Mu v Unique Metal Works Pty Ltd - [2021] NSWPIC 93

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Mu v Unique Metal Works Pty Ltd [2021] NSWPIC 93
APPLICANT:	Jian Guo Mu
RESPONDENT:	Unique Metal Works Pty Ltd
PRINCIPAL MEMBER:	Ms Josephine Bamber
DATE OF DECISION:	23 April 2021
CATCHWORDS:	WORKERS COMPENSATION- Agreed work-related psychological injury, with dispute as to whether the respondent has discharged its onus of proof in relation to section 11A of the 1987 Act; Held- respondent has not established a defence under section 11A of the 1987 Act that its conduct in relation to discipline was reasonable; award for applicant in relation to weekly compensation, treatment expenses and remittal of lump sum claim to the President for referral to Medical Assessor.
DETERMINATIONS MADE:	1. The respondent has not established a defence under section 11A of the Workers Compensation Act 1987. 2. The respondent is to pay the applicant weekly compensation from 8 May 2020 to date and continuing pursuant to section 37 of the Workers Compensation Act 1987 at the rate of $1,099.60 per week. 3. The respondent is to pay the applicant’s treatment expenses pursuant to section 60 of the Workers Compensation Act 1987 upon production of accounts, receipts and/or Medicare Notice of Charge. 4. The lump sum compensation claim is remitted to the President for referral to a Medical Assessor to assess permanent impairment for psychological injury with a deemed date of injury of 19 August 2019. 5. The documents to be referred to the Medical Assessor are to include the following: a. Application to Resolve a Dispute and attached documents; b. Reply and attached documents; c. Applications to Admit Late Documents filed by the applicant dated 14 December 2020, 9 February 2021, and 25 February 2021, and d. Application to Admit Late Documents filed by the respondent dated 25 February 2021.

STATEMENT OF REASONS

BACKGROUND

Jian Guo Mu migrated to Australia in 1998 from China, obtained a Diploma in Mechanical Engineering from TAFE and in 1999 commenced employment as an operator. Mr Mu’s employing company was sold a couple of times and is now Unique Metal Works Pty Ltd, the respondent. Mr Mu’s work with the respondent is as a fulltime programmer.
In his Application to Resolve a Dispute (ARD) Mr Mu’s injury is described as follows:
“Disease injury, psychiatric injury in the form of adjustment disorder with anxious distress.

The applicant was employed as programmer with the respondent. As a result of unsupportive management, lack of communication, not being offered or provided with a support person and unrealistic timeframes to meet allegations, the applicant sustained a psychiatric injury in the form of adjustment disorder with anxious distress.”
The respondent’s workers compensation insurer, in a notice dated 30 April 2020 issued pursuant to section 78 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act), amended it prior notice which was dated 15 April 2020. The insurer confirmed that the evidence establishes that Mr Mu has been diagnosed with a psychological injury and so the dispute relating to “injury” was withdrawn.
However, the insurer advised Mr Mu that it relied upon a defence under section 11A of the Workers Compensation Act 1987 (the 1987 Act), asserting that Mr Mu’s psychological injury was wholly or predominantly caused by action taken or proposed to be taken by the employer with respect to discipline, it added “namely the decision to investigate your alleged breaches of company policy”. The insurer argued in that notice that the actions by the employer were reasonable as it acted “in accordance with the Management of Misconduct/Discipline Policy.[1]”
[1] Application to Resolve a Dispute (ARD) p 21.
The insurer added that it follows that Mr Mu was not entitled to weekly compensation or medical treatment. In a further section 78 notice dated 30 October 2020 the insurer also denied liability for the lump sum compensation claim[2].
[2] ARD p 24.
At the arbitration hearing the respondent’s counsel confirmed that the main dispute was the section 11A defence and did not make submissions in relation to capacity or medical treatment. The claim for weekly compensation is from 8 May 2020 to date and continuing and the pre-injury average weekly earnings figure (PIAWE) was agreed at $1,374.50. Mr Mu’s counsel confirmed, in the event that the respondent did not establish its defence under section 11A, he would be seeking a “general order” in relation to section 60 expenses.

PROCEDURE BEFORE THE COMMISSION

The matter was listed for conciliation conference/arbitration hearing on 18 February 2021. In conciliation additional evidence was discussed and the matter adjourned without the arbitration hearing commencing. The matter proceeded in arbitration hearing on 15 March 2021. Mr Craig Tanner, counsel, instructed by Mr Richard Debabneh, solicitor, appeared for Mr Mu, who was present. The respondent was represented by Mr Howard Halligan, counsel, instructed by Ms Casey Bray, solicitor, and Mr Michael Taylor from the respondent employer and Ms Anna Venardos from the insurer. The hearing was conducted on the MODRON audio-visual platform due to the Covid-19 situation.
I am satisfied that the parties to the dispute understand the nature of the application and the legal implications of any assertion made in the information supplied. 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.

EVIDENCE

Documentary evidence

The following documents were in evidence before the Commission and considered in making this determination:

(a) ARD and attached documents;
(b) Reply and attached documents;

(c) Application to Admit Late Documents filed by Mr Mu dated 14 December 2020;

(d) Application to Admit Late Documents filed by Mr Mu dated 9 February 2021;

(e) Application to Admit Late Documents filed by Mr Mu dated 25 February 2021, and

(f) Application to Admit Late Documents filed by the respondent dated 25 February 2021.

