KRDV and National Australia Bank Ltd
[2011] AATA 210
•29 March 2011
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2011] AATA 210
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2009/3312
GENERAL ADMINISTRATIVE DIVISION ) Re KRDV Applicant
And
National Australia Bank Limited
Respondent
DECISION
Tribunal Senior Member A K Britton
Dr J D Campbell, MemberDate29 March 2011
PlaceSydney
Decision
The decision under review is set aside and a decision substituted that the Respondent is liable under s 14 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) for the injury suffered by the Applicant on 6 June 2008.
.........................[sgd]..........................
Senior Member
CATCHWORDS
WORKERS COMPENSATION – psychiatric injury – liability excluded if psychiatric injury a “result of” reasonable administrative action undertaken in reasonable manner under Safety, Rehabilitation and Compensation Act 1988 (Cth) s 5A – meaning of “reasonable administrative action” - management planning meeting did not constitute administrative action in respect of employment – ordering of business of section too broad a class of action to constitute administrative action – impromptu meeting of manager and applicant not undertaken in reasonable manner
Safety, Rehabilitation and Compensation Act 1988 (Cth) - ss 4, 5A, 5A(1) and (2) 5B(1), 7(4), 14, 5B(1) and (3)
Hart v Comcare (2005) 145 FCR 29
Re Carpenter and Comcare [2010] AATA 62
Re Layton and Comcare (2007) 99 ALD 96
Re McKenzie and Military Rehabilitation and Compensation Commission [2010] AATA 275
Re Radulovic and Comcare [2010] AATA 777REASONS FOR DECISION
29 March 2011 Senior Member A K Britton
Dr J D Campbell, Member1. In 1999 the applicant commenced work with MLC Limited, a subsidiary of the respondent, the National Australia Bank (NAB). She alleges that as a consequence of overwork, lack of support and mistreatment by management, she suffered a psychiatric “injury” in the form of a depressive/anxiety disorder. The applicant has not worked since a meeting with her direct manager in June 2008 during which, on her account, she was bullied and harassed.
2. NAB accepts that the applicant suffers from a depressive/anxiety condition but denies liability under the Safety, Rehabilitation and Compensation Act 1988 (Cth) (the Act). NAB argues that if, as now contended, the claimed “injury” was sustained in January 2007, liability does not arise as it was not “on risk”. In the alternative, it contends that if the injury was sustained in June 2008, it was the result of “reasonable administrative action undertaken in a reasonable manner” and by the operation of s 5A of the Act, liability is excluded.
Legislative Scheme
3. By virtue of s 14 of the Act, NAB will be liable to pay compensation in accordance with that Act in respect of any “injury” suffered by the applicant if it results in impairment or incapacity for work.
4. The Act defines “injury” to include “a disease suffered by an employee” but not a disease suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee's employment : s 5A(1).
5. "Disease" is defined to mean: (a) an ailment suffered by an employee; or (b) an aggravation of such an ailment; that was contributed to, to a significant degree, by the employee's employment by the Commonwealth or a licensee: s 5B(1). Ailment in turn is defined to mean “any physical or mental ailment, disorder, defect or morbid condition (whether of sudden onset or gradual development)”: s 4. “Significant degree” means “a degree that is substantially more than material”: s 5B(3).
Background
6. Shortly after joining MLC as an administrator, essentially a clerical position, the applicant was promoted to the position of accounts manager and later, technical quality coordinator and in 2005, team leader. The accounts manager and technical quality coordinator reported to the team leader. In October 2006, she was appointed as Customer Service Manager and in that role was responsible for managing two team leaders, each of whom had responsibility for about 10 staff. In the course of her employment the applicant obtained a number of qualifications including a Masters of Business Studies which she completed in 2005.
7. Towards the end of 2006 following an internal restructure the applicant became responsible for part of NAB’s business based in Melbourne for about six to eight months. Throughout that period she retained responsibility for her Sydney‑based teams and travelled regularly to Melbourne. Among other things she was responsible for redeploying or making redundant Melbourne based staff.
8. According to the applicant around the time of the Melbourne restructure her sleep deteriorated and her sleep pattern has remained disturbed since that time. Around that time she also experienced some problems with her physical health. Following fainting incidents in late 2006 and early 2007, the applicant consulted her GP who told her that her body was stressed and she should take time out. In November 2009 she told psychiatrist, Dr Julian Parmegiani, that while working in Melbourne she was “living on adrenaline”. Dr Parmegiani was of the opinion that the most likely explanation for the fainting episodes was mental and physical exhaustion. He made a diagnosis of a “Major Depressive Disorder” which he thought was the result of a progression: “sleep begins to deteriorate with anxiety and then it progresses to more severe insomnia as the depression develops … you see quite a degree of insomnia with anxiety and, over time, that becomes far more disabling insomnia …”.
