Dapto Leagues Club Ltd v Thomas
[2008] NSWWCCPD 107
•26 September 2008
| WORKERS COMPENSATION COMMISSION | |||||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | |||||
| CITATION: | Dapto Leagues Club Ltd v Thomas [2008] NSWWCCPD 107 | ||||
| APPELLANT: | Dapto Leagues Club Ltd | ||||
| RESPONDENT: | Nigel Thomas | ||||
| INSURER: | Cambridge Integrated Services Pty Ltd | ||||
| FILE NUMBER: | WCC2049-08 | ||||
| DATE OF ARBITRATOR’S DECISION: | 21 May 2008 | ||||
| DATE OF APPEAL DECISION: | 26 September 2008 | ||||
| SUBJECT MATTER OF DECISION: | Psychological injury; section 11A Workers Compensation Act 1987; whether the cause of injury was multi-factorial or wholly or predominantly due to performance appraisal or discipline of the Worker; notice, incapacity, the effect of pre-existing intellectual impairment on work related psychological injury. | ||||
| PRESIDENTIAL MEMBER: | President Judge Keating | ||||
| HEARING: | On the papers | ||||
| REPRESENTATION: | Appellant: | Workplace Law | |||
| Respondent: | Carroll & O’Dea Lawyers | ||||
| ORDERS MADE ON APPEAL: | The decision of the Arbitrator dated 21 May 2008 is confirmed. | ||||
BACKGROUND TO THE APPEAL
On 12 June 2008 Dapto Leagues Club Ltd (‘the Appellant / Employer’) sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission (‘the Commission’) against a decision dated 21 May 2008.
The Respondent to the Appeal is Nigel Thomas (‘the Respondent / Worker’).
Mr Thomas is 36 years of age. He suffers from a mild congenital intellectual disability, which was diagnosed at the age of 3. He attended special education classes, leaving school at age 18, without the School Certificate or Higher School Certificate. After leaving school he was awarded a disability pension for intellectual disability.
For several years after leaving school, the Worker was employed by companies specialising in employment of people with disabilities before finally securing employment with Dapto Leagues Club where he worked for 13 years, until he ceased employment on 11 October 2007.
The Worker was employed for the first ten years of his employment as a kitchen hand, before transferring to his current role as a floor person, which involves responsibility for cleaning tables, clearing glasses and general cleaning of designated areas.
The Worker claims that over a ten year period he was harassed by certain employees including Mary Conroy (Kitchen Supervisor), Judy Dubois (Cook) and Mira Gilly.
The Worker claims that he suffered a chronic adjustment disorder with mixed anxiety and depression due to the long period of harassment by management and staff.
The Worker’s employment records disclose that there were a series of verbal warnings, “recorded discussions”, counselling and/or discipline records and file memoranda concerning various aspects of the Worker’s employment.
An incident occurred on 11 October 2007. On that occasion the Worker was told by the duty manager to stay in the lobby bar and clean tables, pick up glasses and not to move from there. The Worker did leave the bar area, contrary to instructions, in order to speak to a patron celebrating a birthday. The Worker was stood down pending an investigation into his actions. The Worker was interviewed and was told he was to be issued with a ‘Final Formal Written Warning’ on his return to duties. The Worker did not return to duties with the Employer.
The Worker made a claim for weekly benefits from 12 October 2007 to date and continuing and section 60 expenses. The Worker’s claim for weekly benefits and medical expenses has been declined.
On 19 March 2008 Mr Thomas filed an ‘Application to Resolve a Dispute’ (‘the Application’) in the Commission, claiming weekly benefits of compensation from 5 November 2007 to date and continuing, alleging a chronic adjustment disorder with mixed anxiety and depression due to harassment by management and staff.
The matter was heard before a Commission Arbitrator on 6 May 2008 and decided by him in a reserved decision delivered on 21 May 2008, in which he made the following orders and determinations:
(a)Respondent to pay $259.35 per week from 5 November 2007 to date and continuing pursuant to section 40;
(b)Respondent to pay the Applicant’s section 60 expenses;
(c)Respondent to pay the Applicant’s costs as agreed or assessed.
An appeal was filed on 12 June 2008, in which the Employer sought leave to appeal the Arbitrator’s determination.
LEAVE TO APPEAL
Monetary Threshold
Before proceeding to deal with an appeal the Commission must determine whether the Application meets the requirements of section 352 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’).
The quantum in issue on appeal is in excess of $5,000.00 and therefore the threshold in section 352(2)(a) of the 1998 Act is satisfied.
The amount of compensation on issue at appeal is at least $5,000.00 and at least 20% of the amount awarded in the decision appealed against. Section 352(2) of the 1998 Act is satisfied.
Time
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.
I grant leave to appeal.
ON THE PAPERS REVIEW
Section 354(6) of 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 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.
NATURE OF REVIEW
The Employer submits that this appeal is to be conducted by way of a “review”, which is neither a hearing de novo nor a narrow appeal. The Employer further submits that the perimeters of a review are established in decisions such as Mayne Health Group t/as Nepean Private Hospital v Sarah Sandford [2002] NSWWCCPD 6 (‘Sandford’) and Ross v Zurich Workers Compensation Insurance [2002] NSWWCCPD 7 (‘Ross’).
The Employer submits “the review” is by way of rehearing where the powers of the Commission to confirm, revoke or substitute a decision are exercisable only where it can be demonstrated that the original decision of the Arbitrator is effected by “…some legal, factual or discretionary error” (see Allesch v Maunz (2000) HCA 40 (3 August 2000) and Sandford).
The Worker submits that in the absence of demonstrated error, the appeal must fail notwithstanding a different Tribunal may come to a different decision on the facts.
In the light of recent Court of Appeal decisions, neither approach is correct.
The nature of a “review” under section 352 of the 1998 Act was considered in Aluminium Louvres and Ceilings Pty Ltd v Zheng (2006) NSWCA 34: (2006) 4 DDCR 358 (‘Zheng’) where Bryson JA said at [38]:
“A review is a different process to an appeal and the matters which may be considered and the manner in which they may be considered are somewhat wider. See Boston Clothing Co Pty Ltd v Margaronis (1992) 27 NSWLR 580 at 584 (Kirby P). An attack, on review or otherwise, on an Arbitrator’s discretionary decision in controlling procedure may be based on the test stated in House v R (1936) 55 CLR 499 at 504-505: but that is not the only basis upon which the Presidential Member may act. The powers of a Presidential Member on review are somewhat wider and extend to power to reopen consideration of a matter of which an Arbitrator has disposed, the manner in which the powers of a Presidential Member are to be exercised is itself the subject of discretion of the Presidential Member.”
McColl JA approved this passage in South Western Sydney Area Health Service v Edmonds (2007) 4 DDCR 421: (2007) NSWCA 16 at (134) (‘Edmonds’). To describe the relative weight and relevance of the expert evidence as “a discretionary decision which could only be disturbed on House v King principles” was described as “an over‑generalisation” (at [133]). Thus, on review a Presidential Member is not bound by an Arbitrator’s discretionary decision but can reach his or her own conclusion.
The nature of review was further considered in State Transit Authority of NSW v Fritzi Chemler (2007) NSWCA 249: (2007) 5 DDCR 287 (‘Chemler’) where Speiglmen CJ said at [28] and [30]:
“[28]The concept of a review on the merits is wider than the concept of an appeal in a judicial context. There is a well established line of authority on the use of terminology of “review” instead of “appeal” with respect to the workers compensation system in this State, which establishes the breadth of review on the merits.
[30] A Presidential member exercising a power to review a decision must decide whether the original decision is wrong or, as it is often put in the context of administrative appeals on merits, must decide what is the true and correct view. If s/he does so decide then s/he should substitute his or her own views, unless it is an appropriate case to remit. The power to remit is not constrained in the manner for which the Appellant contends.”
In a recent decision of Tan v National Australia Bank Limited [2008] NSWCA 198 Basten JA noted that at [12] (‘Tan’):
“The fact that the term “appeal” may refer to a hearing de novo, the fact that the appeal is described as one “by way of review”, together with the largely unlimited discretion conferred on the Deputy President as to the manner in which the appeal will be conducted and the broad powers, including the power to make a “new decision” in place of that subject to appeal, all tend to confirm that the Deputy President may conduct a fresh hearing and is not constrained to intervene only if satisfied that the decision of the Arbitrator was effected by identifiable error.”
I propose to apply these principles in the matter before me.
ISSUES IN DISPUTE
The Employer submits that the Arbitrator erred:
(a)In finding that the Worker had duly made a claim pursuant to section 260 of the 1998 Act (‘Duly Made Claim’). The Employer alleges that the Worker’s claim had not been duly made pursuant to section 260 of the 1998 Act and section 11A(8) of the Workers Compensation Act 1987 (‘the 1987 Act’);
(b)In finding that the Worker suffered any psychological injury pursuant to section 4 or section 11A(3) of the 1987 Act;
(c)In finding that the Worker suffered any psychological injury as a result of harassment and/or unfair treatment at work;
(d)In finding that the Worker’s employment with the Employer was a substantial contributing factor to any such psychological ‘injury’ pursuant to section 9A;
(e)In failing to find, in the event that the Worker did suffer such injury and satisfied sections 4, 9A and 11A(3), that such injury was wholly or predominantly caused by reasonable action taken by the Employer with respect of performance appraisal and/or discipline;
(f)In finding that the Worker was partially incapacitated for work pursuant to section 40.
DULY MADE CLAIM
The Employer submits that the Commission had no jurisdiction to entertain the Worker’s claim by reason of his having failed to discharge the onus of proving that his claim had been duly made pursuant to section 260 of the 1998 Act and section 11A(8) of the 1987 Act. The Employer submits that the Arbitrator should have exercised his discretion to strike the matter out.
I shall deal firstly with the submissions concerning the alleged failure to comply with section 11A(8). The relevant subsections of section 11A of the 1987 Act are as follows:
“(7) In the case of a claim for weekly payments of compensation in respect of incapacity for work resulting from psychological injury, the medical certificate required to accompany the claim must (in addition to complying with the requirements of section 65 of the 1998 Act) use, for the purpose of describing the worker’s condition, accepted medical terminology and not only terminology such as “stress” or ‘stress condition’.