Oral evidence

There was no oral evidence. Both counsel made oral submissions which were sound recorded, and a copy of the recording is available to the parties.

FINDINGS AND REASONS

Mr Mu’s statements

Mr Mu has provided statements dated 11 September 2019[3] and 17 November 2020[4]. He describes his duties as a programmer and says Mr Stuart Ellwood has been his Operations Manager since about October 2018. At [28] of his first statement he says before Christmas 2018 he received from Mr Ellwood a letter alleging he beached the company’s code of practice. He said this was investigated and found it was not substantiated or proven. He said he was not worried about that allegation because he knew he had done nothing wrong.
[3] ARD p 5.
[4] ARD p 1.
Mr Mu states he was working on 19 August 2019 when at 3pm Mr Ellwood rang him and asked to speak to him. Mr Mu says he went to Mr Ellwood’s office and he was handed a letter accusing him of two breaches of the company’s policies. He said he was given a copy of the Employee Code of Conduct, which he had not received before.
Mr Mu said he read the letter and told Mr Ellwood the allegations were not true. He said he left Mr Ellwood’s office and was feeling very upset, very shaken and he went back to his desk. He says he was worried and scared and he rang the union. He said the union told him to have the meeting re-scheduled and they would have someone attend as his support person. Mr Mu said he rang his wife and told her what had happened. He asked her to ring the doctor to arrange for Mr Mu to see her as his body was shaking. He said he had trouble typing and speaking because of the shaking.
He said he told the doctor he felt dizzy and had a headache and he was given a certificate for a few days off work. He said he went home but was still upset and shocked. He relates details about his ongoing symptoms and further visit to Dr Wu.
Mr Mu states he attended Mr Ellwood’s office for the meeting on 23 August 2019 with his union support person, Mr Ian Sherwood. Ms De Haan attended by phone. He said
Ms De Hann read the allegations contained in the letter dated 19 August 2019 and advised they were going investigate the allegations and she asked for his response. Mr Mu says he denied the allegations and asked if Vishal and Tony could be called to be questioned about the allegations in front of him. He said she said no, they would do an internal investigation and make a conclusion.
In that first statement at [51], Mr Mu says he has not been told anything about the investigation or conclusion.
Mr Mu then relates his ongoing symptoms and treatment with Dr Wu and his psychologist, Mr Gabriel Wong.
Mr Mu says before the first letter from Mr Ellwood he tried to avoid him, but before that Mr Ellwood was a salesman and they had no problems and had a normal working relationship. At [67] he says when Mr Ellwood started as the Branch Manager late in 2018 he was giving most staff warnings for any little thing and that many people have resigned or been sacked. He said before then there were hardly any warnings given to anyone. At [68] Mr Mu says he feels he has been picked on because he asked questions of Mr Ellwood about the removal of his picnic day and changes regarding overtime pay.
In Mr Mu’s second statement he says in December 2017 he was accused of interfering with one of Brandon Thai’s clock cards. He says Mr Thai is a production supervisor and he would give his card to someone else to swipe in. Mr Mu said he made a copy of the log of the times and took it to the General Manager, Mr Michael Taylor. Mr Mu says Mr Thai found out and shouted at him.
Mr Mu says in June 2018 he believed Mr Thai was not completing tasks through the week so he could work overtime on Saturday. Mr Mu says he raised this with the Manager, Rodney Greenfield. He said after this Mr Thai came and yelled at him. Mr Mu said he notified HR of this. He said he then received an investigation letter regarding his conduct arising from this matter. He says this did not proceed further.
Mr Mu relates that in about November 2018 Mr Ellwood was to become the Manager and he met with him to tell him that he was displeased that Mr Greenwood had not investigated his complaints about Mr Thai.
Mr Mu relates in about May 2019 his picnic day was revoked, and he approached the union for assistance. He says he declined an offer to increase his salary as he would have to sign a new agreement.
Mr Mu says he spoke to Vishay Segran stating he told him that he had spoken to Mr Ellwood about the change in his entitlements, but he did not suggest to Mr Segran that he should alter his work performance.
Mr Mu says despite the abovementioned matters being stressful he was able to keep working. He contrasts this with the situation when he received the letter dated 19 August 2019. At [21] he says he suffered ongoing anxiety because he was not advised of the outcome of the investigation until six months later when the insurer provided him with a copy of the report. He notes the report was dated 23 August 2019 and said his employment would be terminated. He said this had not been communicated to him by his employer and he became distressed on the receipt of the report. He says at the time of making this statement he has not been terminated and the uncertainty surrounding his employment has caused him more anxiety. He describes his ongoing symptoms.

19 August 2019 letter

The letter dated 19 August 2019 from Stuart Ellwood to Mr Mu states it was to inform Mr Mu that allegations have been raised regarding his conduct and that the respondent takes these allegations seriously and was conducting a formal investigation into them. The letter sets out the allegations, that Mr Mu had:
“• On or around the 6th August 2019 spread rumours about Brandon Thai being the reason for Toni Markov's resignation from the Company.
• On previous occasions questioned Vishal Segran and Tony Pan as why they are working so hard stating that they should not be assisting the business the way he is.[5]”
[5] ARD p 29.
The letter stated that this alleged behaviour is in breach of the respondent’s Employee Code of Conduct (CGV-UML-GDL-03) specifically relating to section 3 regarding the company’s values and section 8 relating to an harassment free workplace.
It is also stated that the respondent considers “this as a serious matter and has an obligation to investigate”.
Mr Mu was advised in the letter that he was required to attend an investigation meeting via telephone conference the next day at 10am with Mr Ellwood and the HR Manager, Amanda de Haan. It was stated that he had a right to have a support person attend and he was not to discuss the matter with anyone apart from his support person.

