These consolidated cases involve interpretation of the statutory scheme governing reexaminations of individuals granted disability retirement allowances under the Washington Law Enforcement Officers' and Fire Fighters' Retirement System Act (LEOFF). Appellants, a former Seattle police officer and a former Bellevue fire fighter, challenge the cancellations of their disability retirement allowances, arguing that such cancellations are improper absent a showing that the circumstances under which the allowances were originally granted *486have changed. We agree and hold that there must be some showing of a change of circumstances before a disability allowance may be canceled.
The facts of each case will be dealt with separately.
Malland
Appellant David Malland commenced employment as a Seattle police officer in March 1966. He was granted disability retirement effective November 1979 due to hearing problems.
RCW 41.26.130(5) and RCW 41.26.140 permit periodic reexaminations of LEOFF members who have been granted disability retirement allowances. Pursuant to these provisions, Malland was reexamined in 1982. The Seattle Police Pension Board determined Malland was no longer disabled and, following a hearing, canceled his disability retirement allowance. Malland appealed to the Director of the Department of Retirement Systems. The Director affirmed the local board, stating that a change or improvement in condition need not be proven because RCW 41.26 requires determinations of an individual's condition at different times.
Subsequently, a de novo hearing was held before an administrative law judge. At the administrative hearing, two medical doctors and an audiologist testified that Mal-land's condition had not improved since the original grant of disability. The experts, however, reached contrary conclusions on the central issue of whether Malland was still disabled. One doctor concluded Malland remained disabled. A second doctor, Dr. Sennewald, testified that Malland's condition did not prevent him from performing most of the functions of a police officer with average efficiency.
The administrative law judge concluded no change in medical condition need be shown to cancel a disability allowance but that Malland was still disabled. The Director agreed no change in condition need be proven, but concluded that Malland was not disabled. The Director therefore ordered cancellation of Malland's allowance.
*487Kuaimoku
Appellant Patrick Kuaimoku commenced employment as a Bellevue fire fighter in January 1969. Following a job-related back injury, Kuaimoku filed for disability retirement. The application was denied by the Bellevue Disability Board and the denial was affirmed by the State LEOFF Board.1 Kuaimoku appealed. Subsequently, in a March de novo administrative hearing, the hearing examiner concluded Kuaimoku was disabled from working as a fire fighter and granted him a disability allowance. No appeal was taken from this order.
Subsequently, Kuaimoku was reexamined and, in 1979, the Bellevue Disability Board canceled his disability allowance. Kuiamoku appealed and a hearing de novo was conducted pursuant to RCW 41.26.220.
At the hearing, two doctors testified that there had been no substantial change in Kuaimoku's medical condition. A third doctor would not express an opinion on whether his condition had changed because he had not examined him at the time of the initial disability hearing. The two doctors who testified on behalf of the City of Bellevue concluded that Kuaimoku was not disabled. They based their opinion on the lack of objective signs of back injury. Kuaimoku's doctor, who had first examined Kuaimoku in 1975 in conjunction with the initial grant of disability, stated that Kuaimoku was disabled from working as a fire fighter. In his opinion Kuaimoku's subjective symptoms had improved somewhat because he had learned to take better care of his back.
The hearing examiner concluded Kuaimoku had failed to show he was still disabled. The trial court reversed and remanded, ruling that the burden of proof had been improperly placed on Kuaimoku.
*488On remand before a different hearing examiner, the parties stipulated to use of the record from the prior hearing. The new examiner found, inter alia, that "[a]t the time of reexamination, Kuaimoku's back injury, though slightly improved, was essentially the same as at the time Kuai-moku was initially granted a retirement allowance." He found that Kuaimoku was still disabled and proposed an order reversing the cancellation of disability. The State LEOFF Board did not adopt this proposed order, however, and affirmed the cancellation. The State Board's finding of fact 9 provided: "At the time of reexamination Kuaimoku's back injury had improved somewhat from the time he initially was granted a disability allowance."