(8) If a claim is deficient because subsection (7) has not been complied with and the insurer or self-insurer concerned notifies the worker in writing of the deficiency (including details of what is required to comply with that subsection) as soon as practicable after receiving the deficient claim then (unless the insurer or self-insurer waives that requirement):
(a) the claim is not considered to have been duly made for the purposes of section 93 of the 1998 Act until subsection (7) is complied with, and
(b) proceedings before the Commission cannot be commenced in respect of the claim until subsection (7) is complied with.”
An employer seeking to rely upon subsection (7) must plead reliance on the subsection in its answer (see Johnson v Chubb Security Australia Pty Ltd (1998) 16 NSWCCR 549 at 555). Relevantly, the Employer’s Reply is as follows:
“5.That a claim has not been duly made as required under the Act and Regulations.
6.That the Applicant has not complied with section 260 of the WIM Act 1998 nor with the WorkCover Guidelines.”
The Employer has not pleaded reliance on sections 11A(7) or (8) in its Reply, nor was the case before the Arbitrator run on that basis. In University of Wollongong v Metwally [No 2] [1985] HCA 28; (1985) 59 ALJR 481 (at 483) the majority held:
“It is elementary that a party is bound by the conduct of his case. Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to reuse a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had the opportunity to do so.”
Nothing exceptional has been demonstrated about this case and I see no reason to depart from the conventional course. If I am wrong in that approach I would reject the submission for the following reasons.
There is no evidence to suggest the Employer took any steps to comply with section 11A(8). The letter sent by Cambridge Integrated Services Australia Ltd (‘Cambridge’) (whom I assume is the WorkCover scheme agent for the Employer), to the Worker dated 24 October 2007, notified the Worker that provisional payments of compensation would not commence due to “insufficient medical evidence”. There is no reference in that letter to any specific deficiency in the medical evidence. Section 11A(8) obliges the Employer, inter alia, to inform the Worker what he must do in order to comply with section 11A(7). Again there is no evidence that such steps were taken by the Employer. No submissions were made on any of these matters on appeal.
The medical certificate provided by Dr Cedric Fernandez certified his diagnosis of the Worker’s condition as “adjustment disorder with mixed depression”. On 14 December 2007 the Worker’s solicitors, Messrs Carroll & O’Dea Lawyers, wrote to the Employer seeking a review of its decision to decline liability for the Worker’s claim and provided a copy of the report of Dr Dragutinovich dated 3 December 2007, addressed to the Worker’s solicitors, and a report of 7 November 2007 from Dr Dragutinovich to Dr Fernandez. In that correspondence Dr Dragutinovich made a provisional diagnosis of “chronic adjustment disorder with mixed anxiety and depression”. The diagnosis was confirmed in the correspondence to Dr Fernandez. The combination of those documents in my view satisfies the requirements of section 11A. It follows therefore that the provisions of section 11A(8) cannot be invoked.
I now turn to the submission, that Counsel for the Employer described as a ‘threshold’ issue going to alleged failure to give valid notice of the Worker’s claim being a ‘barrier’ to commencing proceedings, rather than a submission going to jurisdiction.
Counsel for the Employer submits:
“In the absence of any evidence from the Worker to establish that he made a claim in accordance with the Act, the Arbitrator should not have commenced the hearing of the Arbitration and should have exercised his discretion to strike the matter out.”
I shall deal with the discretionary issue in due course, but I shall now deal with the threshold issue.
In order to determine the submission it is necessary to give some brief factual background to the material before the Arbitrator on the question of whether or not the Worker’s claim was duly made.
It appears to be conceded that a claim form in the conventional sense was not completed and submitted by the Worker. He did submit a medical certificate dated 16 April 2008, which includes details such as his name and address, telephone number, date of injury, diagnosis of injury. This certificate complied with section 11A(7) and provided certification as to the Worker’s fitness for employment.
On 14 December 2007, the Worker’s solicitors forwarded to the Employer the two reports that I have referred to from Dr Dragutinovich (see paragraph [37] above). The report from Dr Dragutinovich to the Worker’s general practitioner, Dr Fernandez, dated 7 November 2007, details the history of the Worker’s employment, his current medical condition, refers to documentary evidence upon which he relied (which included supportive letters from co-workers), a diagnosis of the Worker’s condition and a proposed treatment plan.
In favour of the Employer’s argument were two letters sent from Cambridge to the Worker’s solicitor. In both of those letters the Worker’s solicitor’s attention was drawn to the Worker’s failure to provide a claim form. There is no explanation from the Worker or his solicitor as to why no claim form was prepared and submitted following receipt of that correspondence.
Against the Employer’s submission however, is the further correspondence from Cambridge to Workplace Law, dated 23 April 2008. That correspondence includes a reference to the Worker’s date of injury as “11 October 2007”, it also includes reference to a “claim number”, and attaches a schedule of medical expenses paid on behalf of the Worker. The schedule of benefits discloses that the Worker’s treatment accounts, relating to treatment from Dr Dragutinovich, Dr Fernandez and a psychologist, Thomas O’Neill Consulting, were paid by Cambridge.
Mr David Hiscox, the chief executive officer of the Employer, noted in his statement of 30 October 2007 at paragraph [15] that on Tuesday, 16 October 2007, the operations manager informed him that a medical certificate had been received concerning the Worker’s inability to attend work. On 23 October 2007 a meeting was held which was attended by David Hiscox (general manager), Michael Brennan (operations manager), Ron Threlful (union official), Leanne Campbell (union delegate), the Worker, and the Worker’s mother, Maria Thomas. It is clear that at that meeting there was a discussion regarding the Worker’s employment and the difficulties being experienced by him and the Employer. Subsequent to that meeting, a further WorkCover certificate dated 24 October 2007 was received, certifying the Worker unfit until 5 November 2007.
The Worker submits that the evidence establishes that “some sort of claim” was made on 19 October 2007. It is submitted that at that point a file was opened and a claim number was allocated. Subsequently, Dr Dragutinovich’s treatment expenses were met. The Employer submits that as no claim form was ever completed, the Arbitrator erred in drawing an inference that a claim was made simply because the insurer created a file to deal with the matter.
The Employer’s Reply also includes a letter dated 24 October 2007 from Cambridge to the Worker. That letter, addressed to the Worker’s home address, includes reference to the Employer and date of injury. It commences:
“Dear Sir,
We acknowledge receipt of your initial notification of injury received on 19 October 2007.
Please be advised that we will not be commencing provisional payment of compensation benefits for the following reasons pursuant to section 267(1) of the Workplace Injury Management and Workers Compensation Act 1998 and Workers Compensation Act 1987:
·Insufficient medical evidence.
We will arrange for a factual investigation to be investigated to assist in the determination of liability of your claim. You and your Employer will soon be contacted by the investigator to arrange a time to interview you.”
As the Arbitrator points out in his Statement of Reasons for decision, the letter bears a claim number and refers to an initial notification of injury on 19 October 2007. The complaint made is not the absence of a claim form, but insufficient medical evidence to justify commencing provisional liability payments. The Arbitrator inferred from the correspondence that on 19 October 2007 the insurer received some form of written notification sufficient to enable it to open a file and allocate a claim number. The Employer also commenced payment of medical expenses. Apparently, at the teleconference, the Employer was invited to provide a copy of whatever document had caused the file to be opened. No document was produced in answer to that request. Neither has it provided any explanation as to how it was that a file came to be open.
The Arbitrator accepted that in the ordinary course of events a file is opened upon receipt of a claim form. He determined that the correspondence of 24 October 2007 did not suggest that the insurer was lacking information that would have been in the claim form. He inferred that the document received on 19 October 2007 contained all of the information that would have been provided in a claim form. On that basis, he was satisfied that the claim was duly made.
The letter of 24 October 2007 from Cambridge concedes they had received, by that date, a notification of injury. The Worker participated in a meeting where his injury was discussed at length. The subsequent behaviour displayed by Cambridge was consistent with the acceptance of a claim, albeit a defective one. Certainly before proceedings were filed with the Commission on 19 March 2008, the Employer had before it all of the information it could reasonably have expected to have from the provision of a claim form.
Section 260 of the 1998 Act provides that a claim must be made in accordance with the applicable requirements of the WorkCover Guidelines. Section 260 then sets out a range of matters in respect of which the Guidelines may make provision with respect to the making of a claim.
In accordance with the provisions of section 260, guidelines have been issued by the WorkCover Authority for claiming compensation benefits. The Guidelines are dated 25 October 2006. Relevantly, the Guidelines provide:
“A notice of injury may be given orally or in writing and must be given to any person designated by the Employer for that purpose (e.g. as specified in the employer’s return to work program) or to any person under whose supervision the Worker is employed (which may include a person other than a direct supervisor).
A notice of injury must state:
·The name and address of the person injured
·The cause of the injury (in plain language)
·The date upon which the injury happened”
It provides that a claim form is required if compensation is to be paid beyond the provisional liability period or where medical expenses may exceed $7,500.00. The Guidelines make provision for the claim form to be waived in certain circumstances. The Guidelines make provision for minimum information to be required to make a claim, the method of service and so on.
The Worker submits that the purpose behind the supply of a claim form is to notify the insurer/employer of the nature and extent of the claim as it is known at the time. No great degree of formality in the document is required. In Fletcher International Exports Pty Ltd v Barrow & Anor [2007] NSWCA 244 (‘Fletcher’) per Mason P at [39]:
“One can conceive how section 289 may generate an issue as to the Commission’s authority to determine certain disputes unless certain matters have occurred. But nowhere within section 289 does one find any clear toehold for an argument that appears to have been accepted within the Commission in decisions such as Kurrajong Holdings & Cottons Glass to the effect that the Commission lacks “jurisdiction” to exercise its statutory powers with respect to a dispute, if the disputed claim was not in accordance with the guidelines. These provisions do not state that any or all failures to comply with the guidelines might preclude the Commission from embarking upon its task, in accordance with the statutory regime one would think that in most cases, like the present, there would be no question about a dispute having arisen, although there may be some confusion as to its perimeters. The Commission has ample powers to resolve that confusion.”
Mason P went on to note (at [42]) that the Guidelines were “primarily intended to assist WorkCover NSW licensed insurers” and nowhere is it suggested that the Guidelines touch upon the Commission’s jurisdiction or powers as regards a later dispute. His Honour went on to examine the language of the Guidelines in various respects and reached the conclusion that the language is not what one would expect to find if compliance were of the essence of a legally valid claim as regards a matter touching upon the Commission’s “jurisdiction”. He noted “of course, the idea that the Guidelines could dictate the effect of the statute would itself be misconceived”.
