Brickworks Ltd v Wright
[2022] NSWPICPD 21
•7 June 2022
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY A MEMBER | |
CITATION: | Brickworks Ltd v Wright [2022] NSWPICPD 21 |
APPELLANT: | Brickworks Ltd |
RESPONDENT: | Stewart Glenn Wright |
INSURER: | Self-insured |
FILE NUMBER: | A1-W1790/21 |
PRESIDENTIAL MEMBER: | Deputy President Michael Snell |
DATE OF APPEAL DECISION: | 7 June 2022 |
ORDERS MADE ON APPEAL: | 1. The Certificate of Determination dated 23 August 2021 is confirmed. |
CATCHWORDS: | WORKERS COMPENSATION – Section 11A(1) of the Workers Compensation Act 1987 – reasonable action with respect to discipline: Commissioner of Police v Minahan [2003] NSWCA 239, having regard not only to the end result but to the manner in which disciplinary action was effected, Jeffery v Lintipal Pty Ltd [2008] NSWCA 138: test of reasonableness is objective; Mateus v Zodune Pty Ltd t/as Tempo Cleaning Services [2007] NSWWCCPD 227: employer confined to matters raised in dispute notices; ss 22 and 22A of the 1987 Act: apportionment; reasons: NSW Police Force v Newby [2009] NSWWCCPD 75 |
HEARING: | On the papers |
REPRESENTATION: | Appellant: |
| Mr A Combe, counsel | |
| Hall & Wilcox Lawyers | |
| Respondent: | |
| Mr P Stockley, counsel | |
| Michael J Corbett, solicitor | |
DECISION UNDER APPEAL | |
MEMBER: | Mr P Young |
DATE OF MEMBER’S DECISION: | 23 August 2021 |
INTRODUCTION AND BACKGROUND
The respondent, Stewart Glenn Wright (the worker) held a heavy vehicle licence. He worked for RH Giles delivering concrete pipes in semi-trailers from 7 February 2005 to 14 September 2011. He was involved in a fatal accident in 2008 in the course of that employment. The worker suffered significant injuries in the accident, including head injuries and third-degree burns. He was in an induced coma for two weeks. He was diagnosed with Post Traumatic Stress Disorder (PTSD) and received “psychological interventions” over about two years. He felt that he made a complete recovery.[1]
[1] Worker’s statement 24/12/20, [10]–[19], Application to Resolve a Dispute (ARD), pp 23–24.
The worker started working with the appellant, Brickworks Ltd (Brickworks), from about 13 January 2013. The worker was elected as a union delegate in around 2017 and there was a change of management about six months later. The worker considered that safety standards slipped.[2] The worker said he was being marginalised by management when he raised safety issues. He identified a number of areas of concern that he raised with management.[3]
[2] Worker’s statement, [20]–[21], [25]–[26], ARD, pp 24–25.
[3] Worker’s statement, [33]–[34], ARD, pp 25–26.
The worker described an incident on 16 August 2019.[4] A truck was blocking one of two loading bays. Ten trucks were lined up waiting to be loaded because of the blocked bay. The worker stated that a panel, that was waiting to be loaded onto the truck in the blocked bay, required certification before loading. The worker considered that Mr Elston, the manager in charge, was attempting to have the uncertified panel loaded, which was “unsafe and unlawful”. The worker stated that, while he was “assisting with the congested loading bay, [the worker’s] truck was given a load, under the instruction of Mr Andrew Elston, that was 3 [metres] over the legal length”. The worker said he refused to take the load out as it was, and it was replaced with another load that was “the exact same size”. The worker said he again made his position known and Mr Elston said “If you don’t like it fuck off and go home.”[5]
[4] Worker’s later statement 5/8/21, [5], Application to Admit Late Documents (AALD) 6/8/21, p 6.
[5] Worker’s statement, [35]–[38], [40], [43]–[44], ARD, pp 26–27.
The load was removed from the worker’s truck. The worker remained at work. He said his attempts to have others rectify the situation in the blocked loading dock failed. He said Mr Elston attempted to have another driver take out the load that he, the worker, had declined. He said that when he told the other driver not to take the load Mr Elston mockingly laughed in his face. The worker stated that he said to Mr Elston “You’ve laughed at me one too many times. If I took you out the front and tapped you out, who would be laughing then?” The worker stated this was “by no means a threatening comment or situation”. Another worker eventually cleared the backup of trucks.[6]
[6] Worker’s statement, [45]–[56], ARD, pp 29–29.
On 23 August 2019 Mr Barton, the State manager, spoke to the worker and said the worker had threatened and intimidated Mr Elston, which the worker denied.[7] The worker was sent on two weeks’ leave. On 30 August 2019 he was called to a meeting with Mr Coutts and Mr Barton.[8] The worker was told he should attend an anger management seminar and that he was being reprimanded by way of a first and final warning. He indicated he would attend the seminar but would not accept the first and final warning. He left the building and went home.[9] He stated that he subsequently moved out of his matrimonial home, lived with his brother, lived out of his car for periods, and found himself “being treated at St John of God – North Richmond”, where he had “a few admission periods since August 2019”.[10]
[7] Worker’s later statement, [6], AALD 6/8/21, p 6.
[8] Worker’s later statement, [7], AALD 6/8/21, p 6.
[9] Worker’s statement, [59]–[68], ARD, pp 29–30.
[10] Worker’s statement, [72]–[73], ARD, p 31.
The worker lodged a claim form dated 11 March 2020.[11] His employer was described as “Austral Precast”. There is no issue regarding the employer’s identity. The form nominated a date of injury of 6 August 2019 and the condition as “Psychological injury, PTSD, aggravation of underlying PTSD.” It included reference to the earlier claim, “workplace injury on 4/4/2008. EML is insurer”. It described the worker as working full time for Austral Precast from January 2013, with usual earnings of $1,700–1,800 per week excluding overtime and shift allowances.
[11] ARD, pp 1–8.
Brickworks issued a dispute notice dated 14 May 2020.[12] It described itself as the worker’s “employer” and also as a “self-insured organisation”. It disputed liability for the following stated reasons:
(a) the worker had not sustained injury (s 4 of the Workers Compensation Act 1987 [the 1987 Act]);
(b) employment was not a substantial contributing factor to the injury (s 9A of the 1987 Act);
(c) the psychological injury was wholly or predominantly a result of reasonable action of Brickworks taken with respect to discipline (s 11A of the 1987 Act);
(d) there was no incapacity as a result of the injury (ss 36 and/or 37 of the 1987 Act), and
(e) there was no entitlement to the payment of medical expenses (ss 59 and 60 of the 1987 Act).
[12] ARD, pp 9–15.
This decision was confirmed in a review dated 9 November 2020.[13] The current proceedings were commenced by way of the ARD dated 19 May 2021. The matter was listed for hearing on 12 August 2021, Mr Stockley appeared for the worker and Mr Combe for Brickworks. There were no applications to take oral evidence. The Member dealt with the admission of late documents, both counsel addressed and the Member reserved his decision.
[13] ARD, pp 16–22.
A Certificate of Determination with accompanying reasons was issued on 23 August 2021.[14] There was an award of weekly payments in the worker’s favour at a rate of $1,944.22 from 23 September 2019 to 23 December 2019 (pursuant to s 36 of the 1987 Act) and at a rate of $1,637.24 from 24 December 2019 to date and continuing (pursuant to s 37 of the 1987 Act). The orders noted a concession by the worker that he had received compensation from another source, Employers Mutual Ltd (EML), for various periods identified in a schedule prepared by the worker’s solicitors.
[14] Wright v Brickworks Ltd [2021] NSWPIC 301 (the reasons).
THE MEMBER’S REASONS
The Member referred to conflicting suggestions regarding when the worker’s employment with Brickworks commenced. He said there was no evidence to cavil with the worker’s assertion that he commenced from 13 January 2013. The Member said there was prior psychological injury associated with the 2008 accident with a different employer. He noted the worker said that, as a union delegate, he was “bullied and marginalised” by Brickworks when he raised safety and compliance issues. The worker alleged aggravation of the previous PTSD condition. The Member referred to s 22(7) of the 1987 Act. The Member said there appeared to be agreement that the previous PTSD symptoms were a result of the motor accident in 2008.[15]
[15] Reasons, [2]–[4].
The Member said that EML, the relevant insurer in respect of the 2008 injury, had been making weekly payments to the worker since 23 September 2019. It was argued this would prevent him from recovering the weekly compensation provided for in ss 36 and 37 of the 1987 Act from Brickworks. It was argued the general practitioner’s certificates attributed incapacity to the 2008 injury, and this was inconsistent with events in 2019 being the ‘main contributing factor’ to the injury. It was argued the worker’s threats and language were consistent with misconduct and Brickworks was entitled to discipline the worker “in accordance with its various policies”. It was argued the worker’s incapacity was due to the 2008 incident and/or psychosocial factors including his marital breakdown and marijuana use.[16]
[16] Reasons, [6].
