AAP Information Services Pty Limited v Hanson
[2009] NSWWCCPD 24
•11 March 2009
| WORKERS COMPENSATION COMMISSION | ||||||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | ||||||
| CITATION: | AAP Information Services Pty Limited v Hanson [2009] NSWWCCPD 24 | |||||
| APPELLANT: | AAP Information Services Pty Limited | |||||
| RESPONDENT: | Gordon William Hanson | |||||
| INSURER: | GIO General Limited | |||||
| FILE NUMBER: | A1- 004384/08 | |||||
| DATE OF ARBITRATOR’S DECISION: | 9 October 2008 | |||||
| DATE OF APPEAL DECISION: | 11 March 2009 | |||||
| SUBJECT MATTER OF DECISION: | Psychological injury; whether the condition complained of constituted an ‘injury’ within the meaning of section 4 of the Workers Compensation Act 1987; whether the claimed injury was as a result of misperception of conduct which actually occurred in the workplace; whether the injury was as a result of reasonable action by the employer in relation to transfer and/or discipline. | |||||
| PRESIDENTIAL MEMBER: | Acting Deputy President Deborah Moore | |||||
| HEARING: | On the papers | |||||
| REPRESENTATION: | Appellant: | Sparke Helmore Lawyers | ||||
| Respondent: | CMC Lawyers | |||||
| ORDERS MADE ON APPEAL: | 1. The decision of the Arbitrator, dated 9 October 2008 is revoked and the following decision is made in its place: | |||||
| (1) Award in favour of the Respondent. | ||||||
| (2) No order as to costs. | ||||||
| 2. No order as to costs of the appeal. | ||||||
BACKGROUND TO THE APPEAL
On 6 November 2008 AAP Information Services Pty Limited (‘the Appellant / AAP’) sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission (‘the Commission’) against a decision dated 9 October 2008.
The Respondent to the Appeal is Gordon William Hanson (‘the Respondent / Mr Hanson’).
No formal statement was given by Mr Hanson, and I have set out the background to the claim by reference to the Arbitrator’s ‘Statement of Reasons’ (‘Reasons’) and other documents.
Mr Hanson commenced employment with AAP in 1987 as a manager in the finance section. He was responsible for the company’s specialised financial computing system. In 2001 there was a restructure whereby he was transferred to the central computing section, the Integrated Technology Group (‘ITG’). He was under the supervision of the Computer Operations Manager, Mr Paul Bland.
In the ITG, Mr Hanson’s duties and responsibilities were essentially the same. He was responsible for the upgrade of the old financial computing system. This was a staged process whereby temporary upgrades were installed while a new system was being investigated. There appear to have been difficulties in finding an adequate replacement for the old system. Mr Hanson claimed that he was kept “out of the loop” with regard to the proposed replacement. On completion of the temporary upgrade in March 2006, Mr Hanson installed a new password. He then went on leave in September 2006. While he was away, the company was unable to access the system because it did not have the password. On his return he was asked to attend a meeting with Mr Bland and Ms Bridge from the human resources department on 12 October 2006. It was claimed that Mr Hanson had not followed the correct protocol in respect of passwords. A verbal warning was given to him at this meeting.
Since his transfer in 2001, Mr Hanson claimed that he felt “sidelined” and “underemployed”. He was part of a section of administrative personnel but retained his former title and salary as manager. Events came to a head on 8 May 2007. Mr Hanson was asked by Mr Bland to file some CDs. He responded that this was not his job; he was not a filing clerk; he would not do it. He returned the CDs to Mr Bland’s desk. When he then briefly left his own office, he returned to find that the CDs had again been placed on his desk. He then left work and immediately consulted his general practitioner, Dr Lodin, the same day. He has remained off work since.
Mr Hanson made a claim for compensation on AAP’s insurer, GIO General Limited (GIO) which was denied by letter to him dated 27 July 2007.
On 11 June 2008 Mr Hanson filed an ‘Application to Resolve a Dispute’ (‘the Application’) in the Commission seeking weekly benefits of compensation from 8 May 2007 to 8 May 2008. At the conciliation / arbitration hearing held on 20 August 2008, the claim was amended to include an ongoing claim for weekly benefits. The hearing resumed on 17 September 2008 when Mr Hanson gave brief oral evidence recorded in a transcript of that date. The Arbitrator accepted that Mr Hanson had suffered an injury within the meaning of section 4 of the Workers Compensation Act 1987 (‘the 1987 Act’) and awarded him weekly benefits pursuant to sections 36 and 37 of that Act from 8 May 2007 to date and continuing.
It is from this decision that AAP seeks leave to appeal.
THE DECISION UNDER REVIEW
The ‘Certificate of Determination’, dated 9 October 2008 records the Arbitrator’s orders as follows:
“1.The Respondent is to pay the Applicant weekly compensation pursuant to section 36 of the Workers Compensation Act 1987 (the Act) at the rate of $1012.83 per week from 8 May 2007 to 6 November 2007 and thereafter at the statutory maximum pursuant to section 37.
2.The Respondent is to pay the Applicant’s costs as agreed or assessed. I declare that the matter is complex and that there be an uplift on costs of 25%.”
THE ISSUES IN DISPUTE
AAP has identified seven grounds of appeal alleging the Arbitrator:
(a). made a decision that was not supported by the available evidence.
(b)failed to provide proper reasons in support of the decision.
(c)placed undue weight on the worker’s medical evidence in the form of medical certificates from the worker’s general practitioner.
(d)erred in her interpretation of the Appellant’s case.
(e)misapplied the relevant case law.
(f)made a decision in respect of incapacity which was against the weight of the evidence, and
(g)applied the wrong standard of proof.
