QUEENSLAND INDUSTRIAL RELATIONS COMMISSION

CITATION: 

PARTIES:	
	Leonard v State of Queensland (Queensland Health) & Anor [2020] QIRC 207 

Leonard, Robert 
(Applicant)

v

State of Queensland (Queensland Health) 
(First Respondent) 

and 

West Moreton Hospital and Health Service 
(Second Respondent) 
	
CASE NO:
	D/2019/129	
PROCEEDING:
	Arbitration of an industrial dispute 
	
DELIVERED ON:	27 November 2020	
		
HEARD AT:

HEARING DATES: 
	Brisbane 

1 April 2020 
	
MEMBER:	Hartigan IC 
	
ORDER:

CATCHWORDS:	1.	Mr Leonard was entitled to accrue annual leave and sick leave for the period during which he was absent but being paid workers' compensation payments, on the basis that:

(a)	Mr Leonard was not "absent without pay" for the purpose of s 32(2) of the Industrial Relations Act 2016 (Qld) and consequently, during the period that Mr Leonard was absent and being paid workers' compensation payments, he was entitled to accrue annual leave for that period; and

(b)	Mr Leonard remained in employment with Queensland Health during the period that he was absent and being paid workers' compensation payments, and accordingly, that period may be counted towards a completed year of employment with an employer for the purpose of determining his entitlement to accrue sick leave, pursuant to s 40 of the Industrial Relations Act 2016 (Qld).     

INDUSTRIAL LAW – notice of industrial dispute – interpretation of absent without pay - interpretation of completed year – interpretation of pay – accrual of annual leave and sick leave whilst on WorkCover     	
		
LEGISLATION:

CASES:

APPEARANCES: 	Industrial Relations Act 2016 (Qld), s 31, s 32, s 40 

Workers' Compensation and Rehabilitation Act 2003 (Qld), s 119A 

Fair Work Act 2009 (Cth)

Hall v Medical Imaging Queensland Pty Ltd [2015] FCCA 326

Workpac Pty Ltd v M Bambach [2012] FWAFB 3206

Mr R Leonard, Applicant 

Mr M Uzelin for the First Respondent 

Ms Y Prince for the Second Respondent 

Reasons for Decision

	Introduction 

[1]	Mr Robert Leonard has notified of a dispute with his employer, Queensland Health, in relation to whether he accrued annual leave and sick leave entitlements whilst receiving workers' compensation leave. 

[2]	On 20 June 2017, Mr Leonard commenced a period of workers' compensation leave which was backdated to 16 November 2016 by WorkCover Queensland. His employer did not attribute any accrued annual leave or sick leave entitlements to his employment whilst he was on workers' compensation leave. 

[3]	The question for my determination in this dispute is whether, by operation of s 119A of the Workers' Compensation and Rehabilitation Act 2003 (Qld) ("WCRA"), read together with the relevant provisions of the Industrial Relations Act 2016 (Qld) ("IR Act"), Mr Leonard was entitled to accrue annual leave and/or sick leave after a period of three months of receiving workers' compensation payments.  

Issues to be arbitrated 

[4]	Pursuant to orders made, the parties filed an agreed chronology and an agreed statement of issues for arbitration. 

[5]	In summary, the dates relevant to the issues in dispute are, as follows: 

Dates 	Details of Event 	
18 May 1987	Commenced employment with West Moreton Health Service	
15 November 2016 	Injury sustained 	
5 April 2017	Last day of work attended 	
6 April 2017	WorkCover <3 months commenced	
05 June 2017	Returned to work 	
20 June 2017	Ceased work 	
21 June 2017	WorkCover >3 months commenced	
6 August 2019	WorkCover application closed and payments ceased 	
7 August 2019 	Sick leave commenced	
4 October 2019	Sick leave without pay commenced	
18 October 2019	QSuper income protection commenced 	
23 October 2019	Dispute filed with Queensland Industrial Relations Commission 	

…
	
[6]	The parties filed an agreed statement of issues for arbitration in the following terms: 

1.	Question 1: In relation to section 31 Entitlement within the Industrial Relations Act 2016, what is meant by the term "For each completed year of employment with an employer"?

