Navigating Dual-benefit Scenarios And Section 46 In Workers Comp – Learnings From Freeth v Volvo Group Australia Pty Ltd [2025] NSWPICPD 78

In Freeth v Volvo Group Australia Pty Ltd  [2025] NSWPICPD 78, the President dismissed a worker's appeal and confirmed that section 46 of the Workers Compensation Act 1987 (NSW) will operate to reduce concurrent weekly payments where multiple work injuries give rise to the entitlement to benefits of the same kind from the same employer over the same period.

The decision provides guidance on how “incapacity for work” is to be characterised for section 46 and rejects the Alcan‑style PIAWE cap in dual‑benefit scenarios (whereby 100% PIAWE would be received by a worker, if they had concurrent claims and dual entitlements), but also provides guidance that insurers are generally required to give notice if they intend to rely on section 46 in managing concurrent claims.

Background

The worker, who was employed as a store person, suffered two injuries:

1. a physical injury to both shoulders and elbows on 31 August 2021, for which she was in receipt of weekly payments; and 
2. a primary psychological injury deemed to have occurred on 20 August 2024, for which she claimed weekly payments.

The parties agreed that, from 20 August 2024, the worker had no current work capacity. The calculation of PIAWE was agreed. The live issues raised in an Application to the Commission was whether the worker could receive full weekly payments for her psychological injury, in addition to the weekly payments already made for the physical injury over the same period.

The employer relied on section 46 of the Workers Compensation Act 1987 (NSW) (the 1987 Act), arguing that the Commission should reduce the psychological weekly payments to prevent “dual benefits of the same kind” being paid to the worker.

The primary decision

In the original decision, Senior Member Rachel Homan found in favour of the applicant in respect to an incapacity for work arising from both her physical and psychological injuries and ordered that the worker receive weekly compensation under both claims but held that those weekly payments must be reduced under section 46 by the weekly amounts already being paid in respect of the worker's physical injury claim.

The Senior Member found that although the physical and psychological injuries involved different symptoms and restrictions, they produced the same incapacity: an inability to perform her pre-injury or any suitable employment, so that the dual weekly benefits were “of the same kind” and “in respect of the incapacity for work”.

Relying on authority including Cordina¹ and earlier decisions on dual incapacity, Senior Member Homan held that the Commission's discretion was enlivened under section 46 and should be exercised to avoid double recovery, rejecting the worker's submission that she should receive up to 100% of PIAWE by way of combined awards and finding no statutory basis for an Alcan ²-style “cap”.

Although section 46 had not been raised in the original section 78 notice, the Member granted leave (to the extent required) under section 289A(4) of the Workplace Injury Management and Workers Compensation Act 1998  (the 1998 Act) to allow the issue to be agitated and confirmed that the Commission's jurisdiction was enlivened to determine the dual benefits question.

The appeal

The worker appealed the Member's decision to reduce the weekly payments awarded, advancing four grounds: 

1. Section 46 should not have been applied at all; 
2. Her work capacity from the physical and psychological injuries were different; 
3. If section 46 applied, it should only operate so that combined payments did not exceed PIAWE (the “Alcan” approach); and 
4. Reliance on section 46 should have been notified in the insurer's dispute notice, and the Member erred in allowing leave to rely on the issue after the Application was filed.

President Judge Phillips dismissed the appeal on all grounds of the appeal.

Key findings

• Section 46 discretion engaged: The worker had two injuries, both suffered in the same employment and both resulting in incapacity for work to which the worker would be entitled to weekly payments – i.e. “benefits of the same kind” from the respondent over the same period.
• Focus on incapacity for work, not different restrictions: The President rejected the argument that different physical and psychological “restrictions” meant different incapacities. Section 46 directs attention to dual benefits “in respect of the incapacity for work”, not an injury‑by‑injury comparison of restrictions.
• No Alcan‑ style cap: The President held that section 46 does not prescribe a formula like the former section 40, and the Member's rejection of an Alcan‑style PIAWE cap contained no error.
• Notice and leave: The President held that, as a matter of principle, an insurer who intends to rely on section 46 is “duty bound” under section 78 of the 1998 Act to give clear notice of that reliance, but any defect was remedied by the Member's grant of leave under section 289A(4) of the 1998 Act after applying the usual considerations.

Conclusion

The decision confirms that concurrent weekly benefits will be payable where two different injuries each cause incapacity for work; however, by operation of section 46, there will be a discretion to reduce benefits payable to avoid dual payments.

A key consideration in determining if the discretion to reduce should apply is whether the reported incapacity for work in relation to both claimant is the same.

The Commission has also confirmed that the maximum payable for weekly compensation benefits in this scenario will be the maximum for the relevant operative section (be that ss 36, 37 or 38 of the 1987 Act), rather than allowing a top-up to the weekly PIAWE per se.

Critically, for the insurer to validly raise the issue of dual payments, the Presidential Member emphasised the insurer's duty to raise the relevant ground as part of a formal dispute, otherwise complying with sections 78 and 79 of the 1998 Act in the need to give notice of that issue.

Overall, the decision clarifies a preferred construction of section 46 of the 1987 Act, in keeping with the intent of the section. Insurers ought to be aware of dual payments as a potential issue for consideration in considering management of concurrent compensation claims.

Footnotes

1. Cordina Chicken Farms Pty Ltd v Thoa Hong Le [2008] NSWWCCPD 125.

2. ALCAN Australia Ltd v Jordan [1995] NSWCA 12.