The issues in dispute set out in AAP’s submissions however, are principally twofold: firstly, whether the Arbitrator erred in her finding that Mr Hanson suffered an injury within the meaning of the 1987 Act, (the ‘injury’ issue) and secondly, whether the Arbitrator erred in her finding that he was totally incapacitated from 8 May 2007 ( the ‘incapacity’ issue). Sections 9A and 11A of the 1987 Act are also relevant in the context of the ‘injury’ issue.
ON THE PAPERS REVIEW
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) provides:
“(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submission by both parties that the appeal can proceed to be determined on the basis of these documents, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.
LEAVE
Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act.
The appeal meets the monetary threshold as set out in sections 352(2)(a) and (b) of the 1998 Act.
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.
Leave to appeal is granted.
THE EVIDENCE
Mr Hanson’s Evidence
As I said earlier, no statement was attached to Mr Hanson’s Application, however, a brief statement, undated, was tendered at the hearing. I will refer to that document later.
Mr Hanson relied upon a series of medical certificates from his treating general practitioner, Dr Lodin. Those commenced on 8 May 2007 and continued up to 11 May 2008. In all those certificates, Dr Lodin diagnosed “Anxiety Adjustment Disorder” and certified Mr Hanson unfit for work.
Mr Hanson consulted Mr Gerry Wenzel, psychologist, at the request of his solicitors on 28 September 2007. In a report dated 9 October 2007, Mr Wenzel diagnosed “ acute adjustment disorder with mixed anxiety and depressed mood.” He considered that the prognosis was favourable but could not put a time frame on Mr Hanson’s recovery. He agreed with Dr Lodin that Mr Hanson was currently unfit for work but that:
“ In the long term Mr Hanson is likely to recover sufficiently to be able to resume a management position of a similar capacity but he should at no time return to work with his former employer given the breakdown in relations and inherent distrust towards his employer’s motives.”
Mr Wenzel nonetheless thought that Mr Hanson “…would be fit to do some type of part time work but this would also need to be with a different employer.”
As to the history, Mr Wenzel noted that Mr Hanson considered that “…the onset of his problems essentially began in July of 2001.” He continued as follows:
“Mr Hanson noted that as early as 2001 the system that he had inherited was already obsolete. At that time the company had already undertaken several feasibility studies looking into buying a more up-to-date system but no action was taken until early 2006.
Whilst waiting for the new system to be set up Mr Hanson was then involved in transferring the existing material onto another second-hand system that had greater capacity than the one that was being used. This system was in fact only a temporary measure whilst waiting to set up a new system in 2007.
In setting up the new system Mr Hanson was required to establish a password.
Late in September 2006 Mr Hanson was on holidays…he received a phone call from his daughter advising that there had been problems at work…he rang his workplace but was told that everything was sorted out…After returning to work Mr Hanson received an email advising him…to attend a meeting with his manager and the HR manager. The nature and reason for the meeting was not given at that time.
…when he arrived at the meeting he was challenged about the fact that he had changed the password on the computer system without documenting the change. He challenged this view as according to him he had set the password and given it to the company’s computer services as was standard practice. It appears someone in that setting had failed to document the password rather than Mr Hanson not notifying anyone of the new password.
Mr Hanson was subsequently informed that the meeting would be treated as an official verbal warning despite the fact that he had not done anything procedurally wrong…
As such reasons provided by the insurer for disputing liability which included that the verbal warning was reasonable action by the employer is open to being questioned. It was not Mr Hanson’s responsibility once he had notified computer services at AAP that this information could not be found when he was away on annual leave.
Mr Hanson was of the view that since being moved into this new area in 2001 he had essentially ceased working in a management capacity and was rather working in an administrative one. This was in fact reflected by the discrepancy in pay with him being on significantly higher income than most of the people working with him…
Mr Hanson was of the view that he was being deliberately held back from doing his work appropriately with him being worried that this was a way of stalling for time and thereby compromising him if the system was not ready to go by the start of the financial year.
Mr Hanson reported that the final act at work that caused him significant stress occurred in May 2007. At that time he was asked to do another trivial task of filing computer discs which according to him was not part of his usual level of work…
A confrontation and stand-off ensued in the work place with him feeling troubled with increased symptoms of anxiety and tension at that time which prompted him to leave the work place and seek a medical opinion from his doctor……he felt that his management career essentially stalled and ended once he had been moved into the finance department following the dismissal of his former boss on fraud charges.
Mr Hanson was also concerned about his long term job prospects as in his summation there was a high probability that he would be terminated from his job once the new computer system was up and running…”
Mr Wenzel noted that Mr Hanson’s symptoms included elevated blood pressure and a flare up of a long-standing condition of ulcerative colitis.
Mr Hanson also consulted Dr Andrew McClure, consultant psychiatrist, on 4 March 2008, again at the request of his solicitors. He obtained a similar history, noting Mr Hanson’s transfer to the “ITG” department in July 2001. He recorded a number of other matters as follows:
“Mr Hanson still had charge of a specialised accounting system…no one else knew how to operate the system and therefore Mr Hanson, though he requested redundancy at that stage, was ‘kept on’.
Two abortive attempts were made over a number of years to replace the ageing system. Mr Hanson was’ kept out of the loop’ regarding the mooted replacements.”
Dr McClure also recorded that Mr Hanson felt “sidelined” following the meeting in October 2006 regarding the password, and that in recent years at AAP he had “basically felt underemployed.” He noted that Mr Hanson had asked for a redundancy in 2001:
“but there had been no response. In 2005 he saw ‘Human Resources’ again asking for a redundancy because he had been’ virtually demoted’ but was told that there were ‘no grounds’ to make him redundant.
On 8 May 2007 after the altercation with his manager, whose behaviour Mr Hanson felt was rude and demeaning, your client felt a combination of ‘agitation, anxiety and anger.’ He felt ‘targeted by Mr Bland who he believes had previously forced other staff members to resign’.”