2.	Question 2: In relation to the Industrial Relations Act 2016, what is meant by the term "pay"? 

3.	Question 3: In relation to section 32 Working out completed year of employment within the Industrial Relations Act 2016, what is meant by the term "when an employee is absent without pay"? 

4.	Question 4: In relation to Directive 15/18 what is meant by "Special leave to claim Workers Compensation"? 

5.	Question 5: Is Directive 15/18 in conflict with the relevant Industrial Act or industrial instrument? 

6.	Question 6: In relation to section 119A(2) of the Workers Compensation and Rehabilitation Act 2003 what is meant by the term "The worker is entitled to take or accrue annual leave, sick leave and long service leave under an Industrial Act or industrial instrument during the period to which the compensation relates"? 

[7]	Questions four and five relate to Directive 15/18: Leave without Salary Credited as Service ("Directive 15/18"). Queensland Health had previously sought to rely on Directive 15/18 in support of its position not to permit Mr Leonard to accrue annual leave and sick leave. Mr Leonard has maintained that Directive 15/18 is not relevant to his circumstance and no other directives have been referred to as being relevant to this matter by the parties. During the hearing, Queensland Health accepted that Directive 15/18 is not relevant to my consideration of this matter on the basis that it did not apply to Mr Leonard's circumstances. Given Queensland Health's concession, it is only necessary for me to consider Questions 1 to 3 and 6, of the agreed statement of issues. 

[8]	The manner in which Questions 1 to 3 and 6 have been posed do not, in my view, assist the parties in resolving the current dispute. That is not to say however, that I have not considered the subject matter of the questions posed. I address the subject of the matters referred to in Questions 1 to 3 and 6 further under the heading "Consideration". 

	Relevant legislation 

[9]	The WCRA, prescribes, at s 109, who must pay compensation to an injured worker, as follows: 

(1)	If an employer is a self-insurer, the employer must pay the compensation. 

(2)	Otherwise, WorkCover must pay the compensation. 

(3)	An employer who is not a self-insurer can not pay a worker an amount, either in compensation or instead of compensation, that is payable under the Act by WorkCover for an injury sustained by the worker. 

… 

[10]	Queensland Health is not a self-insurer. Accordingly, WorkCover must pay the compensation, pursuant to the WCRA. 

[11]	Section 119A of the WCRA provides that the compensation entitlement does not restrict taking or accruing leave, including annual or sick leave, as follows: 

	119A      Compensation entitlement does not restrict taking or accrual of leave  

(1)	This section applies to a worker who is entitled to compensation, including compensation payable as weekly payments.  

(2)	The worker is entitled to take or accrue annual leave, sick leave and long service leave under an Industrial Act or industrial instrument during the period to which the compensation relates. 

Note – 

In relation to entitlements under the Fair Work Act 2009 (Cwlth), this section removes the restriction under section 130(1) of that Act. 

[12]	The IR Act does provide provisions which, relevantly, entitle a worker to take or accrue annual leave and sick leave.   

[13]	Section 31 of the IR Act, provides for the entitlement to annual leave, as follows: 

31      Entitlement 

(1)	For each completed year of employment with an employer, an employee is entitled to – 

(a)	if the employee is not a shift worker – at least 4 weeks annual leave; or 

(b)	if the employee is a shift worker – at last 5 weeks annual leave. 

(2)	Annual leave is exclusive of a public holiday that falls during the leave. 

(3)	However, if an employee is entitled to additional annual leave as compensation for working on a particular public holiday, annual leave is inclusive of the particular public holiday.
 
(4)	Annual leave accumulates. 

(5)	This section does not confer an entitlement or an additional entitlement in relation to employment before 4 June 1999. 

(6)	In this section – 

"shift worker" means an employee who – 

(a)	is employed in a calling in which shifts are worked 24 hours a day, 7 days a week; and 

(b)	works a rotating roster that includes each of the shifts. 

[14]	Relevantly, s 32 of the IR Act applies for working out a completed year of employment for the purpose of s 31, as follows: 

32      Working out a completed year of employment   

(1)	This section applies for working out a completed year of employment for section 31.  

