Whether an impairment is "serious and permanent" for the purposes of s 14(3) of the SRC Act is a matter of fact and degree to be decided in the individual circumstances of each case. Two general observations may, however, be helpful:

S14(3) is directed to "impairment" and not to "incapacity for work". Assessors should ensure that the medical evidence addresses impairment and not incapacity for work;

the phrase "serious and permanent impairment" is conjunctive, ie. there must be both serious and permanent impairment. Accordingly, the exclusion under s 14(3) will continue to apply where the medical evidence clearly states that the impairment is expected to be temporary. Liability may have to be reviewed if the initial prognosis proves to be incorrect.

"serious" impairment

In order to determine whether an impairment is "serious", the assessor should undertake "a comparison with, and an assessment relative to, other possible impairments or losses of the body function in question. Elements of fact, degree and value judgement are involved" in reaching the appropriate decision: Fleming v Hutchinson (1991).

A serious impairment is one which is "very considerable when compared with the range of possible impairments, and more than marked or significant": Re Grime and Telstra Corporation Limited (1994). The Administrative Appeals Tribunal considered that a residual movement restriction of approximately 50% to the employee's right ankle - a whole person impairment of 10 - 15% - was not a serious impairment within the meaning of s 14(3).

While it is not appropriate to make this judgment solely on the basis of an impairment rating under the Approved Guide, the following general guidelines may be helpful:

an impairment rating of 40% or more in accordance with the Approved Guide would usually be "serious" for the purposes of s 14(3);

ratings in the range 20% - 40% may be "serious" in appropriate cases.

As an example, an impairment of 20% under Table 9.6 ("loss of more than half normal range of movement" may be regarded as "serious" for a manual labourer whose work requires lifting, bending, digging, etc, while it may not be "serious" for a person in a clerical position.