9. After the Melbourne restructure the applicant took an extended overseas holiday, and returned in September 2007 to work exclusively in Sydney. On her account, while she continued to work long hours they were not the gruelling hours she had worked while she had responsibility for Melbourne teams.
10. In late 2007 NAB announced that Corporate Clients, the section where the applicant worked, was to be restructured, with effect from February 2008. Prior to the restructure six Customer Service Managers (CSMs) were responsible for about 130 to 150 staff. Under the restructure, Customer Service Managers were to be replaced by 10 Service Centre Managers. It was the applicant’s understanding that there was to be no material change between the two positions except that teams were no longer headed by team leaders, and as a consequence there was no intermediary between staff and the Service Centre Manager.
11. In February 2008 the applicant was one of three CSMs who remained in her section. They were responsible for overseeing all teams while new managers were recruited. According to the applicant, in the four months before she went on sick leave, the number of staff for which she was responsible fluctuated and for about half the time she was supervising up to 45 people. In her estimate her workload tripled.
12. While employed by NAB the applicant’s performance was assessed quarterly. She was consistently assessed to be a “significant contributor”, the second highest of five available grades and, according to the applicant, the highest grade achieved by any comparable employee. The applicant’s claim that prior to 5 June 2008 she had consistently received favourable feedback and had never been subject to performance management is uncontradicted.
13. Ms Nadine Pillay had been the applicant’s manager for a number of years and they apparently enjoyed an excellent working relationship. Ms Pillay commenced maternity leave in mid-2008 and in March 2008, Mr Brendan Daly was appointed to take over her role. In the three months before Ms Pillay commenced leave she and Mr Daly shared the role of head of Corporate Clients and were jointly responsible for the supervision of staff, including the applicant. Mr Daly and the applicant worked with each other for about eight weeks. He testified that had he been required to assess the applicant’s performance for that period he would have rated her as unsatisfactory.
14. A few weeks after commencing at NAB, Mr Daly introduced what he coined the “100 day plan”. According to Mr Daly the objective of the plan was to improve the level of service provided to clients of the section — employer superannuation funds. Among other things the plan involved roll out of IT services and introducing AOM (Active Operation Management) planning software that had already been introduced in other areas within NAB.
15. Mr Daly could not recall any specific one-on-one meeting, but thought that in his dealings with him the applicant had exhibited a degree of despondency and a “sort of reserve”. He said that at meetings of managers she probably contributed as much as other managers and voiced her opinion but appeared at meetings to be “disengaged”. He found her to be cordial but at times abrupt.
16. The applicant said that Mr Daly always appeared to be in a rush and she found his management style abrasive and confrontational. In her opinion his tone and demeanour were aggressive. She gave as an example his tendency to cut her off in conversation and not let her finish what she was attempting to say. She also recalled a conversation in which she had suggested to Mr Daly that additional support might be necessary to support two of her peers. On her account he said, “If they can’t get their act together they can ‘fuck off’ ”. Mr Daly conceded that he did swear in the workplace from time to time but claimed that he could not recall that meeting. He thought it possible that he had sworn in a conversation with the applicant, but unlikely that he would make the comment attributed to him by the applicant, as on his account he thought the two staff members referred to were performing well.
17. It is common ground that prior to 5 June 2008 Mr Daly had not raised any performance issues with the applicant or raised with her his perception that she appeared to be negative and “disengaged”.
Events of 5 June 2008
18. It is agreed that two successive meetings held on 5 June 2008 were the trigger for the applicant going on extended sick leave. The first was a planning meeting, an “Active Operation Management” (AOM). The second was a meeting attended only by Mr Daly and the applicant.
Active Operation Management planning meeting
19. Managers within the Corporate Client section held weekly AOM meetings to plan and forecast the work load of the section and their respective teams. Each manager was required to estimate the amount of work that had been allocated to their team at a particular point and estimate the resources available — primarily labour — to complete that work. Where the manager estimated that, based on its available resources, a team would complete its allocated work within say three days it was described as being “over by three days”; one with spare capacity was described as being “under by three days”. The planning meetings were a tool used by managers to assess and discuss their respective current and anticipated workloads. A team assessed as being “under” was expected to donate resources to teams assessed as being “over”. A whiteboard was used to assist the participants to assess which teams were in greater need of additional resources. According to Mr Daly an objective of the 100 day plan was the reduction of work “turnaround” to 24 hours across all teams by 30 June 2008.