The Member said the parties agreed that no order for apportionment was sought pursuant to s 22 of the 1987 Act. The Member referred to the decision of Roche DP in Cordina Chicken Farms Pty Ltd v Le.[17] He described that decision as authority that in some circumstances, where there are two separate and distinct incapacities, a worker may be entitled to two awards. He noted that, in cases where the weekly entitlement was governed by the provisions of ss 36 and 37, introduced by the Workers Compensation Legislation Amendment Act 2012 (the 2012 amendments), the discretion to reduce weekly payments had been removed. The Member referred also to cl 6(1) of Sch 3 to the 1987 Act in its amended form: ‘earnings’ is income received by a worker “for work performed in any employment during the week”.[18]
[17] [2008] NSWWCCPD 125 (Cordina).
[18] Reasons, [12]–[13].
The Member said that payments received by the worker from EML were not ‘earnings’ and were not part of the calculation required under ss 36 and 37 of the 1987 Act. He said that the worker did not allege there were two separate incapacities or an entitlement to two awards. The earlier employer from the 2008 injury was not joined as a party, s 22 of the 1987 Act was not in issue. The Member said that the worker, on the evidence, was able to work without restriction prior to the events giving rise to the current claim. The medical evidence generally accepted that the incapacity at issue resulted from that aggravation. It was unnecessary to consider the principles in Cordina.[19]
[19] Reasons, [14].
The Member dealt with the alleged aggravation injury. Dr Bisht, reporting on 8 November 2013, described the worker as “in remission”. The worker worked “without any mental handicap from 2013 until 2019”. A statement of Mr Soares, a fellow worker, indicated that new managers took over in 2017 who were not as skilled as the previous managers, “work quality declined, labour turnover increased and safe work practices began to be compromised”. The worker’s concerns about safety issues were “brushed aside by management”.[20] The Member described the medical evidence on the topic of aggravation of the PTSD condition as “almost unanimous”. It was supported by Dr Rastogi (a qualified psychiatrist), Dr Malik (the treating psychiatrist) and Dr Ilawala (who treated the worker at St John of God Hospital).[21]
[20] Reasons, [15]–[17].
[21] Reasons, [19].
The Member said that Dr Roberts (qualified by Brickworks) considered there was a disproportionate response to the events at Brickworks, because of the 2008 incident. To this extent, Dr Roberts considered the 2008 incident was the “substantial factor”. The Member did not consider this assisted Brickworks’ case. The Member said that Dr Roberts’ opinion was consistent with the worker having an “eggshell skull psyche”, an underlying susceptibility to mental deterioration due to such events.[22]
[22] Reasons, [21]–[23].
The Member considered the defence pursuant to s 11A of the 1987 Act. He said that Brickworks had no medical evidence to establish that the aggravation was wholly or predominantly a result of ‘reasonable action’ in respect of one of the purposes identified in s 11A(1). Reference was made to Hamad v Q Catering Ltd.[23] The Member referred to the evidence of Mr Soares. At the disciplinary meeting on 30 August 2019 no HR representative attended, the meeting was poorly organised and run, and the meeting was very tense with no minutes being taken. One of the managers claimed that there had been an exhaustive investigation, and they had viewed the CCTV footage. They failed to respond when the worker asked to see the statements and the CCTV footage. Brickworks did not produce the CCTV footage for the purposes of the proceedings. There was evidence from Mr Pritchard, who was present during the incident on 6 August 2019, and described the incident as “pretty tame”. Whatever words were used, it was incumbent on Brickworks to investigate and retrieve all relevant information, to pre-warn the worker of the nature of the meeting and to give him an opportunity to explain his behaviour. There should not have been a pre-determined decision until the processes were followed. The defence based on s 11A of the 1987 Act failed.[24] There was an award for the worker as described at [9] above.
[23] [2017] NSWWCCPD 6 (Hamad).
[24] Reasons, [24]–[28].
ON THE PAPERS
Section 52(3) of the Personal Injury Commission Act 2020 (the 2020 Act) provides:
“(3) 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 and enabling legislation without holding any conference or formal hearing.”
Having regard to Procedural Directions PIC2 and WC3; the documents that are before me, and the submissions by the 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.
THRESHOLD MATTERS
There is no dispute between the parties that the threshold requirements as to quantum and time pursuant to ss 352(3) and 352(4) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) have been met.
THE NATURE OF THE APPEAL
The appeal is brought pursuant to s 352(5) of the 1998 Act, which provides:
“An appeal under this section is limited to a determination of whether the decision appealed against was or was not affected by any error of fact, law or discretion, and to the correction of any such error. The appeal is not a review or new hearing.”
In Northern NSW Local Health Network v Heggie,Sackville AJA said:
“A fortiori, if a statutory right of appeal requires a demonstration that the decision appealed against was affected by error, the appellate tribunal is not entitled to interfere with the decision on the ground that it thinks that a different outcome is preferable: see Norbis v Norbis [1986] HCA 17; 161 CLR 513, at 518-519”.[25]
[25] [2013] NSWCA 255 (Heggie), [72].
In Workers Compensation Nominal Insurer v Hill[26] the Court of Appeal said there was no error in a Presidential member, dealing with an appeal pursuant to s 352(5), applying the description of a judge’s function on appeal as explained by Barwick CJ in Whiteley Muir & Zwanenberg Ltd v Kerr.[27] In Raulston v Toll Pty Ltd[28] Roche DP described the nature of such an appeal, applying Whiteley Muir to the appeal process pursuant to s 352 of the 1998 Act (since 1 March 2021[29] applying to a ‘Member’ rather than an ‘Arbitrator’):
“(a) An Arbitrator, though not basing his or her findings on credit, may have preferred one view of the primary facts to another as being more probable. Such a finding may only be disturbed by a Presidential member if ‘other probabilities so outweigh that chosen by the [Arbitrator] that it can be said that his [or her] conclusion was wrong’.
(b) Having found the primary facts, the Arbitrator may draw a particular inference from them. Even here the ‘fact of the [Arbitrator’s] decision must be displaced’. It is not enough that the Presidential member would have drawn a different inference. It must be shown that the Arbitrator was wrong.
(c) It may be shown that an Arbitrator was wrong ‘by showing that material facts have been overlooked, or given undue or too little weight in deciding the inference to be drawn: or the available inference in the opposite sense to that chosen by the [Arbitrator] is so preponderant in the opinion of the appellate court that the [Arbitrator’s] decision is wrong’.”[30]
[26] [2020] NSWCA 54, [20]–[21].
[27] (1966) 39 ALJR 505 (Whiteley Muir).
[28] [2011] NSWWCCPD 25 (Raulston).
[29] The date of relevant commencement of the 2020 Act.
[30] Raulston, [19].
GROUNDS OF APPEAL
The first three grounds of appeal relate to the reasons at [24] to [28] and the failure of the defence pursuant to s 11A(1) of the 1987 Act. Brickworks raises the following grounds of appeal. I note the order of grounds nos. [2] and [3] was reversed in later amended versions of the grounds and submissions.
(a) The Member erred in failing to have regard to evidence of words said to Mr Elston which constituted a threat and grounds for discipline. (Ground No. 1)
(b) The Member erred in failing to refer to evidence of policy documents, that reflected Brickworks’ obligation to provide a safe workplace, and the worker’s obligation to behave in accordance with the ‘Code of Conduct’. (Ground No. 2)
(c) The Member erred in failing to refer to the fact that the worker was not incapacitated until after disciplinary action was instituted in respect of the words said to Mr Elston. (Ground No. 3)
The balance of the grounds relate to the awarding of compensation in the particular circumstances where the worker also received compensation from another source:
(a) The Member erred at [12] to [14] and [29] to [30] of the reasons, in awarding compensation on the basis that the worker had no work capacity despite being awarded compensation at rates of $858.56 to $888.96 per week. (Ground No. 4)
(b) The Member erred at [31] of the reasons by noting the receipt of compensation from another source where there was no provision in the 1987 Act for a reduction under ss 36 and 37 of the 1987 Act, and no joinder of the prior employer under s 22 was made. (Ground No. 5)
(c) The Member erred in awarding compensation where the effect of this was that, with the receipt of compensation from other sources, the worker would receive compensation in excess of his pre-injury average weekly earnings, offending the principle against double compensation. (Ground No. 6)
(d) The Member failed to provide adequate reasons for awarding compensation pursuant to ss 36 and 37 when the worker had already recovered compensation for the same total incapacity from another insurer and for another injury. (Ground No. 7)
GROUNDS NOS. 1 TO 3
Brickworks initially submitted on these grounds together, although submitted on them separately in its amended submissions, which were lodged pursuant to a Direction. The grounds are related and it is convenient to deal with them together. The worker deals with the grounds individually.
Brickworks’ submissions
The worker conceded using the words quoted at [4] above, on site, to Mr Elston. The words were threatening. Brickworks submits it was reasonable that it conduct an inquiry and issue a first and final warning with a requirement that the worker attend an anger management program. Brickworks submits it was error that the Member failed to quote in full the words that the worker conceded using.[31]
[31] Brickworks’ submissions, [9]–[10].
