Payne v Mercy Hospitals NSW Ltd - [2025] NSWPICPD 69

DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY A MEMBER
CITATION:	Payne v Mercy Hospitals NSW Ltd [2025] NSWPICPD 69
APPELLANT:	Michelle Payne
RESPONDENT:	Mercy Hospitals NSW Ltd
INSURER:	Employers Mutual Limited – as agent for the NSW Self Insurance Corporation
FILE NUMBER:	A1-W28866/24
PRESIDENTIAL MEMBER:	Deputy President Elizabeth Wood
DATE OF APPEAL DECISION:	8 October 2025
ORDERS MADE ON APPEAL:	1. The name of the respondent, wherever necessary, is amended to “Mercy Hospitals NSW Ltd.” 2. The Member’s Certificate of Determination dated 9 April 2025 is revoked. 3. The matter is remitted to a different Member for re-determination.

CATCHWORDS:	WORKERS COMPENSATION – where there is no foundation for the conclusion reached, there is error of law – Minister for Immigration and Citizenship v SZMDS [2010] HCA 16; Minister for Immigration & Multicultural Affairs v Al-Miahi [2001] FCA 744; Nicolia v Commissioner for Railways (NSW) (1970) 45 ALJR 465; Onesteel Reinforcing Pty Ltd v Sutton [2012] NSWCA 282 applied – where there is a failure to deal with a submission, the submission must be substantial and material to the outcome – Wang v State of New South Wales [2019] NSWCA 263; Day v SAS Trustee Corporation [2021] NSWCA 71 applied
HEARING:	On the papers
REPRESENTATION:	Appellant:
Mr J Dodd, counsel
McCabe Partners Lawyers
Respondent:
Mr D Baran, counsel
Bartier Perry Lawyers
DECISION UNDER APPEAL:	Payne v Mercy Public Hospital Inc [2025] NSWPIC 137
MEMBER:	Ms D Benk
DATE OF MEMBER’S DECISION:	9 April 2025

INTRODUCTION AND BACKGROUND

Ms Michelle Payne (the appellant) lodged a claim for weekly payments and treatment expenses in respect of an alleged psychological injury, described as an aggravation, acceleration, exacerbation and/or deterioration of a disease pursuant to s 4(b)(ii) of the Workers Compensation Act 1987 (the 1987 Act), occurring in the course of her employment with Mercy Hospitals NSW Ltd (the respondent). The injury was deemed to have occurred on 1 March 2021. The respondent was the last employer who employed the appellant in employment that was said to be a substantial contributing factor to the aggravation, acceleration, exacerbation and/or deterioration of a disease, pursuant to s 16(1)(b) of the 1987 Act.
The respondent accepted that the appellant suffered an injury as alleged, but disputed that the appellant was entitled to compensation on the basis that the psychological injury was caused by reasonable action taken by the respondent with respect to discipline, in accordance with s 11A of the 1987 Act.
The dispute proceeded to arbitration before a Member of the Personal Injury Commission (the Commission). The Member accepted that the injury was caused by reasonable action taken by the respondent with respect to discipline and entered an award in favour of the respondent.
The appellant appeals that decision.

ON THE PAPERS

Section 52(3) of the Personal Injury Commission Act 2020 provides:
“(3) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act and enabling legislation without holding any conference or formal hearing.”
Both parties indicated that the appeal can be determined on the basis of the written application and the written opposition, without the need for an oral hearing.
After this appeal was lodged and the timetable for submissions was closed, the Court of Appeal (Bell CJ, Leeming, Kirk, McHugh and Free JJA) in State of New South Wales v Culhana[1] re-visited a consideration of the effect of the 2011 amendments to s 352(5) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act)[2] and determined that a series of decisions misunderstood the effect of the amendments by applying an unduly narrow test in determining errors of fact.
[1] [2025] NSWCA 157 (Culhana).
[2] Workers Compensation Legislation Amendment Act 2010.
On 31 July 2025, a Direction was issued by a Delegate of the President requiring the parties to make any submissions they wished to make in respect of the application of Culhana. The appellant lodged submissions in response to the Direction on 5 August 2025 and the respondent lodged its submissions on 14 August 2025. A summary of those submissions is included in the summary of the parties’ substantive submissions below.
I have had regard to Procedural Directions PIC2 and WC3; the documents and submissions that are before me, and the submissions by the parties that the appeal can proceed to be determined on the basis of these documents. I am satisfied that I have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing and that this is the appropriate course in the circumstances.