In Tan, following the approach adopted in Fletcher, Basten JA noted at [42]:
“The objectives of the Act, which are directed primarily to ensure compensation for work-related injury, will not be promoted by a narrow reading of a provision that allows for the recovery of compensation in circumstances where procedural requirements have not been followed. It was not in dispute in the present case that the Commission was bound to accord procedural fairness to each party. Accordingly, an inadequate, defective, or even non-existent claim might require the adjournment of proceedings, or part thereof, by the adjournment of proceedings, or part thereof, and the provision of further information by the worker to the insurer. The adoption of a flexible procedure, expressly provided for by s 354, would be more conducive to the purposes of the legislative scheme then the adoption of a technical approach to a procedural requirement. It was, therefore, not correct to dismiss section 260(5) as unavailable in circumstances where there was ‘no claim at all.’ ”
In the same case Young CJ in Eq said, at [79] – [84]:
“79.There is no requirement that notification of a claim needs to be articulated in the statutory language of an “injury” or an ”aggravation”. Lack of strict compliance with s 260 and the Guidelines therefore does not deprive the Commission of its statutory jurisdiction otherwise conferred by statute.
80. However, the Deputy President and Ms Katzmann also argue for the view that there is a difference between making a claim which is defective and not making a claim at all.
81. At first blush this appears to be in the best tradition of legal reasoning, but it does not stand examination. As was put during argument, there is a very fine line between an exacerbation of an injury and a fresh injury and which side of that fine line a situation may fall may only be established after considering a large amount of technical evidence.
82. It is absurd to think that in an Act to assist workers, a worker could be left without any support at all because after a lengthy hearing his or her problem was held to be a fresh injury rather than an exacerbation and a separate piece of paper in the form of a prescribed claim had not been lodged in respect of it.
83. Furthermore, it would be surprising to those in the real world if, after an expensive hearing lasting many days, a tribunal came to the conclusion that it had never had any jurisdiction to commence as someone had omitted to serve a piece of paper.
84.I consider that the Deputy President erred in this respect and this error was probably brought about by her reliance on her previous wrong decision in Kurrajong Holdings v Carrette [2004] NSWWCCPD 8.”
In the present case, the Arbitrator inferred that the claim had been duly made as of 19 October 2007, relying on material from Cambridge, which acknowledged receipt of “initial notification of injury”. By that date, the Employer had received a medical certificate certifying the Worker’s incapacity. Subsequent to that date of course, a meeting had been held with the various parties that I have referred to at paragraph [46], during which the Worker’s employment and the circumstances leading to his incapacity were discussed at length. Subsequently, that information was supplemented by comprehensive medical evidence. In the circumstances, I am of the view that the Arbitrator was correct to infer that a claim had been duly made. I do not accept that he reversed the onus of proof, as submitted by the Employer. In my view, it is clear from the Arbitrator’s approach that he accepted that the onus was on the Worker, but was satisfied on the evidence that it had been discharged.
I am satisfied that the Worker’s Application was properly before the Arbitrator, notwithstanding the absence of a claim from. The approach adopted by the Arbitrator was consistent with the authority of Fletcher and Tan and, in my view, discloses no error. By the time proceedings were filed in the Commission, the Employer had before it all of the information it could reasonably have expected to gain, by the provision of a claim form. I am further satisfied that the Arbitrator’s discretion did not miscarry in declining to strike the matter out for the reasons stated. It follows therefore that this ground fails.
EVIDENCE
The Worker’s Evidence
The medical evidence relied on by the Worker consists of the medical reports of Dr Dragutinovich of 3 December 2007 and 7 November 2007, and a report by his general practitioner, Dr Fernandez of 1 February 2008. I shall come to the detail of those medical reports in due course.
The factual evidence, apart from that related to economic loss, consists of a statement by the Worker of 30 October 2007 and an attachment being a further undated statement of the Worker concerning the events of Thursday, 11 October 2007. Corroborative evidence consisted of an undated letter addressed to the Worker’s mother, signed by Mr and Mrs Ketheringham and several other parties. The Worker also relies on a letter from Bronwyn Leonhardt, a former co-worker dated 6 November 2007. Finally, the Worker relies on a further letter dated 20 January 2008 from Ross Paterson, a patron of the Dapto Leagues Club, concerning his observations of a particular incident involving the Worker.
The Worker asserts that he has been employed by the Employer for 13 years . He is currently employed as a floor person. His duties mainly involve wiping tables, removing glasses and general cleaning of designated areas. Prior to working as a floor person he had been employed by the Club as a kitchen hand for ten years.
The Worker states that over a ten year period (unspecified as to its commencement and termination) he was subjected to harassment by Mary Conroy (kitchen supervisor), Judy Dubois (cook) and Maria Gilly. He asserts that they watched him and were “constantly on my back”.
The Worker states that Mary Conroy talked down to him for years. He said he took it and did not stand up for himself until he was encouraged to do so by other staff.
At a point in time, which is again unspecified, he states that he began to speak up for himself, which created tension with Ms Conroy.
He states that about two years ago there was an incident involving him and Ms Conroy which required the intervention of other staff and a report of the incident to the duty manager, Matt Grant. The Worker claims he was ‘blamed’ for the incident.
The Worker claims that matters settled down for a while but then he felt that the duty managers were constantly observing him and monitoring his performance.
The Worker relies on an incident that occurred “about six months ago”, which I assume from the date of his statement was some time in April 2007, when he had a dispute with Andrew King, the duty manager. The dispute involved his use of containers in the bistro to collect glasses, contrary to earlier instruction. The Worker states that he felt that Andrew King was harassing him and watching him all the time, but other than the incident described above, no further detail is included in the Worker’s statement.
The attachment to the Worker’s statement deals with the incident that occurred on the night of 11 October 2007. On that occasion the Worker had been instructed by Mr King to remain in the lobby bar and to concentrate on keeping that area clean and free from used glasses. Contrary to that instruction, the Worker left the lobby bar area to converse with a customer who was celebrating her birthday. Mr King observed this occurring and approached the Worker stating “what did I tell you to do I told you to stay in this area”. The Worker responded by telling him to “back off” stating that he felt he was being constantly watched and it made him feel nervous and uneasy and “works me up”. He asserts that he has told them (I assume the duty manager) on several occasions how it makes him feel when he is being observed. He was instructed by Mr King to clock off and go home pending an investigation into the incident.
Again, the Worker asserts in his undated statement that he felt watched by Mr King, which he felt was intimidating. He states that when he speaks to patrons “they stand by and watch my every move”. The Worker describes another incident that occurred with a co‑worker named Linda. No date is given for this occurrence. It is asserted that the Worker put warm glasses behind the bar, contrary to the accepted practice. She responded by telling him to “get the hell out of the bar”.
In addition to these particular incidents the Worker asserts that, as management changed, he was reprimanded for things that had been accepted in the past. The points of time when this occurred are not specified in the Worker’s statement. The Worker asserts that he was made to sign an acknowledgement of warnings that he had been given in relation to his work performance, but claims that he did not understand them due to his limited reading ability and only signed them so as not to feel embarrassed. The Worker claims that he had gone from a “happy go lucky” person who loved his employment to a “nervous wreck”. He dreaded going to work everyday and stated that he got worked up and felt nervous before starting work. He asserts that “I have started to stand up for myself and I am being discriminated against. I have been walked over all of my life and I refuse to put up with it anymore”.
The letter signed by Mr and Mrs Kethringham and three others was addressed to the Worker’s mother. The letter concerns the Worker and acknowledges his interaction with the patrons of the Club, acknowledges that he was well liked and cheered people up. It stated “he was always a hard worker and cheered people up…it seems the better you are the less you are valued.”
The letter from Ms Leonhardt is dated 6 November 2007. She worked with the Worker until December 2005. She stated that she had seen the Worker treated with disrespect on many occasions and submitted a statement to David Hiscox before she left employment. She stated that she had witnessed the Worker being sworn at and have his job threatened because he told a staff member who was in charge of him at the time, and who was harassing him, to get off his back. She claimed that during the two years after she left her employment the Worker had told her that he felt that he was being watched and intimidated by certain supervisors and staff. She confirmed that the Worker’s personality had changed and he had gone from being a happy friendly person to one who was depressed and nervous and hated going to work.
Ross Paterson, a patron of the Dapto Leagues Club, wrote to the manager of the Club on 20 January 2008 concerning an episode he witnessed of the Worker being treated unfairly. I assume this refers to the incident that occurred on 11 October 2007. Mr Paterson said:
“We witnessed Nigel being unfairly treated one night by a supervisor who asked him to leave and we could not see any reason for it. We have since heard Nigel is away on stress leave. We think something should be done to improve relationships with the employees of Dapto Leagues. We miss Nigel being around.”
Mr Paterson asserted that the Worker had been unfairly dealt with on that occasion and confirmed that he and his wife found the Worker to be friendly, polite and hard working.
The Employer’s Evidence
The Employer relied on statements of David Hiscox, the chief executive officer, Michael Brennan, the operations manager, and Andrew David King, a duty manager.
David Hiscox, provided a statement dated 30 October 2007. In summary, Mr Hiscox gives an account of the various contacts that he had with the Worker commencing in July 2005. He noted that in February 2007 a number of performance and behavioural issues were raised by the management team in relation to the Worker. The issues related to poor performance and failing to comply with, and, ignoring instructions. He stated:
“In all of the dealings I have had with Nigel, the Club has accommodated where possible, his and his parents concern, in my opinion Nigel confuses coaching and performance management with harassment. Nigel when confronted with allegations relating to his behaviour becomes agitated and at least on one occasion a meeting was adjourned to allow Nigel to compose himself (paragraph 20). During the meetings Nigel’s parents will raise Nigel’s disability. I have found on all occasions that Nigel has understood all of the issues and his obligations. Nigel previously would speak to me directly about issues and would actively seek me out to discuss. The Club’s approach to Nigel’s performance has been consistent and based on one simple premise and that is to get Nigel to perform his duties to the same consistently high standard that he had previously demonstrated”.
