Elliott v UGL Engineering Pty Ltd

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Elliott v UGL Engineering Pty Ltd [2024] NSWPIC 220
APPLICANT:	Charles Elliott
RESPONDENT:	UGL Engineering Pty Limited
MEMBER:	John Isaksen
DATE OF DECISION:	30 April 2024
CATCHWORDS:	WORKERS COMPENSATION - Workers Compensation Act 1987; claim for weekly payments for partial incapacity for a closed period and medical expenses for psychological injury; respondent concedes the worker sustained injury in the course of his employment but relies on section 11A that the injury was wholly or predominantly caused by reasonable action taken by the respondent with respect to retrenchment and/or dismissal; reference to Hamad v Q Catering P/L; reference to Ric Developments P/L v Muir in determination of the weekly payments claim; Held – the injury sustained by the worker was not wholly or predominantly caused by reasonable action taken by the respondent with respect to retrenchment and/or dismissal; award of weekly payments of compensation for partial incapacity for work but for a period less than that claimed by the worker; the respondent to pay the worker’s reasonably necessary medical treatment.
DETERMINATIONS MADE:	The Commission determines: 1. The respondent has failed to establish a defence pursuant to s 11A (1) of the Workers Compensation Act 1987 (the 1987 Act). 2. The applicant is entitled to weekly payments of compensation between 20 October 2021 and 31 July 2022 due to a partial incapacity for work as a result of the psychological injury he sustained in the course of his employment with the respondent. 3. The applicant’s current weekly earnings pursuant to cl 8 of Schedule 3 of the 1987 Act for the period between 20 October 2021 and 31 July 2022 is $1,300. The Commission orders: 4. The respondent is to pay weekly payments of compensation to the applicant as follows: (a) $982.90 per week from 20 October 2021 to 18 January 2022 pursuant to s 36 (2)(b) of the 1987 Act; (b) $982.90 per week from 19 January 2022 to 31 March 2021 pursuant to s 37 (3)(b) of the 1987 Act, and (c) $1,018.10 per week from 1 April 2022 to 31 July 2022 pursuant to s 37 (3)(b) of the 1987 Act. 5. The respondent is to pay Mr Elliott’s reasonably necessary medical treatment for his psychological injury pursuant to s 60 of the 1987 Act.

STATEMENT OF REASONS

BACKGROUND

Charles Elliott, the applicant in these proceedings, claims that he sustained a psychological injury arising out of or in the course of his employment as a Commercial Manager with the respondent, UGL Engineering Pty Limited.
Mr Elliott claims that the three main causes of his psychological injury were:
(a)    workplace bullying and intimidation;
(b)    the stress associated with his whistleblowing in regard to the unethical practices of a third party, and
(c)    his employment being made redundant by the respondent was not genuine but was because of his whistleblowing.
Mr Elliott’s last day of work for the respondent was on 2 April 2021 when his employment with the respondent was made redundant.
Mr Elliott claims that he was at least partially incapacitated for work as a result of his psychological injury and claims weekly payments of compensation from 20 October 2021 to 19 January 2023. He also claims the payment of medical expenses for treatment of his psychological injury.
Icare on behalf of the respondent issued a dispute notice on 23 September 2021 wherein it disputed that Mr Elliott sustained an injury arising out of or in the course of his employment with the respondent, or in the alternative, any psychological injury was wholly or predominantly caused by reasonable action taken by the respondent with respect to “retrenchment/redundancy/termination of employment” pursuant to s 11A (1) of the Workers Compensation Act 1987 (the 1987 Act).
Icare issued a review decision on 31 May 2023 wherein it was stated: “based on the available evidence, we withdraw reliance on sections 4, 4(b) and 9A of the 1987 Act.” However, liability continued to be disputed pursuant to s 11A (1) of the 1987 Act. Icare also confirmed that Mr Elliott was not entitled to weekly payments of compensation for total or partial incapacity for work or for the payment of medical treatment for his psychological injury.

ISSUES FOR DETERMINATION

The parties agree that the following issues remain in dispute:
(a)    whether the psychological injury sustained by the applicant was wholly or predominantly caused by reasonable action taken or proposed to be taken by the respondent with respect to retrenchment or dismissal (s 11A (1) of the 1987 Act);
(b)    whether the applicant has been incapacitated for work as a result of his psychological injury (ss 32A, 33 and 36 of the 1987 Act), and
(c)    whether medical treatment which the applicant has undergone is reasonably necessary as a result of his psychological injury (s 60 of the 1987 Act).

PROCEDURE BEFORE THE PERSONAL INJURY COMMISSION

The parties attended a conference and hearing on 28 March 2024. I have used my best endeavours in attempting to bring the parties to the dispute to a settlement acceptable to all of them. I am satisfied that the parties have had sufficient opportunity to explore settlement and that they have been unable to reach an agreed resolution of the dispute.
Mr Stockley appeared for Mr Elliott, instructed by Ms Byrnes. Mr Robison appeared for the respondent, instructed by Mr Balan.
The Application to Resolve a Dispute (ARD) had been amended at the preliminary conference conducted on 22 January 2024 for the claim for weekly payments of compensation to end as of 19 January 2023.
The hearing could not be completed on 28 March 2024. Mr Robison made his submissions on behalf of the respondent because of the s 11A defence. A timetable was set for the completion of submissions as follows:
(a) the applicant to file and serve written submissions by 11 April 2024, and
(b) the respondent to file and serve any written submissions in reply by 19 April 2024.
There was also no agreement as to Mr Elliott’s pre-injury average weekly earnings (PIAWE) and a direction was made for calculations of PIAWE to be filed by both parties by 11 April 2024 if no agreement could not be reached on PIAWE.
Mr Elliott calculated his PIAWE to be $4,214.98 and conceded that this exceeds the maximum weekly compensation amount prescribed by s 34 of the 1987 Act. The respondent filed a wages schedule which based PIAWE on the maximum weekly compensation amount.