20. The AOM meeting on 5 June 2008 was attended by about eight team leaders, including the applicant, and facilitated by Mr Daly. Minutes were not taken. There is conflicting evidence about the status of the applicant’s team at the time of that meeting in terms of turnaround times. She claimed that her team was about “two days over”; Mr Daly testified that it was “ten days over”; Manager, Ms Robyn Hall testified that it was about “five to seven days over” and one of the worst performing teams. In cross-examination Ms Hall could not explain the apparent discrepancy between that comment and that contained in her statement in December 2009 that she could not recall the applicant’s team being “particularly worse than anyone else”. No records were provided about the performance of the applicant’s team.
21. According to the applicant, in the course of the AOM meeting Mr Daly questioned her several times about her apparent unwillingness to accept resources from teams that were “under”. She found this to be illogical because on her assessment other teams were in greater need of donated resources. On her account Mr Daly questioned her “several times” about her apparent reluctance to accept additional resources before acceding to his request. She believed that she had been picked on and singled out for criticism by Mr Daly at that meeting.
22. Mr Daly testified that he could not recall that exchange but could recall the applicant appearing to be what he termed “disengaged” — arms crossed and looking out the window. Ms Hall testified that she could not recall anything of note about that meeting.
23. According to the applicant she was very upset by the end of the AOM meeting. Mr Daly testified that if the applicant was distressed, which he conceded was a possibility, it was not apparent to him at the time.
Meeting between applicant and Mr Daly
24. Immediately after the AOM meeting Mr Daly asked the applicant to meet with him. He testified that since starting at NAB he had become increasingly frustrated, annoyed and irritated with what he considered to be the applicant’s negativity and her “disengagement” at the AOM meeting represented the “tipping point”.
25. According to Mr Daly it had never been his intention that the meeting be a formal counselling or performance management session but rather a casual chat to tackle what he consider to be the applicant’s apparent unwillingness to “come on board” and to discuss what appeared to be troubling her.
26. Given that much turns on what occurred at that meeting we think it useful that the parties’ respective accounts be set out in full:
27. In statement prepared on 10 November 2008 the applicant gave this account of the conversation:
Brendan Daly [BD]: "This is not going to work, we cannot work with together."
Applicant [A]: "What do you mean? What are you saying?"
BD:"This is just not going work, your attitude is negative and you are not on board."
A:"What do you mean... what is negative about my attitude towards work?"
BD: "You're not on board with what we are doing in the business and what we are trying to achieve; and you're not working with the team, you are isolating yourself from the others."[/ believe he was referring to service standards and bringing the administration teams to as close to the same day processing as per the discussion during the management meeting held that morning.
A: "What do you mean, my team is working on a two days standard - the only team performing at two days and holding ... we are ahead most of the teams and we are working on a number of initiatives and these they take time",
BD: "I don't know, it's just a 'vibe' I get from you. This just isn't going to work, decide what it is that you want to do. You need to make a decision about what you are going to do next".
A:"ls this because I have an opinion... because I challenged you in the meeting... because I speak up when no one else will?"
BD: "That is stupid [the applicant], who feels that they can't speak up, why wouldn't the others say something?"
A: "Everyone...most of the managers have told me that they feel they can't say anything and that they do not feel they are given a chance to. I feel that you are deliberately pushing me into a corner. You are picking on me. You are victimising me and you are bullying me. This is harassment. If you feel you cannot work with me and want me to leave than why am I not being offered retrenchment. My role has been made redundant and I don't believe my current role is comparable. No one has been able to place me in a comparable role. I have applied for other roles but have been unsuccessful because of planned holidays and because of the grade of my current role, [my current role is grade 2 and my previous role was grade 3]."
BD: "I wasn't here when the restructure took place. Nandini is looking into this with PAC; you need to speak to her and get it sorted out". [/ had spoken to Nandini on a number of occasions regarding my concerns that my current position was not comparable to my previous position. Although my remuneration remained the same, my perception was that my current role was a demotion because my position in the organisation was not comparable with the previous position I held. When I raised the subject with Nandini she would refer me to Brendan for further discussion and when I raised the subject with Brendan, he would, as on this occasion, refer me to Nandini, so by this time, I was becoming very frustrated by their responses to my concerns, as I felt they were both doing this in order to avoid dealing with the issue.]
A: 'Well, I know that you want me to leave, but I am not resigning. I do not think it is fair to expect me to simply resign in this circumstance after all the years of service. I don't see how it is fair for me to give up everything I have worked for. / have been with the organisation for nine years, starting as an administrator and progressing to customer service manager. For most of that time, I have been graded as a significant contributor to the organisation; to be put in a position where, without having done anything wrong (other than voice a disagreement with my manager), I am forced to resign was simply devastating]
BD;"lf things continue like this you may not have choice, because I don't see you having a role in corporate clients and possibly anywhere in the organisation if things continue. "
A: "I am not going to be bullied by you, nor pushed into a corner and made to feel like I have no choice but to resign, if you make me to do that, it is constructive dismissal."
BD: "You won't have a case."