Michael Brennan provided a statement dated 30 October 2007. His first contact with the Worker was in about March 2007. His statement deals with complaints that were made to him by duty managers Matt Grant and Andrew King and from other duty managers. This statement gives some detail of the meeting of 23 October 2007, attended by the Worker, David Hiscox, Ron Threlful, union official, Leanne Campbell, union delegate and the Worker’s mother, Maria Thomas. He states the meeting was held in a calm atmosphere and at no time was anything said that may have further upset the Worker. The outcome of the meeting confirmed the Employer’s intention to continue to employ the Worker rather than terminate his employment.
Finally, a statement filed by Andrew David King dated 30 October 2007. He states that he has been a duty manager at Dapto Leagues Club for two years. He first came into contact with the Worker in about 2006. He stated that the Worker needed constant direction to carry out his duties and was easily sidetracked. He stated that during the last three to four months he experienced a problem with the Worker taking directions and being given instructions. He described a counselling session that took place in the member’s lounge regarding the Worker’s attitude. Mr King stated that notwithstanding his counselling sessions the Worker continued to be sidetracked and on one particular occasion the Worker became aggressive towards him and refused to do the tasks required of him and accused Mr King of “picking on him”.
After this incident there were further incidents of the Worker undertaking activities that were contrary to instructions given to him, particularly in relation to using tubs to collect plates and glass wear. Insofar as the incident of 11 October 2007 is concerned, Mr King recounts that about 15 minutes after instructing the Worker to remain in the bistro area, the Worker walked back towards the lobby bar where he was observed to be drinking from a glass of water and talking to a patron. He was called to one side by Mr King and asked to complete the task as previously instructed. According to Mr King, the Worker immediately became aggressive and started yelling “look you back off me”. Mr King was pushed aside by the Worker and he refused to return when instructed to do so. At that point Mr King followed the Worker to the wash up area in the main bar where he told him that he was to be suspended.
To establish its defence, the Employer relied heavily on a series of documents that record its management for a series of incidents involving the Worker where he was either cautioned or counselled. I therefore consider it necessary to include in this decision a chronology and brief description of those documents.
| Date | Document | Outcome | |
| 1. | 01/09/04 | Verbal Warning Record | First official verbal warning given to Nigel. Notified that any further outbursts would attract written warnings. Reminded that he was a valued member of the team and his workmates held him in high regard and that this issue would be quickly forgotten. |
| 2. | 15/10/04 | Recorded Discussion | Not an official warning just discussion of issues. Matt Gooden suggested that staff members speak to Nigel about the impact of his language. If Nigel continued Matt would step in. |
| 3 | 16/10/04 | Recorded Discussion Between: Matt Gooden and Nigel Thomas Re: Mary Conroy’s concerns regarding Nigel’s attitude towards her and also his work methods. | Not an official warning just discussion of issues. Nigel assured by Matt that there was no problem with his effort just his methods and that if he took the cook’s advice/instruction they would use a nicer tone with him. |
| 4. | 30/10/04 | Recorded Discussion | Not an official warning just discussion of issues. Matt reminded Nigel of the Club’s sexual harassment policy and that any further complaints would start the warning process. |
| 5. | 05/11/04 | Recorded Discussion Between: Matt Gooden and Nigel Thomas. Re: Nigel’s poor cleaning methods. | Not an official warning just discussion of issues. Nigel informed that Matt would be checking his work and if not up to standard, warning process would commence. |
| 6. | 17/11/04 | Counselling and/or Disciplining Record | Verbal warning given. If incident occurs again official warning procedure to be implemented. |
| 7. | 24/09/05 | Complaints and/or Grievances by Employee Report | No recommendations made. |
| 8. | 14/10/05 | Recorded Discussion Between: Matt Gooden and Nigel Thomas. Re: Nigel’s inappropriate reaction to being spoken to by staff member, Tony Oxborough. . | Not an official warning just discussion of issues. |
| 9. | 31/10/05 | Recorded Discussion | Not an official warning just discussion of issues. |
| 10 | 09/03/06 | Counselling and/or Disciplining Record | Verbal warning 1 |
| 11 | 24/02/07 | Counselling and/or Disciplining Record Shift on 24/2/07: Matthew told Nigel he had left smoker’s terrace in poor state. Andrew had also spoken to Nigel during the night about cleaning the smokers’ terrace. | Nigel informed that if the bucket/wiping down incidents ever occurred again, counselling process would become formal and involve Michael or David. |
| 12 | 03/03/07 | Counselling and/or Disciplining Record | |
| 13 | 05/03/07 | Diary note Nigel informed and acknowledged that a pattern of these observations had developed on similar issues and that instructions/ coaching from Duty Managers may not be working. | Nigel informed by Michael Brennan that if these issues continued to be raised it would become an issue of his continued employment and his capacity to perform his duties. Nigel acknowledged this and informed that a diary note of the meeting would be kept on his personnel file. |
| 14 | 19/05/07 | Counselling and/or Disciplining Record From: Matthew Grant Given to: Nigel Thomas Reported by: Matthew Grant Category: Counselling/Discipline: Nigel’s inappropriate use of plastic containers for clearing plates and eating during shift and giving inappropriate response when questioned. | Nigel informed that his behaviour was unacceptable and any further occurrences (including leaving the buckets) would result in disciplinary action. |
| 15 | 24/05/07 | Counselling and/or Disciplining Record | Explained to Nigel last verbal warning. Nigel apologised – main concern was getting a report filed against him. |
| 16 | 30/05/07 | Diary note By: Michael Brennan (Operations Manager) Re: Meeting with Nigel Thomas regarding Duty Manager’s reports. In attendance: Michael Brennan, David Niscox (General Manager), Nigel Thomas, Leanne Campbell (Union Delegate) and Mr Thomas (Nigel’s father). Incident 17/05/07: Nigel informed that a Risk Manager Report had been made by Adam Crowther re: unacceptable language against fellow employee and that he had been previously spoken to regarding this issue. Incident 19/05/07: Nigel informed that a Risk Manager Report had been made by Matthew Grant re: performance issues and the manner in which he had addressed Matthew. Nigel informed behaviour was unacceptable. Incident 24/05/07: Nigel informed that a Risk Manager Report had been made by Andrew King re: performance issues re: use of plastic tub. David reminded Nigel re: use of inappropriate language and appropriate ways of speaking to others. Michael informed Nigel that the Duty Management Team were expected to address all behaviour issues with staff in same manner and that performance during rostered shifts to be monitored by Duty Manager/Supervisor to overcome ongoing performance issues. | Agreed that the Duty managers would be advised that Nigel’s performance is to be monitored on all shifts and they would provide feedback on any issues (both positive/negative) that they observed and that an email or Risk Manager Report to be sent to Michael. Nigel informed: if any further incidents re: language occurs he will face disciplinary action and his employment is in jeopardy. He will be sent home and suspended from duty until a meeting day is set to discuss the incident. If he finds himself in a situation with a staff member he cannot deal with, he is to inform a Duty Manager to have it dealt with. Nigel acknowledged this and was informed that a diary note of the meeting would be kept on his personnel file. |
| 17 | 31/05/07 | Email | |
| 18 | 27/06/07 | Email | |
| 19 | 28/06/07 | Email | Recommended that from 2/07/07 Matt Grant would look into Nigel’s claim of not being able to work in smoking areas. |
| 20 | 28/06/07 | Email | Adam asked Nigel in future to look around the area to identify what needed his attention. Nigel agreed he would. |
| 21 | 7/7/07 | Email | Nigel told that he should ask for help if he didn’t know how to do a task. |
| 22 | 22/7/07 | Email | Nigel told to bring in doctor’s certificate re: smoking issue on Sunday 22/7/07. If not presented Andrew to talk to Nigel about refusing given task. |
| 23 | 14/9/07 | Email | |
| 24 | 12/10/07 | Letter to Nigel Thomas | Nigel’s attendance requested at meeting with Management on 16/10/07. During period of suspension Nigel not permitted to use the Club as a member or guest and confidentiality expected during investigations. |
| 25 | 23/10/07 | Diary Note Incident of 11/10/07: Nigel sent home for performance reasons for failing to follow reasonable request from Duty manager. | Meeting advised Club will not terminate Nigel’s employment at this time. Nigel informed any requests to his roster will be considered and accommodated if possible. Nigel to report any issues he has concerns over through the right channels. Informed that he would be issued with a Final Formal Written Warning on his return to work and any further performance issues may place his employment in jeopardy. |
INJURY
The Employer submits that the Worker has not suffered injury pursuant to section 4 or section 11A(3) of the 1987 Act.
Dr Dragutinovich noted the Worker’s palm was wet with anxiety when he shook hands and that the Worker needed to use the toilet prior to their initial assessment owing to anxiety related bowel looseness. The Worker told him that his hands often shook and he felt tight inside. The Worker reported feelings of sadness and pessimism. He reported strong feelings of anxiety, a state of chronic tension. His sleep was disturbed, as was his mood. He reported a loss of confidence and a loss of interest in other people or things. He had become indecisive and lethargic. He was irritable, his concentration was impaired and he fatigues easily.
Mr O’Neill opined that apart from the Worker’s mild congenital intellectual disability he suffered from no other psychological disorder whatsoever. He assessed Mr Thomas as being totally fit for normal hours and normal duties, but he has simply chosen not to return to his employment with the Employer notwithstanding full capacity to undertake such work with the Employer or elsewhere. He did not accept the findings of Dr Dragutinovich in relation to the scores he recorded on the ‘Beck anxiety and depression scales’, given that the Worker was unable to read them. He recorded Mr Thomas’ complaints of distress, feeling “shaky” after the incident, his feelings of harassment, being bullied and people talking down to him. He reported that since being away from the workplace the Worker still becomes agitated if he sees advertisements for Dapto Leagues Club, or if he sees people who work there. He reported Mr Thomas complaining of being agitated, shaky and angry. He recorded the Worker suffering “bad dreams about the club every night”. He recorded his moods are level one or two days per week. On other days, he reported that he wanted to be by himself and constantly “shakes”. Mr O’Neill opined that the history was inconsistent with the Worker’s presentation and stated he was unable to elicit any symptoms consistent with a work related condition “as there is not one”, to use Mr O’Neill’s words. He noted the Worker was generally relaxed and calm throughout the assessment interview and showed no signs of disturbance of mood, excessive anxiety or other distress indicators. The Worker did not complete any psychological inventories for Mr O’Neill, due to his inability to read the inventories. He did however, complete the inventories for Dr Dragutinovich, who relied on the scores to inform his diagnosis. Mr O’Neill offered no explanation as to why the Worker’s presentation on examination was inconsistent with his reported symptoms. He did not suggest the Worker was malingering or exaggerating his symptoms.