THRESHOLD MATTERS

There is no dispute between the parties that the threshold requirements as to quantum and time pursuant to ss 352(3) and 352(4) of the 1998 Act have been met. The Member’s decision was not interlocutory in nature, so that leave to appeal the decision is not required.

The name of the respondent

The proceedings below and the citation of that decision referred to the respondent as “Mercy Public Hospital Inc”. In submissions dated 9 May 2025, the appellant indicated that the correct name of the respondent is “Mercy Hospitals NSW Ltd”. In the respondent’s Notice of Opposition to Appeal Against the Decision of a Member (opposition), the respondent also indicated that the correct name of the respondent is Mercy Hospitals NSW Ltd and seeks to have the respondent’s name amended accordingly.
I therefore amend the name of the respondent, wherever necessary, to “Mercy Hospitals NSW Ltd”.

THE EVIDENCE

The appellant’s statements

The appellant provided a statement dated 12 May 2021.[3] She described a past history of adverse personal events for which she was prescribed antidepressant medication on two occasions. She said that she commenced employment with the respondent in 2001, most recently working in the Transitional Aged Care Program in the position of a coordinator, which was a community program to assist aged people who were returning home from hospital.
[3] Application to Resolve a Dispute (ARD), pp 10–22.
The appellant stated that in 2016, following one of the personal stressors, she was placed on a performance management plan for a period because she was not concentrating on her work and fell behind.
The appellant said that one of the respondent’s clients, who she referred to as “H”, had been participating in the Transitional Aged Care Program on numerous occasions for about six years, and, over time, the appellant became close friends with “H”, who would ask staff if the appellant could visit her. She advised that she would often visit “H” at her home on weekends and would help her with showering because “H” was not happy with being showered by a male worker.
The appellant indicated that “H” developed terminal cancer in 2020, so the appellant visited “H” more frequently. She said that “H” was admitted into the program in early December 2020 as a palliative care client and would attend the respondent’s premises for pain management. The appellant described the ongoing friendly and supportive interactions she had with “H”, and how “H”’s condition deteriorated over time, resulting in “H” going into care at the respondent’s premises.
The appellant indicated that she received a telephone call on 22 February 2021 from one of the nurses, who advised that “H” was frightened and had asked for the appellant to come to her room. The appellant stated that she stayed with “H” throughout the night because “H” was very unsettled and disorientated. Shortly before 8.30 am on the following morning (23 February 2021) she advised Ms Claire Findlay, her line manager, that she had stayed overnight in her capacity as a friend, and asked whether she had permission to stay in the room until the carer and “H”’s friend arrived at 10 am. She said that she was due to start work at 8.30 am so she worked on her laptop until 9.30 am when Ms Findlay came to the room and directed her to attend a meeting with Ms Findlay and Mr Patrick Maloney, the nurse unit manager.
The appellant advised that at that meeting, Mr Maloney asked her why she was asked to sit with “H”, and she explained that one of the nurses had asked her to do so. She said that Mr Maloney told her that this amounted to professional misconduct and asked her for the name of the nurse. The appellant said that she was asked whether she had written her name and contact number in “H”’s file. She denied that she had written her name and contact number in the file as the person to contact. The appellant indicated that Mr Maloney cited professional misconduct, breach of privacy and confidentiality, and abandonment of duties, and told the appellant that she was in a lot of trouble because she could have deprived the carers of their right to be present if “H” had passed away. The appellant said that Ms Findlay advised her that there were concerns about her professional conduct which did not auger well for her and there was to be a further meeting with Mr Maloney on the following Monday. The appellant said that she was told that from that time, she could no longer visit “H” or have any contact with her either as a friend or a client, whether it was in work time or her own time and she was warned that otherwise there would be “repercussions”.
The appellant indicated that at that stage, she became quite upset and began to cry. She advised that she asked Mr Maloney if someone could sit with “H” and Mr Maloney responded that “[p]eople die by themselves all the time”,[4] which she said upset her further. The appellant said that she was offered the assistance of the Employee Assistance Program (EAP) and was told to go home and take annual leave for the day.
[4] Appellant’s statement dated 12 May 2021, ARD, p 17, [23].
The appellant said that she attended a second meeting on 25 February 2021, when she met with Ms Findlay, who told her that she had spoken with Human Resources. She said Ms Findlay told her that there were concerns about her professional misconduct, said that things did not look promising and that there was to be a further meeting with Mr Maloney on the following Monday. The appellant stated that she became very upset but continued to work that day and the following day, which was a Friday.
The appellant said that “H” was transferred into a smaller room, and on Monday 1 March 2021, she was told that “H” had passed away over the weekend. The appellant stated that she became anxious and upset, particularly about not being able to see and be with “H” at that time.
That day, she attended a third meeting, this time with Mr Maloney and Ms Findlay and her support person, Marlene Irving, who was also quite close to “H”. She said that Ms Findlay commented that she could not see why a support person was necessary. She stated that she explained to Ms Findlay how the friendship with “H” had evolved and how she would spend a lot of her own time with “H”, often when staff said that “H” would ask for her to visit.
The appellant said that Ms Findlay advised her that continuing a friendship with a client, sending emails from “H”’s room and giving her private telephone number to the client amounted to professional misconduct, that the appellant should have advised Ms Findlay that she was visiting “H” in her own time and that she was staying overnight with “H.” The appellant stated that Mr Maloney denied that he knew that the appellant had stayed with “H”, and Ms Findlay said that the appellant should have reported to Mr Maloney that “H” had problems communicating with staff at night and that her failure to do so also constituted misconduct. The appellant stated that Mr Maloney had been in the room when “H” reported “H”’s concerns to the doctor, it was noted in “H”’s clinical notes, and also Mr Maloney knew she stayed there when she spoke to him on one occasion while she was getting herself a cup of coffee.
The appellant indicated that Mr Maloney queried her about the consequences of abandoning her duties and she confirmed that it was a matter of instant dismissal and asked whether she was losing her job. She said that Ms Findlay advised that they would need to discuss that with Human Resources.
The appellant stated that she was very afraid of losing her job and had been given no prior warning of this meeting, either orally or in writing. She said that her usual general practitioner was on leave, so she consulted Dr Judith Nall-Bird, general practitioner, who advised her not to return to work and provided the appellant with a medical certificate. The appellant advised that she submitted her resignation to Ms Findlay, Ms Mary-Lou Cusack (the Operations Manager) and to Mr Maloney because she did not want the allegations placed on her record of employment. She said Ms Cusack refused to accept the resignation and indicated that she could not understand why the appellant had acted so drastically. The appellant stated that she had not been told the outcome of the meeting on 1 March 2021, she had not returned to work, and she felt sad that she had not been there for her friend.
The appellant provided a further statement dated 9 February 2022, which was consistent with her earlier statement.[5] She confirmed that on 22 February 2021, while “H” was in the respondent’s palliative care unit, one of the nurses (Ms Annette Hill) called her, advising that “H” was scared and in a frightened state and had asked the appellant to attend the unit and sit with her. In addition, the appellant stated that she had known that she was not allowed to strike up a relationship with a care taker if she was to receive an inheritance from the care taker but did not know that it was a criminal offence. She said that she did not inherit any benefit from “H” and would do things for “H” in her own time and at her own expense.
[5] ARD, pp 23–56.
In a third statement dated 31 July 2024, the appellant described the ongoing difficulties she was experiencing as a result of the conduct of the respondent’s representatives. The appellant referred to the evidence that Mr Maloney denied ever knowing of her relationship with “H” and pointed out that the friendship was well documented and widely commented on by staff members, carers and friends.[6]
[6] ARD, pp 57–72.