Dr McClure confirmed the “likely diagnosis” of “Adjustment Disorder with Mixed Anxiety and Depressed Mood.” He noted that Mr Hanson had only been referred to a psychologist in the last month, and had not been taking any psychotropic medication. His medication was for hypertension and ulcerative colitis. Dr McClure considered that Mr Hanson was unfit for his pre-injury duties since “the difficulties in his relationship with Mr Bland have not yet been resolved…” but that he was fit for alternative duties. He also regarded the prognosis for recovery as “good.”
That was the extent of the evidence relied upon by Mr Hanson in his Application.
At the Arbitration on 20 August 2008, Mr Hanson gave brief oral evidence principally in relation to his meeting with Mr Bland and Ms Rebecca Bridge in October 2006. Mr Hanson said that he initially entered the password in March 2006 and gave notice of it to Ms Effie Pappas, the supervisor at “Communication Services.” He said that the protocol for keeping the password was to put it in an envelope and lock it in a drawer. He denied that he had ever changed the password between March 2006 and the meeting in October 2006. At the meeting, he said that he told Mr Bland and Ms Bridge that “I had set the password and it hadn’t changed since day one.” He denied telling Mr Bland that he had made a “ mistake” in relation to the password. [Transcript pages 5-7].
After this evidence, the matter was then adjourned to allow AAP to respond to this hitherto unknown evidence. When the hearing resumed on 17 September 2008, Mr Hanson was cross-examined on his earlier evidence. [Transcript pages 15 – 19]. He repeated that the password had not changed since it was installed in March 2006. He could not explain why the company had been unable to access it in his absence, except to say that he had given it to Ms Pappas, but that she had told him after the meeting in October 2006 that the company had been unable to find it. (Ms Pappas denied this version of events.) Mr Hanson then said that:
“After I came back from holiday, when I found that the password had again been changed, I changed the password at that stage in October 2006 after the meeting…and then gave her [Ms Pappas] another copy, which is what I’m supposed to do”. [Transcript page 19]
Mr Hanson also tendered a short undated statement at that hearing which simply responded to the matters raised by Mr Bland and Ms Pappas in their statements dated 27 August 2008 and 25 August 2008 respectively.
AAP’s Evidence
In it’s Reply, AAP included a detailed report from the Centre for Corporate Health Pty Limited dated 8 June 2007, under the hand of Ms Jennifer Driver, consultant psychologist. The report included a psychological assessment of Mr Hanson from Ms Driver, and statements she obtained from Mr Paul Bland and from Mr Peter Woods, the director of the ITG group. The report also included her summaries of both Mr Hanson’s and AAP’s “account of precipitating factors”. Mr Hanson also undertook formal psychometric testing.
Another detailed ‘factual’ report was prepared by All States Investigations and Corporate Protection Group on 10 July 2007. This report contained statements from Mr Bland, Mr Woods, and three fellow employees. Other documents from AAP were also included.
Following the initial hearing on 20 August 2008, AAP sought and was granted leave to obtain evidence from Ms Pappas and further evidence from Mr Bland. A statement from Ms Pappas dated 25 August 2008, and from Mr Bland dated 27 August 2008, was admitted into evidence at the further hearing on 17 September 2008, as was a file note relating to the meeting on 12 October 2006.
The material produced by AAP was extensive. I have read it carefully, as I have read the material relied upon by Mr Hanson. I do not propose to set it out in detail in this decision but rather summarise the more important allegations and incidents.
Ms Driver conducted a lengthy assessment of Mr Hanson. She obtained details of his background, work and medical history. She then set out extensive details of “Claimant’s account of precipitating factors.” Many of these correspond to the matters described by Mr Wenzel and Dr McClure but I will set out a summary of Ms Driver’s account of Mr Hanson’s claims. She noted:
(a)When the restructure occurred [2001] “the wheels started to come off”.
(b)His role was then significantly changed.
(c)He was no longer responsible for overseeing staff.
(d)He was no longer given any managerial responsibilities and had “no control” over how and when things occurred with the computer system.
(e)The scope of his duties was significantly reduced and became more administrative.
(f)He had previously had responsibility for all of the computer systems including planning, implementation, and maintenance of the server and network. In the ITG area, his duties were predominantly with VMS operations, which required special skills which only a few (including Mr Hanson ) had.
(g)He assumed that his position with ITG was temporary and that he’d be offered redundancy. His attempts to discuss this with Mr Woods were unproductive.
(h)Whilst he was unhappy with his duties in ITG, he believed it would be difficult to obtain other employment, and that redundancy would be offered. Instead, he has been “effectively shoved to one side and demoted.”
(i)He believed that the only reason that redundancy was not offered was because of his specialised knowledge of the VMS and that as this system was to be superseded in July 2007 there was no need to keep him on.
Ms Driver then set out details of the “password” incident in 2006 which generally accorded with other accounts given by Mr Hanson. She noted Mr Hanson’s comments on this incident as:
(a)At this time [October 2006] the workplace was “ moving toward trying to sack me” and that “they seem to be trying to back me into a corner” because they want me to leave.
(b)He speculated that the reason for this was due to the expense of maintaining him on his high salary, well in excess of his colleagues in ITG.
(c)He had not received any support from the workplace. When he raised the issue of redundancy with Ms Jenny Wright in Human resources in 2004 or 2005 he was told that as long as the workplace continued to pay him he had “nothing to complain about.”
(d)As to the incident with filing the discs in May 2007, Mr Bland was laughing when he told him to do this task. He told Mr Bland he would not do it. He believed that Mr Bland was trying to provoke him so that he would be issued with another conduct warning.
(e)Since 2001, Mr Bland had failed to provide him with any training in certain computer systems but was unable to quantify how this alleged lack of training impacted on his daily functioning.
Ms Driver noted that Mr Hanson rated his relationships with his colleagues as good but poor with Mr Bland whose approach was “bullying and domineering.” Mr Hanson ranked the change in workplace structure as the principal cause of his “current distress” stating that the alleged discriminatory behaviour from Mr Bland and the conduct warning were the least distressing.