The Employer submitted that the opinion of Dr Fernandez should be treated with caution given that he is neither a psychiatrist nor a psychologist. Furthermore, it is submitted that Dr Fernandez was not provided with any evidence from the Employer and arrived at his conclusions based solely on the Worker’s history. Dr Fernandez diagnosed the Worker’s condition as a chronic adjustment disorder with mixed anxiety and depression. Based on the history he obtained from the Worker, he was of the view that the employment was a substantial contributing factor to the current condition. He unfortunately failed to record a history of the presenting symptoms.
Further, it is submitted by the Employer that the Worker has not actually suffered an “injury”. The Employer relies on Kirby v Trustees of the Society of St Vincent de Paul (unreported 11 April 1997) where Neilson J stated at page 4:
“To succeed in this court, the applicant must prove that the conduct complained of constituted “injury” with the meaning of the Act. Where, as here, a psychiatric injury is alleged the applicant must proved either:
(i)That the nervous system was so affected that a physiological effect was induced, not a mere emotional impulse: Yates v South Kikby Collieries Ltd [1910] 2 KB 538; Austin v The Director General of Education (1994) 10 NSWCCR 373; Thazine-Aye v the Workcover Authority of NSW (1995) 12 NSWCCR 304; The Zinc Corporation v Scarce (1995) 12 NSWCCR 566
or
(ii)The aggravation, acceleration, exacerbation or deterioration of a pre-existing psychiatric condition; Austin’s case.
Frustration and emotional upset do not constitue injury; Thazine-Aye’s case; nor, semble, where a mere “anxiety state”; The Zinc Corporation case. A “straight litigation neurosis” is not compensable; Karathanos v Industrial Welding [1973] WCR 79. A misperception of actual events, due to the irrational thinking of the worker leading to a psychiatric illness is not compensable; Townsend v The Commissioner of Police (McGrath CJ 17.02.92, unreported).
The Employer submits that Mr O’Neill’s opinion confirms that the Worker may have suffered “frustration” or “emotional upset” or even an “anxiety state”, but this does not constitute or amount to an “injury” within the meaning of section 4 or section 11A(3).
At [21] of the Statement of Reasons the Arbitrator noted that Dr Dragutinovich described in his report clear signs of psychological effect due to psychological stress. He noted that it was common ground that there had been a change in the Worker’s demeanour. He had clearly been hard working and happy for the first ten years of his employment. This is no longer the case. He found that Dr Dragutinovich’s observations and conclusions were consistent with the history and the Worker’s presentation. The Worker submits that the findings made by the Arbitrator were open on the evidence and did not involve error.
A convenient summary of the relevant principles as to what constitutes a psychological injury are set out in Department of Corrective Services v Bowditch [2007] NSWWCCPD 244 at [53] – [59]:
“[53] There are three important additional requirements that must now be added to the above comments:
1.under section 9A of the 1987 Act a claimant for compensation for a psychological injury must now prove that his or her employment was a substantial contributing factor to the injury;
2.he or she must not be prevented from receiving compensation by reason of the provisions of section 11A of the 1987 Act, and
3.the authority of Townsend v Commissioner of Police (1995) 25 NSWCCR 9 must be read subject to the Court of Appeal decision in State Transit Authority of New South Wales v Fritzi Chemler[2007] NSWCA 249.
[54] In Bhatia v State Rail Authority of NSW [1997] NSWCC 25; (1997) 14 NSWCCR 568 (‘Bhatia’) Judge Burke reviewed several authorities dealing with psychiatric injuries and considered what was needed in order to recover compensation. After referring to emotional responses to life events His Honour said at 578:
“Emotion is a fact of day-to-day life. If your daughter is ill, you can tend to be anxious; if she dies, you can tend to be depressed. Neither reaction is a physiological abnormality both being emotional reactions, or impulses, appropriate to the stimulus. This type of emotional impulse is the normal reaction of a human person or organism to a particular event. If that reaction becomes excessive in degree or duration, or is inappropriate to the stimulus, then there can be a physiological problem.”
This approach is certainly consistent with the views expressed by Powell JA in Austin v. Director General of Education (1994) 10 NSWCCR 373 at 386-7. In his view, the symptoms of anxiety, mania and depression experienced by the worker were physiological effects manifesting the effects of injury. While his Honour has no need of my approbation, such an approach I would regard as impeccably correct. In my view if it be accepted that a worker has symptoms of this type and degree, then it is axiomatic that he has suffered an injury. A particular case then becomes a question of whether such arises out of or in the course of the employment--as in Zinc Corporation Ltd v. Scarce (1995) 12 NSWCCR 566--or whether it results from a relevant work cause--as in Anderson Meat Packing Co Pty Ltd v. Giacomantonio [1973] 47 WCR (NSW) 3.”
[55] His Honour added at 579A:
“In my lexicon, a diagnosis of anxiety state of such degree and long duration would be axiomatically a physiological effect. I would not expect that any psychiatrist, unless specifically asked, would feel it necessary to so categorise such a reaction. It would be taken for granted. ‘Impulse’ has to me connotations of spontaneity and transience. The Macquarie dictionary suggests ‘sudden, involuntary inclination prompting to action’. Probably a common occurrence is in the term beloved of marketing people when they speak of impulse buying. It’s a spur of the moment affair. This concept fits quite well with the accepted emotional responses of people to particular stimuli--it comes, it lasts relatively briefly and it passes.”
[56] His Honour concluded at 579F:
“All the Act is concerned with is injury to a worker. A worker is what he is. He is both mind and matter which function as one integrated, symbiotic entity--as a single organism. Whether it is either or both of the perceived elements that is injured is really immaterial. The ultimate question is, has the worker received injury? Has the human organism which is the worker become dysfunctional? Any condition as debilitating and long lasting as the effects of these relevant incidents on Mr Bhatia could hardly be conceived as anything but injury.”
[57] Since Bhatia was decided the High Court has considered the recovery of damages for psychiatric injuries in Tame v New South Wales (2002) 211CLR 317 (‘Tame’) where Gummow and Kirby JJ (with Gaudron J agreeing) held at 447:
“It has been noted earlier in these reasons that the common law in many United States jurisdictions has developed differently. In Australia, as in England, Canada and New Zealand, a plaintiff who is unable affirmatively to establish the existence of a recognisable psychiatric illness is not entitled to recover [168]. Grief and sorrow are among the ‘ordinary and inevitable incidents of life’ [169]; the very universality of those emotions denies to them the character of compensable loss under the tort of negligence [170]. Fright, distress or embarrassment, without more, will not ground an action in negligence. Emotional harm of that nature may be evanescent or trivial.”
[58] In Commonwealth v Smith[2005] NSWCA 478 (‘Smith’) Handley JA noted at [16] and [17]:
“16 Thus the law does not recognise that emotional and mental problems constitute an injury unless they constitute a psychiatric illness that has been recognised as such by ‘professional medical opinion’. Accordingly a plaintiff, such as Mr Smith, who is aware of all his symptoms, cannot know that he has suffered a mental injury unless he knows that they constitute a recognisable psychiatric illness. Without this knowledge he cannot know that he has suffered something which the law recognises as an injury.
17 In Tame v New South Wales Gummow and Kirby JJ explained the rationale for this restriction at 382-3:
‘The apparent disregard of the distinction between emotional distress and a recognisable psychiatric illness in some United States jurisdictions is significant in appreciating the restrictive common law rules that have there applied. Properly understood, the requirement to establish a recognisable psychiatric illness reduces the scope for indeterminate liability or increased litigation. It restricts recovery to those disorders which are capable of objective determination. To permit recovery for recognisable psychiatric illnesses, but not for other forms of emotional disturbance, is to posit a distinction grounded in principle rather than pragmatism, and one that is illuminated by professional medical opinion rather than fixed purely by idiosyncratic judicial perception. Doubts as to adequacy of proof ... are to be answered not by the denial of a remedy in all cases of mental harm because some claims may be false, but by the insistence of appellate courts upon the observance at trial of principles and rules which control adjudication of disputed issues’.”
[59] The authorities of Tame and Smith are consistent with section 11A(3) of the 1987 Act where ‘psychological injury’ is defined as ‘an injury (as defined in section 4) that is a psychological or psychiatric disorder. The term extends to include the physiological effect of such a disorder on the nervous system.’ In light of the above authorities it should now be accepted that a worker has suffered a psychological injury under section 4 of the 1987 Act if he or she has sustained a psychological or psychiatric disorder in the course of or arising out of employment and employment has been a substantial contributing factor to the injury, and section 11A does not apply to prevent the recovery of compensation. Such a disorder will, almost invariably, result in a physiological effect (as it has in the present case) thus also satisfying the test propounded by Judge Neilson in Stewart. Compensation is not recoverable for an emotional impulse or mere anxiety state.”
Neither Dr Dragutinovich, Dr Fernandez, nor the Worker for that matter, were required for cross-examination.
The history and findings of Dr Dragutinovich are consistent with the Worker’s own statements whilst Mr O’Neill noted the Worker was generally relaxed and calm throughout the assessment. Those findings were inconsistent with the findings of Dr Dragutinovich that the Worker was so agitated at the time he presented for assessment that he had to use the toilet prior to the initial assessment owing to bowel related looseness. It is difficult to reconcile the two presentations. Notwithstanding his apparent presentation to Mr O’Neill, Mr Thomas gave a history that is highly suggestive that the events at the Club had a physiological effect on him. These include reports of shakes, insomnia, withdrawal, stress, anxiety and anger. His assessment that the Worker suffered from no psychological condition whatsoever is implausible given the Worker’s history of physical and emotional symptoms, which the Arbitrator accepted.
The Arbitrator preferred the opinion expressed by Dr Dragutinovich to those of Mr O’Neill on the question of the diagnosis of the Worker’s condition. That finding was certainly open to the Arbitrator on the evidence before him.