A: "Well, I am going on annual leave as planned and I intend on coming back to my position. I am not resigning.
BD: "Again, you may not have a choice and you should use the time off to make a decision about what you intend to do and what your next steps are going to be."
28. She claimed that the statement had been prepared from contemporary notes made shortly after the incident. When asked to produce these notee in these proceedings she claimed they could not be found.
29. In an email to Mr Daly dated 26 June 2008 the applicant wrote:
I found your comments during our last catch-up on (5 June) very distressing and would like very much to see your concerns of not being able to work with me resolved as soon as possible. Looking back on our discussions (in particular your comments that I may have no alternative but to resign since in your opinion I may not get a position not only in Corporate Clients but anywhere in the organisation) – as stated previously I have no intention of resigning from the organisation and at this stage in view of your comments in regard to my career opportunities in the organisation, will also address my options with HR as soon as I am well enough to do so.
30. On 28 October 2008 NAB rehabilitation officer Ms Janelle Heatherton met with the applicant. Ms Heatherton recorded that the applicant outlined what she saw as her “three key issues”:
1. Restructure…
2. Workload …
3. Meeting with Brendan … “Her perception of the meeting is he advised her that “he cannot work with her”. He told her she needed to make a decision about what she was going to do or he would be left with no choice. She advised he stated “you will never work with CC [Corporate Clients] or NAB again”.
31. In an email to NAB’s Human Resources section dated 3 October 2008 Mr Daly gave this account of the conversation:
I started by stating that there was clearly something that was troubling her and her approach was very negative which was effecting her performance and asked whether she wanted to discuss this. I can’t recall exactly what she said, but her immediate response was along the lines of; ‘I have been with MLC for 9 years and I should have been retrenched in the recent restructure when her role became redundant’. I advised her that I would look into this which I did immediately thereafter with Nandini who advised that HR had been involved and had ticked off all required steps in the previous restructure.
I advised her that in terms of her looking for other roles her current approach and negativity would be having some impact on her success in applying for these, mainly through the impression she must be leaving with her interviewers and the reputation she was starting to develop through the way she was interacting with people (this was not done in a threatening way or implying that I would stand in the way of her getting another role, rather I would like to have seen her successful in this). At this point I referred to the 3 pieces of direct feedback above.
I advised [the applicant] that irrespective of whether she was looking for roles or her success in applying for these, there was a minimum standard that she needed to maintain in her current role. I also advised that her performance would need to improve (particularly around her behaviours) or we would need to progress this further. At this point she said she was aware of constructive dismissal, to which I responded that this was not what I was intending or had meant to imply, however the point of the discussion remained that if her underlying performance did not improve I would be left with few choices.
I suggested that she have a chat with Nandini (given that the view that she had espoused to me where similar to my observations) to discuss this meeting and whether anything that I had outlined was materially incorrect.
32. It is common ground that by the end of the meeting the applicant appeared extremely distressed and sought out Ms Pillay. She returned to work the following day. On her account, she returned home after only an hour or so due to her distress. She described symptoms such as vomiting, shortness of breath, dizziness, stomach pains, shaking, and a physical sensation of tingling. A few days later she was certified unfit for work by her GP, Dr Wong. She began seeing psychologist, Dr Patrick Jabour towards the end of July 2008. The applicant has not worked since the incident.
Issues
33. It is not in issue that by 6 June 2008, the applicant suffered from an “ailment” in the form of a depressive/anxiety disorder. Nor is it in issue that that condition was contributed to, to “a significant degree” by her employment with NAB and accordingly constitutes a disease within the meaning of the Act. The key issue in dispute is whether the condition was a “result of” reasonable administrative action taken in a reasonable manner. It is necessary to first decide when the injury was sustained.
Date of injury
34. Under the Act, an employee is taken to have sustained an injury — being a disease or an aggravation of a disease — on the day they first sought medical treatment for the disease/aggravation; or it first resulted in the employee’s impairment/incapacity for work; whichever happens first: s 7(4). The applicant asserts that for the purposes of the Act her condition occurred in mid-January 2007 being when she first sought medical treatment for stress which she believed was the result of a disturbed sleeping pattern from overwork and exhaustion.
35. To constitute “a disease” or “an aggravation of a disease” the applicant’s condition must be contributed to, to a significant degree, by [her] employment by … a licensee” [emphasis added]: 5B (1) of the Act.
36. NAB was not issued a licence by the Safety Rehabilitation and Compensation Commission under Part VIII of the Act, until 13 April 2007. It follows that NAB will not be liable under the Act for any disease sustained by the applicant prior to that date. Accordingly, it is not open to us to find that the applicant sustained the claimed “disease” prior to 13 April 2007 because she had not been employed by NAB in its capacity as a licensee prior to that date.