Brickworks refers to the well-known passage in Irwin v Director-General of Education,[32] cited with approval by Foster AJA (Sheller and Santow JJA agreeing) in Commissioner of Police v Minahan:
“The question of reasonableness is one of fact, weighing all the relevant factors. The test is less demanding than the test of necessity, but more demanding than a test of convenience. The test of ‘reasonableness’ is objective, and must weigh the rights of employees against the objective of the employer. Whether an action is reasonable should be attended, in all the circumstances, by a question of fairness.”[33]
[32] Geraghty CCJ, unreported, 18/6/1998 (Irwin).
[33] [2003] NSWCA 239 (Minahan), [27], [42].
Brickworks also refers to Director-General, Department of Education and Training v Pembroke where Handley ADP said: “In determining whether the conduct was reasonable, all relevant factors must be taken into consideration including the rights of both employee and employer.”[34] (underlining added in Brickworks’ submissions).
[34] [2006] NSWWCCPD 182.
Brickworks refers to its Code of Conduct dated May 2019, which at cl 3.1 stated:
“Acts of violence, threats, physical intimidation, bullying and harassment have no place at Brickworks and can result in immediate disciplinary action, up to and including termination of employment.”[35]
[35] AALD 9/8/21, p 18.
Brickworks refers to its ‘Grievance Resolution Policy and Procedure’, which provided that, in the event of a formal complaint, an investigator was to be appointed to investigate.[36] It refers to its Equal Opportunity Policy, which provided that breaches would amount to “misconduct or serious misconduct” which could result in disciplinary action up to and including dismissal.[37] Brickworks referred to its ‘policy documents’ which identified ‘misconduct’ and ‘serious misconduct’ as including “violence, fighting or making threats” (emphasis added in Brickworks’ submissions) which warranted various disciplinary procedures and action. Brickworks submits the Member did not refer to the above documents.[38]
[36] AALD 9/8/21, pp 29–30.
[37] AALD 9/8/21, p 39.
[38] Brickworks’ submissions, [14]–[16].
Brickworks submits:
“… no issue was taken by the [worker] that there had been noncompliance with the policy documents of [Brickworks]. What was taken issue was the fact that further investigations were not taken by way of speaking to witnesses or reviewing CCTV footage or letting the [worker] view CCTV footage.”
Brickworks submits “the other witnesses and CCTV footage were ultimately irrelevant” as the available evidence showed the worker had made a statement that constituted violence or making a threat, that warranted the investigation and disciplinary action. Brickworks submits the evidence of policy guidelines substantiates an assertion that its actions were reasonable. The Member’s failure to refer to this relevant evidence was, it is submitted, an error of law.[39]
[39] Brickworks’ submissions, [17]–[19].
Brickworks submits incapacity commenced on 19 August 2019, after the worker was spoken to as part of the disciplinary action. It submits this, on a common-sense basis, established the necessary causal link between the disciplinary action and the aggravation injury. Medical evidence on that specific point was not necessary in the circumstances.[40] It submits this “clear causal nexus” was not considered by the Member, which constituted error.[41]
[40] Reference is made to Hamad v Q Catering Ltd [2017] NSWWCCPD 6 (Hamad), [88].
[41] Brickworks’ submissions, [12].
Brickworks refers to the following passage from Manly Pacific International Hotel v Doyle:
“Whether or not the appellant's transfer of Mr Doyle was the whole or predominant cause of [the worker’s] psychological injury within the meaning of subsection 11A(1) is a question of fact and degree, which involves consideration of all the factors which produce [the worker’s] condition.”[42] (underlining in Brickworks’ submissions)
[42] [1999] NSWCA 465; 19 NSWCCR 181 (Doyle), [8].
Brickworks relies on this passage to submit that “all the factors” include its obligation as an employer to investigate the complaint and consideration of the evidence of a threat. There was a “clear prohibition” of serious misconduct, part of the obligation to provide a safe workplace.[43] It submits:
“The investigation was reasonable and necessary and had to be conducted in accordance with [Brickworks’] own policy guidelines. The disciplinary action in the face of words being spoken by the [worker] were reasonable. The Member erred in law by failing to have regard to the relevant material in the form of the policy guidelines.”[44]
[43] Brickworks’ submissions, [21]–[22].
[44] Brickworks’ submissions, [23].
The worker’s submissions
The worker submits that Brickworks, as at first instance, argues the s 11A defence was made out because it was entitled or obliged to investigate the allegation. This failed to engage with the worker’s argument that how it went about investigating the complaint and delivering the outcome were not fair. Brickworks again, on the appeal, fails to deal with the propriety of the process. The worker submits that Brickworks re-states the arguments it made at first instance without challenging the Member’s reasoning.[45]
[45] Worker’s submissions, [3]–[6].
The worker refers to Brickworks’ argument that the Member failed to set out, in full, the words used by the worker to Mr Elston. This is described as “unduly technical”, failure to quote the words in full does not mean they were not considered. The worker submits the Member’s task was not to decide whether there was a disciplinary offence, it was to decide whether the actions of Brickworks constituted reasonable action taken or proposed to be taken in respect of discipline. The worker accepts that Brickworks had a responsibility to investigate a complaint of threatening behaviour by one of its employees. For the defence to then succeed it was necessary that that action constitute the whole or predominant cause of the injury and that the action have been reasonable. The Member considered this and found against Brickworks. The worker submits the conduct of Brickworks “cannot have been reasonable when it did not consider all of the relevant evidence, particularly that of independent witnesses. The Member so found.”[46]
[46] Worker’s submissions, [7]–[11].
The worker submits Brickworks “did not and could not point to medical evidence supporting its contention that [the worker’s] injury resulted wholly or predominantly from its allegedly reasonable action in respect of discipline”. Its psychiatrist, Dr Roberts, did not assist. He concluded that employment was not a substantial contributing factor to injury, “inconsistent with a finding that the injury was wholly or predominantly as a result of action in respect of discipline, reasonable or otherwise”. Dr Roberts simply agreed with a “non-medical proposition” that it was appropriate for Brickworks to investigate the complaint of misconduct. The worker submits that Brickworks has fallen back on “the simplistic and unpersuasive proposition that correlation constitutes causation”. The worker states that this proposition was not advanced by Brickworks at first instance, but the Member’s reasoning is now challenged for failing to adopt it. The worker states that the Member did not, in any event, decide the matter on this basis, as he decided that Brickworks’ relevant action was not ‘reasonable’. If there was an error in respect of causation it would not alter the outcome.[47]
[47] Worker’s submissions, [12]–[17].
The worker refers to Ground No. 3 which he submits is “entirely misconceived”. The Member did not conclude that Brickworks did not have the right or obligation to investigate alleged misconduct. Brickworks’ “WHS obligations” could only go to its responsibility to conduct an investigation, not to whether its actions were reasonable. The worker refers to the reasons at [26] to [28]. He refers to the ‘Independent Formal Investigation of Complaint’[48] where it is stated:
“The Investigator will generally interview both the employee who raised the grievance, the employee against whom the complaint is made and any other relevant person(s) and may seek any further information the Investigator considers necessary.”
[48] AALD 9/8/21, p 29.
The worker submits that Brickworks “either ignores or overlooks” this direction. The worker submits Brickworks does not identify error in the Member’s reasoning or conclusion.[49]
Brickworks’ submissions in reply
[49] Worker’s submissions, [18]–[22].
Brickworks refers to the worker’s complaint that independent witnesses were not interviewed. It submits such interviews could not have changed the fact that a threat was made that justified discipline and Brickworks’ process “was therefore reasonable”. The actions of Brickworks in their entirety were reasonable.
Brickworks refers to the worker’s description, of Brickworks’ causation submission at [15], as “simplistic and unpersuasive”. Brickworks submits that such a common-sense evaluation is consistent with Kooragang Cement Pty Ltd v Bates.[50] It submits that such an argument was made before the Member at first instance.
[50] (1994) 35 NSWLR 452 (Kooragang), 463–464.
Brickworks refers to the worker’s submission on Ground No. 3, which raises the direction quoted at [39] above. It makes the point that the direction refers to having application “generally”, and that the investigator “may seek any further information”. It submits the worker admitted to stating the relevant words that constituted a threat. It was unnecessary to interview other relevant people before disciplinary action was taken.[51]
Consideration
[51] Brickworks’ submissions in reply, [2]–[4].
Some relevant authorities
In Minahan Foster AJA, referring to the decision of Geraghty CCJ in Irwin, said that his Honour also referred to the decision of Truss CCJ in Ivanisevic v Laudet Pty Ltd,[52] where her Honour said:
“In my view when considering the concept of reasonable action the Court is required to have regard not only to the end result but to the manner in which it was effected.”
[52] Truss CCJ, unreported, 24/11/98 (Ivanisevic).
Foster AJA (Sheller and Santow JJA agreeing), in Minahan at [42], referred with approval to the passages quoted above from the unreported decisions in Irwin and Ivanisevic.
In Heggie Sackville AJA, after referring to the facts in Minahan, said of that decision:
“The case is therefore not authority for the proposition that disciplinary action, short of dismissal of an employee or a finding of misconduct, is reasonable only if the decision is based on a consideration of all the circumstances bearing on the truth or otherwise of allegations made against the employee.”[53]
[53] Heggie, [58].