The Arbitrator, at [21] of the Statement of Reasons, found that Mr Thomas suffered a “chronic adjustment disorder with mixed anxiety and depression”. Such a diagnosis constitutes a psychological injury. In my opinion, the finding was open to the Arbitrator on the evidence and I agree with it. It discloses no error.
CAUSE OF THE WORKER’S INJURY
Arbitrator’s Treatment of the Evidence
The Employer submits that the Arbitrator has misstated the evidence, particularly at [29] in his Statement of Reasons, where he said:
“Most of the documents referred to confrontations between the Applicant and Mary Conroy, and complaints by Mary Conroy.”
The Employer submits that complaints were made to management about the Worker’s behaviour, conduct, and poor performance by many fellow employees, apart from Mary Conroy, including Vicki Webster, Nedeen Ceely, Carolyn Hayes, Adam Crowther, Dom, Natasha Haines, Matt Grant, Linda Morris and Adam King.
It is submitted that the Arbitrator (at paragraph 28) made particular reference to Mary Conroy and the fact that there was no statement from her. It is submitted that the Arbitrator failed to take into account all of the available evidence when he concluded “I accept the Applicant’s evidence that he was being harassed by Mary Conroy. It is apparent from the documentation that that harassment continued for quite some time”. It is submitted that that conclusion is not available when all of the evidence is considered in the context of the Worker’s attitude, behaviour and performance over a lengthy period of time.
My attention has been drawn to the Arbitrator’s findings at [29], where he said:
“It is also noticeable that apart from the complaint by Mary Conroy there were no complaints about the quality of the Applicant’s work until 2007.”
It is submitted that that conclusion is unavailable in the context of the whole of the evidence.
It is submitted that the Arbitrator relied on the evidence of Bronwyn Leonhardt (see [16] Statement of Reasons). Ms Leonhardt’s evidence is contained in a brief statement dated 16 November 2007. That witness left the Employer in December 2005, nearly two years prior to the Worker leaving. It is submitted that the Arbitrator should not have preferred the evidence of that witness over the more recent detailed and consistent statement of Messrs Hiscox, Brennan and King.
It is submitted that the Arbitrator also relied on a short statement from Mr Ross Paterson, who was a patron at the Club and who was of the opinion that the Worker was “being unfairly treated one night by a supervisor” (see [17] Statement of Reasons). It is submitted that this statement is brief, an observation and opinion concerning one occasion and of little weight when compared with the detailed statements in reply by Messrs Hiscox, Brennan and King. It is submitted that the opinion of one patron on one occasion, who was without all of the background facts and circumstances, should be given little or no weight.
Further, it is submitted that the Worker’s statement should be treated with caution, since the extensive memoranda contradict the Worker’s perception that he was being harassed or victimised. The documents indicate that the Worker’s supervisors tolerated his inappropriate conduct towards his co-workers and his poor work performance over three years. The Employer submits that the Arbitrator noted the Worker appeared to perform his duties to a satisfactory standard for many years prior to 2004 when problems began to emerge. It is submitted that whilst this may be true, the evidence is silent as to why the Worker’s performance and behaviour began to deteriorate from this time until he left in October 2007, and it is not for the Employer to speculate as to why this occurred.
As to the cause of the Worker’s injury, the Arbitrator found at [30] of the Statement of Reasons:
“Considering all the evidence I am satisfied that the Applicant was the subject of harassment and unfair treatment by Mary Conroy and Andrew King at least. I’m also satisfied that it was this treatment that was the predominant cause of the Applicant’s injury.”
In reaching that conclusion the Arbitrator found at [28] of the Statement of Reasons the Worker was in conflict with Mary Conroy commencing in about October 2004. He said “most of the documents referred to confrontations between the Applicant and Mary Conroy and complaints by Mary Conroy”. He also noted “apart from the complaint by Mary Conroy, there were no complaints about the quality of the Applicant’s work until 2007. At that stage, the Applicant was having difficulties with Andrew King”. He did not accept Mr King’s assertion that he had never spoken to the Worker in an aggressive manner when giving him directions. He relied on the letter from Mr Paterson to the manager complaining about the way the Worker was treated when spoken to by Mr King on 11 October 2007. The Arbitrator found that it was probable therefore that his behaviour was similar on other occasions.
The first incident involving Mary Conroy, according to the Employer’s records, occurred on 1 September 2004. On this occasion Mary Conroy witnessed an incident involving the Worker and a workmate during which the Worker became irate and raised his voice. The next incident is on 16 October 2004 and involved a complaint by Mary Conroy about the Worker’s attitude towards her and his method of speaking to her.
On 31 October 2005, Mary Conroy was involved in a recorded discussion involving the Worker and Matt Gooden concerning the Worker going behind the café service area after he had completed his shift. On 8 March 2006, there was an aggressive argument between the Worker and Mary Conroy in the kitchen area, which was the subject of a further counselling session. The documents disclose this was the last occasion of any recorded incident between the Worker and Mary Conroy.
Insofar as Andrew King is concerned, the records indicate that the first incident involving the Worker occurred on 25 May 2007. It involved counselling the Worker for carrying plastic tubs around a large bar to collect glasses, contrary to instructions not to use the plastic tub. When counselled about this incident the Worker was argumentative and disrespectful to Mr King. He stormed off stating, “you are all a pack of mongrels”. After that incident the Worker apologised to Mr King. The next recorded incident involving the Worker and Mr King occurred on 22 July 2007. On that occasion the Worker refused to clean ashtrays when directed to do so, claiming that he was unable to work in smoking areas relying on a medical certificate that had been submitted a year earlier. Arising from that incident the Worker was told that he would be required to submit another medical certificate if he continued to refuse to work in smoking areas at the Club.
The final incident involving Andrew King occurred on 11 October 2007. On that occasion, Mr King had instructed the Worker to remain in the lobby bar, to clean tables and pick up glasses and not to leave that area of the Club. Within 15 minutes of being given the instruction, the Worker left the lobby bar to speak with a patron who was celebrating her birthday. Clearly there was an altercation that occurred between the Worker and Mr King when he was challenged over failing to comply with the instructions that he had been given. Given the corroborative evidence from Mr Paterson, I accept the exchange between the worker and Mr King was heated on both sides. Mr King alleges on this occasion the Worker was aggressive, speaking in a raised voice and said to him “look you back off me”. He pushed Mr King aside as he walked off.
The Worker came under notice on a number of other occasions (as set out above) for a variety of incidents that involved neither Mary Conroy nor Andrew King.
What emerges from the evidence is that the Worker had a series of personal disagreements with Mary Conroy and Andrew King. The last of the incidents involving Mary Conroy occurred in March 2006, almost 18 months before the Worker ceased duties in October 2007. The incidents involving Andrew King were more proximate to the Worker ceasing duty, but appear to be no more numerous or sustained than complaints made by other managers and supervisors. Indeed the majority of incidents involving the Worker were following complaints made by staff members other than Andrew King or Mary Conory. These incidents, in the main, concerned the Worker’s failure to follow clear instructions particularly in regard to cleaning methods, and his approach to other staff members.
The complaints involving the Worker were initiated by a number of staff and supervisors including Vicki Webster, Nedeen Ceely, Carolyn Hayes, Natasha Harris, Matt Gooden, Matthew Grant and Adam Crowther.
Mary Conroy, whom the Worker complains harassed him, did not provide a statement of evidence and was not called to give evidence. This has compounded the difficulty in resolving the factual issue of whether the Worker was harassed by her. As the evidence stands, the Worker’s evidence on this issue is un-contradicted and indeed it is corroborated by the letters from Ms Leonhardt (at least to the point she left the employer’s employment in December 2005), and from Mr Paterson.
Throughout 2007 the Worker came under notice almost every month, sometimes several times a month, for the reasons I have identified.
The Arbitrator’s finding at [28] of the Statement of Reasons that most of the documents referred to conflict with Mary Conroy and complaints by Mary Conroy is incorrect when all of the incidents involving the Worker are considered in detail.
The Arbitrator found at [29] of the Statement of Reasons that apart from the complaint by Mary Conroy there were no complaints about the quality of the Worker’s work until 2007. That is also incorrect. The Worker came under notice on at least five occasions throughout 2004 and 2005 for various reasons including using unacceptable language, using language of an inappropriate sexual nature, breaching Club procedures concerning being behind the bar area whilst off duty and speaking to a supervisor rudely and loudly in front of Club patron.
Discussion on Causation
Whilst the evidence does not support the Arbitrator’s finding that harassment and unfair treatment by Mary Conroy and Andrew King were the predominant cause of his injury, they were certainly a contributing factor.
Whilst the Employer has a well documented history of issues involving discipline or performance appraisal of the Worker, the Worker’s complaint is that he was exposed to constant harassment, which was not the subject of reported incidents. For example, the Worker made complaints of harassment by Judy Dubois (cook) and Maria Gilly. Neither of those workers, apart from a passing reference to Ms Dubois, are referred to in the Employer’s documented history. The Worker’s case is that he was spoken down to constantly over a ten year period. The Employer’s documented history of discipline or performance appraisal spans just three years. He did not report any of the incidents that he complains of because he was too timid to do so until encouraged by other workers.
Bronwyn Leonhardt worked with the Worker for a ten year period. She corroborates his complaints of constant disrespect. She felt sufficiently strongly about the treatment the Worker was subjected to that she submitted a statement to David Hiscox before she left employment. She stated that she witnessed the Worker being sworn at and having his job threatened. Apparently nothing was done about her complaints. According to Dr Dragutinovich three other female staff members put in written complaints to the Club about the way the Worker was being treated about three years ago. Again, according to Dr Dragutinovich, other employees have told the Worker that he is a liability to the Club and that he was a menace and that he should not be working there.
Until such time as Ms Leonhardt left the Club, the Worker was able to tolerate his situation as she functioned as a surrogate counsellor whom, as she states in her letter, advised him to settle down so he could go to work and be calm, advice that the Worker followed. The Worker’s evidence as to the treatment he was subjected to is corroborated by Ms Leonhardt and Mr Paterson. I accept that he was subjected to such treatment over a ten year period at least. Such treatment was, in my view, a real and significant contributing factor to the onset of the Worker’s condition.
The medical evidence on the causation issue is far from ideal. Mr O’Neill, for the Employer, formed the view that the Worker suffered from no psychological injury at all and therefore made no comment on causation.