37. We believe it more likely than not that consistent with the opinion of Dr Parmegiani the applicant was probably suffering from depression prior to the events that occurred on 5 June 2008. We find that the applicant sustained “an aggravation” of that ailment and for the purpose of the Act was deemed to have occurred on 6 June 2008 being the date the aggravation first resulted in incapacity for work. For convenience we will refer to the aggravation of the applicant’s condition as “the condition”.
Result of reasonable administrative action taken in a reasonable manner
38. NAB contends that it is not liable for the applicant’s alleged “injury” as it was “a result” of, among other things “reasonable administrative action”. Section 5A(1) defines injury to mean:
(a) a disease suffered by an employee; or
…
but does not include a disease … suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee's employment. [emphasis added]
“A result of”?
39. The purported injury will “result from” an excluded cause if that cause was one of several that lead to the development or aggravation of the injury: Hart v Comcare (2005) 145 FCR 29. In Re Carpenter and Comcare [2010] AATA 62, Deputy President Jarvis considered the meaning of the phrase “a result of” in the context of s 5A. The Deputy President rejected the view expressed in Re Layton and Comcare (2007) 99 ALD 96, that a test of materiality should not be imported into the phrase “as a result of” and said:
103 [I] think that a requirement of a “material contribution” should be implied into the exceptions to the definition of “injury”, since otherwise the exceptions to the definition would be wider than the primary requirements of the definition of “disease”, which is a subset of “injury”. This would be incongruous, and would not, I think, accord with Parliament’s intention. I accordingly conclude that on the proper interpretation of the definition of “injury” the exceptions to that definition only arise where the excepted events contribute in a material way to the disease in respect of which compensation is claimed. ...
104 I think my above conclusion is also supported by the consideration that the SRC Act is remedial legislation, and where two constructions are possible, that which is favourable to the worker should be preferred: Whittaker v Comcare [1998] FCA 1099; (1998) 86 FCR 532 at 544 …
40. (See also Re McKenzie and Military Rehabilitation and Compensation Commission [2010] AATA 275 at [93].)
41. Adopting that approach the question posed is, “Did the purported administrative action materially contribute to the aggravation of the applicant’s condition?” That requires us to identify all relevant contributing factors and evaluate the extent to which, if any, the purported administrative action contributed to the condition.
42. NAB contends that the applicant’s condition was the result of the following, each of which constitute “reasonable administrative action”:
The meetings held on 5 June 2008
Mr Daly’s conduct of the administrative activities of the section
43. The original decision-maker who refused the applicant’s claim for compensation concluded that her failure to gain two positions for which she applied in 2008 was a cause of her condition. While not altogether clear whether NAB continues to rely on that ground in the interests of completeness we will consider it.
Alternative roles
44. In the first half of 2008, Ms Pillay encouraged the applicant to apply for three positions within NAB. She applied for two of those positions.
45. According to the applicant, despite initially encouraging her to apply for the position of Quality Control Coordinator, Ms Pillay told her that on reflection she thought the role might not be sufficiently challenging. The applicant proceeded to the second round of interviews but was unsuccessful. She testified that she was not overly upset and after learning of Ms Pillay’s reservations had became somewhat equivocal about the role.
46. In early May 2008, again at the encouragement of Ms Pillay, the applicant applied for a technical role within NAB. She received a second interview but was not appointed. On her account she received favourable feedback but was told she would not be offered the position because of her plans to take extended annual leave in July. She also claimed that the position was filled on a secondment basis and that she had been invited to discuss taking it on, on a permanent basis when she returned from annual leave.
47. A few days after being interviewed for that position the applicant was encouraged to apply for a third position, a business analysis role, to be created within the Corporate Clients area. On her account she was very interested in the position but somewhat nervous as neither a job description nor details of the salary or grade were available. Further she said she was concerned that being a newly created position there was a risk that any manager who might follow Ms Pillay or Mr Daly might consider the position (and the attached team) unnecessary. She did not apply for that position.
48. The applicant has given a plausible explanation for not being especially disappointed with not being appointed to either of the two positions for which she applied. She shared Ms Pillay’s reservation about the first and thought that she had a good chance of being appointed to the second on her return from annual leave. When asked by NAB’s Rehabilitation officer to outline her concerns a few months after the injury she made no mention of her unsuccessful applications. The only evidence to indicate otherwise was the file note entered by Ms Stephanie Hosking of a telephone conversation with Ms Pillay:
…Nandini considered that missing out on the job at the end of May 2008 was perhaps a more likely trigger for her [the applicant] ceasing work some 2 weeks later.
49. It goes without saying that the applicant is not an independent witness. Nonetheless having considered all the evidence we are not satisfied that her failure to be appointed to either of the two positions within NAB was a material cause of her condition.