In Jeffery v Lintipal Pty Ltd, dealing with the construction of s 11A(1) of the 1987 Act in the context of ‘transfer’, Basten JA said:
“There is a clear distinction to be drawn between a statutory test which requires an objective assessment by the Commission of the reasonableness of the action of the employer and a test by which it is sufficient for the employer to demonstrate to the Commission that, in all the circumstances, the action appeared to it to be reasonable. In my view, the present statutory provision engages the former test ... If it were sufficient that the employer took action because it appeared to the employer, on grounds upon which it was reasonable to rely, to be reasonable action, the legislature could have said so. However, it did not. In my view, if, in the view of the Commission, the action taken by the employer in transferring an employee is not reasonable in all the circumstances, the employer cannot rely upon s 11A because it held a genuine belief, based on reasonable grounds, that its action was reasonable.”[54]
[54] [2008] NSWCA 138 (Jeffery), [50].
In Heggie Sackville AJA said:
“The test of reasonableness is objective. It is not enough that the employer believed in good faith that the action with respect to discipline that caused psychological injury was reasonable. Nor is it necessarily enough that the employer believed that it was compelled to act as it did in the interests of discipline.
Where the psychological injury sustained by the worker is wholly or predominantly caused by action with respect to discipline taken by the employer, it is the reasonableness of that action that must be assessed. Thus, for example, if an employee is suspended on full pay and suspension causes the relevant psychological injury, it is the reasonableness of the suspension that must be assessed, not the reasonableness of other disciplinary action taken by the employer that is not causally related to the psychological injury.”[55] (emphasis in original)
[55] Heggie, [59].
In Department of Education & Training v Sinclair Spigelman CJ, considering a defence pursuant to s 11A(1) based on ‘discipline’, said:
“Such actions usually involve a series of steps which cumulatively can have psychological effects. More often than not it will not be possible to isolate the effect of a single step. In such a context the ‘whole or predominant cause’ is the entirety of the conduct with respect to, relevantly, discipline.”[56]
[56] [2005] NSWCA 465 (Sinclair), [96].
Legislation
Section 11A(1) of the 1987 Act provides:
“(1) 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.”
Discussion
Brickworks’ first ground is narrowly put, an alleged failure to have regard to the words said by the worker to Mr Elston. The words are quoted at [4] above. The worker denied that the words were threatening, he denied that he had threatened and intimidated Mr Elston (see [4] to [5] above). Mr Pritchard, who witnessed the incident, described it as “pretty tame”. It is not common ground that the words were threatening. Mr Pritchard’s recall of the words used is a little different: “if things were different and we were out the front”.[57]
[57] Reasons, [28].
Brickworks submits that it was entitled and obliged to investigate the complaint made about the worker’s behaviour (see [26], [30] and [35] above). The worker accepts that Brickworks was entitled to investigate a complaint about threatening behaviour by an employee (see [37] above).
The primary contest, and the basis on which the s 11A defence failed, does not turn on whether Brickworks was entitled to conduct an investigation. It involves the deficiencies identified by the Member in the investigation that occurred. In considering ‘reasonableness’ it was appropriate that the Member consider “the entirety of the conduct” of Brickworks with respect to discipline. The disciplinary meeting occurred on 30 August 2019. The Member relied on the evidence of Mr Soares (who attended the meeting as the worker’s support person). Mr Soares stated that no representative of HR attended, the meeting was poorly organised and run, no minutes were taken, those conducting the investigation had not spoken to two potential witnesses, Josh and Steve. Management said they had reviewed the CCTV footage yet when the worker asked to see the CCTV footage and statements there was “no apparent response”. The Member noted that Brickworks did not produce the CCTV footage for use in these Commission proceedings. The Member said it was clear that Brickworks did not “have the benefit of Mr Pritchard’s view of the words used”.[58]
[58] Reasons, [26]–[28].
It was not in issue that the worker’s injury was a ‘psychological injury’ or that Brickworks’ relevant actions were with respect to ‘discipline’. The Member gave the following assessment of what Brickworks’ obligations were in the circumstances for its actions to be ‘reasonable’:
“Regardless of the words used, it was incumbent upon [Brickworks], in exercising reasonable discipline, to take reasonable action and that in my view includes fairly retrieving by investigation all relevant information, pre-warning the [worker] concerning the nature of the meeting, providing the [worker] with an opportunity to explain any behaviour he concedes and not making any predetermined decision until those processes have been followed.”[59]
[59] Reasons, [28].
The passage of Irwin, quoted in Minahan and also in Brickworks’ submissions on appeal, says “[w]hether an action is reasonable should be attended, in all the circumstances, by a question of fairness”. It is also appropriate to note the statement of Truss CCJ in Ivanisevic, that in assessing whether an employer’s actions are reasonable regard should be had to the manner in which the actions were effected (see [44] above). Brickworks’ submissions deal at some length with its policies and whether breach of these, by an employee making a threat, justified investigation. The fundamental basis on which Brickworks’ defence failed was that the Member found that its actions were not reasonable, for reasons which were spelled out.
Brickworks’ response to this is referred to above, where it refers to the fact that “further investigations were not taken by way of speaking to witnesses or reviewing CCTV footage or letting the [worker] view CCTV footage”. It refers also to its policy documents that it submits justify its decision to investigate the matter. The Member did refer to matters relating to deficiencies in Brickworks’ gathering of evidence (see [54] above). The matters referred to relate essentially to whether the worker was treated fairly. The response of Brickworks to any deficiency in its processes, as identified it in the summary at [32] above, was to submit that “the other witnesses and CCTV footage were ultimately irrelevant”, as it was entitled to conduct an investigation in any event as a threat had been made.
Ground No. 1 states the Member failed to have regard to relevant evidence. This was a reference to the worker’s admission that he said, to Mr Elston, the words contained in his statement, these words constituting Brickworks’ grounds for discipline. Ground No. 2 is related, and states that the Member failed to refer to Brickworks’ policy documents, which reflected its obligation to supply a safe place of work, and the worker’s obligation to behave in accordance with the Code of Conduct. The various policy documents referred to in the submissions are internal documents of Brickworks. Compliance (or non-compliance) with those documents does not, of itself, establish that the worker behaved in a fashion that justified disciplinary action, nor that Brickworks behaved reasonably in implementing disciplinary action. It is clear, from the passages from Jeffery and Heggie quoted at [47] and [48] above, that the necessary assessment of ‘reasonable action’ is an objective one. It is not sufficient that an employer believed it was acting reasonably. It is not sufficient that an employer believed it was compelled to act as it did in the interests of discipline.[60]
[60] Heggie, [59].
As the worker submits, the fact that the Member did not quote the words said to Mr Elston does not indicate that the Member failed to consider the words. The words formed the starting point for the consideration of the reasonableness of the disciplinary process that was carried out. The Member, at [26] to [28] of the reasons, discussed deficiencies in Brickworks’ conduct of the disciplinary process, leading to his conclusion that Brickworks’ disciplinary action was “not reasonable” within the meaning of s 11A(1) of the 1987 Act. For reasons given above, Brickworks has failed to identify error in the Member’s consideration of whether its relevant actions were ‘reasonable’.
The above is sufficient to deal with Grounds Nos. 1 and 2, which fail.
Ground No. 3 relates to the requirement that, for the defence in s 11A(1) to apply, the psychological injury must be ‘wholly or predominantly caused’ by the relevant reasonable action. This causation issue is one on which the employer carries the onus. The parties refer to Hamad regarding discharge of this onus. Hamad accepts that there will be cases where satisfaction of this onus will be possible without specific medical evidence, and that the need for medical evidence will depend on “the facts and circumstances of the individual case”. Where there are a number of potentially causative factors raised on the evidence, only some of which are matters within the scope of s 11A(1), it may well be that medical evidence will be necessary on this causation issue for an employer to discharge its onus.
In the current matter, Brickworks failed to establish the defence in any event, as the Member rejected the argument that its actions were ‘reasonable’. The Member’s finding did not engage with the causation issue, as he found:
“… if the [worker’s] aggravation (etc) was caused wholly or predominately by action taken on the part of [Brickworks], that action was not reasonable action within the meaning of section 11A.”[61]
[61] Reasons, [28].
The worker correctly submits that “if there was an error in respect of causation it would not alter the outcome”. It is unnecessary to further deal with Ground No. 3.
GROUNDS NOS. 4 TO 7
Brickworks’ submissions
These grounds were initially dealt with together, but were then dealt with separately in Brickworks’ amended submissions. The grounds are related and it is convenient to deal with them together.