(2)	The following periods when an employee is absent without pay are not to be taken into account – 

(a)	a period of more than 3 months when an employee is absent with the employer's approval; 

(b)	a period when an employee is absent without the employer's approval, unless the employee is absent for not more than 3 months because of illness or injury that is certified by a doctor. 

[15]	Section 40 provides for the entitlement to sick leave, relevantly, as follows: 

40	Entitlement to sick leave 

(1)	An employee is entitled to at least 10 days sick leave on full pay for each completed year of employment with an employer. 

(2)	An employee's entitlement to paid sick leave accumulates – 

(a)	progressively during a year of employment according to the employee's ordinary hours of work; and 

(b)	from year to year. 

(3)	Sick leave may be taken for part of a day. 

… 

[16]	Relevantly, it is noted that sick leave accrues, inter alia, progressively during a year of employment, according to the employee's ordinary hours of work. I will consider this further below. 

[17]	Schedule 5 to the IR Act includes the dictionary which defines the meaning of wages, as follows: 

	"wages" means – 
	
(a)	an amount payable to an employee for – 

(i)	work performed, or to be performed, by the employee; or 

(ii)	a public holiday; or 

(iii)	leave the employee is entitled to; or

(iv)	termination of employment; or 

(b)	a salary; or 

(c)	an amount payable from wages for the employee, with the employee's written consent. 

	Consideration 

[18]	Section 119A of the WCRA provides that an entitlement to compensation, including the payment of compensation as weekly payments, does not restrict a worker taking or accruing annual leave, sick leave and long service leave under an Industrial Act or Industrial Instrument during the period to which the compensation relates. An Industrial Act is defined to mean the IR Act or the FW Act. 

[19]	The entitlement to take or accrue annual leave, sick leave or long service leave whilst receiving workers' compensation is subject to the terms of the entitlement to take or accrue such leave under an Industrial Act or industrial instrument. 

[20]	As noted above, the IR Act provides for the taking and accruing of annual leave and sick leave. Accordingly, in considering s 119A of the WCRA, regard must be had to the relevant terms of the IR Act and the provisions which provide for the taking or accruing of annual leave and sick leave. This will require consideration of, inter alia, ss 31, 32 and 40 of the IR Act. 

[21]	Relevantly, s 31(1)(a) of the IR Act provides that an employee is entitled to four weeks of annual leave for each completed year of employment with an employer. 

[22]	The phrase "each completed year of employment" is relevant to whether Mr Leonard accrued annual leave whilst he was receiving workers' compensation payments. 

[23]	Section 32(2) of the IR Act provides that when an employee is absent without pay, the following periods are not to be taken into account when determining a completed year of employment: 

(a)	a period of more than 3 months when an employee is absent with the employer's approval;

(b)	a period when an employee is absent without the employer's approval, unless the employee is absent for not more than 3 months because of illness or injury that is certified by a doctor.

[24]	Queensland Health contends that Mr Leonard, whilst he was receiving workers' compensation, was absent without pay for a period of more than three months with the employer's approval and consequently that period of time should not be taken into account in calculating a completed year of employment. 

[25]	Mr Leonard contends that during the period he was receiving workers' compensation payments, he was not absent without pay and consequently, that period is to be counted towards a completed year of service in order to calculate his annual leave entitlements. 

[26]	The word "pay" is not defined in either the IR Act or the Acts Interpretation Act 1954 (Qld). 

[27]	Queensland Health contends that the word "pay" must take on its ordinary meaning. However, Queensland Health further argues that the word pay should be read within the context of being paid by an employer for the performance of work. In that context, Queensland Health contends that "pay" must mean "wages". The practical effect of this is that on Queensland Health's argument, s 32(2) should be read as if it were stating "absent without wages". 

[28]	The Macquarie Dictionary defines the word "pay" to mean:

1.	to discharge (a debt, obligation, etc.), as by giving or doing something. 
2.	to give (money, etc.) as in discharge of debt or obligation. 
3.	to satisfy the claims of (a person, etc.) as by giving money due. 
4.	to defray (cost or expense). 
5.	to give compensation for.
…  

[29]	Having regard to the ordinary meaning of the word "pay", I do not accept that the word "wages" can easily be used as a substitute for the word "pay". This is so, even having regard to the employment context, as an employer's obligation with respect to an employee is not limited to the payment of wages. 