EVIDENCE

Documentary evidence

The following documents were in evidence before the Personal Injury Commission (Commission) and considered in making this determination:
(a)    the ARD and attached documents;
(b)    Reply and attached documents, and
(c)    Application to Admit Late Documents filed by the respondent on
22 March 2024.

Oral evidence

There was no application to adduce oral evidence or cross examine Mr Elliott or any other witnesses who have provided written statements.

The s 11A defence

The applicant’s evidence

Mr Elliott has provided statements dated 18 May 2021, 25 July 2022 and 2 November 2023.
Mr Elliott states that he commenced employment as a Commercial Manager with the respondent in December 2018. He states that his duties and responsibilities related to reviewing subcontractor agreements for tender.
Mr Elliott states that between March 2020 and April 2021 he conducted duties on the Tasmanian and Shoalhaven water projects and a third project located at North Head waste water treatment plant.
Mr Elliott states that he began experiencing bullying behaviours towards him from Paul Pattison, who was the Senior Commercial Manager, shortly after Mr Elliott commenced to work on the Tasmanian project in late 2020. He provides examples of this bullying as follows:
(a)    a lack of business engagement with Mr Elliott;
(b)    being unsupportive and dismissive towards Mr Elliott’s involvement in the project;
(c)    depriving Mr Elliott of critical information regarding the project;
(d)    a dislike of Mr Elliott’s appointment to the project;
(e)    no designated workloads and direction regarding Mr Elliott’s appointment to the project, and
(f)    treating Mr Elliott like a corporate spy.
Mr Elliott provides a particular instance on 3 July 2020 when he was sent an email in error from Mr Pattison which included: “I’d prefer he had a crack so we can wind Charles out of the project.” The email was addressed to a third party consultant who was later to be the subject of a whistle blower complaint by Mr Elliott. Mr Elliott states that he was alarmed by this email, and he felt like he was “being ganged up on and targeted”, and he did not know why Mr Pattison wanted him off the project.
Mr Elliott states that the actions and behaviours by Mr Pattison contributed to Mr Elliott’s stress and anxiety and he attended his psychiatrist, Dr Pilsky, on 27 July 2020 for his stress and anxiety.
Mr Elliott states that he noticed a suspiciously high amount of money being invoiced by a third-party contractor. He states that on 1 October 2020 he wrote an email to Andrew Hardcastle, senior finance manager, advising that there was a self-employed contractor who was engaged in excessive billing of invoices. He states that he copied that email to Simon McKenzie, the project manager, and Andrew McGowan, his line manager.
Mr Elliott states that he got no response from those three men and on the following day he lodged a formal whistleblower complaint to “Stopline”, an independent whistle blower hotline service. He states that he was worried that he would be liable if he did not report his findings. He states that he selected the option to remain partially confidential so that he could share more details of the complaint.
Mr Elliott states that his whistleblowing complaint was escalated to very high levels within the respondent, but he was concerned that Stephen Barrett-White, General Counsel and Chief Legal Officer, who Mr Elliott had spoken to on 15 October 2020 had a close relationship with the people that Mr Elliott was complaining about.
Mr Elliott states that he felt better having lodged a complaint and discharged any responsibility from himself. He states that he was contacted by the industrial relations manager, Dean Langridge, on multiple occasions between October 2020 and March 2021. He states that Mr Langridge confirmed on or about 22 December 2020 that the third-party contractor had been investigated but Mr Elliott was not provided with any information in regard to the investigation. He states that sometime later he was advised by a colleague that the third-party contractor was no longer working on the contract.
Mr Elliott states that he consulted Dr Pilsky again on 14 December 2020 because he was feeling anxious and distressed about events which were happening at work including the bullying that he had been experiencing since March 2020 and the stress associated with the whistleblowing complaint and the way in which it was being handled.
Mr Elliott states that he received a telephone call from Simon McKenzie on 21 February 2021 advising him that he might be receiving a letter, but Mr McKenzie did not expand on this. He states that he received notification of redundancy on 23 February 2021.
Mr Elliott states that he immediately felt his stress and anxiety worsen when he received this notification of redundancy and was of the opinion that he was being penalised for the whistleblowing incident. He states that his work performance had not been questioned over the previous year, and that the Tasmanian project was in urgent need of assistance and that Mr McKenzie knew this.
Mr Elliott states that on 26 November 2020, Krista Capuano, Contracts and Procurement Manager, had sent an email to Mr Elliott which indicated there was a significant amount of work to be completed on the Tasmanian project. He states that Ms Capuano provided to Mr Elliott a list of critical and high priority work items that was required to meet the Tasmanian project on 3 December 2020. Mr Elliott states that Doug Moss, Managing Director, informed employees in a meeting in November 2020 that no further redundancies were to take place and a restructure had been completed.
Mr Elliott states that he wrote to John Greaves, the author of the redundancy notice, on 4 March 2021 and questioned the reason behind the redundancy and whether it was a result of his whistleblowing complaint. He states that he informed Mr Greaves that his health and well-being had been impacted as a result of his whistleblowing complaint and was being made worse by the decision to make him redundant.
Mr Elliott states that Mr Greaves replied on 12 March 2021 and stated that the whistleblowing complaint had been handed confidentially and no one involved in the redundancy process had any knowledge of the whistleblowing complaint. Mr Elliott states that this response caused him further distress and anxiety because Mr McKenzie, who was Mr Elliott’s line manager, had been involved in the redundancy process and had also been aware of the circumstances surrounding the whistleblowing complaint. He states that he was being punished for his conduct.
Mr Elliott states that the formal letter of redundancy was received by him on 2 March 2021 and his last day of work was on 2 April 2021.
Mr Elliott states that he attended Dr Pilsky on 7 April 2021 and was issued with a Certificate of Capacity stating that he was only fit for 20 hours of work per week. He states that he lodged a workers compensation claim after he was made redundant.
Mr Elliott states that in July 2020 he did not suffer from any psychological conditions. He states he had experienced stress and anxiety when working in a fly in/fly out job in Western Australia in 2014. He states that his sister passed away unexpectedly in 2015 and that he found this hard to process and he consulted Dr Pilsky to assist with the grieving process.