Brickworks submits the weekly award in the worker’s favour is pursuant to ss 36 and 37 of the 1987 Act, at an appropriate statutory rate for a worker with no work capacity, based on average weekly earnings of $2,060. It states the rate at which payments were made by the earlier insurer started at $858.56 per week from September 2019. It submits the medical certificates for these periods showed the worker was certified to have no work capacity due to the injury in 2008. It submits that payments pursuant to the award, when added to the payments made by the earlier insurer, would be at least $2,700 per week. It submits this would offend the concept that “a plaintiff cannot recover more than he or she has lost”, referring to Haines v Bendall,[62] confirmed in Manser v Spry.[63] Brickworks submits there was no basis for entry of the award on the basis of no work capacity, when the worker was being compensated for the same incapacity. It submits this was an error of law. The incapacity did not result from the injury on 16 August 2019 (the subject of the current proceedings) for the purposes of s 33 of the 1987 Act, as compensation was being paid by EML (the 2008 injury insurer) on the basis that incapacity resulted from the earlier injury.[64]
[62] (1991) 172 CLR 60 (Haines), 63.
[63] (1994) 181 CLR 428 (Manser), 434–435.
[64] Brickworks’ submissions, [25]–[27].
Brickworks states that the benefits could not be reduced by way of the exercise of a discretion, there is no provision for the exercise of discretion pursuant to ss 36 and 37. It submits the payment of money by the earlier insurer cannot be a ‘deductible’ as compensation payments do not fall within the definition of ‘earnings’ and are “excluded by cl 6(2)(c)”. Brickworks submits there is no basis for a reduction of the payments to take account of the compensation already received for the same period of incapacity. It submits:
“The inevitable outcome of the awards for payment of compensation is that the [worker] will be paid more than his PIAWE. This is an error of law.”[65]
[65] Brickworks’ submissions, [27].
Brickworks submits the Member correctly noted that payments made by EML were not ‘earnings’ and that the matter did not raise issues under s 22. Two separate incapacities were not alleged. There was only one incapacity, which had already been compensated. It was error to make an award doubly compensating for the same incapacity. The notation inserted at [31] of the reasons was “meaningless and an error of law”. An absurdity arises from the construction of ss 36 and 37 “as inherently applied by the Member”. Having already received compensation from another insurer, on the basis that he had no capacity, from September 2019, an award has been made for compensation for the same period on the basis that he had no work capacity.[66]
[66] Brickworks’ submissions, [28]–[31].
Brickworks submits the Member’s interpretation of ss 36 and 37 results in the following absurdities:
(a) the worker is entitled to full compensation pursuant to ss 36 and 37 of the 1987 Act;
(b) he is not obliged to refund any compensation or reduce his entitlement based on moneys already paid;
(c) he is overly compensated contrary to common law principles, and
(d) compensation received will exceed the statutory maximums under ss 36 and 37.[67]
[67] Brickworks’ submissions, [30].
Brickworks submits “there can be no two overlapping periods of total incapacity”. It submits the Member erred in awarding compensation pursuant to ss 36 and 37 from September 2019 when compensation had already been paid. This “offends the legal prohibition against over compensation”. Brickworks submits the Member’s reasons are insufficient to permit it to understand why the findings were made and awards and notation were entered. It submits there is no rationale referable to an analysis “to explain what the notation at [31] is meant to achieve”. It submits this is an error of law. Reference is made to Beale v Government Insurance Office (NSW)[68] and Nepean Rubber Moulding Pty Ltd v Veljanoski.[69]
[68] (1997) 48 NSWLR 430, 443–444.
[69] [2014] NSWWCCPD 3, [21].
Worker’s submissions
The worker makes submissions on Grounds Nos. 4 to 7 separately.
Ground No. 4 raises the issue that the Member erred in awarding compensation on the basis that the worker had no work capacity despite being awarded compensation at rates of $858.56 to $888.96 per week.
The worker submits this issue was not raised by Brickworks as a notified issue and that objection to it was taken at the hearing. The worker submits the Member erred in permitting this point to be elevated to an issue. The matter proceeded with an acceptance by the worker that he would fail if he could not establish the pleaded injury against Brickworks and incapacity resulting from that injury. His case was that events at Brickworks “triggered a relapse of his pre-existing but quiescent PTSD”. If he succeeded in that, his entitlements would be assessed according to the legislation. All of the evidence supported a finding that the worker had no current work capacity at all relevant times. Once that was established, he was entitled to have his entitlement assessed in accordance with Pt 3 Subdiv 2 of the 1987 Act. This invited an assessment of his ‘pre-injury average weekly earnings’ (PIAWE) and quantification pursuant to ss 36 and 37 of the 1987 Act.[70]
[70] Worker’s submissions, [23]–[27].
The worker states that Brickworks “seemed” to argue at first instance, and on this appeal, that income support from a previous employer (although based on a lower PIAWE) somehow disentitled the worker from obtaining an award or left the Commission without jurisdiction. The worker describes this as misconceived. He asks what would Brickworks’ liability have been if the earlier insurer had not elected to make voluntary payment? Would the worker’s rights have been extinguished if he had received income support from Centrelink or an income protection insurer? Obviously not. Brickworks did not invoke s 22 of the 1987 Act to seek apportionment against EML. The worker had no notice of any issue that may have permitted EML’s joinder to the proceedings. From the worker’s point of view, he was simply being paid by EML at the maximum permissible rate for its liability. The worker submits that Brickworks’ position is defeated by s 22(7) of the 1987 Act. It is not supported by law or principle and the appeal on this issue should be dismissed.[71]
[71] Worker’s submissions, [28]–[34].
Ground No. 5 raises an argument that the Member erred in making a notation of the payments made by EML, when there was no provision under ss 36 and 37 for a reduction, and no joinder pursuant to s 22 of the 1987 Act had been made. The worker submits the notation made it clear to a reader that the worker was not seeking to be paid twice for the same period of incapacity. The worker submits this is not an appealable error and rhetorically asks what relief Brickworks seeks in this regard.[72]
[72] Worker’s submissions, [35].
Ground No. 6 raises the fact that, with the receipt of compensation from other sources, the worker would receive compensation in excess of his pre-injury average weekly earnings, offending the principle against double compensation. The worker submits this raises an issue that was not notified and should not be entertained. The worker submits it reflects a misconception, on Brickworks’ part, of the effect of the determination.
Ground No. 7 raises an argument that the Member failed to provide adequate reasons for awarding compensation pursuant to ss 36 and 37 when the worker had already recovered compensation for the same total incapacity from another insurer and for another injury. The worker submits that the Member had no obligation to deal with the issue at all let alone give reasons. In any event, his determination was correct in law.
Brickworks’ submissions in reply
Dealing with Ground No. 4, Brickworks submits this issue was fully ventilated, it was a matter of legal construction, there was no prejudice to the worker in raising the defence. It again submits that, as the worker was compensated by another employer for the same period of incapacity, he could not be compensated for that period by Brickworks, as this offends a fundamental rule against over-compensation. It submits that the worker conceded that s 22 of the 1987 Act could not be invoked as the prior employer had not been joined.[73]
[73] Brickworks’ submissions in reply, [5]–[6].
Referring to Ground No. 5, Brickworks submits the notation had no legal effect. Brickworks is liable to the full extent of the award. There is no basis to reduce the payments on account of payments already made.[74]
[74] Brickworks’ submissions in reply, [7].
Dealing with Ground No. 6, Brickworks submits the subject matter is not a ‘notifiable issue’. The ground arises from the Member’s reasons and the award entered, which results in over-compensation.[75]
[75] Brickworks’ submissions in reply, [8].
Brickworks submits it argued against an award of weekly benefits where there was a risk of overcompensation. The reasons for making the award should have been fully and properly disclosed but were not.[76]
[76] Brickworks’ submissions in reply, [9].
Legislation
Section 22 of the 1987 Act provides:
“22 Compensation to be apportioned where more than one injury
(1) If—
(a) the death or incapacity of a worker, or
(b) a permanent impairment suffered by a worker as referred to in Division 4 of Part 3, or
(c) a liability under Division 3 of Part 3 to a worker,
results from more than one injury to the worker, liability to pay compensation under this Act is to be apportioned in such manner as the Commission determines.
(1A) Death, incapacity, loss or liability that results partly from one injury and partly from one or more other injuries is taken to have resulted from more than one injury.
(2) Liability to pay compensation under this Act includes—
(a) the liability of an employer (including an employer who is a self-insurer), and
(b) the liability of an insurer under a policy of insurance in respect of the payment of that compensation (including a direct liability to the worker), and
(c) a liability in respect of a claim under Division 6 of Part 4, and
(d) in the case of a worker who is partially incapacitated for work, a liability that arises because the worker is entitled to be compensated under this Act as if totally incapacitated.
(3) Liability to pay compensation under this Act is not to be apportioned by the Commission if the parties to whom the liability relates have agreed on the apportionment.
(4) Liability to pay compensation under this Act may be apportioned by the Commission even though it is the liability of a single insurer in respect of different periods of insurance, but only if the employer or the Authority applies for such an apportionment.
(5) The Commission may, on the application of any insurer or employer concerned or of the Authority, determine a dispute as to whether—
(a) liability to pay compensation under this Act should be apportioned under this section, or
(b) any such liability should be apportioned under this section in respect of different injuries.
The determination of the Commission has effect despite any agreement on apportionment if the application for determination was made by an employer (in the employer’s own right) or the Authority.