[30]	Mr Leonard submits that the Commission should take a similar approach to that taken by the Federal Circuit Court of Australia and the Fair Work Commission, when determining matters of a similar nature, albeit, in the context of the Federal jurisdiction. 

[31]	The decision of Bambach v Workpac Pty Ltd [2012] FWA 670 was considered on appeal in Workpac Pty Ltd v M Bambach [2012] FWAFB 3206 ("Bambach"). A Full Bench of Fair Work Australia in Bambach considered whether Mr Bambach, whilst in receipt of workers' compensation benefits in New South Wales, was in "service" for the purpose of s 22 of the FW Act.  

[32]	In that matter, Mr Bambach was injured during the course of his employment, soon after his commencement with the employer. The issue was whether he was entitled to the protection of the unfair dismissal provisions of the FW Act on the basis that he had been in continual service. He had had a period away from work, during which he was in receipt of workers' compensation payments from the employer's workers' compensation insurer. The day following his return to work, his employment was terminated. The issue was whether the period during which he was absent on leave counted as part of his service and consequently, whether he was able to access the unfair dismissal laws. 

[33]	The Full Bench held that the absence was not an unpaid absence for the purpose of s 22(2)(b) of the FW Act because the employer was under an obligation pursuant to the Workers' Compensation Act 1987 (NSW) to make the compensation payments to the applicant. The Full Bench relevantly stated: 

[32]	The word 'unpaid' presents an insurmountable problem for the appellant in this case. The period during which Mr Bambach's was absent due to his work related injury was not 'unpaid'. During the relevant period Mr Bambach received compensation payments in accordance with the provisions of the Workers' Compensation Act 1987 (NSW) (the Workers' Compensation Act). Those payments were made pursuant to a legal obligation upon Mr Bambach's employer, WorkPac. Section 9(1) of the Workers’ Compensation Act provides:

"A worker who has received an injury ... shall receive compensation from the worker's employer in accordance with this Act" [emphasis added]
	
…
	
[37]	Contrary to the appellant’s submission, the fact that WorkPac chose to insure against such liabilities, and hence the payments were actually made by WorkPac's insurer, is irrelevant. The fact that the payments were made pursuant to a legal obligation upon the employer is the critical consideration. The nature of the payment does not change because the employer has entered into an indemnity arrangement with a third party. We note that our conclusion in this regard is consistent with the decision of Commissioner Roe in Webster v Toni and Guy Port Melbourne Pty Ltd. In that case the Commissioner concluded that an employee's period of absence due to a motorcycle accident was a period of 'unpaid leave or unpaid authorised absence' within the meaning of s.22(2)(b). This was found to be so despite the fact that the employee was receiving payments from the Transport Accident Commission during the relevant period.

(Citations omitted) 

[34]	The decision of Hall v Medical Imaging Queensland Pty Ltd [2015] FCCA 326 ("Hall") cited Bambach and relevantly considered the provisions of the WCRA. The issue to be determined in Hall was similar to this matter, in that it was to be decided whether Mr Hall accrued annual leave during a period in which he was absent from work and receiving workers' compensation benefits. In determining the issue, the Federal Circuit Court considered the proper construction of relevant provisions of the Fair Work Act 2009 (Cth) ("FW Act") and the WCRA. 

[35]	Relevantly, it was argued by Mr Hall that his absence was not unpaid because WorkCover were paying compensation to him that his employer was otherwise obliged to pay. The employer argued that the period under consideration was a period of unpaid leave or unpaid authorised absence because Mr Hall was in receipt of workers' compensation payments and was not paid wages by his employer. 

