The employer was deemed to have accepted liability for the worker’s claim for compensation, but subsequently disputed liability to pay a medical expense on the basis that the worker had not suffered an injury in the course of his employment.
Whether the employer can use s77AA of the Workers’ Rehabilitation and Compensation Act 1988 (Tas) to dispute foundational liability for medical expenses.
The worker was employed as a labourer by the employer. On or about 16 March 2017 he made a claim for compensation for a back injury he claimed to have suffered in the course of his employment in January 2017.
The employer did not dispute liability under s81A of the Workers' Rehabilitation and Compensation Act (‘the Act’), being the section through which an employer would usually dispute initial or foundational liability. Therefore the employer was taken to have accepted liability pursuant to s81AB of the Act and the worker received payments of compensation.
In February 2018, the employer gave the worker notice pursuant to s77AA of the Act (‘the notice’), which provides the means to dispute a particular medical expense, or all medical expenses.
In this notice the employer disputed liability to pay a tax invoice issued by the general practitioner and all medical and associated expenses of any kind whatsoever claimed by the worker. This was on the basis that the employer disputed that the worker had ever suffered an injury in the course of his employment, despite liability having been deemed to be accepted pursuant to s81AB.
The employer’s claims in the notice were supported by the worker’s medical records which disclosed that he attended a general practitioner on 9 May 2016, being over six months prior to the claimed work injury, complaining of back pain.
Also, on 30 January 2017 the worker attended another general practitioner complaining of back pain from 2 weeks prior. At the appointment the worker specifically advised the doctor that there was no specific incident at work and that there were no previous lower back problems, despite the 2016 attendance. Both attendances related to pain on the left side.
The worker referred the notice to the Tribunal alleging that the employer was not entitled to dispute liability to pay medical and associated expenses claimed under Division 2 of Part VI of the Act under s77AA of the Act on the basis that it disputes the foundation liability.
The Tribunal’s Decision
As a starting point, the Tribunal noted that s77AA did not expressly limit the grounds upon which an employer may dispute liability for a medical expense.
It further noted that the words ‘liability’ and ‘liable’ appear in s77AA and that the Supreme Court in Federal Hotels v Webb  TASSC 36 discussed the meaning of liability in s81A(a). The Court there held that liability should be given a wide meaning and it should allow the employer to not only dispute foundational liability, but also ongoing liability.
In this case the worker was arguing the opposite; that liability should be limited to ongoing liability only, and not foundational liability. This was on the basis that s77AA should be read subject to s75, which is the section that prescribes when medical expenses are payable under the Act. In s75, the expenses must be:
- Necessarily incurred;
- As a result of the injury.
Therefore the worker’s position was that s77AA can only be used to dispute liability if the expense isn’t reasonable or isn’t necessary or isn’t as a result of the work injury.
The Tribunal did not agree as there are no words in either of those sections to require s77AA to be read subject to s75. Nor did the Tribunal consider there was a drafting error by the Parliament in not including such words into those sections, and the Tribunal considered that the worker’s argument was contrary to Blow J’s decision in Webb.
The Tribunal considered it ‘absurd’ that s77AA would allow an employer to dispute liability in circumstances of a. to c. above but not on the basis that liability for the injury itself was disputed such as here, particularly where both s77AA and s81A (which enables a dispute to foundational liability) both say ‘…disputes liability to pay…’
The Tribunal took the view that allowing s77AA to be used to dispute initial liability does not render s81A(5) null, as s77AA can only be used where an employer had received a request for funding. Section 81A(5) allows an employer to dispute liability for medical expenses at any time. Additionally, an employer bears the onus of proof under both sections, meaning s77AA does not place the employer in a more advantageous position.
Implications for you
This is a significant determination for employers and their insurers, with the issue having not previously been considered by the Tribunal. S77AA provides a quick means to dispute foundational liability to pay medical expenses where it has not done so using s81A, provided that the employer has its supporting evidence in order. Failing that, if a s81A(5) dispute is the only option available to an employer to dispute a claimed medical expense, the employer should consider filing a s60A referral at the same time, seeking an determination that it need not pay the expense in the interim.