Employers must keep paying injured workers during certification gaps, court rules

A Tasmanian public school employee has won a landmark workers compensation dispute after the state government attempted to use a gap in her medical certification to withhold weekly payments, a move three Supreme Court judges have unanimously rejected.

The Full Court of the Supreme Court of Tasmania, in a decision last month, dismissed the state's appeal and affirmed that employers cannot use a break in medical certification as grounds to stop paying injured workers.

How the dispute unfolded

The employee worked for the Tasmanian Department for Education, Children and Young People. She made a workers compensation claim in November 2022 after being incapacitated by stress and exhaustion.

Her employer did not dispute the claim within the statutory 84-day window, meaning liability was taken to have been accepted under the Workers Rehabilitation and Compensation Act 1988 (Tas).

She continued submitting consecutive medical certificates until 18 May 2023. When her next certificate arrived on 14 June 2023, 27 days after the previous one expired, the Department invoked section 69(13) of the Act, which allows an employer to treat a certificate lodged more than 14 days late as a fresh compensation claim.

The Department referred the matter to the Tasmanian Civil and Administrative Tribunal and stopped paying her weekly payments for the period covered by the new certificate, 18 May to 12 July 2023.

The Tribunal initially sided with the employer. The worker appealed to the Supreme Court, where Chief Justice Blow allowed her appeal and ordered the Department to pay.

The Department then escalated the matter to the Full Court.

The Full Court's findings

The three-judge bench dismissed the appeal unanimously, with Brett J delivering the principal judgment.

The Department had argued that section 81AA(4) of the Act, which disapplies certain protections in cases where section 69(13) is invoked, meant weekly payments were effectively suspended until the certification dispute was resolved. Brett J rejected this reasoning outright.

"If the legislature had intended to suspend the obligation of the employer to make weekly payments in accordance with this provision on a certificate delivered after a gap in certification of more than 14 days, it could easily have given effect to this intention by saying so in the legislation," Brett J wrote. "It did not do so."

The court found that the employer's obligation under section 69(1), to pay weekly payments where a worker is certified as incapacitated, remained in force regardless of whether the employer had elected to treat the late certificate as a fresh claim. Only a prospective order from the Tribunal could bring that obligation to an end, meaning no retrospective withholding of payments was permissible.

Brett J also dismissed the Department's argument that requiring payments in such circumstances could produce absurd outcomes for employers, noting the Act already provides mechanisms, including a review of weekly payments under section 88, through which employers can seek relief.

The court further rejected the Department's attempt to rely on a clause note from the 2001 legislative amendments as extrinsic material supporting its interpretation, finding the note did not meet the threshold required under the Acts Interpretation Act 1931 (Tas) to be considered in statutory construction.

Experts from Carroll & O'Dea Lawyers noted the decision carries important practical consequences for workers and employers alike.

Workers on accepted claims must still be aware that a gap in certification places weekly payments in abeyance, and that a gap of more than 14 days gives the employer the right to reopen a previously accepted claim within 84 days.

"However, the decision in State of Tasmania v Pearson clarifies that when an employer does take such action, it is still obliged to pay the worker weekly payments until liability regarding any dispute is determined," they said in a recent publication.