Evidence from other witnesses

Dean Langridge has provided a statement dated 25 May 2021. Mr Langridge states that he is employed with the respondent as an industrial relations manager.
Mr Langridge states that he was appointed to investigate the whistleblowing complaint made by Mr Elliott on 22 October 2020. He states that he spoke with Mr Elliott on 28 October 2020 and that Mr Elliott raised concerns of bullying, victimisation, job insecurity, and the excess billing of a consultant. Mr Langridge states that Mr Elliott did not provide any further particulars regarding bullying and victimisation other than to relate those complaints to his concerns about job security.
Mr Langridge states that Mr Elliott did not want him to make any direct inquiries in relation to the excessive billing complaint to the extent that it could be linked to Mr Elliott. He states that it was agreed with Mr Elliott that Mr Langridge would conduct an independent audit on the selection and assessment of contractors and that hopefully this would provide the information he needed to further assess the validity of the consultant involved.
Mr Langridge states that Mr Elliott informed him on or about 7 December 2020 in one of their regular weekly or fortnightly discussions that all of Mr Elliott’s concerns regarding his allegations appear to have resolved. Mr Langridge states that he spoke with Mr Elliott again on 22 December 2020 and Mr Elliott reiterated that his concerns had been resolved and he would like to discontinue the complaint.
Mr Langridge states that he spoke frequently with Mr Elliott throughout the investigation process between 28 October 2020 and 22 December 2020, but not between 22 December 2020 and March 2021 as claimed by Mr Elliott.
Simon McKenzie has provided a statement dated 25 May 2021. Mr McKenzie states that he is employed with the respondent in the role of Operations Manager-Water.
Mr McKenzie states that Mr Elliott reported to him from 23 November 2020. He states that Mr Elliott only met some of his key performance indicators (KPIs) and that areas of improvement had been discussed with him. Mr McKenzie refers to the attachment of Mr Elliott’s 2020 performance appraisal in his statement, but that document has not been placed into evidence.
Mr McKenzie states that he did not witness or observe Mr Elliott being bullied by Mr Patterson while he was assigned to the Tasmanian project. He states that no complaints were ever made by Mr Elliott regarding any bullying by Mr Patterson.
Mr McKenzie states that on 1 October 2020 he was copied in on an email from Mr Elliott to Mr McGowan regarding a third-party contractor. He states that no issues were raised by the client of the respondent or auditor regarding any fraudulent activity by this contractor.
Mr McKenzie states that he phoned Mr Elliott on 23 February 2021 to advise that Mr Elliott’s role as commercial manager was proposed to be made redundant and that Mr Elliott would receive a letter shortly from the respondent. He states that he issued the proposed redundancy letter from Mr Greaves to Mr Elliott on 24 February 2021. He states that the proposed redundancy was due to the commercial completion of the Shoalhaven project in early February 2021 and the need for ongoing commercial roles to be based in Tasmania for that project.
Mr McKenzie states:
“The Alliance project was completing ongoing procurement and commercial work, there were several management and team members on site in Tasmania, there is an ongoing need to recruit for more staff, however the main contract requires permanent roles to be based in Tasmania, to be able to closely interface with the local supply chain market, it was not an option for Charles to relocate unfortunately.”
Mr McKenzie states that the respondent undertook an extensive redeployment process which Mr Elliott was actively involved in, but no suitable alternative role could be identified for Mr Elliott.
Stephen Barett-White has provided a statement dated 27 May 2021. Mr Barett-White states that he has been employed with the respondent as General Counsel since early 2017.
Mr Barett-White states that he spoke to Mr Elliott on 14 or 15 October 2020 and informed him that his complaint had been passed on to the UGL People and Culture Team. He states that he understands Mr Langridge in that team would undertake the investigation.
Mr Barett-White states that complainants are informed of the outcome of any investigation into allegations that are raised, but generally do not receive a copy of the investigation.

Other relevant evidence

The letter from Mr Greaves to Mr Elliott dated 23 February 2021 regarding Mr Elliott’s position being made redundant is in evidence. The letter states that Mr Elliott’s role of Commercial Manager “is surplus to manning requirements”. The letter states that the respondent has been investigating alternative roles for Mr Elliott.
There is an email from Mr Greaves to Mr Elliott dated 12 March 2021 which is in evidence. That email includes the following:
“As you are aware, all whistleblower complaints are treated strictly confidentially and are not shared. As the matters pertaining to the whistleblower complaint that you reference in your letter were confidential, I, nor anyone else that has been involved in the proposed redundancy were aware of your complaint and as such, I can confirm that it had no impact on your position with UGL.
The proposed redundancy is a bona fide redundancy, based on the business requirements as discussed with you.”
There is a reply from Mr Elliott on that same day: “Thank you for your response and your confirmation that my complaint had no impact on your position with UGL - that is all I wanted to hear.”

