External

Section 19 (4) sets out the criteria by which an employee's ability to earn can be assessed.  Where it is considered that the employee could be earning more, sections 19 (4) (b) to (g) need to be applied to establish the increased level of the employee's ability to earn.

Example 1

An employee worked a 40 hour week, prior to sustaining a compensable back injury.

His NWE is $500.

After some time away from his employment, the employee returns to work for 3 hours a day, earning $187.50.

Having regard to section 19 (4) (a), the employee's ability to earn is $187.50 per week.

However, if a higher level of ability to earn is supported, say through medical evidence, then the Commonwealth can offer the employee suitable employment at this level.

If the employee unreasonably refuses this offer, then section 19 (4) (b) can be applied to deem the employee able to earn at the higher level.  This application will override the operation of section 19 (4) (a).

Example 2

An employee worked a 40 hour week prior to sustaining a compensable neck injury.  Her NWE is $500.

The employee resigns and some time later claims compensation for a reduced work capacity.

She is working 10 hours a week in a hotel, earning $100 per week.

Medical evidence supports some incapacity for full time work.

Payments for incapacity will initially need to be made on the basis of actual earnings from the hotel work.  This is the employee's ability to earn having regard to section 19 (4) (a).

If further investigation indicates that the employee is capable of working 30 hours per week in a suitable clerical position within the Commonwealth, nothing can alter in relation to earnings taken into consideration for incapacity payments unless:

  • the Commonwealth can offer the employee the clerical position and it is unreasonably refused (section 19 (4) (b) refers);

  • a rehabilitation plan is devised with a view to employment at the end and the employee does not continue with the program (section 19 (4) (d) refers); or

  • the employee fails to seek suitable employment (even though currently employed) as per section 19 (4) (e).

In any of the above situations, a notional ability to earn can be applied.