilitation authority, rather than the Chief of the Defence Force.This generally entails a broader range of rehabilitation services, including whole of person psychosocial rehabilitation, than is provided by Defence.
Incapacity payments are calculated and paid under Part 4 of Chapter 4 of the MRCA for former members, as distinct from Part 3 of Chapter 4 of the MRCA which relates to current members. The implications of which are:
- If the person has been in receipt of incapacity payments since prior to 1 July 2013, their Military Superannuation would not have been included in the calculation of incapacity payments while they were a serving member. Once they are a former member or being taken to have ceased to be a member for the purposes of the MRCA, the superannuation benefit will now be reduced from incapacity payment calculations.
- The reduction provisions (section 131) apply after the person has been in receipt of incapacity payments for 45 weeks from the date of their discharge or the section 10 determination.
- The person may also be considered for SRDP eligibility, and become eligible for any of the ancillary benefits associated with SRDP eligibility.