The medical evidence

There are clinical notes in evidence from MyHealth Zetland and Neutral Bay Medical Centre. There is only one consultation recorded for Mr Elliott from both sets of notes in the period between March 2020 (when Mr Elliott states when he began to work under the supervision of Mr Patterson) and April 2021 (when his position with the respondent was made redundant). This is on 27 July 2020 with Dr Chernyak at MyHealth Zetland which records that a fitness to drive report was completed.

There are six reports from Dr Pilsky, consultant psychiatrist, who has treated Mr Elliott and which are written between 27 July 2020 and 28 July 2021. There is a lengthy report dated 13 September 2023 which is provided upon a re-referral by Dr Chernyak to Dr Pilsky.
In a report to Dr Chernyak dated 27 July 2020, Dr Pilsky writes that Mr Elliott “is doing well at work and his family life is stable.” He writes that Mr Elliott is not depressed at present but continues to take Efexor prophylactically.
In his next report dated 14 December 2020, Dr Pilsky writes that Mr Elliott is not depressed but continues to take Efexor prophylactically.
In his next report dated 7 April 2021, Dr Pilsky records the following:
“Unfortunately he has not been so well of late. Things came to a head at his work. It appears that Charles reported significant rorting of company resources and following that there was a lot of angst from another employee who was his superior and worked as a subconsultant. Charles received an email inadvertently which detailed a request from this subconsultant to remove Charles of the job which was quite stressful and Charles felt that this was done because of his whistleblowing. Then, he received a redundancy which he attributes to his whistleblowing. They advised him that there was no work left for him which he is certain is not the case.”
Dr Pilsky writes that Mr Elliott’s mood has deteriorated as a result of these events and he has become increasingly dysphoric. Dr Pilsky states that Mr Elliott’s condition is an aggravation of his pre-existing major depression which was in remission for a long time.
In his next report dated 17 May 2021, Dr Pilsky writes that Mr Elliott remains somewhat dysphoric, ruminative and anxious. He writes that Mr Elliott continues to work for 20 hours per week which is the maximum which he can do at the present.
In his report dated 13 September 2023, Dr Pilsky writes that he has known Mr Elliott since 2016 when Mr Elliott was admitted to Wesley Private Hospital for treatment for alcohol and benzodiazepine abuse. Dr Pilsky writes that Mr Elliott frequently ruminates about when he became a whistleblower due to inappropriate behaviour of colleagues at work in 2020 and feels that he has been undermined by the incident. Dr Pilsky also records that Mr Elliott struggled with a job in Melbourne in late 2022 due to a deteriorating relationship with a manager, sensitivity to perceived criticism, and demands of frequent travel to Melbourne.
Dr Pilsky writes that Mr Elliott was in partial remission for his condition of major depression until this condition was aggravated by stress at work in 2020 and that this aggravation continued until his last contact with Mr Elliott in 2021.
Dr Canaris, consultant psychiatrist, has provided a report at the request of Mr Elliott’s lawyers dated 28 February 2023.
Dr Canaris records the following from Mr Elliott: “there was an issue at work which caused a lot of concern for me - I feel there had been some dishonesty - I put myself out as a whistleblower - all that rebounded on me.” Dr Canaris records that Mr Elliott decided to report his concerns about the invoices from a subconsultant, but nothing was said or done by the respondent until it was referred to someone from industrial relations. Dr Canaris records that Mr Elliott was informed that his position was to be made redundant, and although he was told there would be attempts made to find him an alternate position, the respondent “didn’t try very hard.”
Dr Canaris then records difficulties which Mr Elliott has had with some employers since he ceased employment with the respondent.
Dr Canaris records that Mr Elliott began to see Dr Pilsky around 2016 and that Mr Elliott’s previous depression seems to be linked to his divorce from his first wife in 2012.
Dr Canaris concludes:
“Mr Charles Elliott departed his workplace in July 2020 in the setting of a redundancy which had occurred soon after he had made a protected disclosure saying that he had cited a document suggesting that he be moved out of the company.”
Dr Canaris diagnoses Mr Elliott as having the re-emergence of a pre-existing major depressive disorder which had been in stable remission.
Dr Canaris notes that Dr Pilsky wrote that Mr Elliott was well when he was seen in July 2020 and December 2020, but that Mr Elliott described a deterioration in his mood on 7 April 2021. Dr Canaris concludes:
“…the emergence of depressive symptoms coincides with workplace difficulties suggesting that the latter because the re-emergence of his depression.”
Dr John Roberts, consultant forensic psychiatrist, has provided a report at the request of the respondent dated 25 July 2021.
Dr Roberts records that Mr Elliott believed the cause of his current difficulties was the result of a number of events which occurred during 2020 in regard to his job and job security. Dr Roberts records that Mr Elliott considered that the circumstances of his employment were not “crash hot”. He records that Mr Elliott thought he had been treated in “a very unethical manner” and that Mr Elliott considered the whistleblowing had “rebounded” on him.
Dr Roberts records that Mr Elliott asked the rhetorical question as to why he should be fired. He records that Mr Elliott considered that he was fired because of concern by senior people that they would be held to account as a result of the whistleblowing report made by him.
Dr Roberts concludes that having regard to Mr Elliott’s past psychological condition and treatment, that Mr Elliott suffers “a primary disorder of mood characterised by periodicity.” Dr Roberts writes that the terminology “primary disorder of mood” indicates that the prime pathology is that of depression, and periodicity implies an inherent tendency to relapse over time, regardless of circumstances.
Dr Roberts does not consider that Mr Elliott’s employment caused his psychological condition because his condition was in existence before his employment with the respondent and dates back to 2015. Dr Roberts does concede that there is the possibility that his employment caused a transient aggravation. Dr Roberts then writes:
“If my impression is correct, I would consider that Mr Charles Elliott’s injuries namely a possible aggravation of long-standing pre-existing condition was wholly or predominantly caused by employer conduct or action with respect to retrenchment or dismissal of workers, arising from the claimant’s redundancy.”
Dr Canaris has provided a supplementary report dated 4 April 2023. Dr Canaris writes:
“His major depressive disorder had been in stable remission. However, he would have been vulnerable to recurrences. Recurrences would have been more likely in response to stressful events such as his employment difficulties. However, the re-emergence of his depression was by no means inevitable as suggested by Dr Roberts… Because his depression is now ongoing, his condition has not been exacerbated. Rather it has been aggravated.”