[36]	In construing the relevant provisions of the WCRA, Jarrett J summarised the relevant components of the workers' compensation scheme provided for by the WCRA. That summary is equally relevant to my consideration of this matter. Relevantly, Jarret J stated, as follows: 

[18] 	The scheme of the Workers Compensation and Rehabilitation Act 2003 (Qld) seems to be as follows (all references are to the WCRA unless otherwise stated):
a.	a worker injured in the course of his employment is entitled to compensation: s.108(1);

b.	compensation includes, amongst other payments, an amount payable as weekly payments to the worker during the period of the worker’s incapacity and amounts for appropriate medical treatment, hospitalisation and rehabilitation of the worker: ss.9, 145(2), 208(2);

c.	an employer is legally liable for compensation for injury sustained by a worker employed by the employer: s.46(1);

d.	an employer must be insured against the employer's legal liability for compensation to the employer’s workers for injury sustained by them: s.48(1);

e.	the employer's insurance must be provided for under a licence as a self-insurer or under a WorkCover policy: s.48(3);

f.	if an employer is a self-insurer, the employer must pay the compensation: s.109(1);

g.	if not, WorkCover must pay the compensation: s.109(2);

h.	save in circumstances where a worker has made a claim for compensation but that claim has not yet been determined by WorkCover (as provided for in s.109(4)), an employer who is not a self-insurer cannot pay a worker an amount, either in compensation or instead of compensation, that is payable by WorkCover under the Act for an injury sustained by the worker: s.109(3);

i.	if an employer does so, it is liable to penalty equal to 50% of the employer's premium for the period of insurance: s.109A(2);

j.	an employer who has a policy of insurance with WorkCover, is liable to pay to a worker compensation for the excess period in respect of a claim for compensation accepted by WorkCover, as calculated according to Chapter 2 Part 3 Division 4 of the Act;

k.	an employer may not insure against payments it is liable to make in the excess period with WorkCover: s.67;

l.	if WorkCover has paid compensation for an injury sustained by a worker when the employer was not insured against the employer's legal liability for compensation to the worker the employer is liable to pay to WorkCover the amount of any payment made by WorkCover to the injured worker together with a penalty equal to 50% of the payment: s.57(2)(b).
[19] 	It is apparent from the above that the primary liability for compensation to an injured employee falls upon an employer. An employer is obliged to insure against that liability. If the employer does insure against that liability, the obligation to make payments to the employee falls upon the insurer. That might be WorkCover, or it might be the employer if they are licenced to self-insure. If the employer is not insured, the employer remains liable and in the event that WorkCover makes a payment to the injured employee it is able to recover from the employer any amounts it may have paid to the injured worker, together with a penalty. But the employer remains primarily liable. Moreover, in cases where an excess period applies, the employer must pay the compensation payable during the excess period.
	…
 [24]	As Webster illustrates, a worker might be absent from work due to injury for which his employer has no liability to pay him compensation. However, the worker might have an entitlement to receive payments in respect of his injury or any disability that it might cause. That right might arise pursuant to a statutory compensation scheme such as was the case in Webster or it might be through a private insurance arrangement entered into by the employee. There are other possibilities.
[25]	What then differentiates between an employee who is absent and paid compensation by reason of a statute like the Workers' Compensation Act (Qld) and a worker who receives payment because of a private insurance arrangement or a statutory "no fault" compensation scheme? The answer is supplied by Bambach. That decision demonstrates that, if the employer has an obligation to pay the employee whilst he is absent, then whether the employer pays the employee, or another does on the employer’s behalf does not matter. The absent is not unpaid for the purposes of s.22(2)(b) of the Fair Work Act.
…
[28]	In Queensland, that obligation is discharged by the employer undertaking either self-insurance or obtaining a policy of insurance with WorkCover. In the former case, the employer is liable to make the payments to the injured worker. In the latter it is WorkCover. Even where WorkCover insures an employer, the employer may be called upon to make payments to the employee where there is an applicable excess period.
[29]	If the respondent's argument is correct, it would lead to the anomalous situation where an injured employee's entitlement to accrue annual leave whilst on an authorised absence from work was dependent upon whether his employer had chosen to self-insure for the employer's liability to the employee for compensation. The construction contended for by Mr Hall would avoid such an anomalous result and would place all injured workers on the same footing with respect to service for the purposes of s.22 of the Fair Work Act.
[37]	Queensland Health, in its written submissions, argued that Mr Leonard's references to Bambach and Hall were not relevant as they dealt with the operation of the FW Act and as Mr Leonard is not a national system employee, the FW Act does not apply to his employment. 

[38]	Further, Queensland Health submitted that the FW Act contains no legislative provision either identical or similar to s 32 of the IR Act and, as such, the decisions should be disregarded as irrelevant to this matter. 