Vishal Segran

Mr Vishal Segran provided an email to Mr Mu dated 7 January 2021[6]. Mr Segran joined the same company as Mr Mu in 2004 as a laser operator but became a programmer in 2012 and was trained by Mr Mu. Mr Segran says that Mr Mu always had a positive attitude towards the employer, and he admired Mr Mu for his hard work, honesty and sincerity in his work. He says he does not recall making complaints to management about Mr Mu.
[6] Application to Admit Late Documents dated 9.2.21.

Employee/Witness Statement Tony Pan

A document headed Employee/Witness Statement signed by Tony Pan dated 16 August 2019 is in the Reply[7]. Apart from the formal heading parts, it has two sections headed “Matter” and “Detail”. Under “Matter” it is obvious the typed contents are those made by Mr Ellwood because the opening sentence says that morning at 9am Tony Pan had a conversation in confidence with me Stuart Ellwood. Mr Ellwood has written:
“In confidence I asked Tony about the office and how things have been going and if he has felt anyone has been in discussion with him about trying to slow him down or his performance. Tony had come forward to discuss regular occurrences of Jim Mu approaching Tony to ask him why he works so hard and why he gives so much effort to the business when he does not need to. Tony said that he comes to work to give his all and does not want the negativity that Jim has been bringing…”
[7] Reply p 36.

Under the heading “Detail” in handwriting it is stated “I can confirm the statement/briefing above is the fact and I personally feel it’s impacting everyone but for Jim being a senior member I cannot do anything about it”.

Employee/Witness Statement Brandon Thai

This document is also dated 16 August 2019 and has the same format as the above document. It refers to Mr Clayton Tanner being an attendee. Under “Matter” the typed sentence is “On 6/08/2019 around 1pm Brandon had heard from Clayton that a rumor had been spread by Jim that Toni Markov resigned from the business because of Brandon. This rumor was unfounded and had impacted Brandon in a negative manner.”
Under the heading “Detail” in handwriting is the following:
“I heard from Clayton on the 6/8/2019 around 1pm that Jim spreading rumor around that Toni resigned because of myself. I have ask Clayton who told you that he won’t tell me. Has we all know’s else [sic]”[8].
[8] Reply p 58.

Clayton Tanner

An Employee/Witness Statement dated 16 August 2019 signed by Clayton Tanner states Mr Thai was an attendee. Under the heading “Matter” it is typed “On 6/08/2019 around 1pm Brandon Thai had heard from Clayton that a rumor had been spread by Jim Mu that Toni Markov resigned from the business because of Brandon. This rumor was unfounded and has impacted Brandon in a negative manner”. Under the heading “Detail” in handwriting it is written “I heard a rumor and spoke with Brandon on 6/08/2019 at 1pm however I cannot recollect who told me the rumor.”[9]
[9] Reply p 59.
Telephone text messages are before the Commission from Mr Tanner in which he says it is his signature on the document dated 16 August 2019, but he says it is not his writing[10]. In a second text message he states:
[10] Application to Admit Late Documents dated 25.2 21.
“That 1 about not telling about the rumor! That is about Brandon when he got caught forging the time cards!! I refused to tell who told me because Pedro asked me not to mention his name but Pedro went & showed Stuart pictures as evidence of Brandon doing wrong! As u can see in my signed statement it doesn’t mention Tony Markovs name or your name & there is no date! Stuart wrote that himself telling me that Brandon will be investigated & sacked so I signed it thinking it was about Brandon!! Pedro & John also signed statements about Brandon & the time card thing! Stuart has used my statement about Brandon & used it as a statement about you!!”
A handwritten statement signed by Mr Tanner and dated 10 February 2021 says that he has no recollection of writing a statement nor signing this particular statement about Jim Mu spreading rumours about Tony Markov resigning because of Brandon Thai. He says he never received an original copy of this statement.

Investigation report

The respondent’s investigation report is dated 23 August 2019[11]. It states that the investigator was Stuart Ellwood. The conclusion is recorded that Mr Mu’s conduct was harassment of Brandon Thai but this seems to only be in relation to the allegation that Mr Mu spread a rumour that Brandon Thai was the reason Toni Markov left the business. It was also concluded that Mr Mu’s conduct was unprofessional and unproductive suggesting to Mr Segran and Mr Pan they reduce their work performance. It is recorded that Mr Ellwood regarded these as serious misconduct and the outcome of the investigation is the termination of Mr Mu’s employment.
[11] Reply p 67.