(6) (Repealed)
(7) A person who is liable to pay compensation under this Act is not entitled in any proceedings under this Act to a reduction in that liability by apportionment on account of the existence of any other person who is also liable to pay any part of that compensation unless that other person is a party to the proceedings.
(8) This section applies to any liability arising before or after the commencement of this Act.”
Section 22A of the 1987 Act provides:
“22A Further provisions concerning apportionment of liability under section 22
(1) The apportionment of liability under section 22 is—
(a) in the case of the apportionment of liability between employers—to be on the basis of the relative length of the worker’s employment with each employer concerned (not including any period of employment after the last relevant injury was received), or on such other basis as the Commission considers just and equitable in the special circumstances of the case, and
(b) in the case of the apportionment of liability between insurers of the same employer—to be on the basis of the relative length of the employer’s period of insurance with each insurer concerned during which the worker concerned was employed by the employer (not including any period of insurance after the last relevant injury was received), or on such other basis as the Commission considers just and equitable in the special circumstances of the case.
(2) (Repealed)
(3) Liability may be apportioned under section 22 even if the liability has been discharged.
(4) When liability to pay compensation is apportioned under section 22 between 2 or more persons, the Commission may order that the compensation is payable to the worker by one of those persons and that the other persons are to pay (by way of contribution) their apportioned share of that compensation to that person.
(5) The person ordered under subsection (4) to pay compensation to the worker is to be—
(a) in the case of apportionment between employers—the employer who most recently employed the worker, or such other of the employers as the Commission considers reasonable in the special circumstances of the case, and
(b) in the case of apportionment between insurers—the insurer of the employer at the time of the last injury, or such other of the insurers as the Commission considers reasonable in the special circumstances of the case.
(6) An order is not to be made under subsection (4) if the parties concerned have agreed as to the payment by one of them of the compensation concerned.
(7) In this section a reference to an insurer includes a reference to a self-insurer and a reference to a period of insurance includes a reference to a period of self-insurance. A liability in respect of a claim under Division 6 of Part 4 is for the purposes of this section taken to be a liability of the insurer of the employer concerned during the period that is relevant to that liability.
(8) In a case to which section 22 applies, if all of the insurers concerned (being either insurers of the same employer or of the different employers concerned) are insurers within the meaning of Division 4 of Part 7 and the entitlement of the worker (or other claimant) to receive compensation is not disputed—
(a) the compensation is (despite subsection (5)) payable by the last insurer or the last employer (as relevant to the case), with no apportionment of liability under section 22, and
(b) for the purposes of calculating an insurance premium payable by any of those employers, their claims histories are to be determined on the assumption that liability had been apportioned under section 22 (without the need for a determination of, or agreement as to, that apportionment).
(9) The operation of section 22 is not to be limited because of the fact that it provides for liability to be apportioned rather than providing for payment of contributions.”
Section 289A of the 1998 Act provides:
“289A Further restrictions as to when a dispute can be referred to Commission
(1) A dispute cannot be referred for determination by the Commission unless it concerns only matters previously notified as disputed.
(2) A matter is taken to have been previously notified as disputed if—
(a) it was notified in a notice of dispute under this Act or the 1987 Act after a claim was made or a claim was reviewed, or
(b) it concerns matters, raised in writing between the parties before the dispute is referred to the President for determination by the Commission, concerning an offer of settlement of a claim for lump sum compensation.
(3) The Commission may not hear or otherwise deal with any dispute if this section provides that the dispute cannot be referred for determination by the Commission. However, the Commission may hear or otherwise deal with a matter subsequently arising out of such a dispute.
(4) Despite subsection (3), a dispute relating to previously unnotified matters may be heard or otherwise dealt with by the Commission if the Commission is of the opinion that it is in the interests of justice to do so.”
Consideration
Sections 35, 36 and 37 of the 1987 Act provide statutory formulae for the calculation of weekly compensation during incapacity. They interact with s 32A and Sch 3 of the 1987 Act, which provide various statutory definitions. In general terms, prior to the commencement of the 2012 amendments, if a worker was being compensated on the basis of partial incapacity, the weekly entitlement could be reduced on account of discretionary factors, to reflect such amount as may appear proper in the circumstances (s 11(1) of the Workers Compensation Act 1926, s 40(1) of the 1987 Act prior to the 2012 amendments, see generally Mitchell v Central West Health Service,[77] Australian Wire Industries Pty Ltd v Nicholson[78]). There is no comparable discretion in ss 35 and 36 of the 1987 Act. This is the statutory basis behind the references in the submissions to the unavailability of discretion. The discretion never had application in any event, under the provisions applying prior to commencement of the 2012 amendments, where a worker was totally incapacitated.
[77] (1997) 14 NSWCCR 526.
[78] (1985) 1 NSWCCR 50.
There was discussion during submissions before the Member, and in the reasons, going to Cordina (see the reasons at [12] to [14]). That is a decision of Roche DP that deals with, and summarises the authorities relating to, the circumstances where a worker may have two separate and distinct incapacities, and a resultant entitlement to two awards of weekly compensation. The Member correctly noted the evidence supported the existence of a single incapacity, and it was unnecessary to further consider the principles discussed in Cordina.
It follows that the references to Cordina, and to the removal of the statutory discretion, are not of direct relevance to the issues in the current case.
Ground No. 4
The Member found that the worker had no current work capacity. Brickworks in Ground No. 4 asserts that it was an error of law to enter an award on the basis of no work capacity, when the worker was being compensated by EML for the same incapacity.
The argument that receipt of compensation payments from EML was inconsistent with a finding that there was ‘no current work capacity’ is misconceived. The terms ‘current work capacity’ and ‘no current work capacity’ are defined in cl 9 of Sch 3 to the 1987 Act:
“9 Meaning of ‘current work capacity’ and ‘no current work capacity’
(1) An injured worker has current work capacity if the worker has a present inability arising from the injury such that the worker is able to return to the worker’s pre-injury employment, or is able to return to work in suitable employment, but the weekly amount that the worker has the capacity to earn in any such employment is less than the weekly amount that the worker had the capacity to earn in that employment immediately before the injury.
(2) An injured worker has no current work capacity if the worker has a present inability arising from an injury such that the worker is not able to return to work, either in the worker’s pre-injury employment or in suitable employment.”
There is no legitimate basis on which it can be argued that the receipt of weekly compensation is inconsistent with a finding that a worker has no current work capacity. The receipt of compensation from EML is simply irrelevant to that issue. For that reason, Ground No. 4 fails.
There is an additional matter raised by the worker. Brickworks issued two dispute notices, dated 14 May 2020[79] and 9 November 2020.[80] These described the matters in dispute as s 4 (injury), s 9A (substantial contributing factor), s 11A (psychological injury as a result of reasonable action in respect of discipline), s 33 (did incapacity result from injury), ss 36 and/or 37 (an entitlement to weekly benefits in respect of incapacity) and ss 59 and 60 (entitlement to medical expenses). Near the commencement of the hearing Brickworks’ counsel, identifying the issues, referred to the matters raised in the dispute notices. He continued:
“There’s a very large issue that arises from what was said by Mr Stockley which I just want to expand on though which is the alleged entitlement to two awards in respect of no work capacity. That can be dealt with under the chapeau of section 33 as well. I don’t concede that this gentleman can receive two separate awards in respect of no work capacity under the current weekly benefits regime.”[81]
[79] ARD, pp 9–15.
[80] ARD, pp 16–24.
[81] Transcript of arbitration hearing 12/8/21, (T), T 7.24–31.
Mr Stockley objected to this issue being raised on the basis it had not been notified in the dispute notices:
“Well, as presently instructed, Member, the matters mentioned by Mr Combe just then aren’t in issue, they’re not something that, as far as I can discern, is identified in the dispute notice and I don’t propose to make any submissions to you on it unless and until my friend can point to where it’s raised as an issue. The [worker is] not in receipt of an award from any source at the moment. The only award he seeks is one against [Brickworks]. I’ll leave that for the moment and see how that plays out.”[82]
[82] T 9.11–20.
The worker did not have, and did not seek, an award against EML (or its insured) in respect of the 2008 injury. EML was not a party to these proceedings, or to any other relevant proceedings so far as can be ascertained from the material. On a fair reading of the dispute notices issued by Brickworks, the above issue was not raised in those notices. Brickworks did not seek leave pursuant to s 289A(4) of the 1998 Act to rely on unnotified matters. The need for an employer to clearly raise issues on which it relies, and the consequences of a failure to do so, were discussed in Mateus v Zodune Pty Ltd t/as Tempo Cleaning Services,[83] a decision with which I agree and which has been regularly applied over many years. The worker’s counsel made it clear during the hearing that he relied on the absence of appropriate notice of the additional issue and objected to it being raised. He did not acquiesce in Brickworks’ attempts to raise the issue without appropriate notice.
[83] [2007] NSWWCCPD 227.
The Member dealt with Brickworks’ submissions on the topic relatively briefly in the reasons at [13] to [14]. The effect of this consideration was that, to the extent to which the Member permitted Brickworks to raise an unnotified matter, this did not affect the outcome and did not constitute appealable error.[84]
[84] Gerlach v Clifton Bricks Pty Ltd [2002] HCA 22; 209 CLR 478 (Gerlach), [10].