A summary of submissions by the parties

Mr Robison on behalf of the respondent submits that the details of bullying set out by M Elliott in his statement dated 18 May 2021 (and set out in paragraph 19 of this decision) should be regarded as conclusionary and descriptive rather than being particular. He submits that it is totally unclear what is meant by statements such as Mr Patterson having a lack of business engagement with Mr Elliott or being unsupportive. Mr Robison also submits that there is no reference to bullying in a therapeutic context.
Mr Robison submits that psychological injury can be established by a misconception of a true fact (as in Attorney General’s Department v K [2010] NSWWCCPD 76), but that this cannot defeat a defence pursuant to s 11A of the 1987 Act. Mr Robison submits that the evidence supports a finding that the redundancy was bona fide because the respondent followed proper protocol and the email from Mr Elliott dated 12 March 2021 indicates that Mr Elliott was satisfied from his own enquiries that the redundancy was genuine.
Mr Robison submits that the medical opinion of Dr Roberts that Mr Elliott’s psychological injury has been wholly or predominantly caused by reasonable action taken by the respondent with respect to retrenchment or dismissal has not been answered by the medical opinion relied upon by Mr Elliott. He submits that the respondent has satisfied the requirements of s 11A.
Mr Stockley on behalf of Mr Elliott submits that the respondent cannot discharge its onus on causation based upon the opinion of Dr Roberts because Dr Roberts does not accept that Mr Elliott sustained an injury in the course of his employment. Mr Stockley submits that the opinion from Dr Roberts falls far short of what is required for a s 11A defence as set out in Hamad v Q Catering Limited [2017] NSWWCCPD 6 (Hamad) wherein DP Snell was critical of the employer’s failure “to address the issue of the competing causal roles of the various work matters” [at 77].
Mr Stockley submits that the opinion of Dr Roberts that there was “a possible aggravation of a long-standing pre-existing condition” which was wholly or predominantly caused by reasonable conduct by the respondent is not a useful expression of expert opinion and does not satisfy the evidentiary requirements set out in Hamad.
Mr Stockley refers to the respondent’s contention that Dr Roberts’ opinion has not been answered by the medical opinion relied upon by Mr Elliott and responds that there is nothing to rebut based upon the opinion of Dr Roberts.
Mr Stockley submits that the respondent has failed to identify any credible reason for the redundancy. Furthermore, the respondent has failed to provide any insight into its guidelines and policies for redundancy. As a consequence, the action taken by the respondent with respect to retrenchment or dismissal could not be regarded as reasonable.
Mr Robison submits in reply that the opinion from Dr Roberts is not insufficient because Dr Roberts does concede the possibility of an aggravation and the respondent is not bound by the evidence from Dr Roberts in toto or otherwise.