The Worker relies on a report from his treating psychologist, Dr Dragutinovich, who diagnoses an adjustment disorder with mixed anxiety and depression, which said at page 7:
“The onset of this condition has been insidious, reactive to the constancy of the disrespectful, discourteous, and excessive scrutiny to which Nigel has been subjected over the past couple of years. It gradually built up until he could no longer take it.”
Dr Dragutinovich was satisfied that the Worker suffered a psychological injury based on the history that the Worker was being constantly watched and intimidated by supervisors and staff members. Regrettably, Dr Dragutinovich did not have the history of the numerous counselling sessions and warnings involving the Worker relating to his unacceptable language, using language of an inappropriate sexual nature, breaching Club procedures concerning being behind the bar area whilst off duty, and speaking to a supervisor rudely and loudly in front of Club patrons.
Dr Dragutinovich noted in respect of the incident that occurred on 11 October 2007:
“The event represented the ‘straw that broke the camel’s back’ as Nigel, who had been putting up with inappropriate, harassing and disesteeming treatment for a long time, did not respond as he had previously responded by withdrawing into himself and not speaking out. I should like to add that Nigel’s perception of the treatment meted out to him is supported by other [former] workers at the workplace [detailed later].
When Nigel responded to the floor supervisor’s inappropriate anger with ‘back off’, he followed immediately with an apology and an assurance ‘that it won’t happen again’. The supervisor, apparently intolerant of Nigel’s disability, told him to go home as he was suspending him for three days. To another individual this may not have amounted to much, but to a premorbidly compensating Nigel, it affected him with shock. I understood Nigel shook with anxiety until his sister arrived to take him home.”
Dr Dragutinovich noted that the Worker had been strongly anxious since that date at least to the date of his assessment in November 2007.
Dr Dragutinovich also said, at page 3:
“Inability to permanently escape persistent aversive stimulation in the form of unrelenting anxiety, which has become consolidated over the last few years reactive to the cumulative effect of inappropriate treatment from the floor manager, has resulted in Nigel suffering additional disturbance to mood and affect in the form of depression, the psychometric evaluation of which using the Beck Depression Inventory – 2 yielding a score [22] which, when compared against normative samples, classified the current intensity of Nigel’s work related depression in the moderate category. Without your appropriate prescription of 20 milligrams of Lovan antidepressant medication which, no doubt, is stabilising Nigel’s mood and affect, the intensity of his depression would be higher…”
Dr Dragutinovich (at page 6) made a provisional diagnosis of “Chronic Adjustment Disorder with Mixed Anxiety and Depression. Eatiology is work related.”
The Employer submits that Dr Dragutinovich “either has been given or has reached the wrong conclusion of the facts”. Further, the Employer submits that Dr Dragutinovich was not provided with the memorandum and diary notes concerning the Employer’s extensive counselling of the Worker over a lengthy period of time. Thus, it is submitted that Dr Dragutinovich’s opinion is based on an inadequate history.
In Paric v John Holland Constructions Pty Ltd (1984) 2 NSWLR 505 (‘Paric’) it was argued that several medical experts for the employer had based their conclusions on inaccurate histories and therefore the trial Judge should not have accepted their opinions. In the New South Wales Court of Appeal Samuels JA (Hutley and Priestley JJA agreeing) said, at [509]-[510]:
“509. It is a question of whether the hypothetical material put to the expert witness represents a fair climate for the opinions they expressed. I do not think there is any requirement that the matter put is precisely consonant with the material provided: and certainly it cannot be contended that there was no evidence upon which the opinions could be based.
510. Discrepancies may be fatal: in some cases even slight discrepancies may be fatal: in other cases even broad departures are not likely to affect the force of the expert opinion. Moreover, it is for the tribunal of fact to address this factual basis.”
The High Court in Paric (1985) 59 ALJR 844 unanimously dismissed the worker’s further appeal stating, at [846]:
“It is trite law that for an expert medical opinion to be of any value the facts upon which it is based must be proved by admissible evidence: Ramsay v Watson (1961) 108 CLR 642. But that does not mean that the facts proved must correspond with complete precision to the proposition upon which the opinion is based. The passages from Wigmore on evidence cited by Samuels JA in the Court of Appeal… to the effect that it is a question of fact whether the case supposed is sufficiently like the one under consideration to render the opinion of the expert of any value are in accordance with both principle and commonsense.”
The Court of Appeal further considered this issue in Makita (Australia) Pty Limited v Sprowles [2001] NSWCA 305:(2001) 52 NSWLR 705 where Hayden JA (as he then was) said at [64]:
“The basal principle is that what an expert gives is an opinion based on facts. Because of that, the expert must either prove by admissible means the facts on which the opinion is based, or state explicitly the assumptions as to fact on which the opinion is based. If other admissible evidence establishes that the matters assumed are ‘sufficiently like’ the matters established ‘to render the opinion of the expert of any value’, even though they may not correspond ‘with complete precisio’, the opinion will be admissible and material: see generally Paric v John Holland Constructions Pty Ltd [1984] 2 NSWLR 505 at 509-510; Paric v John Holland Constructions Pty Ltd [1985] HCA 58; (1985) 59 ALJR 844 at 846. One of the reasons why the facts proved must correlate to some degree with those assumed is that the expert’s conclusion must have some rational relationship with the facts proved.”
Dr Dragutinovich’s opinion is that the Worker was subject to the cumulative effect of being constantly watched and scrutinised in relation to his work activities. Dr Dragutinovich relied on the Worker’s complaints of his reaction to perceived harassment and to constant disrespectful, discourteous and excessive scrutiny together with the corroborating evidence of Ms Leonhardt and Mr Paterson. Whilst it is true that Dr Dragutinovich was not provided with the Employer’s file, his history provided a “fair climate” for the acceptance of his conclusions.
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” (Speiglman CJ at [54] in Chemler). The Chief Justice was endorsing the approach taken by McGrath CJ in the Compensation Court in Townsend v Commissioner of Police (1992) 25 NSWCCR 9 at [235].
Whether the incidents, of which the Worker complains, over a ten year history, amounted to harassment or not, they were real events, as asserted by the Worker, and corroborated by Ms Leonhardt and Mr Paterson. Dr Dragutinovich, whose evidence I accept, was entitled to conclude that the psychological injury arose by reason of actual events in the workplace and accordingly, the causal link with employment is established.
I therefore find that the Worker’s psychological injury arose out of or in the course of his employment with the Club as a result of his treatment by co-workers and supervisors over several years.
Section 9A
Section 9A(1) states:
“9A No compensation payable unless employment substantial contributing factor to injury
(1) No compensation is payable under this Act in respect of an injury unless the employment concerned was a substantial contributing factor to the injury.”
Both Dr Dragutinovich and Dr Fernandez were firmly of the view that the Worker’s condition was caused by his employment and that his employment was a substantial contributing factor to the condition.
The Employer submits the Worker’s pre-existing personality and mild intellectual disability is responsible for any past or current psychological condition. I reject that submission. Even with his intellectual disability the Worker maintained employment over a thirteen year period, which, according to Dr Dragutinovich was “compensation free”. There is no evidence that the Worker would have suffered a psychological injury at the same time or stage of his life, if he had not worked for the Club.
There is no issue that the Worker suffered a mild psychological disability when he commenced work with the Club. He was in that sense perhaps more vulnerable psychologically to disharmony in the workplace. This may well have been a factor in the onset of his condition. Dr Dragutinovich described him as ‘premorbidly compensating’. However, whatever his vulnerability or pre-disposition to psychological injury may be, it does not out weigh the established employment factors, which in my view were the substantial cause of the Worker’s psychological injury.
The Employer submits that the Worker’s reactions were completely disproportionate to the ordinary and common workplace interactions, which are common and frequent in any workplace environment. Even if that is true, I am satisfied that it was the workplace environment that caused those reactions. The Employer employed the Worker with his pre-existing disability. It is not open to the Employer to argue that if it were not for his disability he may have reacted differently to the way he did and therefore may not have suffered injury. The Employer must take the Worker as he is. It cannot derive any benefit on this issue from the pre-existing disability.
As Chief Justice Speiglman said in Chemler (at [40]):
“In this area of law, as in negligence, the talem qualem principle is applicable i.e employers take their employees as they find them. With respect to psychological injury there is an “eggshell psyche principle” which, like the equivalent “eggshell skull” principle, is a rule of compensation not of liability. The element of foreseeability required by the law of negligence is not the basis of the “eggshell skull” principle, and it can be applied by way of an allergy to claims for compensation under the 1987 Act (Morgan v Tame (2000) 9 NSWLR 21 esp at [23] – [29] and the cases quoted therein. See also Tame v NSW (2002) 21 CLR 317 esp at [318] and Nominal Defendant vGardikiotis (1995) 186 CLR 49 at [68]).”
The Employer also submits the opinion of Mr O’Neill should have been preferred over Dr Dragutinovich. For the reasons stated at [92]-[93] above, I do not accept Mr O’Neill’s evidence.
Whether I accept the Employer’s contention that the Worker’s condition arises from his response to reasonable action taken by the Employer with respect to performance appraisal or discipline (an issue dealt with below), or the Worker’s contention that the condition arises from harassment over a sustained period, in either case, or in combination, his employment was a substantial contributing factor to his injury.
For the foregoing reasons I agree with the Arbitrator’s finding that the Worker suffered an injury, being a chronic adjustment disorder with mixed anxiety and depression, to which his employment with the Employer was a substantial contributing factor.
Section 11A
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.”
The onus of proving that an injury, that is a psychological injury, was wholly or predominately caused by reasonable action taken or proposed to be taken by or on behalf of the Employer with respect to, relevantly, performance appraisal or discipline, rests with the Employer (see Ritchie v Department of Community Services [1998] NSWCC 40 at [43] where Armitage J adopted the reasoning of Geraghty J in Irwin v Direction General of School Education (unreported) on the issue of onus of proof).
I find that the following work related issues contributed to the Worker’s condition of chronic adjustment disorder with mixed anxiety and depression:
(a)harassing, inappropriate and disesteeming treatment by his co-workers including Mary Conroy and Andrew King, over a ten year period; and
(b)actions taken by the Employer with respect to discipline and/or performance appraisal.
There was considerable evidence from the Employer of instances of discipline of the Worker. The actions taken by the Employer in some of these instances may well have been reasonable. However, the difficulty the Employer faces is in establishing that the injury was wholly or predominately caused by those actions.