Kuaimoku again appealed. The trial judge affirmed, ruling that the State Board's order was neither "arbitrary and capricious" nor "clearly erroneous". The judge concluded that no change in medical condition or other circumstances need be shown to justify cancellation of a disability allowance. The judge further stated that even if such a change was required, the record supported the Board's finding of improvement in condition.
I
The issue presented in this case is whether a LEOFF Retirement System disability allowance may be canceled absent a showing that the circumstances upon which the original grant of disability was based have changed. The Department of Retirement argues that the issue of a claimant's continuing disability is to be determined de novo in a reexamination hearing, without reference to the initial determination of disability. We disagree.
Disability retirement may be granted only upon a finding by a Disability Board that the claimant's mental and physical condition disables the claimant from the further performance of his or her duties. RCW 41.26.120. This is not a finding of temporary disability. Separate provisions are made for temporary disability leaves. RCW 41.26.120. RCW 41.26.130(5) allows all members who were awarded disabil*489ity allowances before July 26, 1981, to be reexamined twice a year. However, this provision does not allow the Department to relitigate the issues resolved in the initial disability hearing. On reexamination, the Department is instructed to determine whether the member is "still unable to perform his duties”. (Italics ours.) RCW 41.26.140(1). Inquiry is focused on the continuing nature of the disability, thus implying that some change in circumstances must be shown before a disability allowance may be canceled. The burden of proving such a change in circumstances rests with the Department.
This interpretation of the statutory scheme is consistent with the judicial principles of finality and fairness embodied in the doctrine of collateral estoppel. The doctrine of collateral estoppel, or issue preclusion, seeks to prevent relitigation of previously determined issues between the same parties, to promote judicial economy, and to prevent harassment of and inconvenience to litigants. State v. Dupard, 93 Wn.2d 268, 609 P.2d 961 (1980). Without the requirement that some change in circumstances be shown on reexamination, the Department would be allowed to relitigate the same issues resolved in the initial disability hearing after the time for appeal has elapsed.
The requirements for application of collateral estoppel are: (1) identical issues; (2) a final judgment on the merits; (3) the party against whom the plea is asserted must have been a party to or in privity with a party to the prior adjudication; and (4) application of the doctrine must not work an injustice on the party against whom the doctrine is to be applied. Rains v. State, 100 Wn.2d 660, 674 P.2d 165 (1984).
The Department argues that the doctrine of collateral estoppel should not apply. It reasons that identical issues are not present in both proceedings because the initial disability determination and the reexamination deterr mination involve consideration of the claimant's medical condition at different times. We reject this argument. While evidence presented at the reexamination proceeding may *490describe the disability at a later point in time, if the disability is unchanged and there is no change in job requirements or the law governing disabilities, the difference in time periods is irrelevant. As recognized in the Restatement (Second) of Judgments § 27, comment c (1982), preclusion doctrines may apply despite temporal disparities:
Sometimes, there is a lack of total identity between the matters involved in the two proceedings because the events in suit took place at different times. In some such instances, the overlap is so substantial that preclusion is plainly appropriate. . . . [I]n the absence of a showing of changed circumstances, a determination that, for example, a person was disabled ... in one year will be conclusive with respect to the next as well.
The remaining requirements for application of collateral estoppel are satisfied. The initial determination of disability is a final judgment, the local disability boards and the Department are parties in both proceedings, and no injustice will result from application of collateral estoppel.
Collateral estoppel may bar relitigation of issues determined by an administrative agency if (1) the agency, acting within its competence, has made a factual decision and (2) application of the doctrine does not contravene public policy. Dupard, at 275. In determining whether an applicant is entitled to a disability allowance, disability boards act in a quasi-judicial capacity to resolve disputed issues of fact. Further, application of collateral estoppel does not contravene the purposes of RCW 41.26. The statute was passed to provide an actuarial reserve system for the payment of retirement and disability benefits to law enforcement officers and fire fighters. RCW 41.26.020. While the fiscal stability of the system is important, fairness and finality are also important since an important purpose of the system is to encourage police officers and fire fighters who are not able to adequately perform their duties to leave their jobs.