Her conclusion following her psychological examination of Mr Hanson was as follows:
“…while Mr Hanson is likely experiencing ongoing symptoms of distress at the current time, it is not deemed to be at a clinical level…Mr Hanson’s tendency to be suspicious of others’ intentions, his reluctance to admit his own shortcomings, and his accumulating occupational discontent have likely substantially contributed to his current distress, whereby these factors have likely fuelled his perception that the workplace are attempting to force him to leave. These factors are likely substantial in contributing to his recent subclinical distress levels.”
Ms Driver also interviewed Mr Peter Woods, Director of the ITG. He subsequently signed a statement dated 13 June 2007 endorsing Ms Driver’s account of the interview. Relevant points are:
(a)He has known Mr Hanson since he commenced with AAP in 1987.
(b)A decision was made in 2001 to amalgamate the finance system with other computer systems so that Mr Hanson’s role was moved to ITG.
(c)The only change in Mr Hanson’s status was that he then became accountable to the Computer Services Manager, Mr Bland.
(d)None of Mr Hanson’s duties became obsolete since the same financial system was maintained.
(e)Mr Hanson was never responsible for managing staff when he was based in the finance area. The title of ‘manager’ was an “anomaly” and was retained on his transition to ITG as there was no specific reason to change his title.
(f)Mr Hanson was not happy with the change in 2001 but Mr Woods could not recall the reasons for this.
(g)There were rumours in the company that Mr Hanson wanted to be made redundant, but Mr Hanson never approached him about this directly.
(h)It would not have been reasonable for Mr Hanson to ask for redundancy since there was no change in his job function.
(i)There are plans to implement a new finance system in July 2007 which will not affect Mr Hanson’s role since it is merely a technology upgrade. Training in this new system has been arranged for Mr Hanson but he is currently on leave.
(j)He did not want Mr Hanson to leave in 2001 after the changes because he was the only system administrator with knowledge across all of the finance system.
(k)He was aware of the ‘password’ incident in October 2006 but not directly involved in addressing this issue.
(l)Mr Hanson had taken a lot of leave in the past 12 to 18 months but medical certificates did not cite the reasons, and he did not give any to Mr Woods.
(m)He was unaware of any conflict in Mr Hanson’s relationships with his colleagues.
(n)Mr Hanson had not been treated any differently by people since his move in 2001, and he continues to liase with many of the same employees such as engineers and computing staff.
(o)Mr Bland’s management style is direct but not aggressive or confrontational, and there have been no complaints from staff in relation to Mr Bland’s approach.
(p)He is unaware of any specific factors contributing to Mr Hanson’s claim, and he has never observed any signs or symptoms of distress in Mr Hanson.
Ms Driver interviewed Mr Paul Bland, the Manager of ITG. He also subsequently signed a statement on 13 June 2007 endorsing the contents of the interview. Relevant points, additional or varying from those made by Mr Woods, are as follows:
(a)Mr Hanson’s original title and salary were retained when he moved to ITG and there were no changes to his duties and responsibilities, although he has taken on a few additional duties, predominantly setting up user accounts.
(b)Mr Hanson seemed unhappy about the move to ITG.
(c)His salary remained the same, significantly higher than other administrators in that group. Due to this discrepancy, Mr Hanson had not received an increment in his pay in the past 3 to 4 years. He was given an opportunity to discuss this with Mr Woods and Human Resources but chose not to do so.
(d)Due to this discrepancy, Mr Hanson was asked to take on some additional minor duties.
(e)He has heard from other staff that Mr Hanson has made remarks about the possibility of obtaining redundancy. This was not a reasonable option since Mr Hanson’s role was still important, and someone else would need to be hired to replace him.
(f)Mr Hanson was aware that his function in the finance system, despite new software, had not changed, and that he was aware that training would be provided to him in relation to the new system scheduled to occur during his current absence.
(g)Mr Hanson was never denied access to training and had never requested additional training. All employees are able to submit requests for training.
(h)At the meeting in October 2006 in relation to the ‘password’ incident, Mr Hanson said that he had informed 2 other ITG staff of the password. When Mr Bland checked this with the nominated staff, they denied that this occurred. Mr Hanson also said that he had told an Operator of the password, but when asked for details, he could not recall the name of the Operator. Mr Bland spoke to the Operators and none could recall having been told.
(i)Mr Hanson did not appear to appreciate the seriousness of this incident. He was told that the incident would be noted on his file, and correct protocol was reiterated.
(j)He was not aware of any specific difficulties with Mr Hanson whom he described as a “nice bloke”.
(k)He described his own management style as “easy going but fair” and that he provides a flexible working environment.
(l)Mr Hanson’s current absence was unexpected, and he was unaware of the factors which may have precipitated it.
(m)He recalled the incident with the box of discs. He did not ask Mr Hanson to file them, but simply left them on his desk. This was the usual procedure with all the administrators who were familiar with this process. Mr Hanson had previously been responsible for this task. It was a job shared amongst all administrators in ITG and was within Mr Hanson’s role. The administrator who had previously been attending to this task was on leave at the time. He observed that the box had been moved to another administrator’s desk and he moved it back to Mr Hanson’s desk although he was not present at the time.
(n)He was unsure if this was an issue with Mr Hanson since he had not spoken to him about it
(o)He had never observed any signs or symptoms of distress in Mr Hanson.
Mr Bland provided a further statement dated 27 August 2008, following the initial hearing before the Arbitrator, and in response to the oral evidence Mr Hanson gave.
That statement essentially elaborated on the ‘password’ issue. Mr Bland said:
(a)When Mr Hanson was on leave, there was a requirement to boot the finance system and give login details. None of the login details we had on file were correct meaning that the system login details had been changed, and the changes were not given to the computer operations staff. All passwords were tried but to no avail, and eventually the system was accessed via a back door.