Determination

The respondent relies upon s 11A (1) of the 1987 Act, which provides:
“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.”
Mr Elliott identifies three “main drivers” for the stress and anxiety which he claims that he experienced from March 2020.
Firstly, there is the claim of workplace bullying and intimidation. I agree with the submission made by Mr Robison that there is a lack of particulars provided by Mr Elliott of specific events or incidents which he contends amounts to bullying and intimidation, and the evidence which he does provide is in very general terms. Mr Langridge also states that Mr Elliott raised concerns of bullying and intimidation when they had an initial discussion on 22 October 2020, but that Mr Elliott provided no particulars in regard to this complaint.
However, Mr Elliott does refer to one particular incident on 3 July 2020 when he was inadvertently sent an email written by Mr Pattison which contemplated Mr Elliott being taken “out of the project.” I accept that the receipt of this email by Mr Elliott would have caused him to be alarmed, although his claim that this led him to attending Dr Pilsky on 27 July 2020 does not appear to be confirmed by details taken by Dr Pilsky. Dr Pilsky writes on 27 July 2020 that Mr Elliott “is doing well at work.”
There has also been no evidence provided by Mr Pattison in response to Mr Elliott’s evidence, despite the respondent being aware of both the specific incident on 3 July 2020 and the more general allegations of bullying in the first statement made by Mr Elliott to an investigator retained by or on behalf of the respondent in May 2021.
The second cause of psychological injury identified by Mr Elliott is his claim of stress associated with whistleblowing which commenced on 1 October 2020. There is a difference in the evidence between Mr Elliott stating that he was in contact with Mr Langridge on multiple occasions between October 2020 and March 2021, and the evidence from Mr Langridge that the investigation ended on 22 December 2020. Mr Elliott’s evidence regarding the length of the investigation could be viewed as an attempt to emphasise that the stress associated with his whistleblowing complaint occurred over a prolonged period of time.
Nonetheless, Mr Langridge does confirm that he had regular weekly or fortnightly discussions with Mr Elliott in regard to the progress of his complaint over at least a two month between late October and late December 2020. Although Mr Elliott provides little detail in regard to his psychological symptoms over this two month period, I accept that the action he took would have caused him some psychological stress and concern, although there is again no acknowledgement of this by Dr Pilsky in his report dated 14 December 2020.
The third cause of psychological injury identified by Mr Elliott is the action taken by the respondent to make Mr Elliott’s position redundant, which the respondent claims is the whole or predominant cause of his injury. Dr Pilsky records a deterioration in Mr Elliott’s psychological condition which coincides with his redundancy and cessation of employment in April 2021.
Dr Pilsky does not provide a report wherein he is specifically asked to opine as to the cause or causes of the deterioration in Mr Elliott’s psychological condition in April 2021, or the defence relied upon by the respondent pursuant to s 11A of the 1987 Act.
The reports from Dr Pilsky dated 27 July 2020 and 14 December 2020 which record that Mr Elliott is doing well are understandably relied upon by the respondent to thwart Mr Elliott’s claims of psychological injury caused by bullying and intimidation and choosing to be a whistleblower, and to place the whole or predominant cause of injury on the action taken by the respondent with respect to retrenchment or dismissal. That might then fall within what was contemplated by DP Snell in Hamad at [88]:
“There may be cases in which causation of a psychological injury can be established without specific medical evidence, for example where there is a single instance of major psychological trauma, with no other competing factors.”
Nonetheless, DP Snell also observed in Hamad at [85]: “a series of events can have a cumulative effect, and may be causative of a psychiatric condition which does not manifest itself until a later time.”
Dr Pilsky does record a series of events which Mr Elliott experienced while employed with the respondent which Dr Pilsky concludes has resulted in a deterioration of Mr Elliott’s mood and aggravation of a pre-existing major depression which had been in remission.
I acknowledge that those events recorded by Dr Pilsky do not fit the chronology set out by Mr Elliott in his evidence. Dr Pilsky records that the email from Mr Pattison, which was inadvertently sent to Mr Elliott, occurred after Mr Elliott chose to take whistleblowing action, whereas the offending email was created a few months before the whistleblowing action taken by Mr Elliott.
I am also mindful that the reports made by Dr Pilsky in both July and December 2020 to Mr Elliott’s general practitioner that Mr Elliott was doing well occurred at the very times that Mr Elliott claims that he was suffering stress due to firstly bullying and intimidation and then from the whistleblowing process.
However, in spite of those details recorded by Dr Pilsky in July and December 2020, he formed the opinion in April 2021 that the cumulative events of the email which was inadvertently sent to Mr Elliott, the whistleblowing which Mr Elliott was engaged in, and then the loss of Mr Elliott’s employment, had resulted in the aggravation of Mr Elliott’s pre-existing major depression.
I prefer the evidence and opinion which has been provided by Dr Pilsky because he has had the benefit of treating Mr Elliott for several years and has had the opportunity to monitor his patient’s psychological condition over those years. The evidence and opinion from Dr Pilsky is consistent with a series of events which “can have a cumulative effect, and may be causative of a psychiatric condition which does not manifest itself until a later time” as identified in Hamad.
In Ponnan v George Weston Foods Ltd [2007] NSWWCCPD 92 (Ponnan), ADP Handley said at [24] that “predominantly caused” is to mean mainly or principally caused.
I cannot be satisfied that the action taken by the respondent with respect to retrenchment or dismissal can be regarded as the whole or main or principal cause of Mr Elliott’s psychological injury because of other causes of the deterioration of Mr Elliott’s condition which have been identified by Dr Pilsky.
Such a conclusion is supported by the opinion of Dr Canaris, notwithstanding that there are some deficiencies in his report dated 23 February 2023. Dr Canaris appears to understand that little was done by the respondent in response to Mr Elliott’s whistleblowing complaint, whereas Mr Langridge states that he had regular discussions with Mr Elliott as part of the respondent’s investigation.
The conclusion reached by Dr Canaris that Mr Elliott departed his workplace in July 2020 in the setting of a redundancy which occurred soon after he made a protected disclosure that he had seen a document that he would be moved out of the company, does not fit the chronology of events set out by Mr Elliott and the other witnesses or even the year when Mr Elliott was made redundant.
However, Dr Canaris does reach a similar conclusion as Dr Pilsky that it was “workplace difficulties” which coincided with the emergence of depressive symptoms, rather than action taken with respect to the redundancy, as being cause of the emergence of those depressive symptoms.
Although I have identified some deficiencies in the reports of Dr Pilsky and Dr Canaris, those experts are to be preferred over the opinion provided by Dr Roberts.
Deputy President Snell said in Hamad at [71]:
“The next issue is whether the Arbitrator could be satisfied that the respondent had discharged its onus on the causation issue, in the circumstances of the case, in the absence of medical evidence addressing the issue.”
I agree with the submission made by Mr Stockley that the opinion of Dr Roberts cannot be relied upon by the respondent in their s 11A defence because Dr Roberts does not accept a primary condition imposed by s 11A that Mr Elliott has sustained an injury in the course of his employment.
Dr Roberts is only prepared to concede that it is possible that Mr Elliott’s employment caused a transient aggravation of his psychological condition to allow the respondent to rely upon a s 11A defence. His own conclusion is that Mr Elliott suffers from “a primary disorder of mood” which has an inherent tendency to relapse over time “regardless of circumstances.”
In my view, the difficulty faced by the respondent is that it concedes that Mr Elliott has a psychological injury which has been sustained in the course of his employment, but there is the “the absence of medical evidence addressing the issue” of causation for a s 11A defence (Hamad at [71]). This is because Dr Roberts does not hold a genuine belief that Mr Elliott’s employment has been the cause of Mr Elliott’s psychological injury. His opinion is that Mr Elliott had a tendency to relapse regardless of his circumstances and that there is no temporal connection between events at work and the aggravation of Mr Elliott’s pre-existing psychological condition.
I find I cannot prefer the opinion of Dr Roberts when that opinion is compared to the opinion of Dr Pilsky, who has had the benefit of treating Mr Elliott over a period of some years and is prepared to set out those events during the course of Mr Elliott’s employment which have led to a deterioration of his patient’s psychological condition in April 2021.