Ground No. 5
Ground No. 5 alleges error in noting the receipt of compensation from EML, where there was no provision in the 1987 Act for a reduction under ss 36 and 37 of the 1987 Act, and no joinder of the prior employer under s 22 was made. It submits the notation at [31] of the reasons was “meaningless and an error of law”. The worker submits this did not constitute appealable error. The worker rhetorically asks what relief Brickworks seeks in respect of this alleged error. Brickworks gives no meaningful response to this question.
The worker’s argument on this ground is correct. On Brickworks’ submission, the effect of this alleged error was to include a notation that was meaningless. This was not dispositive and does not constitute appealable error.[85] Ground No. 5 fails.
[85] Gerlach, [10].
Ground No. 6
Ground No. 6 alleges error in awarding compensation where the effect was that this award, with the receipt of compensation from other sources, would exceed the worker’s pre-injury average weekly earnings, offending the principle against double compensation.
Brickworks relies on the High Court decisions in Haines and Manser as authority for the operation of the “principle against over compensation or double compensation”. The plurality in Haines spoke of:
“The settled principle governing the assessment of compensatory damages, whether in actions of tort or contract, is that the injured party should receive compensation in a sum which, so far as money can do, will put that party in the same position as he or she would have been in if the contract had been performed or the tort had not been committed.”[86] (excluding citations) (emphasis added)
[86] Haines, [1].
Haines dealt with the entitlement of a worker to interest, on certain heads of damage, as part of his common law damages, between the date when the cause of action arose and the date on which judgment in the common law proceedings took effect. Their Honours said:
“An award of interest up to the date of judgment is an award of interest in the nature of damages. This statement acknowledges that the award of interest is an integral element in the attainment of the object of damages, namely, to compensate a plaintiff for injury sustained. Hence the award of interest is compensatory in character.”[87] (excluding citations)
[87] Haines, [9].
Their Honours concluded that a payment of lump sum compensation, pursuant to the former s 16 of the Workers Compensation Act 1926, should be brought into account in calculating the interest to which the plaintiff was entitled, from the date when the cause of action accrued to the date of judgment in the common law proceedings.[88]
[88] Haines, [26]–[27].
Manser involved a plaintiff injured in a motor vehicle accident, in respect of which she recovered damages. Subsequent to the motor accident, and before conclusion of her damages claim relating to the accident, the plaintiff, in an incident at her work, aggravated the injuries suffered in the motor accident. She received payments of weekly compensation from her employer in respect of this aggravation. There was a question regarding “whether damages [in the motor accident case] should be assessed by taking account of the compensation which the plaintiff had received and would receive under the Act without any obligation to repay Workcover”. This assumed that the defendant in the motor accident proceedings “would otherwise be liable in damages for the consequences of the work injury”. The issue was whether the plaintiff could recover the same loss twice, once from Workcover and again from the defendant in the common law proceedings. The High Court considered the relevant provisions from the South Australian workers compensation legislation and concluded that the provisions giving Workcover a right of recovery had “no application to a case where the right to compensation arises from an event subsequent to the tort in which the original injury was inflicted”.[89]
[89] Manser, [2]–[7].
The High Court referred to:
“… advantages which accrue to the injured plaintiff, whether as a result of legislation or of contract or of benevolence, which have an additional characteristic … they are conferred on him not only independently of the existence in him of a right of redress against others but so that they may be enjoyed by him although he may enforce that right: they are the product of a disposition in his favour intended for his enjoyment and not provided in relief of any liability in others fully to compensate him. This is readily seen in the case of benevolence.”
The Court referred to the following, from the reasons of Windeyer J in The National Insurance Co of New Zealand Ltd v Espagne:
“The most satisfying of the reasons that have been given for refusing to diminish damages because of voluntary gifts is that they are given for the benefit of the sufferer and not for the benefit of the wrongdoer. That, it may be said, cuts across the principle that damages for negligence are compensatory and not punitive. ... But I do not think the two propositions necessarily come into collision. A donor can say who is to benefit by his generosity.”
“… it is not, I think possible, to enunciate an exhaustive rule for all parts of this vexed topic. And the questions that arise can never be determined in the abstract. Each must depend on the terms of the particular contract, pension scheme, charitable benefaction or statute governing the benefit conferred.”[90]
[90] [1961] HCA 15; 105 CLR 569 (Espagne), 598, 600.
In Manser the plaintiff was entitled to receive compensation, under the South Australian workers compensation legislation, which did not have to be repaid. The High Court concluded “the receipt or entitlement should be taken into account in the assessment of the plaintiff’s award of damages in a way which ensures that the plaintiff does not receive and retain double compensation for the same loss or expense.”[91]
[91] Manser, [14].
The first thing to be noticed is that both Haines and Manser involved a consideration of principle in the context of common law claims for damages. Haines speaks of the “compensatory” nature of such damages. The decisions, particularly that in Manser, make it clear that there may be circumstances where an award of damages may exceed a plaintiff’s actual loss, depending on the basis on which moneys have been paid. The “principle against over compensation” on which Brickworks relies will not apply in all circumstances.
The basis on which voluntary payments were made by EML was submitted to be based on a “lower PIAWE” than would apply to the more recent claim (see [72] above). I would infer this would result from the PIAWE being based on earnings that applied to the claim dating from 2008, as opposed to the more recent events and pay rates leading to the claim based on events in 2019. Whatever the reason, the weekly rate paid to the worker by EML from 24 September 2019 to 17 May 2021 ranged from about $858.56 to $888.96.[92] The rate at which the award was made by the Member in respect of the 2019 injury, was $1,944.22 from 23 September 2019 to 23 December 2019, and $1,637.24 thereafter. The rate at which the worker was compensated by EML in its voluntary payments was a little more than one half of the rate found to be applicable in the current claim. The worker was not, in the absence of the current proceedings, being fully compensated. Brickworks declined the worker’s claim based on the psychological injury in 2019 (as it was entitled to do).
[92] ARD, pp 250–252.
The only basis on which the worker could pursue his entitlements, based on his earnings in 2019, was by pursuing his claim against Brickworks. In doing that, the only orders sought by the worker were based on his statutory entitlements against Brickworks.
The factual situation in the current case is not uncommon. In Cluff v Dorahy Bros (Wholesale) Pty Ltd the Court of Appeal said:
“It is well established that if a worker receives an injury in the course of his employment with A that renders him vulnerable to increased disability by the effects of further work and then in the employment of B the work brings about those effects that it is open to the tribunal of fact to hold that the ultimate incapacity resulted from the first injury in the employment of A and it is not to the point that if the worker had in these circumstances proceeded against B he might also have obtained an award in respect of the whole extent of his existing incapacity.
It is also not open to doubt that if a worker receives a disability in the employment of A and subsequently receives an injury in the employment of B which is causally related to the original disability it is open to the tribunal to conclude that any incapacity arising after the second injury resulted from the first injury.”[93]
[93] [1979] 2 NSWLR 435; 53 WCR 167, 176 (per Reynolds JA, Hope and Glass JJA agreeing), (Cluff). See also Calman v Commissioner of Police [1999] HCA 60, [38].
It is apparent that the factual situation outlined in Cluff can lead to a position where there are two employers potentially liable for payment in respect of a single period of incapacity. Sections 22 and 22A of the 1987 Act are set out at [80] and [81] above. Section 22(1) provides inter alia for apportionment of liability where incapacity results from more than one injury to a worker. It is open to the parties to agree on apportionment (subs (3)). Subsection (5) provides for determination of a dispute regarding whether liability to pay compensation should be apportioned “on the application of any insurer or employer concerned or of the Authority”. The evidence does not suggest that any such application was made. There is no indication that Brickworks and EML have sought to come to any agreement on apportionment.
Mr Stockley, the worker’s counsel, raised s 22 at the hearing. He said that the payments made by EML “don’t, in any way, affect the liability of Brickworks if they’re liable”. He continued:
“If the [worker’s] incapacity results from more than one injury there is a facility pursuant to section 22 of the ’87 Act for an apportionment between employers or insurers or both and they can avail themselves of those legislative provisions if they see fit.”[94]
[94] T 33.12–20.
Mr Stockley referred to Sutherland Shire Council v Baltica General Insurance Co Ltd,[95] a decision which affirmed the operation of s 22 of the 1987 Act. In that case Clarke JA said:
“… a trial judge’s initial task is to determine the liability of an employer or employers to pay compensation to a worker. If the worker satisfies the test in a case where there are a number of work injuries and apportionment is sought, the trial judge is then to apply the section 22 test and that test will be satisfied if the incapacity resulted partly from one injury (presumably the injury which led to the finding under section 33) and partly from another or other injuries.”[96] (emphasis added)
[95] (1996) 39 NSWLR 87; 12 NSWCCR 716 (Baltica).
[96] Baltica, 732F.