(b)As a result of the severity of this incident, it was agreed that disciplinary action was appropriate. Rebecca Bridge from Human Resources and I attended a meeting with Mr Hanson in 2006, but I don’t recall the date.
(c)Mr Hanson did not follow the correct protocol in relation to providing and updating the password for the finance system.
(d)To my knowledge, Mr Hanson did not give a password or a note with a password to anyone before he went on holidays. If he had given the password to someone, there would not have been a need to access the system via a back door.
Annexed to this statement was a File Note made by Ms Bridge following the meeting on 12 October 2006 which Mr Bland confirmed was an accurate record of the meeting. Ms Bridge was present to ensure that the discussion was fair and that Mr Hanson was given an opportunity to respond. Ms Bridge noted:
(a)The reason for the warning was discussed and all the circumstances surrounding the failure to access the system were explained.
(b)Mr Hanson initially stated that the password had never changed from day one.
(c)Mr Bland said it must have because the password on file did not work.
(d)Mr Hanson then named two fellow employees to whom he had given the password. They were contacted but neither of them knew the password.
(e)Mr Hanson then said that he had followed the correct procedures and given the password in an envelope to someone in Computer Operations, whose name he could not recall.
(f)Ms Bridge reiterated that an extensive investigation had been done to try and locate the password without success such that it would appear that at some point the correct procedure was not followed.
(g)Mr Hanson confirmed that he knew the procedure and that he still believed that he had followed it.
(h)Mr Hanson was advised that a file note would be made.
Ms Effie Pappas made a statement dated 25 August 2008, again in response to Mr Hanson’s evidence before the Arbitrator. Ms Pappas said:
(a)At no time in late 2006 did Mr Hanson hand me a note containing a password.
(b)I recall that I received the password in question when Mr Hanson returned from holidays but I don’t recall the exact date but it was in late 2006.
(c)If Mr Hanson had given me a note containing a password I would have put it on a USB stick then printed it out and put it in an envelope in a locked drawer which is standard procedure.
The report prepared by All States Investigations( ASI) dated 10 July 2007 also contained statements from Mr Bland and Mr Woods, both dated 12 June 2007. Those statements essentially reiterate the matters described by Ms Driver, although in much greater detail. I do not propose to refer to them in any great detail however, given the scope of the dispute in this matter, I think it is important to set out relevant extracts, although they are somewhat repetitive. Statements were also obtained from Ms Jenny Murugesan, System Administrator, dated 6 July 2007, Mr Roy Houssarini, Computer Services Operator, dated 6 July 2007, and Mr Gary Anderson, Systems Administrator, also dated 6 July 2007. They all provided details of their respective observations of Mr Hanson in the workplace. I will refer to them shortly.
The ASI report also contained a short statement from Ms Jennifer Wright, Human Resources Manager. She said:
“Towards the end of 2004, I am unsure of the exact date, Gordon Hanson came to see me saying he was unhappy with his pay increase. I told him he is being paid at the highest level for his position and AAP could not increase his salary any further. He then said he felt he should be entitled to a redundancy. I told him that is not an option as a redundancy only occurred when a position was no longer required for operational reasons and this is not the case with his position. He did not appear to be very happy with this outcome.”
In his statement dated 12 June 2007, Mr Woods said:
“Gordon did not express any concern to me about the change [in 2001] in the area he worked in and for 18 months he was the only one that knew the system. I do not believe that Gordon’s role changed, just his reporting line changed.
I do not know if Gordon had been involved in any management or planning and development and I would question how much of that was needed in Finance as the system had not changed for so long [20 years].
We are developing a new system and I would expect that Gordon would not have been involved in the planning and development of the new system. Gordon’s managers in Finance would have been responsible for selecting a product. IT’s role in the process was just to give advice…this is a policy issue and does not require input from staff…the new finance system is a standard Microsoft environment so limited consultation was needed.
Gordon was marked to be on the training for the new finance systems and he is the primary administrator to the finance system so his job is essential and ongoing.
There was never a threat of Gordon being made redundant.
Gordon and Paul [Bland] always seemed cordial and I am not aware of any issues between Gordon and Paul. Gordon had not approached me and advised me about any concerns he may have had about Paul. Under our grievance procedure if any staff have an issue with Paul they have the right to come and speak to me or HR.
I was advised of the verbal warning and Gordon had the right to come to me if he thought it was unwarranted but he did not approach me.
I do circulate in the IT area and I think if there was something overt going on between the staff I think I would notice.”
Mr Bland’s statement of 12 June 2007 covers matters already dealt with, but some further comments he made are worth noting. He said:
“I would describe my relationship with Gordon as being fine. I had no problems discussing issues with the finance systems with him and I often spoke with him.
I would describe my interaction with Gordon as professional. I am a manager that asks people to do things and I am fair and reasonable…I consider myself to be easygoing in most circumstances. I have been managing staff for ten years without any problems. Most days I would speak with Gordon four or five times per day and he did not express any concerns to me. I did not notice any change in Gordon’s demeanour. He was very cooperative and he always is.I am not aware of any animosity or ill feeling between Gordon and myself… I am happy to have him as part of the team.”
In his statement of 6 July 2007 Mr Houssarini said:
“When Gordon was on leave I was the operator on shift…
We needed to get into the system to restart it and the password we had did not work.No one knew the new password as they had the same one as me. This meant that the password had been changed and we were not notified.
Gordon called me from Hong Kong …he provided me with a different password to the one I had which worked. In this period…one of the administrators found an alternate way to get into the system.
We all contact each other when we are on leave if we need to know something and Gordon has been called a number of times and he has not objected to that.
I have seen Gordon and Paul Bland interacting on several occasions and I did not notice any tension between them.
I would describe Paul’s management style as being getting the job done but he is not a people person. Paul has quite an assertive manner but I have not seen him bully anyone.”