The respondent has therefore failed to establish that the psychological injury sustained by Mr Elliott was wholly or predominantly caused by reasonable action taken by the respondent with respect to retrenchment or dismissal and the defence pursuant to s 11A of the 1987 Act must therefore also fail.

The claim for weekly payments of compensation

The applicant’s evidence

Mr Elliott states that he worked in a consultant role of managing insurance claims with Capital Consulting International Ltd from November 2020 until October 2021. He states that he worked around 20 hours per week and his average earnings over this period of time was $2,744.33 per week.
Mr Elliott states that his employment with Capital Consulting International Ltd ended when he had a minor argument with a lawyer who worked in the business. He states that he “completely overreacted” to this minor disagreement because he was very sensitive to perceived criticism following his work injury.
Mr Elliott states that he worked full-time with Downer EDI Works Pty Ltd as a commercial manager from around 1 September 2022 until 31 December 2022 and earned about $4,613 per week. He states that his employment with Downer EDI Works Pty Ltd ended because he could not cope with full time work and travel and he was very sensitive to perceived criticism, and that this led to a deterioration in his relationship with that company.
Mr Elliott states that he has also worked on an intermittent basis as a consultant with Wellman Strata Management, which manages the strata property which he lives in. He states that he usually worked around three hours per fortnight, and his average earnings between August 2021 and June 2022 were $471.74 gross per week.
Mr Elliott states that he worked full-time in a commercial manager role with MTR Corporation (Sydney) Pty Limited in January and February 2023 and earned $3,573 per week on average. It is not disclosed in his evidence, but it was conceded at the preliminary conference conducted on 22 January 2024, that Mr Elliott has been incapacitated since January 2023 due to a knee injury.

The medical evidence

Dr Pilsky writes in his report dated 7 April 2021 that he did not want Mr Elliott to work more than 20 hours a week and completed a Workcover certificate to that effect.
A Certificate of Capacity issued by Dr Pilsky on 16 June 2021 certifies Mr Elliott as having the capacity to work 20 hours per week, and includes the following declaration made by Mr Elliott:
“I continue to work as a sole trader but limited my working hours to 20 hours per week as per Dr Pilsky’s instructions, which has substantially reduced my earning capacity and leading to further stress and anxiety.”
Dr Pilsky writes in his report dated 13 September 2023 that Mr Elliott had been working for approximately 20 hours per week in his consulting business, but that he struggled significantly when he attempted to increase his work hours. Dr Pilsky records that Mr Elliott struggled with a job in Melbourne in late 2022 due to a deteriorating relationship with a manager, sensitivity to perceived criticism, and demands of frequent travel to Melbourne. He records that Mr Elliott could not cope with another job in February 2023 due to perceived criticism.
Dr Pilsky then writes:
“He attributes this and other setbacks at work to previous issues in 2020 when he became a whistleblower because of inappropriate behaviour of his colleagues at work.”
Dr Pilsky records that there was some reduction in Mr Elliott’s anxiety once he had given up very demanding jobs. Dr Pilsky concludes that Mr Elliott could potentially increase his hours of work to 25 hours per week, but he is not certain that Mr Elliott would be able to sustain full-time work considering his age, medical issues, chronic low-grade psychiatric symptoms, poor tolerance of stress and interpersonal sensitivity.
Dr Canaris examined Mr Elliott on 28 February 2023 and records that Mr Elliott had tried to find work but “things did not go well” on three occasions. He records that one company decided to side with a lawyer in a disagreement between the lawyer and Mr Elliott and Mr Elliott’s employment was then terminated. Dr Canaris records there was another company in Melbourne where there was a dispute over Mr Elliott’s expenses.
Dr Canaris records that Mr Elliott was “between jobs” during 2022 and sailed from the Cape Verde Islands to Barbados.
Dr Canaris concludes that Mr Elliott would not be fit for work in his previous position with the respondent. He writes that Mr Elliott has had significant problems in other jobs because Mr Elliott is very sensitive to perceived rudeness and criticism. He also writes that Mr Elliott may function better if he finds his way into work in which he is not answerable to an employer.
Dr Roberts examined Mr Elliott some 18 months before the report from Dr Canaris. Dr Roberts records that Mr Elliott was working 20 hours in construction and claims assessment.
Dr Roberts opines that having regard to the 20 hours of work per week being undertaken by Mr Elliott, and Mr Elliott being able to engage in a variety of recreational activities and successfully completing some tertiary studies to qualify as an arbitrator, that Mr Elliott’s long-standing major depressive disorder was not compromising his employment capacity.

