Goyenecha v Mayne Pharma Ltd and QBE Workers'

[2008] VMC 19

IN THE MAGISTRATES COURT OF VICTORIA

AT MELBOURNE

CIVIL

Case No. W03376332

Goyenecha	Plaintiff
v
Mayne Pharma Ltd	First Defendant
QBE Workers’ Compensation (Vic) Ltd	Second Defendant

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MAGISTRATE:	P Lauritsen
WHERE HELD:	Melbourne
DATE OF HEARING:	3, 4 & 8 December 2008
DATE OF DECISION:	16 December 2008
CASE MAY BE CITED AS:	Goyenecha v Mayne Pharma Ltd and QBE Workers’ Compensation (Vic) Ltd
REASONS FOR DECISION

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Catchwords: duration of incapacity for work – applicability of s 82(2A) Accident

Compensation Act 1985

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff
For the Defendant  HIS HONOUR:

Introduction

1.  Carlos Goyenecha (Goyenecha) seeks, primarily, weekly payments of compensation from 21 May 2007. His claim raises two main issues:

(a) the duration of his incapacity for work; and
(b) the applicability of s 82(2A) of the Accident Compensation Act 1985 (the Act).

Circumstances

2.  In 1993 Goyenecha commenced working for David Bull Laboratories in its factory at Mulgrave[1]. He did so pursuant a written contract. It anticipated his employment in the “Non ANP Packaging Department”. But the contract contained the following – “It is also understood that this offer of employment is on the basis that you are prepared to work on a day, afternoon or night shift basis in any manufacturing area within DBL”. It appears that David Bull Laboratories was part of a larger company. This larger company was later acquired by the first defendant, Mayne Pharma Ltd (Mayne). At the relevant times, Goyenecha was employed by Mayne.

[1] More precisely, his employer seemed to be company called DBL Australia Pty Ltd. Apparently, it traded

3.  The work of employees in the ANP packaging department involved the packing of containers of cytotoxic drugs. These drugs are used to treat cancer.

4.   On 29 April 2005, Mayne entered into an agreement with two unions, National Union of Workers and the Australian Services Union (the Agreement)[2]. The Agreement contained numerous provisions relating to many aspects of the conditions of employment of Mayne’s employees. It operated from the first pay period on or after 1 March 2005 until 28 February 2008. It applied to all employees of Mayne at its Mulgrave premises (whether members of the two unions or not) and covered by a particular award or were clerical employees[3]. It was not suggested that Goyenecha was not the subject of the agreement. This was certified by the Australian Industrial Relations Commission (Commission)[4].

[2] The agreement is called Mayne Pharma (Mulgrave) NUW/ASU Enterprise Agreement 2005.

[3] See clauses 4.1 and 5.2.

[4] The statutory effect of the Agreement is contained in the Workplace Relations Act 1996.

5.   The agreement provided for a disputes resolution procedure[5]. The procedure applied whenever a dispute or grievance arose about the wages or conditions of employment of any employee. It provided for a series of steps. First, the matter would be discussed by the employee and his or her supervisor. If not resolved, it was then to be discussed by the employee, the supervisor, relevant union delegate and manager. If not resolved, it was then to be discussed by the employee, relevant union delegate, relevant union official and the manager. Finally, if not resolved, then the matter must be referred to the Commission for decision. Either party could refer it to the Commission. During these discussions and reference, the status quo was to be maintained[6].

[5] Clause 16.

[6] Sub-clause 16.3.

6.  During 2006, while Goyenecha was employed in the AVA or ampoules department, Mayne decided to outsourced the manufacture of ampoules and close this department. Mayne entered into a memorandum of understanding (memorandum) with the National Union of Workers[7]. The memorandum did not form part of the Agreement[8] but was intended to be legally binding[9].

[7] Exhibit 5 is an undated and unexecuted copy.

[8] See clause (1).

[9] See clause (26).

7.  Since closing the department affected other employees in the factory, Mayne invited expressions of interest in voluntary redundancy from its employees in September. Goyenecha did not express interest. In November, Mayne again invited expressions of interest in voluntary redundancy and, on this occasion, Goyenecha did express interest. However, he was not offered voluntary redundancy because Mayne did not want to lose a person with his skills.

8.  By December 2006, the ampoules department had closed. During December and January 2007, Goyenecha took holidays. Before starting his holidays, he was told that when he returned on 1 February he would be working with ANP products. Goyenecha did not want to work in that department. He feared contracting cancer if he did. He told Mayne that. Pending a resolution of his objection Mayne required him to work in packing room 1. That room did not handle cytotoxic drugs.

9.  On 9 March 2007, Mayne wrote to Goyenecha advising that he would be transferred to its Packaging Department that day; his blood would be tested each three months; and his first test should be undertaken within a week. The author noted his previously expressed concerns and offered to arrange a personal meeting with Dr Jacono. He added – “If you do not agree to undergo such a test non-compliance will be considered to be a refusal to obey a reasonable and lawful instruction and a breach of Company policy”. Dr Jacono, a general practitioner, has advised David Bull Laboratories and Mayne for many years over health issues at the Mulgrave factory.