Stuart Ellwood’s statement

Mr Ellwood gave a statement to the insurer’s investigator on 20 September 2019[12]. At [20] he expresses the view that Mr Mu is not a team player citing an example before Christmas in 2018 when he said Mr Mu refused to help get a job completed.
[12] Application to Admit Late Documents dated 25.2.21 (AALD) p 2.
At [23] he refers to a prior warning being given to Mr Mu but then says the company has no record of it being given to Mr Mu as it was a day or so prior to the then company going into administration. In [10] Mr Ellwood says RCR Laser went into administration in November 2018 and was purchased by the current respondent in February 2019. So, I infer the warning that Mr Ellwood is referring to was in November 2018. Mr Ellwood became Mr Mu’s manager in October 2018.
Mr Ellwood’s statement is somewhat disjointed, but it seems the events that this prior warning related to arose from conversations he had with Mr Mu in November 2018. At [25] he says he spoke to Mr Mu at his desk, which is in an open plan area. He said Mr Mu became heated and said “there is a disease down there” referring to the area of the company downstairs.
Mr Ellwood says he did not know that Mr Mu was referring to any individual. So, it is apparent Mr Mu must not have mentioned anyone’s name in this conversation. However, Mr Ellwood says that Mr Thai told him he had overheard their conversation and he was not happy being referred to as a disease.
Mr Ellwood says around this time Mr Pan approached him and said Mr Mu said to him that he must not let the disease rub off on him. Mr Ellwood says on 9 November 2018 he spoke to Mr Mu at his desk and told him it was not acceptable for him to call people names. He says Mr Mu was irate and said that Mr Thai did not deserve to be in his role as he is criminal and evil. Mr Ellwood says they had an investigation into the matter with a meeting with Mr Mu and the upshot was Mr Mu was told he would receive a written warning that he breached the company’s code of conduct. However, at [33] Mr Ellwood says this letter was not handed to Mr Mu because of the company going into voluntary administration.

Mr Ellwood says on 8 January 2019 he had a conversation with Mr Mu in the kitchen in which Mr Mu expressed his continued unhappiness about the above matter and Mr Thai’s promotion, and that Mr Mu believed that Mr Ellwood was taking sides with Mr Thai.
At [37] Mr Ellwood relates that Mr Thai told him that Mr Tanner had told him that Mr Mu had spread rumours that the reason an employee had left the company was because of Mr Thai. Mr Thai was upset about this. Mr Ellwood states around the same time on 31 July 2019 and on 13 August 2019 Mr Segran had come into his office and said Mr Mu had said to him why was he working so hard and why was he helping the company.
Mr Ellwood states on 15 August 2019, after Mr Mu had returned to work from sick leave, they spoke in Mr Ellwood’s office and Mr Mu again raised concerns with work and the situation downstairs and said that nothing had been done about it and it was affecting him. He says Mr Mu was also upset because he had not received a promised gift card form the company for his 20 years’ service. Apparently, Mr Mu had been told on 10 May 2019 he would receive the gift card.
Mr Ellwood says on 16 August 2019 Mr Mu sent him an email referring to his time off work and expressing appreciation for Mr Ellwood’s understanding and willingness to offer support.
Mr Ellwood says on 16 August 2019 he spoke to Mr Pan who told him for years Mr Mu had been asking why he was working so hard for the company and he had told the previous manager about such comments, but nothing was done about it.
Mr Ellwood says of 16 August 2019 he also spoke to Mr Segran, Mr Thai and Mr Tanner separately to see if they were prepared to provide employee statements. These have been described by me above and I note on Mr Thai’s statement it says Mr Tanner was present and on Mr Tanner’s statement it says Mr Thai was present.
At [45] of his statement Mr Ellwood says based off this evidence the management determined an investigation meeting would be held with Mr Mu and so Ms de Haan prepared a letter dated 16 August 2019 which Mr Ellwood says he gave Mr Mu that day and there was to be a meeting on 19 August 2019. However, I note the letter is dated 19 August 2019 and referred to a meeting to be held on 20 August 2019. At [46] Mr Ellwood says he read the letter to Mr Mu and provided him with a copy of the code of conduct. He said this took place on 16 August 2019 and he said Mr Mu did not attend work on Monday 19 August 2019. These dates are wrong, and given the letter is dated 19 August 2019, I find the conversation took place that date. Nothing turns on this error in the time frames.
Mr Ellwood relates that the meeting took place on 23 August 2019 at 10am and that Mr Mu denied the allegations. He does not give details of that meeting in this statement. He just says they told Mr Mu they would complete an internal investigation. I note the investigation report is dated 23 August 2019.

Meeting 23 August 2019

A record of the meeting between Mr Ellwood, Ms de Haan, Mr Mu and Ian from the union reveals it took place on 23 August 2019 from 10am to 10.10am[13]. It is recorded that in relation to the first allegation that Mr Mu had been spreading rumours that Toni Markov left the company because of Brandon Thai, Mr Mu stated the following:
“on the first allegation is that I haven’t spread any rumours as listed on the letter and when I was asked by my colleague, how was Tony and what happened to him? I just replied whatever Tony Markov had told me that he was upset and resigned. In the meeting Brandon didn’t…. (?) he should have talked to me instead of putting it on the table in the meeting, all this information was …. this allegation put to me is false. It’s close (?) information and I just replied to what Tony told me.”
[13] AALD p 56.
Ms de Haan asked some clarifying questions and Mr Mu confirmed he did not initiate any conversation stating that Mr Thai was the reason Toni Markov left. He said that Toni had told him that he was upset and resigned. He says there was a meeting, and Toni said that Mr Thai should not have brought something up at the meeting and Toni says Mr Thai should have spoken to him first. Mr Mu says he replied, when asked by a question from John from downstairs, and said what Toni had told him. Mr Mu repeatedly stated that it was not a discussion he just replied to a question.
In relation to the second allegation, that he told Mr Segran and Mr Pan why did they work so hard, he said he did not recall such conversations.