Mr Anderson said in his statement dated 6 July 2007:
“I have known Gordon Hanson for seven years. For the last two years I have been sitting next to him.
I did not notice anything out of the ordinary in relation to the relationship between Paul Bland and Gordon.
We are in an open plan office so what happens is open and easily visible to staff. I have never seen Paul target anyone in the office. Over the last few years I have not seen Paul bully any staff member. Paul seems to try and get along with staff and interact on the same level.”
In her statement of 6 July 2007, Ms Murugesan said:
“I have known Gordon Hanson for four years and I have worked in the same area as him for the last two years.
I have always found Gordon to be very friendly and easygoing. I have not noticed any change in his demeanour over the last 12 to 18 months.
I have found Paul to be a good manager. I have never found Paul to be a bully or domineering.
I have seen Gordon and Paul interacting. I always thought that Paul liked Gordon. I have never noticed any tension between them…
I have never seen any behaviour from any staff member which would leave me with the impression that they were trying to force Gordon out of the workforce.
I do not know anything about the CDs.I did not notice anything unusual about Gordon in the two weeks prior to him going on extended leave and he did not express any concerns to me about anything.”
Other documents included in the ASI report were numerous medical certificates. Some identified the reason for absence, but many did not. A document titled “Grievance and Fair Treatment Resolution Procedure” was also attached It set out in some detail procedures to resolve workplace issues.
THE ARBITRATORS’ FINDINGS
The Arbitrator briefly summarised the statements of Mr Bland and Mr Woods by reference to the evidence of Mr Hanson. That evidence was essentially his account of events given to Mr Wenzel and Dr McClure. The Arbitrator was critical of the report of Ms Driver stating that it was not “medical evidence” and was “ …an amalgam of a diagnosis by Ms Driver herself and an investigation also conducted by Ms Driver.” The Arbitrator said at [28]:
“As noted above the Respondent does not have any evidence from a medical practitioner. The Respondent relies on a report of Ms Driver, psychologist. Having regard to this conflict in the evidence in respect of the Applicant’s diagnosis, I find that greater weight should be placed upon the opinion of the treating general practitioner. His diagnosis is supported by a consultant psychiatrist and also a qualified clinical psychologist…I prefer the evidence of the Applicant to that of the Respondent and find that he does have a psychological condition within the meaning of DSMIV, being an Adjustment Disorder with mixed anxiety and depressed mood.”
The Arbitrator continued at [29]:
“In relation to the issue of whether the psychological condition arose out of or in the course of employment with the Respondent, I note that the Respondent claims that if there is a psychological injury then it arose as a result of a misperception.”
The Arbitrator then set out the “facts” as she saw it. She set out the history of events as described in the various statements to which I have referred before concluding at [36] – [38] as follows:
“36.Both Mr Bland and Mr Wood[s] stated that the Applicant’s position was not under threat. Mr Bland also stated that he was not treated any differently to other staff by him. Other staff members have given statements that they have not observed any conflict between Mr Bland and the Applicant, nor have they observed the Applicant to be targeted by Mr Bland.
37.There is however simply no dispute that the Applicant held an anomalous position. He retained his former title even though he was not a manager in the ITG. He had less work than his comparable co-workers and yet was paid significantly more than them, possibly the same as Mr Bland himself. Mr Bland’s evidence is that while other employees in ITG did think the Applicant should take on extra work, they were unaware of the salary anomaly. The evidence from Mr Bland is that while in the past the Applicant was the only person responsible for the specialised computer accounting system there was a plan to have more than one person. The evidence of the Applicant is that he was ‘kept out of the loop’ in respect of changes to the computing system. This appears to be confirmed by Mr Wood[s].
38.Having regard to the evidence in it’s entirety I do not find that the injury was as a result of a misperception based upon innocuous events, nor of imagined events. I find that the Applicant’s perception that he was being sidelined and that his position was at risk was rational. This perception may not have been correct, however I find that it was rational in the circumstances of this work environment.”
The Arbitrator concluded that employment was a substantial contributing factor to the injury stating at [47]: “the evidence is that it was the Applicant’s concerns about the workplace that contributed to the injury.”
The Arbitrator then turned to consider the impact of section 11A of the 1987 Act, in particular, whether the injury was wholly or predominantly caused by the reasonable actions of the employer in respect of discipline or transfer. She said:
“54 …it was alleged in the section 74 Notice that the verbal warning given in late 2006 was a reasonable action taken by the employer as the Applicant failed to adhere to documented workplace organisational procedures in respect of system passwords. I find that the incident can be described as ‘discipline’ within the meaning of section 11A as it resulted in a ‘verbal warning’.
55.It was noted in the section 74 Notice that the Applicant had not seemed happy about the organisational restructure since it occurred in 2001. There is however no evidence before me from the Respondent to suggest that it was the transfer itself which resulted in the psychological injury.”
The Arbitrator then considered the evidence in relation to whether the actions of AAP in relation to the ‘password’ incident were reasonable. She concluded as follows:
“59.The evidence of Mr Hanson in relation to the password could best be described as somewhat evasive. It appears that much of the dispute hinged on semantics, whether he ‘changed’ the password or installed a password on the new upgraded system. In any event he clearly failed to disclose to Mr Bland and Ms Bridge to whom he had given the password…this would have allowed for a contemporaneous investigation at the time…On the available evidence I find that the Respondent acted reasonably in relation to this incident which I find was a serious incident for the organisation.
60.Having reached this conclusion I find that while the incident in respect of the password contributed to the injury, I do not find that it was either wholly or predominantly the cause of the psychological injury. This is because the evidence from Dr McClure is that the injury arose because of a background of chronic dissatisfaction with being side-lined and a sense of being targeted and under-employed, it was not related to this single event. Supporting this conclusion is the fact that the Applicant continued to work until 8 May the following year.”
The Arbitrator then dealt with the issue of incapacity, concluding that Mr Hanson was currently totally incapacitated for work.