The application of the doctrine is limited by the terms of the statute. Collateral estoppel does not apply to the award *491of a disability allowance since the statute allows the Department to return members to active duty. The doctrine does require that the Department show a change in circumstances to cancel a disability award, since the disabling effect of an established medical condition under previously existing circumstances may not be relitigated.
We do not require the Department to prove an objective improvement in the claimant's medical condition in all cases. Adaptations to physical disabilities, compensation for physical limitations and changes in equipment or job requirements are also changes in circumstances, evidence of which could be presented by the Department to support its position that a claimant is no longer disabled. A claimant's current job or other activities may be evidence of an improved medical condition or of adaptation to a medical condition, but the Department must also offer evidence that the ability to participate in such activities demonstrates an ability to perform all necessary job duties.
This decision precludes the Department from canceling a disability allowance on the basis of new expert testimony that the claimant's unchanged medical condition does not prevent the claimant from performing unchanged job duties or new medical testimony that the claimant's medical condition was incorrectly diagnosed at the time of the initial disability hearing.
II
Having determined that the Department must prove a change in circumstances to cancel a disability allowance, we turn to the cases of Malland and Kuaimoku.
In Malland's case, the Department applied the wrong standard in making its determination. In his conclusions of law, the Director stated:
RCW 41.26.140 requires a determination as to whether a retiree is "still unable to perform his duties". Thus, the employer and state as part of its burden need not show a change of conditions. Rather, the determination is whether the appellant is currently able to perform the duties of police officers with average efficiency.
*492Conclusion of law 3. By concluding that no change of conditions need be shown, the Director erred in interpreting the statute, and applied this erroneous interpretation to the facts of the case.
Even had the Director applied the correct standard, the Department did not present sufficient evidence to carry its burden of proof. It is undisputed that Malland's medical condition is unchanged. Our opinion today precludes consideration of Dr. Sennewald's testimony that Malland's medical condition would not prevent Malland from performing his duties as a police officer. His testimony is merely new expert testimony on an issue previously litigated at the initial hearing. The mere fact of Malland's current employment as a safety engineer for an insurance company and of his membership in the Coast Guard Reserve is not evidence of his ability to perform the duties of a police officer absent testimony that those activities demonstrate such an ability. Consequently, we reverse the cancellation of Malland's disability retirement allowance.
In Kuaimoku's case, the Retirement Board found that "[a]t the time of reexamination, Kuaimoku's back injury had improved somewhat from the time he was initially granted a disability retirement allowance." Judicial review of the administrative agency's finding of fact is governed by the clearly erroneous standard of RCW 34.04-.130(6)(e). See RCW 41.26.220. A finding of fact is clearly erroneous '"when although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed."' Franklin Cy. Sheriffs Office v. Sellers, 97 Wn.2d 317, 324, 646 P.2d 113 (1982) (quoting Ancheta v. Daly, 77 Wn.2d 255, 259-60, 461 P.2d 531 (1969), cert. denied, 459 U.S. 1106 (1983)).
Although there is some evidence to support the Department's finding, having reviewed the record, we are convinced a mistake has been committed. The doctors who examined Kuaimoku testified that his back condition was unchanged. The record reveals that the doctors who testi*493fied that Kuaimoku's subjective symptoms had improved attributed this to the fact that Kuaimoku had been "pampering his back". This testimony does not support an inference that Kuaimoku could work as a fire fighter because his back condition had improved. Rather, it supports an inference that Kuaimoku's condition had improved only because he was not working as a fire fighter. Consequently, we reverse the cancellation of Kuaimoku's disability retirement allowance.
In light of our holding that the doctrine of collateral estoppel applies to reexamination proceedings, we need not address appellants' arguments concerning the applicability of res judicata, the doctrine of finality, the law of the case, or the definition of disability.
The cancellations of appellants' disability retirement allowances are reversed.
Williams, C.J., Dolliver and Pearson, JJ., and Cunningham, J. Pro Tern., concur.
The 1982 Legislature abolished the Washington Law Enforcement Officers' and Fire Fighters' Retirement Board and transferred all of its powers, duties, and functions to the Director of the Washington State Department of Retirement Systems. RCW 41.26.051.