Statement of Ms Marlene Irving

Ms Irving provided a statement dated 6 May 2021.[7] She advised that she was an enrolled nurse and had known the appellant for approximately 15 years. She said that, as a health professional, she would attend the appellant’s patients. She advised that the appellant was under some pressure at work prior to the event leading up to her workers compensation claim. She observed that the appellant’s work was of the highest standard and she would be upset if her work was questioned.
[7] Reply to Application to Resolve a Dispute (reply), pp 33–36.
Ms Irving stated that she was approached by the appellant, who told her that she was required to attend a meeting because she had been accused of being unprofessional and acting outside of the scope of her role. Ms Irving said that the appellant was noticeably upset, so Ms Irving agreed to attend the meeting with her.
Ms Irving advised that she and the appellant attended the meeting with Ms Findlay and Mr Maloney. She stated that during the meeting Ms Findlay spoke about how bad the appellant’s behaviour was, how the appellant had breached the boundaries with a patient and how a personal relationship with a patient was not allowed.
Ms Irving observed that all of the staff who dealt with “H” developed a relationship with her. She indicated that she commented to Ms Findlay that it was a small town and everybody knew each other, but Ms Findlay told her to be quiet, or she would have to leave the meeting. She said that Ms Findlay repeatedly kept telling the appellant that she had crossed the boundaries by staying with “H”. Ms Irving said that the appellant queried whether her employment was to be terminated but neither Mr Maloney or Ms Findlay responded to her or provided the appellant with any reassurance.