DISCUSSION AND FINDINGS
The “Injury’ Issue
Section 4 (a) of the 1987 Act defines ‘injury’ as “…personal injury arising out of or in the course of employment…” In addition, section 9A provides that no compensation is payable unless the employment concerned was a substantial contributing factor to the injury.
In cases of psychological injury, section 11A(1) provides as follows:
“No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers.”
The determination of these issues requires consideration of all the evidence, in particular, whether there is any substance to Mr Hanson’s allegations such that they could be found to cause a psychological injury. In other words, were the facts relied upon ‘real’ events or ‘imagined’?
Similar issues were considered by the Court of Appeal in State Transit Authority of New South Wales v Fritzi Chemler [2007] NSWCA 249 (‘Chemler’) and by Deputy President Roche in Callingham v Tophos Pty Ltd t/asCentral Coast Easy Care [2008] NSWWCCPD 140 (‘Callingham’) where he said at [74] –[78]:
“74. The argument that a “perception of harassment is not a sufficient basis to support a finding of ‘injury’ under the 1987 Act” was considered and rejected by the Court of Appeal in Chemler. The “perception issue” has its origins in the authority of Townsend v Commissioner of Police (1992) 25 NSWCCR 9 (‘Townsend’) where McGrath CJ said, at [235]:
‘My conclusions are that the anxiety state resulted from the applicant’s erroneous perception of external events and not from his reaction to real events which were potentially damaging.’
75. This authority was interpreted by Neilson CCJ (at [53]) in Yeo v Western Sydney Area Health Service (1999) 17 NSWCCR 573 (‘Yeo’), as holding:
‘...that a misperception by a worker of otherwise innocuous matter, which misperception leads a worker to develop a psychiatric condition, does not constitute injury arising out of or in the course of employment.’
76. Spigelman CJ considered the above authorities in Chemler, and observed (at [54]):
‘In my opinion, this states the authority of Townsend too broadly. As McGrath CJ Comp Ct indicated, as quoted above, a ‘perception of real events’, which are not ‘external events’, can satisfy the test of injury ‘arising out of or in the course of employment’.’
77. Basten JA noted (at [69] of Chemler):
‘If conduct which actually occurred in the workplace was perceived as creating an offensive or hostile working environment, and a cognizable injury followed, it was open to the Commission to conclude that causation was established. Accordingly, no error in point of law was identified by this ground.’
78. A worker’s perception of an event will naturally involve his or her subjective assessment of the particular event. A worker’s perception of real events, which are not external, can satisfy the test of causation in a claim for compensation under the 1987 Act. In the present matter, the critical events that caused Ms Callingham’s injury (see [58] to [62] above) were real events that happened at work during working hours over work issues. Whilst to characterise those events as “harassment, bullying and victimisation” was, arguably, not necessarily accurate, the use of that terminology was of no consequence, as the employer was not misled as to the nature of the case it had to meet. Those work events caused Ms Callingham’s psychological injury, which Dr Vickery diagnosed as depression and anxiety.” (emphasis added)
The facts or ‘real events’ relied upon by Mr Hanson are, for the most part, vague indeed. Leaving aside for the moment the ‘password’ event, which undeniably was a real and actual event in the workplace, there is very little of substance left. As AAP submitted, that was” the only event that could be relied upon …as it was the only event that could be established on the evidence as having actually occurred…”
The Arbitrator concluded that “… the injury arose because of a background of chronic dissatisfaction with being side-lined and a sense of being targeted and under-employed…” This appears to emanate from the company’s restructure in July 2001 resulting in Mr Hanson’s transfer to the ITG. Mr Hanson told Mr Wenzel that in his view, “…the onset of his problems…” began at this time. A similar statement was made to Dr McClure. Ms Driver noted that Mr Hanson said that the “most distressing” event was the change to the ITG. Nonetheless, the Arbitrator stated that there was no evidence before her from AAP to suggest that it was the transfer itself which resulted in the injury, notwithstanding that it had been referred to in the section 74 Notice, and notwithstanding that Mr Hanson himself seemed to regard the ‘transfer’ as the principal cause of his condition. Ms Driver summarised AAP’s actions in detail in her report: there is no evidence that the company’s decision to amalgamate all technical areas into the ITG whereby Mr Hanson was moved from the Finance area but maintained similar duties and responsibilities, was unreasonable.
Consideration of these issues has been hampered by the lack of any detailed statement from Mr Hanson, let alone any corroborative evidence from him. As Deputy President Roche said in Gardiner v Spotless Services Australia Ltd [2008] NSWWCCPD 129 at [71]:
“A worker’s statement will usually form the basis of any claim for compensation in the Commission. It should set out a clear and detailed account of the worker’s version of the events that have allegedly given rise to the claim. That will include, at the least, a statement of what happened and, in lay terms, what symptoms were experienced at the time of the injury and subsequently.”
While it is true that the history of events given to doctors may be treated as evidence of the fact under section 60 of the Evidence Act 1995 (NSW), (see R v Welsh (1996) 90), there is simply very little information to ground those ‘facts’ in this case. Terms such as “side-lined” and “out of the loop” do not offer any insight into events. They are, simply put, “perceptions” of events.