Other documents

In the Application to Admit Late Documents filed by the respondent dated 25 February 2021 there are many other emails and documents relating to the complaints Mr Mu made about Mr Thai in 2017 and the events and conversations in 2018. I have read them all but do not propose to summarise them. The dispute I am required to determine relates to whether the respondent has discharged its onus of proof in relation to the section 11A defence which it has raised concerning the psychological injury of Mr Mu which it asserts was caused by the actions of the employer relating to discipline in relation to the allegations set out in the letter dated 19 August 2019.

Dr Wu

Dr Wu is Mr Mu’s general practitioner. She first saw him in relation to the injury on 19 August 2019. She has issued a series of Workover NSW-certificates of capacity up to 27 October 2020, all of which certify that Mr Mu has no capacity for any employment[14]. Her diagnosis is “work-related anxiety stress” and she notes he has “been accused to breach company policies and procedures”.
[14] ARD pp 83 -106.
Dr Wu has provided an undated report in response to a letter from Mr Mu’s solicitors dated 21 September 2020[15]. She relates that Mr Mu first consulted her on 19 August 2019 and told her that he was unfairly accused by his manager of breaching the employee code of conduct by spreading rumours about his colleagues. She notes that Mr Mu has subsequently been feeling unwell with stress, anxiety, insomnia, headache, fears and hopelessness since he received the letter dated 19 August 2019. She notes that Mr Mu had no past history of mental health issues. She advises that Mr Mu’s psychiatric injury could have been avoided if the employer had provided him with the opportunities for better communication or meeting to address the alleged issue.
[15] Application to admit late documents dated 14.12.20.

Gabriel Wong

Gabriel Wong is a psychologist who commenced to treat Mr Mu on 31 August 2019. In his reports to the insurer dated 5 September 2019 and to Dr Wu he advises that Mr Mu meets the diagnostic criteria for an adjustment disorder with mixed anxiety and depressed mood. He relates the history that Mr Mu was accused by his manager of breaching the company’s code of conduct by spreading rumours of his colleague and questioning two colleagues why they were working so hard. Mr Wong notes on the way home that day Mr Mu could not focus on his driving, his mind was very confused, and he has since had difficulty sleeping due to rumination. He refers to his other symptoms[16].
[16] ARD pp 42 and 60.
His clinical note from this first consultation has the same history as to the cause of Mr Mu’s psychological condition[17]. Mr Wong saw Mr Mu again on 7 September 2019[18], 14 September 2019[19], 5 October 2019[20], 26 October 2019[21], and 13 November 2019[22]. On some of the typed clinical notes the year of the treatment sessions has a typographical error referring to 2020. In a report to Dr Wu dated 17 November 2019 Mr Wong advises that Mr Wu still has not heard the outcome of the investigation and he is concerned about returning to work as he is fearful his manager may accuse him of other matters[23].
[17] ARD p 52.
[18] ARD p 59.
[19] ARD p 62.
[20] ARD p 63.
[21] ARD p 67.
[22] ARD p 68.
[23] ARD p 75.
It is not necessary to summarise the details of the treatment given to Mr Mu because “injury” is not in issue.

Dr Rastogi

Dr Rastogi, psychiatrist, has provided a medico-legal report for Mr Mu dated 10 September 2020[24]. She diagnoses that Mr Mu has an adjustment disorder with anxious distress. She takes the history that Mr Mu had no performance issues or allegations in his employment for approximately 20 years. She relates that this included reporting to seven different branch managers and the company takeover in 2010. However, she records that when the business was taken over by the present respondent in 2019 Mr Mu had complained that his previous entitlement to a picnic day had been taken away. She relates he thereafter continued to work in his normal duties until on 19 August 2019 when at 3pm he received a letter from the respondent alleging he had breached the company’s policies.
[24] ARD p 30.
Dr Rastogi notes that Mr Mu said he was in acute distress, had severe anxiety, was tremulous, with racing thoughts and could not comprehend anything. He went to his doctor on the same day. He re-attended on his doctor two days later reporting he had experienced insomnia, had intrusive thoughts, ruminations, felt miserable and had impaired concentration.
Dr Rastogi refers to the meeting held on 23 August 2019 attended by Mr Mu with Mr Ellwood, Ms de Haan and a union support person.
The doctor records Mr Mu’s ongoing symptoms and the details of her mental state examination of Mr Mu. After making her diagnosis, Dr Rastogi summarised the events at work and referred to the receipt of the letter and she states “this caused significant stress and anxiety with excessive fears as he denied the allegations.” She notes that Mr Mu was unable to work since then. She notes that before this time Mr Mu was not given prior warning or had a meeting to discuss his behaviours.
Dr Rastogi expressed the view that Mr Mu was unfit to work in any capacity. She assessed him as having 17% whole person impairment (WPI).