Mr Stockley continued:
“… he’s entitled to the full measure of the compensation against this employer and the fact is that in the meantime a voluntary payment’s been made to him by someone else. Now, let’s say the voluntary payment had been made by [Brickworks], he’d still be entitled to the full award but they’d get credit for it but for the payments made. We’re simply saying that the same proposition would apply here. So their obligation has been discharged by someone else but we don’t seek to have it paid twice.”[97]
[97] T 35.7–16.
The Member raised, with Mr Stockley, the proposition that the worker, if paid from both sources, “would receive in combination far more than the entitlement”. Mr Stockley responded:
“We’re not asking for a result that has that effect because – maybe this is a matter for subsidiary argument depending on what findings you do make but the award will have been discharged to the extent that EML’s already paid it and [Brickworks] can point to that and they’d get no pushback from the [worker]. So we’re only asking them to pay the difference between what he’s already received and the full extent of their obligation.”[98]
[98] T 34.13–23.
Mr Combe said a submission that s 22 could “be relied upon for some sort of apportionment order has to be rejected” because of section 22(7), “any person against who[m] such an order is to be made has to be joined to the proceedings”. Mr Stockley said he agreed that there was “no basis for an order to be made”, saying:
“I said in due course if there was – if anyone wanted relief that’s where they could go but I’m not suggesting that the Commission’s going to entertain a section 22 application today.”[99]
[99] T 38.4–27.
It is apparent why such an application could not be pursued at the hearing, given it does not appear that an application raising s 22 had been made at that point or that EML (or its insured) had been placed on notice of such an application. This was not the end of the matter. Section 22A(3) permits the making of an application after the relevant liability has been discharged: HIH Workers Compensation (NSW) Pty Ltd v GIO General Ltd.[100] Brickworks submits the matter did not raise issues pursuant to s 22 (see [66] above). It clearly did have that capacity, and Mr Stockley drew s 22 to the attention of the Member and his opponent in the exchange referred to at [108] to [111] above. In considering Brickworks’ submission that the Member’s orders impermissibly involved “over compensation” it is appropriate to have regard to the statutory context in which the orders were made. That context included ss 22 and 22A. This, in a general sense, is consistent with the passage from Espagne quoted at [101] above.
[100] [2000] NSWCC 25; 21 NSWCCR 108.
A further point which should be made is that the pleadings in the matter did not seek any relief against EML or its insured. The worker sought a weekly award against Brickworks pursuant to ss 36 and 37, and a general order for treatment expenses.[101] These were the only claims before the Member and the only claims that the Member determined or made orders in. He did not make orders relevant to any liability of EML or its insured. At the request of the worker he simply noted the voluntary payments that EML had made. The position adopted by the worker was that payments made by EML would be treated as being in partial discharge of the liability of Brickworks pursuant to the award the Member was asked to enter. That position had the effect that payments to the worker from both sources would not exceed Brickworks’ liability pursuant to the award. The Member did not err by simply deciding the only claim that was brought before him.
[101] T 33.20–23.
In short, ss 22 and 22A of the 1987 Act permit apportionment of liability where a liability to pay compensation results from more than one injury. Section 22(5) provides for an application to be made by “any insurer or employer concerned or of the Authority”. Section 22(7) provides that compensation is not to be reduced on account of the liability of a person who is not a party to the proceedings. It would have been open to Brickworks to bring an application for apportionment against EML or its insured, which it did not do. It then relied on the absence of EML or its insured, as a party to these proceedings, to submit that s 22(7) prevents the making of “some sort of apportionment order”.[102] It submits on this appeal that “the matter does not involve a question of apportionment under s 22 of the 1987 Act”.[103] Against that background, Brickworks then identifies a number of what it describes as “absurdities” set out at [67] above. Brickworks should by now have satisfied the weekly award made against it. It is open to Brickworks to bring an application pursuant to s 22 to seek apportionment orders should it wish.
[102] T 38.4–9.
[103] Brickworks’ submissions, [28].
The only orders for the payment of moneys were in respect of the claim based on the 2019 injury. Whatever moneys have been paid by EML in respect of the 2008 injury, they are not the subject of orders of the Commission. If Brickworks utilises the machinery in s 22 of the 1987 Act, there is no reason to anticipate any over-compensation. The approach suggested by Mr Stockley in the running of the case (see [109] to [111] above) would have avoided any risk of over-compensation. Ground No. 6 fails.
Ground No. 7
Brickworks submits the Member failed to provide adequate reasons for making an award pursuant to ss 36 and 37 of the 1987 Act when the worker had already recovered compensation for the same total incapacity from another insurer and for another injury. It submits the Member’s reasons are insufficient to permit it to understand why the findings were made and awards and notation were entered. The way in which the ground is framed restricts it to the reasons on this specific point.
The Member considered the parties’ submissions going to ‘two awards’ and Cordina. He concluded (and this is not challenged) that there was a single incapacity.[104] He set out the principles that were “tolerably clear” from Cordina. He set out the circumstances where two awards may be available. He said “the main point is that in the aggregate, the payments must not exceed the [worker’s] probable weekly earnings”.[105] The Member said that, the discretion having been removed, “the factors just mentioned cannot always be achieved”.
[104] Reasons, [14].
[105] Reasons, [12].
The Member set out four “points to be made”. These were:
(a) Payments from EML were not ‘earnings’ and did not form part of the calculations relating to ‘AWE’ in ss 36 and 37 of the 1987 Act.
(b) There was not an entitlement to two awards as two separate incapacities were not alleged. It was unnecessary to deal with s 22 of the 1987 Act as the first employer had not been joined.
(c) The worker was capable of doing his full usual duties from 2013 to August 2019. The medical evidence generally accepted that the events leading up to and during August 2019 were the trigger for resurrection of the worker’s PTSD, and incapacity resulted from that aggravation.
(d) It was unnecessary to consider Cordina as the evidence supported a single incapacity from August 2019.
The Member referred to the evidence from Dr Bisht in 2013, which supported the proposition that the worker, from 2013 to 2019, was in remission and worked without a mental handicap.[106] He referred to the medical certificates that attributed incapacity to the injury in 2008. He referred to medical evidence that the cessation of work in 2019 “was caused by bullying and harassment in the workplace”. He said a decision regarding which injury is truly causative is a legal issue on the whole of the evidence. He considered that Dr Roberts’ opinion was supportive of the worker’s position, as it indicated the worker had an ‘eggshell skull psyche’.
[106] Reasons, [15]–[16].
The issues raised were those set out at [7] above, taken from the dispute notices issued by Brickworks. The worker did not consent to the expansion of the matters in dispute. Brickworks did not apply for leave pursuant to s 289A of the 1987 Act to rely on additional matters. The worker having succeeded on the ‘liability’ issues, it was necessary that the Member deal with quantification of the weekly entitlement, in particular applying the provisions in ss 36 and 37 of the 1987 Act. This the Member did in an unexceptionable way. In NSW Police Force v Newby Keating P dealing with the obligation to provide adequate reasons in the former Workers Compensation Commission of NSW, said:
“149. To succeed in having the Arbitrator’s decision set aside on this ground, the Police Force must demonstrate not only that the reasons are inadequate, but that their inadequacy discloses that the Arbitrator failed to exercise his statutory duty to fairly and lawfully to determine the application (YG & GG v Minister for Community Services [2002] NSWCA 247). Reasons must set out the judge’s (Arbitrator’s) reasoning process and merely incorporating counsel’s submissions is not appropriate (Sourlos v Luv a Coffee Lismore Pty limited & anor [2007] NSWCA 203 at [30]).
150. The standard by which the adequacy of reasons must be determined is relative to the nature of the decision itself and the decision-maker (Mayne Health Group t/as Nepean Private Hospital v Sandford [2002] NSWWCCPD 6). It is not necessary for an Arbitrator to refer to every piece of evidence (Yates Property Corporation Pty Limited (in Liq) v Darling Harbour Authority (1991) 24 NSWLR 156; Ainger v Coffs Harbour City Council [2005] NSWCA 424).
151. When considering the adequacy of the reasons the decision must be read as a whole (Beale v GIO (NSW) (1997) 48 NSWLR 430 at 443-444 (‘Beale’)). A Presidential member on review is not required to comb through the Arbitrator’s findings and reasons in search of error (Minister for Immigration and Multicultural Affairs v Wu Shu Liang [1996] HCA 6; (1996) 185 CLR 259). In Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 (‘Soulemezis’) McHugh JA (as he then was) stated at 280:
‘If an obligation to give reasons for a decision exists its discharge does not require lengthy or elaborate reasons: Ex parte Powter; Re Powter (1945) 46 SR (NSW) 1 at 5: 63 WN 34 at 36.’”[107]
[107] [2009] NSWWCCPD 75 (Newby), [149]–[151].
In my view the reasons given by the Member satisfied his obligation to furnish adequate reasons in dealing with the issues that were before him. The orders were, of course, made only against Brickworks, it being the only employer that was a party to the proceedings. It is open to Brickworks to seek apportionment orders pursuant to s 22 of the 1987 Act, should it wish. Ground No. 7 fails.
DECISION
The various grounds raised by Brickworks have failed. The appeal fails.
The Certificate of Determination dated 23 August 2021 is confirmed.
Michael Snell
DEPUTY PRESIDENT
7 June 2022
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