Causes of the applicant’s condition
50. It seems to us that there were a number of causes of the applicant’s condition. These include:
Her pre-existing anxiety and depression, which made her vulnerable to further stressors;
Working long hours over an extended period including during the period NAB was “on risk”;
Her poor relationship with Mr Daly. The evidence makes plain that even before the June meeting their relationship was strained;
The meetings held on 6 June 2008 - especially the second. It is plain from the evidence that these caused the applicant to be greatly distressed and triggered her incapacity.
What constitutes “administrative action”?
51. The applicant disputes that the actions relied upon by NAB constitute “reasonable administrative action”.
52. Section 5A(2) provides:
For the purposes of subsection (1) and without limiting that subsection, reasonable administrative action is taken to include the following:
(a) a reasonable appraisal of the employee's performance;
(b) a reasonable counselling action (whether formal or informal) taken in respect of the employee's employment;
(c) a reasonable suspension action in respect of the employee's employment;
(d) a reasonable disciplinary action (whether formal or informal) taken in respect of the employee's employment;
(e) anything reasonable done in connection with an action mentioned in paragraph (a), (b), (c) or (d);
(f) anything reasonable done in connection with the employee's failure to obtain a promotion, reclassification, transfer or benefit, or to retain a benefit, in connection with his or her employment.
53. Section 5A(2) sets out a non-exhaustive list of examples of actions that constitute reasonable administrative action: performance appraisal, counselling, suspension and disciplinary actions and “anything reasonable done in connection with” those actions. It also includes anything reasonable done in connection with the employee's failure to obtain a promotion, reclassification, transfer or benefit, or to retain a benefit, in connection with his or her employment. The only express limitation is that contained in s 5A(1) that the action be “in respect of the employee’s employment”.
54. In our view the ejusdem generis rule applies here. That is, statutory words will be read in their contexts and, as Professors Pearce and Geddes, the authors of Statutory Interpretation in Australia (6th ed), have expressed the rule, “general matters will be constrained by reference to specific matters.”[1] The scope of the phrase “administrative action” was considered in some detail in Re Radulovic and Comcare [2010] AATA 777 at [74].
Accordingly the Tribunal considers that section 5A(2) does not extend to all forms of management action which may cause injury. To so interpret the provision could unduly stultify the underlying purpose or object of the Act, namely, to provide a ‘scheme of rehabilitation and compensation for employees who are injured in the course of employment’] unless there has been intentional self-infliction of an injury, or serious or wilful misconduct. The Tribunal considers the preferable interpretation, as a matter of statutory construction, is to limit the provision to the examples listed to ‘anything reasonable done in connection with’ those examples and to other administrative action which falls within categories comparable to those listed. [footnotes omitted]
[1] Butterworths, Sydney, 2006 p 133.
55. We agree with these comments. Section 5A does not extend to any managerial or administrative action even if taken in respect of the claimant’s employment and reasonable.
56. We will now consider whether “the actions” on which NAB relies constitute “administrative action”.
57. AOM meeting While there is a dispute as to precisely what happened it is common ground that during the meeting there was an exchange between Mr Daly and the applicant about the appropriateness of accepting resources “offered” by another team. The applicant believed that she was singled out for criticism; Mr Daly believed he did no more than urge her to consider accepting the resources on offer.
58. It is contended for NAB that this meeting constitutes an appraisal of the applicant’s performance or counselling action in respect of her performance (ss 5A(2)(a) and 5A(2)(b)). Plainly the meeting as a whole could not be said to constitute action of that type “in respect of the applicant’s employment”. It will be recalled that it was a meeting of managers held to plan workloads and allocate resources within the Corporate Clients section. The only basis “the action” could be said to fall within the scope of the provision, is if it is limited to the exchange that took place between Mr Daly and the applicant.
59. On Mr Daly’s account, managers were encouraged to actively participate in an exchange of information and opinions at the meeting. At its highest the applicant’s evidence is that Mr Daly challenged her decision not to accept resources donated by others; they argued; she ultimately acquiesced. In our view it is something of a stretch to suggest that this exchange constituted an appraisal of the applicant’s performance, informal counselling, something comparable or something done in relation to those actions. We are not satisfied that the exchange constitutes “administrative action…in respect of the applicant’s employment”.
60. Conduct of the administrative activities of the section: Counsel for NAB contends that Mr Daly’s “ordering of the business of the section” constitutes administrative action. Counsel gave as examples Mr Daly’s conduct of one-on-one meetings with the applicant and the AOM meetings she attended. We understand it is intended to refer to Mr Daly’s management style and his ongoing interaction with the applicant. As is apparent the class of action as described is extremely broad in scope and somewhat nebulous.