Determination

The preference which I have for the opinion of Dr Pilsky in his capacity as Mr Elliott’s treating psychiatrist extends to the opinion which he provides on Mr Elliott’s capacity for work between April 2021 and August 2022.
Dr Pilsky is in the best position to provide an opinion as to the extent of Mr Elliott’s capacity for work because of his understanding of the development of Mr Elliott’s condition and the responsibility he bears for his patient’s treatment.
Dr Pilsky exercises his clinical judgement in April 2021 to certify that Mr Elliott should only be doing 20 hours of work per week.
Mr Elliott was nonetheless able to earn in excess of the maximum weekly compensation amount for almost seven months after he ceased employment with the respondent in early April 2021. His claim for weekly payments of compensation only commences when his employment with Capital Consulting International Ltd ends, and this is when he “completely overreacted” to a minor disagreement with a lawyer. Mr Elliott chooses to provide scant details in regard to this, and Dr Pilsky merely recites Mr Elliott’s belief as to the cause of this setback rather than engage in his own consideration as to the reasons that Mr Elliott could not maintain this work.
It is therefore arguable that Mr Elliott’s ability to work for some seven months after he ceased employment with the respondent and earn in excess of the maximum weekly compensation amount for that work means that he has had no loss of earning capacity notwithstanding the psychological injury he has sustained. It can be argued that Mr Elliott’s loss of earnings from late October 2021 was not due the effects of the work injury but due to the lack of availability of work which he had shown he was otherwise capable of doing from the seven months of work he did for Capital Consulting International Ltd after his employment with the respondent ceased.
I agree with a submission made by Mr Robison that the Commission cannot award a buffer for economic loss, but instead it must be satisfied there has been actual loss on a week-by-week basis and the statutory formula for weekly payments of compensation imposed by the 1987 Act must be met.
Past decisions have emphasised the practical exercise which needs to be undertaken in determining whether the inability or reduced ability to work due to an injury has led to a worker to a reduced capacity to earn. Basten JA in Ric Developments Pty Limited t/as Lane Cove Poolmart v Muir [2008] NSWCA 155; 6 DDCR 339; 71 NSWLR 593 (Muir) referred at [33] to the unreported decision of Hutley JA in Alexander v Ashfield Municipal Council (NSW Court of Appeal, 27 October 1982) that:
“Capacity is diminished, even though in selected instances the worker can earn as much as he did before, if there are fields from which he is excluded, by reason of the injury, in which he laboured at the time of the injury.”
Basten J also referred in Muir to what was said by Burke CCJ in Mangion v Visy Board Pty Ltd [1991] NSWCC 1; (1992) 8 NSWCCR 175 (Mangion) at [180]:
“A rarely available niche in the labour market which carries, perhaps, substantial remuneration, does not serve as a sole criterion of capacity to earn.”
The documents which relate to the earnings of Mr Elliott in both the ARD and the Application to Admit Late Documents filed by the respondent reveal that Mr Elliott had been undertaking work for Capital Consulting International Ltd while he was working for the respondent. He was able to retain that work for another seven months after he ceased employment with the respondent and despite experiencing an aggravation of his psychological condition as a result of his employment with the respondent.
It is therefore reasonable to conclude that this work with Capital Consulting International Ltd was a “selected instance” or a “rarely available niche in the labour market” (Mangion) which Mr Elliott was able to retain for some seven months. He then found great difficulty in obtaining work for another nine months or so because of his injury and the restrictions placed his work reduced capacity by Dr Pilsky.
Mr Elliott nonetheless did obtain some work during those ensuing nine months as set out in the Schedule of Earnings in the ARD. The Schedule of Earnings identifies two occasions when Mr Elliott earned $1,300 per week, and another week where he earned $1,500. There were another nine weeks when he earned $750 per week or more and that this income was derived from consultancy work with Wellman Strata Management.
Mr Stockley makes the fair concession in view of this evidence that Mr Elliott’s current weekly earnings as defined in cl 8 of Schedule 3 of the 1987 Act should be $1,300. Another approach that reaches a figure close to $1,300 is to allow an earning capacity of $60 per hour for 20 hours of work per week as an employed building consultant, which is within a range for a salary for such jobs listed in seek.com.au.
A further factor in finding that Mr Elliott had a capacity to earn $1,300 per week in the period claimed for weekly payments by Mr Elliott is that although Mr Elliott would often only work for three hours per week for Wellman Strata Management, the restriction of 20 hours of work per week as recommended by Dr Pilsky would have allowed for Mr Elliott to work more than those three hours if such work or similar work was available.
Mr Elliott’s entitlement to weekly payments of compensation pursuant to ss 36 and 37 of the 1987 Act will then be the difference between the maximum weekly compensation amount and the amount of $1,300.
The period of weekly payments of compensation from my review of the material in this dispute should not end on 19 January 2023 as claimed by Mr Elliott, but instead on 31 July 2022.
Mr Elliott states that he commenced work as a commercial manager with Downer EDI Works Pty Ltd from around 1 September 2022 and earned about $4,613 per week, which is well in excess of the maximum weekly compensation amount.
However, the pay advice from Downer EDI Works Pty Ltd for the month of September 2022 (at ARD 161) records earnings for that month to be $19,607.84, with a year to date total of $34,953.11. That would indicate that Mr Elliott had commenced employment with Downer EDI Works Pty Ltd and had begun to earn income from that employment sometime in August 2022, and most likely close to the beginning of that month. Mr Elliott has not provided evidence which is contrary to such a conclusion being reached.
In the absence of any further evidence as to when Mr Elliott commenced employment with Downer EDI Works Pty Ltd, I consider that no weekly payments of compensation should be awarded from the beginning of August 2022.
The award of weekly payments of compensation to be made to Mr Elliott will therefore be as follows:
(a)    $982.90 per week from 20 October 2021 to 18 January 2022 pursuant to s 36 (2)(b) of the 1987 Act;
(b)    $982.90 per week from 19 January 2022 to 31 March 2021 pursuant to s 37 (3)(b) of the 1987 Act, and
(c)    $1,018.10 per week from 1 April 2022 to 31 July 2022 pursuant to s 37 (3)(b) of the 1987 Act.

The claim for medical expenses

There will be an order that the respondent is to pay Mr Elliott’s reasonably necessary medical treatment for his psychological injury pursuant to s 60 of the 1987 Act.

[2024] NSWPIC 220

30 April 2024