Dr Bisht

Dr Bisht, psychiatrist, was qualified by the respondent and has provided reports dated 21 November 2019[25] and 27 October 2020[26]. In his first report Dr Bisht has a history of Mr Mu’s psychological symptoms starting after he was given the letter dated 19 August 2019. The doctor notes that Mr Mu informed him that the investigation into the allegation is not finalized and he is fearful of the consequences of the outcome of the investigation. The doctor details Mr Mu’s symptoms under the heading current functioning and also to some extent in the mental state examination.
[25] Reply p 100.
[26] Reply p 107.
Dr Bisht diagnosed that Mr Mu had an adjustment disorder with mixed anxious and depressed mood. The doctor opined that there were stressful work-related experiences, that is being given the letter dated 19 August 2019. He stated that the whole and predominant cause is the investigations and meeting that were planned in the letter dated 19 August 2019 in relation to disciplinary action that was being undertaken by the employer.
Dr Bisht found that Mr Mu was not fit to return to work with the pre-injury employer, but he anticipated he could do so once he had processed the outcome of the investigation, and then he could participate in a graded return to work.
Dr Bisht re-examined Mr Mu and provided a second report in October 2020. He details Mr Mu’s symptoms, conducted a mental state examination and assessed Mr Mu’s permanent impairment, finding 7% WPI. He said he found no clear evidence of malingering or exaggeration and that Mr Mu’s symptoms had been of a long duration. When assessing Mr Mu under the Psychiatric Impairment Rating Scales (PIRS), for employability he stated that Mr Mu can work part time in a different environment and requiring a different skillset, such as data entry. He notes his concentration is affected and would take longer than other people to complete a course and after reading he needs a break after 10 to 15 minutes.

Determination

The parties have agreed that Mr Mu has a psychological injury from work-related events. However, section 11A(1) of the 1987 Act 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.”
The respondent has the onus of establishing a defence under section 11A. In Mr Mu’s case the aspect of section 11A being relied upon is discipline. The respondent submits this is not a case where Hamad v Q CateringLimited[27] applies. Hamad was a case concerned with the proof required of the aspect of section 11A dealing with “wholly or predominantly caused”. The respondent submits that the matters set out in the ARD description of injury such as being unsupported by management, lack of communication and no support person are not dealt with in Mr Mu’s statements. The respondent submits that the medical evidence is in agreement that the psychological injury commenced in response to Mr Mu being given the letter dated 19 August 2019.
[27] [2017] NSWWCCPD 6, Hamad.
For the respondent to succeed it needs to prove that the employer’s conduct was reasonable action. The respondent’s counsel argues that the employer had more than enough information for it to seek for Mr Mu to explain himself and that is why the letter dated 19 August 2019 was given to him and the meeting on 23 August 2019 held. The respondent argues that this conduct by the employer was reasonable.
The respondent submitted the test of reasonableness is an objective test and referred to cases such as Jeffery v Lintipal Pty Ltd[28], Baldwin v Greater Building Society Ltd[29] and Irwin v Director General of Education[30].
[28] [2008] NSWCA 138, Jeffery.
[29] [2011] NSWWCCPD 18, Baldwin.
[30] Unreported 18 June 1998, No 14068 of 1997, Irwin.
In Baldwin at [96] Roche DP stated it is necessary to have regard to all the circumstances, including the seriousness of the conduct that has led to the disciplinary action, the nature of the employer’s business and the worker’s position in that business. At [104] he also stated that mere compliance with a set procedure that the employer believes is reasonable will not necessarily mean that an employer’s conduct is in fact reasonable in all the circumstances and Roche DP cited Basten JA in Jeffery at [50].
The respondent says the meeting time was changed and Mr Mu had a support person at the meeting. It submits there is no complaint as to how the meeting was conducted.
The respondent’s counsel canvassed the contents of the employee statements. In relation to Mr Segran’s denial, it was submitted that it came into existence after the proceedings were issued and it is far-fetched. In relation to Mr Tanner’s statement it was submitted that it is his signature and it should be found he has adopted the contents.
Attention was drawn to the Employee’s Code of Conduct, particularly paragraph 8 referring to an harassment free workplace. It was submitted that the allegations were sufficient to discuss the allegations with Mr Mu as they were not vacuous allegations.
In summary, the respondent submitted it was a clear case where the section 11A defence should succeed, and it seeks an award for the respondent.
Mr Mu’s counsel criticised the respondent’s evidence because there are no statements from Mr Pan, Mr Segran, Mr Tanner, and Mr Thai in the usual form, just the documents dated 16 August 2019 which are very brief, and it appears the narrative in them was written by Mr Ellwood.
Mr Mu’s counsel submitted that the accusation about the rumour involving Mr Thai is very vague. He says he heard from Mr Tanner on 6 August 2019 that Mr Mu was spreading a rumour that the reason why Mr Markov resigned was because of Mr Thai but Mr Tanner said he will not say who told him that. Counsel submitted that this does not qualify as a matter worthy of investigation or discipline. Furthermore, counsel submits that Mr Ellwood had made a determination about the alleged rumour and pre-determined the guilt of Mr Mu, when he says the rumour was unfounded and affected Brandon negatively.
It is argued that the reliance on this accusation infects the proceedings against Mr Mu and renders the entirety of the disciplinary process as unreasonable.
Mr Mu’s counsel submits that it was known from the prior situation that there was bad blood between Mr Thai and Mr Mu and so to institute disciplinary proceedings against Mr Mu was unfair, especially relying on hearsay, as Mr Thai cannot give evidence that it was Mr Mu spreading rumours.
In relation to Mr Tanner, Mr Mu’s counsel raised a series of matters that he said should cause concern. He noted that the documents record that Mr Thai and Mr Tanner were present together when giving their statements to Mr Ellwood on 16 August 2019 and they should have been spoken to separately. Also, Mr Tanner allegedly said he cannot remember who told him the rumour. So, it was argued there was no substance to implicate Mr Mu. Furthermore, in the handwritten details there is no mention of Mr Mu and no mention as to what the rumour was.
Mr Mu’s counsel characterised this allegation as being based on flimsy evidence and he submitted it should not have been the subject of disciplinary proceedings.
Counsel submitted that it was disturbing that Mr Tanner denied writing this, even though he acknowledged his signature. He submitted that this is a serious allegation by Mr Tanner, and one would have expected a statement to have been obtained from Mr Ellwood about this.
Counsel made submissions about the different handwriting, however I am not a handwriting expert and so I do not place weight on this aspect of the submissions. However, given the respondent has the onus of proof this is an aspect I would have expected to be addressed by Mr Ellwood.
Mr Mu’s counsel submitted that there is no independent statement from any of the persons where they give their own account.
Counsel submitted that it was not reasonable conduct of the employer to hand the letter dated 19 August 2019 to Mr Mu without a support person being present at that time, particularly given his length of service with the company and its predecessor companies.
It was also submitted that it was not reasonable to not just speak to Mr Mu and instead to move straight to a disciplinary process, with an emphasis that the company thought the allegations were serious. It was submitted that the contents and tone of that letter indicated that the company had adopted the allegations and it was not just an investigation. An example was given of this as it is stated in the letter “UML is specifically concerned about your conduct and alleges you have…”.
It was also submitted that in that letter the employer stated that the alleged conduct breached section 8 of the code of conduct, relating to harassment but these allegations do not constitute harassment. It was submitted that Mr Ellwood was trying to concoct a case against Mr Mu. It was submitted that it was not reasonable for the letter to appoint a meeting the next day and it was not reasonable for Mr Ellwood to be at the meeting since he took the statements, particularly as in those statements he has already expressed a conclusion that the alleged conduct has negatively impacted Mr Thai.
It was submitted at a procedural level the investigation was not manifestly reasonable. It was argued at the very least Mr Ellwood should have just had a discussion with Mr Mu. It is argued that the allegation telling Mr Pan not to work hard does not warrant a disciplinary hearing and, even if it did, the way it was conducted by Mr Ellwood was not reasonable, as it seems he predetermined the matter.
It was submitted that the respondent has not established the section 11A defence and, as the respondent has not submitted about the relief sought, there should be an award for weekly compensation based on the evidence from Dr Rastogi and the medical certificates. A general order was sought for section 60 expenses.