61. As the Tribunal commented in Radulovic “administrative action” does not extend to management actions at large. It is limited to the examples listed in s 5A(2) and “anything reasonable done in connection with” those examples, and to other administrative action that falls within categories comparable to those listed. The action described by Counsel for NAB effectively catches all conduct by Mr Daly that relates to the applicant. In our view this class of conduct does not constitute administrative action.
Second meeting
62. Counsel for the applicant contends that the second meeting did not constitute reasonable administrative action because as Mr Daly was at pains to point out, he had intended that the meeting be nothing more than a casual chat and not a formal disciplinary or counselling session. Whatever he might have intended as things turned out in the course of the meeting, Mr Daly raised concerns about the applicant’s performance and attitude and advised that things must change. That discussion in our constitutes an appraisal of the applicant’s performance or a counselling action and falls within the scope of ss 5A(2)(a) and 5A(2)(b) of the definition of “administrative action”.
63. There is conflicting evidence about whether as Mr Daly claims there were shortcomings in the applicant’s performance or attitude. Whatever the truth might be, as one of her direct managers, it was not unreasonable that he raised his concerns with the applicant providing he had reasonable grounds for doing so. It follows that the meeting constituted “reasonable administrative action”.
Taken in a reasonable manner?
64. The real issue in our view is whether the second meeting was conducted in a reasonable manner. That requires us to make an objective assessment having regard to all relevant circumstances. Whether the impugned action was undertaken in a “reasonable manner” will depend on the circumstances and does not lend itself to a one-size fits all assessment. Mr Daly’s motive in initiating the meeting while relevant is not determinative. Reasonableness is not to be assessed against the benchmark of “best practice” or by asking whether the subject action was beyond reproach.
65. The assessment of what was said at the meeting is made difficult given the conflicting evidence, the passage of time, the absence of independent evidence and the emotive quality of the discussions. Despite significant points of disagreement there is nonetheless some common ground about what was said at that meeting. First, immediately after the AOM meeting Mr Daly requested the applicant meet with him alone and did not foreshadow what he intended to discuss. Second, the meeting opened with Mr Daly accusing the applicant of being negative in the workplace and raising a number of performance issues. Third, he announced that if her performance and behaviour did not improve “we would need to progress this further” and he would “be left with few options”. Fourth, the applicant raised the issues of retrenchment and her classification within the restructure. Fifth, Mr Daly said that unless matters improved the applicant was unlikely to succeed in obtaining alternative employment within NAB.
66. The only material points of difference about the content of those discussions are whether, as Mr Daly claimed, the applicant immediately responded to his opening comments about her negative attitude etc with the comment that she should have been retrenched in the recent restructure; whether, as she claimed, Mr Daly retorted, “you won’t have the case” after she mentioned constructive dismissal; and, whether she had accused Mr Daly of bullying and harassment.
67. In our view the following considerations are relevant to an assessment of whether the meeting was undertaken “in a reasonable manner”. First, as Mr Daly admits, in the eight weeks preceding the meeting he had become increasingly frustrated and annoyed with the applicant and saw the AOM meeting as being the “tipping point”. While the applicant and Mr Daly gave different accounts of that meeting, both perceived it as having an undertone of tension: Mr Daly thought that the applicant had presented as especially negative and uncooperative; she thought she was singled out for criticism. We think it more probable than not that despite Mr Daly’s self assessment that he managed to keep his emotions in check, he took his feelings of annoyance and frustration into the second meeting and they infected its tenor. Second, the relationship between the parties was in its infancy and as agreed far from robust. As such Mr Daly’s feelings of annoyance and frustration were likely to be acutely perceived by the applicant. Third, the applicant was given no notice of what was to be discussed and was moved straight from the AOM meeting into another.
68. Mr Daly’s decision to meet with the applicant on 5 June 2008 was a spur of the moment decision. We accept that he did not set out to formally counsel or discipline the applicant or, as she believes, to bully, threaten or intimidate her. However that she took the words, to which he admits using after criticising her performance — “we would need to progress this further” and “[he would] be left with few options” — as a veiled threat, is hardly surprising. The unavoidable inference to be drawn from those comments is that the applicant’s employment was under threat unless matters improved. They illustrate that whatever Mr Daly’s intention might have been for calling the meeting, it quickly transcended into something more than an informal chat. In our view Mr Daly’s decision to initiate a meeting with a subordinate without notice about a matter of some consequence in circumstances where he felt annoyed and frustrated, was a serious error of judgement. While other factors no doubt contributed to the strength of the applicant’s reaction, that she found the meeting distressing is not surprising in those circumstances. We are not satisfied that the action was taken in a reasonable manner.
69. In the interest of completeness it is necessary to deal with the submissions made by Counsel for NAB about the applicant’s alleged disappointment at not being offered a retrenchment and her purported reclassification. As we understand it is suggested that both contributed to the applicant’s condition and constituted reasonable administrative action.