[39]	I do not accept Queensland Health's submissions that the decisions are irrelevant to this matter. 

[40]	Section 22 of the FW Act provides the meaning of "service" and "continuous service" for the purpose of the FW Act. Section 22(2)(b) provides, inter alia, that a period of unpaid authorised absence does not count towards service. 

[41]	The decisions of Bambach and Hall considered whether a period in which the employee was receiving workers' compensation payments in accordance with the WCRA was a period of unpaid absence for the purpose of s 22 of the FW Act. 

[42]	The Macquarie dictionary defines unpaid as "not paid". I consider that "unpaid" and "without pay" have the same, or substantially the same meaning. Accordingly, consideration of the terms "unpaid" or "without pay" and whether those terms apply to an employee receiving workers' compensation payments in accordance with the WCRA, are relevant to my consideration in this matter. 

[43]	As was the case in Hall, Mr Leonard was receiving workers' compensation payments pursuant to the scheme provided for by the WCRA. Whilst I accept the submissions made by Queensland Health, that an employer who is not a self-insurer cannot pay a worker an amount either in compensation or instead of compensation that is payable by WorkCover under the Act, that does not remove the employer's obligation to obtain insurance from WorkCover for the compensation to be paid. Just as in Hall, the primary liability for compensation rests with Mr Leonard's employer. The relevant scheme provides that the employer in this instance is obliged to insure against that liability and in those circumstances, the obligation to make payments to the employee falls upon the insurer. 

[44]	As in the decisions of both Hall and Bambach, it is Mr Leonard's employer who has the obligation to pay him whilst he is absent. Whether, arising out of this obligation, Mr Leonard is paid by his employer or by WorkCover, on his employer's behalf, is inconsequential. Mr Leonard was not absent without pay for the purpose of s 32(2) of the IR Act.  

[45]	Consistent with this conclusion, is the language used in s 32(2) of the IR Act. Section 32(2) does not refer to the payment of "wages"; a term defined in the IR Act. Rather, the provision is broad, and the scope of the payment has not been limited by the insertion of the word "wages".  

[46]	Consequently, I consider that by the operation of s 119A of the WCRA and ss 31 and 32 of the IR Act, that Mr Leonard was entitled to accrue annual leave during the period that he was absent and was paid workers' compensation payments. 

[47]	Section 40 of the IR Act provides for the entitlement to accrue sick leave. It relevantly provides that an employee is entitled to at least 10 days sick leave on full pay for each completed year of employment with an employer. Section 40(2) provides that an employee's entitlement to paid sick leave accumulates progressively during a year of employment according to (a) the employee's ordinary hours of work; and (b) from year to year. 

[48]	The term "completed year of employment" is not defined for the purpose of s 40 of the IR Act. Relevantly, there is no equivalent provision to s 32, in terms of working out a completed year of employment for the purpose of s 40. Section 32 specifically states that it applies only to working out a completed year of service for the purpose of s 31 of the IR Act. 

[49]	Accordingly, as the IR Act has not sought to define or impose limitations on the meaning of the words "completed year of employment", for the purpose of determining an entitlement to sick leave then those words operate with their ordinary meaning. 

[50]	During the period in which Mr Leonard was paid workers' compensation payments, he remained employed by his employer. Accordingly, that period may count towards calculating a completed year of employment to determine Mr Leonard's entitlement to receive sick leave. Section 40(2) then applies to determine how such an entitlement accumulates. 

	Conclusion 

[51]	For the forgoing reasons, I have concluded that Mr Leonard was entitled to accrue annual leave and sick leave for the period during which he was absent but being paid workers' compensation payments, on the basis that:

(a)	Mr Leonard was not "absent without pay" for the purpose of s 32(2) of the IR Act and consequently, during the period that Mr Leonard was absent and being paid workers' compensation payments, he was entitled to accrue annual leave for that period; and

(b)	Mr Leonard remained in employment with Queensland Health during the period that he was absent and being paid workers' compensation payments, and accordingly, that period may be counted towards a completed year of employment with an employer for the purpose of determining his entitlement to accrue sick leave, pursuant to s 40 of the IR Act.