The Employer has called no expert evidence that the whole or predominant cause of the Worker’s injury was the reasonable action taken, or proposed to be taken, by or on behalf of the Employer with respect to discipline or performance appraisal.
Mr O’Neill is silent on this issue and other evidence, including Dr Dragutinovich, whom I accept, is against that conclusion.
Whilst I accept that those issues may have been a contributing factor to the Worker’s condition, I am not satisfied on review that they were the sole or predominant cause of the injury.
Given my finding on the cause of the Worker’s injury, the reasonableness of the Employer’s conduct with respect to issues of discipline or performance appraisal does not arise. The defence under section 11A fails.
Incapacity
The Arbitrator correctly noted that both Dr Dragutinovich and Dr Fernandez expressed the view that the Worker is unfit to return to work with the Employer. Neither doctor expressed an opinion about the Worker’s ability to work elsewhere. On 16 April 2008, Dr Fernandez wrote a WorkCover medical certificate in which he says that “the worker is unfit to work at Dapto Leagues Club but will be fit to work at other places”. It is unclear as to what those other places are.
The Arbitrator noted that the Worker suffers a congenital intellectual disability. He attended special education classes leaving school aged 18, without the School Certificate or Higher School Certificate. He was immediately awarded a disability pension for intellectual disability. He worked briefly for employers specialising in employment of disabled persons before obtaining work with the Employer.
The Worker’s capacity to work is significantly restricted before he suffered his psychological injury. The Arbitrator noted that he should be capable of performing similar work, however, he would enter the labour market exhibiting the symptoms of depression. He will also have difficulty dealing with management scrutiny in any other employment. Whilst neither Dr Dragutinovich nor Dr Fernandez expresses a clear view on the Worker’s capacity to work, they both say “there are no specific interventions which will enable Nigel to return to full, partial or pre-injury duty”.
The Arbitrator expressed the view that when the symptoms of the Worker’s psychological condition are imposed upon his already limited working capacity he is going to have great difficulty finding and maintaining employment in the labour market reasonably accessible to him. The Arbitrator found that as a consequence it is likely that there would be long periods of unemployment and that periods of employment may be short lived. The Arbitrator accepted that if, and when, the Worker does obtain employment it is likely that he would be remunerated at a level commensurate with his pre-injury employment. Taking those factors into account, the Arbitrator assessed the Worker as capable of earning in some suitable employment an average sum of $200.00 per week.
It is agreed that the Worker’s pre-injury earnings were $459.35 gross per week.
The Arbitrator awarded the Worker the difference between his pre-injury earnings of $459.35 a week and his assessed residual earning capacity of $200.00 per week and made an award in favour of the Worker in the sum of $259.35 per week.
The Employer submits that the Worker would be capable of performing the same or similar duties that he performed with the Employer at a plethora of other clubs around the Sydney metropolitan area, performing the unskilled duties on the floor that he had performed with the Employer for many years.
The Employer submits that the Worker came to the Employer with an existing incapacity on the open labour market as a result of his intellectual disability. The Employer, nonetheless, provided employment to the Worker suitable to his intellectual ability.
The Employer submits that if the Worker is found to be partially incapacitated then any mathematical difference between his probable earnings and ability should not take into account his existing disability not caused by the Employer and it is submitted that the Arbitrator erred in “so penalising” the Employer in this regard.
The Worker’s submissions do not address the question of incapacity, or the quantification of any section 40 entitlement other than to submit that the Arbitrator’s award should be confirmed.
A section 40 assessment requires the application of the five steps in Mitchell v Central West Area Health Service (1997) (14) NSWCA 526 (‘Mitchell’).
The Arbitrator determined probable weekly earnings but for the injury (section 40(2)(a) of the 1987 Act) (step 1) to be $459.35 per week gross. There is no challenge made to that part of the Arbitrator’s finding, and for the reasons given by the Arbitrator, I agree with it.
The Arbitrator determined (step 2), ability to earn in some suitable employment after the injury (section 40(2)(b) of the 1987 Act) to be $200.00 per week. This figure represented approximately 44% of the Worker’s pre-injury earnings.
Neither party called any specific evidence concerning the Worker’s residual earning capacity. The Worker’s employment with the Employer has comprised the vast bulk of his employment history. The Worker’s only other employment was for a relatively short period of time after leaving school in employments that were essentially sheltered workshops.
While the evidence suggests the Worker is capable of performing the duties he previously performed with the Employer, as the Arbitrator correctly observed, he would enter the labour market not only with his pre-existing congenital intellectual disability but also exhibiting the symptoms of depression. The Arbitrator found that the Worker will have difficulty dealing with management scrutiny in any other employment and is likely to have great difficulty finding and maintaining employment in the labour market reasonably accessible to him.
The Arbitrator inferred from all of the evidence that it is likely that the Worker will encounter long periods of unemployment and is unlikely to secure employment for anything other than for short periods.
What must be considered in assessing the Worker’s residual earning capacity includes an assessment of the practical realities facing the Worker in his injured condition and with his age, abilities, and his pre-existing intellectual disability, being able to secure and maintain employment.
In Sommerson v Alcan Australia Limited (1994) 10 NSWCCR 571 the worker suffered a repetitive strain injury to her left dominant arm whilst working for Alcan Australia Limited (‘Alcan’) as a switchboard operator/telephonist. After being retrenched by Alcan and undergoing treatment, the worker obtained employment as a telephonist with George Patterson & Co, earning more than she had at Alcan. The later employment ended because of a reason unrelated to her injury. In her claim for weekly compensation Alcan argued that the worker had no entitlement to compensation because she had a proven capacity to earn more than her pre-injury earnings and, therefore, there was no economic loss as a result of her injury. The medical evidence established and the Judge accepted that the worker had a continuing problem with her left arm as a result of her injury with Alcan and that that problem prevented her from doing rapid repetitive work with her left arm. The Court took into account a range of restrictions on her capacity, which included not being able to work where there was no headset, an inability to hold a telephone handset in her dominant left hand, and an inability to work with computerised switchboards which require keying duties with her left dominant hand. The Court concluded therefore that the number of jobs she could hold down was reduced. That reduction meant that if the applicant found herself unemployed, it would be harder for her and it would take longer to obtain suitable employment. In that case, the residual earning capacity was assessed having regard to the time taken by the worker to obtain employment and the periods unemployed up to the date of the hearing.
In Mangon v Visy Board Pty Limited (1992) 8 NSWCCR 175 (‘Mangon’) Judge Bourke said at 180:
“When assessing a capacity to earn under section 40(2), it is not sufficient to merely identify a particular potential avenue of employment and attribute the income from such a job to a man’s capacity to earn. Allowance must be made for the availability of their work – availability, not so much in the sense of a presently depressed labour market, but in the sense on the general availability in any labour market. A rarely available niche in the labour market which carries, perhaps, substantial remuneration, does not serve as the sole criterion of capacity to earn.”
In Cowra Shire Council v Quinn (1996) 13 NSWCCR 175, the Court of Appeal expressly approved the approach of Bourke J in Mangon.
In Ric Developments t/as Lane Cove Pool Mart v Muir (2008) NSWCA 155 Campbell JA (Rein J agreeing) said, at [48]:
“That the worker had a physical and mental capacity to carry out the tasks involved in some particular job is not sufficient to establish that there was a realistic prospect that anyone would actually give him such a job, or that he would be able to keep it. A further enquiry was needed concerning those matters…”
In referring to the factors in section 43A, His Honour said, at [50]:
“Those factors are all ones that concern the practical realities of the worker, in his or her injured condition or with his or her actual age, abilities, limitations and circumstances in life, being able to get and keep employment. In my view, the Deputy President was right in taking the view that the practical realities of the worker actually getting and keeping a job in his injured condition were required to be assessed.”
The Worker is now 36 years of age. He lives at Robertson in New South Wales, which is an area between Moss Vale to the west and Albion Park to the east. It is not a densely populated metropolitan suburb. Given the Worker’s age, employment history and intellectual impairment, the prospect of him finding and keeping employment in the labour market reasonably accessible to him is remote. I agree with the Arbitrator’s inference that as a consequence of these factors that he will spend long periods out of work and will have difficulty keeping work, were certainly open to him and on review.
On one view of it, his assessment that the Worker will, on average, be able to earn his pre‑accident earnings up to 44% of the time is optimistic, but is certainly open on the available evidence. On review, I agree with the finding as to the Worker’s ability to earn.
The Employer argues that quantification of the Worker’s ability to earn should not take into account his intellectual disability and that in so doing, the Arbitrator erred.
In assessing the Worker’s ability to earn after his injury, the Employer must take the Worker as he is, that is a person of limited education and skills, with a mild congenital intellectual disability, i.e the “eggshell psyche principle” – see paragraph [138] (supra).
The Arbitrator was correct, in my view, in assessing the Applicant’s residual earning capacity having regard to his pre-existing psychological condition. That pre-existing condition had not prevented Mr Thomas from working full time for the Club for many years.
At step 3 of the Mitchell formula, the Arbitrator found the difference between the Worker’s pre-accident earnings of $459.35 per week gross, and his assessed ability to earn at $200.00 per week, resulted in a difference of $259.35 per week.
The Arbitrator found that there were no factors which required the exercise of his discretion (step 4 of Mitchell) to require any deduction to be made on the sum of $259.35 per week. Neither party has submitted that there is any particular discretionary factor that should be taken into account, nor is it appropriate that any further deduction should be made. I see no error in the Arbitrator’s calculations or approach to step 3 or 4 of the Mitchell formula.
CONCLUSION
Having conducted the detailed review on the merits, Mr Thomas is entitled to succeed with his claim on the ground that he suffered a psychological injury in the course of and arising out of his employment, and to which his employment was a substantial contributing factor. The Employer has failed in its defence under section 11A, as I am not satisfied that Mr Thomas’ injury was wholly or predominately caused by action taken (reasonable or otherwise) with respect to discipline or performance appraisal.
DECISION
The Arbitrator’s decision of 21 May 2008 is confirmed for the reasons stated.
COSTS
The Appellant Employer is to pay the Respondent Worker’s costs of the appeal.
His Honour Judge Keating
President
26 September 2008
I, MARIE JOHNS, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF JUDGE GREG KEATING, PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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