70. There is no issue that retrenchment and reclassification were discussed at the meeting with Mr Daly. Nor is it disputed that the restructure of Corporate Clients occurred before Mr Daly arrived at NAB and that he played no role in any employment decisions relating to the restructure.
71. Retrenchment: Mr Daly and the applicant gave differing accounts about the circumstances in which the topic of retrenchment arose at the 5 June 2008 meeting. He claimed that after outlining his concerns about her performance and attitude, the applicant launched into an attack on NAB’s decision not to offer her a retrenchment in the context of the restructure. In contrast, the applicant claims that after Mr Daly accused her of negativity and poor performance and said that he could not work with her (which is denied), she said “If you feel you cannot work with me and want me to leave then why am I not offered retrenchment?”.
72. The applicant made no mention of retrenchment in the claim form lodged with NAB in October 2008. Nor was mention made of retrenchment in the notes made by NAB staff following the meeting with the applicant held after that claim was made when she was asked to outline her concerns. There is no direct evidence that the applicant was dissatisfied because she had not been offered a retrenchment and she strongly refuted that suggestion under cross-examination. The only evidence to suggest otherwise is the hearsay evidence given by Mr Daly and Ms Hall, which was to the effect that they heard rumours that the applicant had wanted to be retrenched. Ms Hall’s statement that she understood following the restructure the applicant appeared happy to go into a Service Centre Manager role and had not said anything to her to indicate otherwise would appear to contradict those rumours.
73. We decline as invited by NAB, to draw an adverse inference from the applicant’s failure to produce to the Tribunal the contemporary notes she claimed to have made following her meeting with Mr Daly. She gave a plausible explanation for her failure to produce those notes and furthermore impressed us a truthful witness. We prefer her account of the context in which the retrenchment comment arose during the 5 June meeting. It does not indicate as suggested that she bore a grudge towards NAB on account of not being offered a retrenchment but rather that if Mr Daly felt he could not work with her she ought at least be offered a retrenchment package. We are not persuaded that the applicant was dissatisfied with not being offered retrenchment following the restructure or that her condition was a “result of” not being made such an offer.
74. Reclassification: The applicant claims that she became concerned that her position had been downgraded as a consequence of the restructure when the person responsible for recruiting the second position for which she applied, told her that she might be unable to apply on account of her grade. That discussion took place about three weeks before the June meeting with Mr Daly. The applicant believed that before the restructure her position was a Grade 3 and that consistent with the information provided by NAB her grade was unchanged by the restructure. The applicant testified that after speaking to the recruitment officer she sought clarification from Ms Pillay who said she also understood that the position was a Grade 3 and shared her concern that perhaps her new role might not be comparable as had originally been thought. The applicant also claimed that Ms Pillay undertook to make further enquiries but the issue remained unresolved at the time of the June meeting.
75. It is not entirely clear to us what action NAB claims constitute “reasonable administrative action” in relation to the applicant’s purported reclassification. It goes without saying that before it can be determined whether the applicant’s condition was a result of “reasonable administrative action” it is necessary to identify with precision the relevant action.
76. It is to be observed that there is no evidence to suggest that the applicant “failed to retain a benefit” or had an expectation that she would be reclassified or promoted, as a consequence of the restructure. Her letter of appointment dated 6 February 2008 described her new position as a “directly comparable appointment [to her previous position of Customer Service Manager]”.
77. In our view the relevant administrative action could not be said to be the decision(s) taken in relation to the applicant’s grading or classification made consequent on the restructure, as the evidence does not support a finding that these represented a source of concern to the applicant. Her concern was triggered by the discussion with the recruitment officer and the lack of any formal response once she sought clarification about the issue from her managers. Even if assumed, that those acts separately or in combination, fall within the scope s 5A(2)(f) we do not think that they could be described as “reasonable”. In our view providing inaccurate information about an employee’s grade or failing to address an employee’s legitimate concern in a timely manner once raised, do not constitute “reasonable administrative action”.
summary
78. The applicant suffered an injury within the meaning of the Act. The injury was not the result of reasonable administrative action taken in a reasonable manner. Accordingly NAB is liable to pay compensation in accordance with the Act. It follows that the decision under review must be set aside.
I certify that the 78 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member A K Britton and Dr J D Campbell
Signed: ..................[sgd]................................................
Associate to Senior Member BrittonDate/s of Hearing 7-9 September 2010 and 6-7 December 2010
Date of final submissions 15 January 2011
Date of Decision 29 March 2011
Counsel for the Applicant Mr M Best
Solicitor for the Applicant Mr T Mithieux, Carroll & O’Dea Lawyers
Counsel for the Respondent Mr M Snell
Solicitor for the Respondent Ms K Miller, Sparke Helmore
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