10. Goyenecha did not have his blood test. He did not go to the Packaging Department.

11.On 29 March 2007, Mayne again wrote to Goyenecha. The author noted his failure to attend its on-site medical centre for a blood test and meet with Dr Jacono. He extended the offer to meet Dr Jacono again. He ended with this warning – “If you do not agree to a blood test we will be left with no option but to review your ongoing employment with Mayne Pharma.”

12. Again Goyenecha did neither.

13.Since other employees voiced objections somewhat similar to Goyenecha’s, Mayne arranged for Dr Jacono to speak to those employees collectively. Before doing so, he spoke to a group of union officials.

14.Dr Jacono spoke to those employees and union officials on 12 April 2007. He explained the nature of the drugs, the type of dangers to health posed, the monitoring process and the purpose of blood testing. He pointed out that there was no proof that these drugs were harmful at low rates of exposure. He explained the engineering steps taken by Mayne to separate its employees from exposure to the drugs. He invited questions and the answered the one asked. He spoke for one to two hours. His explanation did not satisfy Goyenecha, who wanted a guarantee that he would not contract cancer if he worked in the ANP area. Dr Jacono could not give such a guarantee.

15.Goyenecha took leave between 7 and 20 May. He used the time studying for a qualification in remedial massage. Owing to something he was told by a union official, Goyenecha believed that he would be sacked in the near future if he did not agree to work in the Packaging Department. This made him unwell. He sought medical help. He attended his workplace on 28 May. He handed over a claim for compensation and two certificates of capacity[10]. He was handed a letter. The letter recited the earlier history and ended:

[10] Exhibits D and E.

We still require you to agree to work with the secondary packaging of cytotoxic products and to submit to a blood test. If you do not agree to these requirements by COB Wednesday 30 May 2007 we will be left with no option other than to end your employment with Mayne Pharma on 31 May 2007 based upon your consistent and persistent refusal to observe a reasonable and lawful direction to agree to work with cytotoxic products and to be blood tested.

We hope you agree to these requirements as you are a valued member of the
Mayne Pharma team and we wish for your employment with us to continue.”

16.As a result, Goyenecha suffered an injury. It was an adjustment disorder. Between 21 May and 5 June, he had no current work capacity. This period of incapacity is based on the certificates of the general practitioner, Roger King. I do not interpret Dr Chris Grant’s report of 14 June 2007 as implicitly asserting that Goyenecha had no current work capacity until the day of his examination and report. After 5 June, he was capable of returning to work in any capacity provided it did not involve the handling of cytotoxic products.

Relevant provisions

17.There are three relevant provisions. The definitions of “no current work capacity” and “current work capacity” use the expression “pre-injury employment” in the context of a worker’s inability to return to such. The expression is not defined.

S 82(2A) provides relevantly:

“Compensation is not payable in respect of an injury consisting of an illness or disorder of the mind caused by stress unless the stress did not arise wholly or predominantly from –

(a) reasonable action taken in a reasonable manner by the employer to transfer,
demote, discipline, redeploy, retrench or dismiss the worker;
(b) ….
(c) an expectation of the taking of such action or making of such a decision.”

Discussion

18.In context, “pre-injury employment” must refer to a worker’s employment prior to the start of the incapacitating effects of an injury. In this case, Goyenecha was able to return to return to his pre-injury employment on 6 June 2007. He could perform the tasks required by packing room 1 even though his employment there was also temporary.

19.The plaintiff relied on Asioty v Canberra Abattoir Pty Ltd[11]. This case dealt with the meaning of “aggravation” of a pre-existing disease within the meaning of the Workmen’s Compensation Ordinance 1951 (ACT). What was said by Toohey J, who gave the leading judgment, has no bearing on the interpretation of “pre-injury employment”.

[11] (1989) 167 CLR 533.

20.Goyenecha’s injury consisted of a disorder of the mind caused by stress. The action to redeploy him was reasonable considering the closure of the Ampoule Department and the requirement for most employees to work in the ANP Department. However, the action was not taken in a reasonable manner because it breached the requirements of the Agreement in relation to dispute resolution. The evidence does not specifically reveal the taking of any of the steps contained in clause 16. Without an internal agreement, the last resort was the Commission. This was the only way a dispute about a matter like redeployment could be resolved in the absence of an agreement reached in one of the three earlier steps. Reference of an unresolved dispute to the Commission was mandatory. Although I was not taken to the relevant provisions of the Workplace Relations Act 1996, it seems to me from a reading of the relevant parts of that Act, the Agreement bound both Goyenecha and Mayne. Its terms were enforceable in a court of competent jurisdiction. Mayne could not terminate Goyenecha’s employment over this dispute until after, at the very least, the Commission had determined the matter.

21.The processes set out in the memorandum was not intended to, and did not, supplant the disputes resolution provisions of the agreement. The existence of the memorandum and the negotiations leading up to it are immaterial to the issue of “reasonable manner” in s 82(2A).

22.The fact that Goyenecha did not refer the dispute to the Commission does not absolve the parties from seeking its services in determining their dispute. So much was required by the Agreement.

23. The defence under s 82(2A) must fail.

ORDERS:

24.The plaintiff is entitled to an order against the defendants for weekly payments of compensation from 21 May 2007 to 5 June 2007 at the rate applicable for no current work capacity. He is entitled to an order for reasonable medical and like expenses. I will hear the parties on any other orders.

under the name of David Bull Laboratories.