In reply the respondent submitted that if Mr Ellwood had confronted Mr Mu with the allegations at work that would have been argued to be unreasonable. It was submitted that the respondent acted reasonably issuing the letter to formally advise Mr Mu of the allegations. It was submitted that when Mr Ellwood was dealing with Mr Mu it was against a background of confrontations with Mr Thai. And previously Mr Mu did not want to reconcile his differences with Mr Thai. Therefore, it was submitted that it was appropriate to deal with this matter formally.
The respondent submitted that Mr Segran’s and Mr Tanner’s denials only come into being in 2021 and the allegations were made in 2019. It was noted that the screen shots from Mr Tanner only were made a short time before the first arbitration date. However, I note the reason the matter went over to a second arbitration date was so the respondent could obtain evidence in reply.
Both counsel made further submissions about Mr Tanner’s assertion that he did not write the contents of his statement but signed it.
I accept the evidence supports that Mr Mu developed his psychological injury from receiving the letter dated 19 August 2019 and therefore it is not appropriate I deal with why it took so long for the respondent to advise him of the outcome of the investigation and whether the conclusion of termination of employment was reasonable action.
However, as I have stated above Baldwin is authority for the proposition that it is necessary to have regard to all the circumstances, including the seriousness of the conduct that has led to the disciplinary action.
I am not persuaded on the balance of probabilities that either of the allegations were serious separately or when viewed together. In relation to the onus of proof in Nguyen v Cosmopolitan Homes (NSW) Pty Limited[31] McDougall J stated at [44]:
“A number of cases, of high authority, insist that for a tribunal of fact to be satisfied, on the balance of probabilities, of the existence of a fact, it must feel an actual persuasion of the existence of that fact. See Dixon J in Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336. His Honour’s statement was approved by the majority (Dixon, Evatt and McTiernan JJ) in Helton v Allen [1940] HCA 20; (1940) 63 CLR 691 at 712.”
[31] [2008] NSWCA 246, Nguyen.
The alleged conduct has to be viewed objectively. But even viewed against the Employee’s Code of Conduct I find the alleged behaviour falls well short of harassment. In section 8 of their code it is stated that:
“The following behaviour is expressly prohibited:
• unwelcome conduct – whether verbal, physical, or visual – that is based on a person’s protected status, such as race, colour, religion, sex, age, national origin, citizenship status, disability, sexual orientation, veteran status, or any other protected status;
• abusive language, physical aggression, deliberately causing injury to another or any disorderly conduct or malicious disturbance. This includes intimidation or harassment of others;
and
• sexual harassment. This includes unwelcome sexual advances, request for sexual favours, as well as other physical, verbal, or visual conduct based on sex when:
• submission to the conduct is an explicit or implicit term or condition of employment; or
• the conduct has the purpose or effect of unreasonably interfering with the individual’s work performance by creating a hostile, offensive, or intimidating working environment.”
The respondent advised Mr Mu in the letter dated 19 August 2019 that it relied on this section of the code. Clearly the alleged conduct does not fall under sexual harassment, nor was it based on a person’s protected status, nor was it alleged that Mr Mu used abusive language, physical aggression or deliberately caused injury to another or any disorderly conduct or malicious disturbance.
For Mr Ellwood to escalate these allegations to a formal disciplinary process I find was not reasonable, particularly given Mr Mu’s 20 years of long service with the business and the antecedent companies.
Furthermore, Mr Ellwood knew Mr Mu had just come back from sick leave and he had spoken to Mr Mu on 15 August 2019 and relates that Mr Mu was upset about the situation in the workplace and the fact he had not been given the gift card promised to him in May 2019 for his long service. Mr Ellwood wrote a long email to himself recording the conversation details including
“I mentioned to Jim that I understand he has had regular occurrences of Sick Leave and I want to make sure that he is okay and that if he is being affected by anything in the business or it is cause of stress that we can see if there is anything that can be done to assist him and support him.[32]”
[32] AALD p143.
The next day at 10.00 am Mr Mu sent an email to Mr Ellwood in which he stated the following:
“Hi: Stuart