The principles in Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305 are also relevant in this context. Those principles were succinctly summarised by Deputy President Roche in Combined Civil Pty Ltd v Rikaloski [2007] NSWWCCPD 181 where he said at [33]:
“That case made it clear that the prime duty of experts in giving opinion evidence is to furnish the trier of fact with criteria enabling evaluation of the validity of the expert’s conclusions (per Heydon JA in Makita at [59]). Without that evidence the expert’s opinion will be a ‘bare conclusion’ (Makita at [59]). In many cases the history recorded by an expert will not accord precisely with the other evidence in the case. In that situation the question will be whether the history recorded provided a ‘fair climate’ for the acceptance of the expert’s opinion (Makita at 731-732; Paric v John Holland Constructions Pty Ltd [1984] 2 NSWLR 505 at 509-510 and Brady v Commissioner of Police (2003) 25 NSWCCR 58”
In the present case, leaving aside the “password” incident, and the “CDs” incident, many of the alleged “facts” recorded were simply unsubstantiated. For example, Dr McClure noted Mr Hanson’s statement that he believed that Mr Bland “…had previously forced other staff members to resign.” There was no evidence of that: the statements of the co-workers would seem to place that belief in doubt. Mr Wenzel focussed on the “password” incident, concluding that the suggestion that the verbal warning was “reasonable” was open to question, a conclusion rejected by the Arbitrator. Much of his report referred to Mr Hanson’s “concerns” about possible consequences of certain tasks he performed: again, there was no evidence to substantiate these claims. In short, these histories did not provide a “fair climate” for the acceptance of the opinions proffered.
Mr Hanson’s perception that he was being “side-lined” and “kept out of the loop” or that his position was at risk is not borne out by the evidence from AAP, not only that of Ms Driver, but also Mr Woods, Mr Bland and other fellow employees. The Arbitrator has mis-stated her task. She was required to determine whether real events or conduct at work satisfied the test of ‘injury’, not whether Mr Hanson’s perception of events, even if wrong, was “rational”. In other words, was there a real basis upon which Mr Hanson might conclude, for example, that he was being “targeted”.
The Arbitrator concluded that the “password” incident fell within the category of “discipline” in section 11A. She concluded that AAP acted reasonably in relation to that incident. That conclusion was entirely consistent with the evidence. She found that, although it contributed to Mr Hanson’s ‘injury’ it was not the predominant cause. There was no reference to the incident involving the filing of the CDs which was apparently the catalyst for Mr Hanson’s cessation of employment. Mr Hanson’s account of this incident is disputed by Mr Bland, and in the absence of any other evidence, it is impossible to assess the impact of this incident on the ‘injury’ issue. The Arbitrator focussed on “…a background of chronic dissatisfaction with being side-lined and a sense of being targeted and under-employed” as the basis of the ‘injury’
As Deputy President Roche said in Callingham, (see [64] above) “a worker’s perception of an event will naturally involve a subjective assessment…” In the present case, it is fair to say that it is clear that Mr Hanson was not happy about his transfer to the ITG in July 2001. There is no evidence to suggest that the transfer was unreasonable, or that it resulted in Mr Hanson suffering financially or in terms of altered or extra work, or that he was placed in an untenable position. Nor in my view is there sufficient evidence to conclude that he was “targeted” by Mr Bland, or that he was “side-lined” or” kept out of the loop” by Mr Woods. His position in ITG was more administrative than managerial, and he became responsible to Mr Bland. Mr Hanson sought redundancy on several occasions because he felt “under-employed”. He was not offered redundancy because he held a viable position. That was a valid decision by AAP. His position may well have been “anomalous”, as the Arbitrator described it, but that alone does not ground an ‘injury’.
I have carefully considered all the evidence, and I have come to view that Mr Hanson has failed to establish that he suffered an injury within the meaning of section 4 of the 1987 Act, and in line with the authorities to which I have referred. Mr Hanson’s perception that he was being “targeted and under-employed” was simply not borne out by the facts. That he was unhappy or dissatisfied in his position in the ITG is fairly clear, but that in my view does not of itself support a finding of “injury”.
Having determined that Mr Hanson failed to establish that he sustained an injury within the meaning of section 4 of the 1987 Act, it is not necessary for me to determine the other matters raised on appeal. Nonetheless, some further observations are warranted.
Even if I am wrong on this aspect of the claim, I would add that I have considerable reservations as to the Arbitrator’s acceptance of the diagnosis of “Adjustment Disorder with mixed anxiety and depressed mood.” Although I accept that it is a recognised psychiatric condition, there is no evidence that Mr Hanson was ever treated for such a condition. As Dr McClure noted, he was receiving treatment for long-standing problems of ulcerative colitis and hypertension. He also noted that “He has not been taking any psychotropic medication.” This suggests that his “distress” as noted by Ms Driver may have impacted upon his underlying health complaints, but raises questions as to the primary diagnosis.
The Arbitrator was wrong in stating that AAP did not have “ any evidence from a medical practitioner.” Ms Driver is a qualified consultant psychologist, as is Mr Wenzel. While I accept that it was in theory open to the Arbitrator to prefer the medical opinions obtained by Mr Hanson to the opinion of Ms Driver, I remain concerned about the diagnosis.
The ‘Incapacity’ Issue
Having determined that no “injury” arose out of or in the course of employment with AAP, it is not necessary for me to determine this issue, and I do not propose to comment further on it.
CONCLUSION
Having conducted a review on the merits (per Spigelman CJ in State Transit Authority v Fritzi Chemler [2007] NSWCA 249: (2007) 5 DDCR 287 at [28]), I am of the view, for the reasons given in this decision, that Mr Hanson has failed to adequately demonstrate that any psychological condition he may have suffered in 2007 was causally related to real events that occurred in the workplace. The only established event was disciplinary proceedings taken following the problem with the computer password in October 2006, which the Arbitrator correctly found on the evidence was reasonable action by AAP in the circumstances.
Unlike the facts in Callingham, his condition arose as a result of his perception of unsubstantiated events at work, and as a consequence of his unhappiness at his transfer to the ITG in 2001. There was no evidence to suggest that the transfer was in any way unreasonable, although it was clearly the focus of Mr Hanson’s dissatisfaction.
DECISION
The decision of the Arbitrator dated 9 October 2008 is revoked, and the following decision made in its place:
“1. Award in favour of the Respondent.
2. No order as to costs.”
COSTS
I make no order as to costs of the appeal.
Deborah Moore
Acting Deputy President
11 March 2009
I, MARIE JOHNS CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF DEBORAH MOORE, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
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