Good morning!

As the benefit to keep senior worker at work place with their valuable experience, as They are ageing who do naturally come with some health problems, I have rarely taken any sick leave before till now.

I understand I don't have to explain to you every time why I am on sick leave. I am much appreciated for your willingness to offer a suppourt in regards, any thing reduce stress to me which could helping me. As recently some staff left, and I tried catch up extras, increased my stress level, and effect my sleep and I just don't feel well with my existing health condition, I hope my this explanation will help you to understanding.

I attached PDF file from GOV's heart foundation info might help for further understanding.
thank you very much for your consideration & any help.[33]”
[33] AALD p 29.
Yet later that day Mr Ellwood took the “statements” from Mr Mu’s co-workers and says the same day Ms de Haan drafted the letter to give to Mr Mu. To give a worker, on the next working day after he had expressed concerns about his health, a formal letter stating the company views the allegations seriously and advising that they warranted investigation, I find, is not reasonable conduct by the employer and poor management practice. Mr Mu had just told Mr Ellwood he felt stressed and he followed this up with the email. I note that before this situation arose Mr Ellwood had checked with Ms De Haan Mr Mu’s sick leave record. She advised in email dated 19 July 2019 that he had taken 60.8 hours from February 2019 to July 2019 which she said was high but not overly excessive. She advised Mr Ellwood “Keep in mind Jim is 62 years old and has a heart condition and that employees are entitled to 10 days personal leave per year (76 hours)[34]”.
[34] AALD p 26.
Viewed objectively in this context, a preferable way forward would have been to speak informally to Mr Mu. Had Mr Ellwood done so presumably Mr Mu would have said what he told Ms de Haan in the meeting on 23 August 2019 that he did not spread rumours about Mr Markov’s leaving, he just answered a question put to him as to why Mr Markov left and he told his questioner, John, what Mr Markov had told him. Mr Ellwood could then have defused the situation by saying to Mr Mu that he would appreciate it that if anyone else asked him about why Mr Markov left for them to come and ask Mr Ellwood. Alternatively, Mr Ellwood could have had a meeting with all the staff and said there have been questions asked, and discussion, regarding the resignation of Mr Markov. Mr Ellwood could have requested such discussions cease as it was not helpful to staff morale. These are two fairly obvious ways the situation could have been handled without instigating an inquiry.
The other allegation was that Mr Mu said to Mr Pan and Mr Segran comments about why they worked so hard. Again, these are low level type comments and open to interpretation. Mr Pan said Mr Mu had been saying such comments for years. I find objectively they can be viewed as workplace grumbles not harassment. Again Mr Ellwood could have just asked Mr Mu about this informally and if he denied it or said he did not remember, Mr Ellwood could have asked him to keep in mind that others can interpret comments in ways that might not be intended and he would appreciate if Mr Mu helped by making positive comments in the workplace. Mr Ellwood could also have held a meeting with all staff to encourage positive morale in the workplace.
In summary, the respondent has not persuaded me that the action the employer took by issuing the letter dated 19 August 2019, instigating a formal investigation was reasonable conduct. I find it has not established a defence under section 11A of the 1987 Act.
The respondent made no submissions about the compensation claimed by Mr Mu. Accordingly, I accept the submissions of Mr Mu’s counsel that the weight of evidence does support a finding that Mr Mu has had no current capacity for employment from 8 May 2020 to date and continuing. In coming to this finding, I rely particularly upon the evidence from the general practitioner in the certificates of capacity as they were given contemporaneously, and I prefer that evidence to that of Dr Bisht. The certificates of capacity also accord with the opinion of Dr Rastogi, which I therefore prefer to that of Dr Bisht in relation to capacity for employment. The PIAWE was agreed at $1,374.50. Pursuant to section 37 of the 1987 Act, Mr Mu is entitled to 80% of that figure in weekly compensation, being $1,099.60 per week. I order that the respondent is to pay Mr Mu’s treatment expenses pursuant to section 60 of the 1987 Act upon production of accounts, receipts and/or Medicare Notice of Charge.
Mr Mu has also claimed lump sum compensation and I remit that claim to the President for referral to a Medical Assessor to assess permanent impairment for psychological injury with a deemed date of injury of 19 August 2019. The documents to be referred are those that were in evidence before the Commission.

Josephine Bamber
PRINCIPAL MEMBER

23 April 2021