Ms Mary-Louise Cusack

Ms Cusack, the respondent’s operations manager and Director of Nursing, made a statement dated 6 May 2021.[8] She advised that the appellant worked under the supervision of her line manager, Ms Findlay. She stated that she was aware that the appellant had a close relationship with the resident “H”, who had passed away recently. Ms Cusack recalled a conversation with the appellant in which she informed the appellant that she would not accept the appellant’s resignation and invited the appellant to come to see her and talk with her.
[8] Reply, pp 37–40.
Ms Cusack indicated that when the appellant did go to see her, the appellant was very upset and emotional, so she advised the appellant to go away and give some thought to her decision to resign and not make the decision rashly. She added that she offered the appellant EAP counselling and informed the appellant that it was never the intent of the meeting with Mr Maloney and Ms Findlay to terminate her employment, which they did not have the authority to do. She said that she told the appellant that the meeting was only to discuss with the appellant what had occurred and why.
Ms Cusack confirmed that the appellant withdrew her resignation in writing.

Mr Patrick Maloney

Mr Maloney, nurse unit manager, provided a statement dated 6 May 2021.[9] He referred to the meeting on 23 February 2021 and observed that the appellant did not appear distressed at first, but by the end of the meeting, she had become emotional and agitated. He denied that he had said that the person who called the appellant to visit “H” would be in trouble and his intention was to have a conversation with the person to ascertain why the person had called the appellant. He said that at that stage, all he was aware of was that the appellant’s name and telephone number had been handwritten on “H”’s notes, which meant that that information was not recorded in the system. He said that it was unclear whether “H” would always ask for the appellant to visit.
[9] Reply, pp 41–46.
Mr Maloney denied that he told the appellant that she was in serious trouble, but said that he did advise her that bringing patient information into a clinical area raised significant privacy concerns and that she did not have permission to perform her work duties by a patient’s bedside. He further denied that he mentioned that the appellant might have to attend court because of the allegations.
Mr Maloney referred to the conversation relating to the allegation that the appellant had abandoned her employment. He explained that the appellant needed to go home because she was distressed and tired, so that she was unable to perform her duties. He added that he had asked the appellant if she had written her name down as the contact for “H” and the appellant advised him that she had given her telephone to a member of the medical staff, but she did not identify the staff member.
Mr Maloney advised that he had not had the opportunity to speak with “H”’s next of kin.
Mr Maloney denied that he continually spoke about professional misconduct, and asserted that all that he said was that abandonment of duty could be considered as professional misconduct. He said that he advised the appellant that visiting the patient could be construed as favouritism over other patients but told her that she could visit a patient in normal visiting hours in her own time.
Mr Maloney denied that he commented that “people die in here all of the time”,[10] but what he did say was that sometimes patients wait for the last visitor to arrive, or for visitors to leave, before the patient died.
[10] Mr Maloney’s statement, reply, p 45, [28].

Mr Maloney asserted that during the meeting, Ms Findlay did not make any “material comment” because he was the one who organised the meeting and was asking the questions so that he could ascertain why the appellant was at the patient’s bedside. He added that Ms Findlay was there because she was the appellant’s manager. He said that the appellant did advise that she had emailed Ms Findlay to tell her that she intended to work from the patient’s bedside that day.
Mr Maloney said that he stopped the meeting because the appellant was distressed and crying. He said that he suggested that the appellant should consult the EAP, told her to go home and offered to call a taxi, but she declined the offer.
Mr Maloney recalled that, at the meeting on 1 March 2021, the appellant was given the opportunity to provide her version of events, which she did, disclosing that she had stayed overnight with “H”. He said that Ms Findlay advised the appellant that maintaining a personal relationship with a patient was professionally inappropriate and not misconduct. He observed that staff members providing their contact details to patients put them at risk of burnout because the patient could call at any time throughout the day or night.
Mr Maloney confirmed that Ms Findlay told Ms Irving that as a support person, she was not to make comments. He added that he had spoken to “H” about issues with the staff, so it was unnecessary for the appellant to raise that issue at the meeting. He indicated that the possibility of termination was not raised by him or Ms Findlay, it was raised by the appellant when she was asked if she understood the seriousness of abandoning her employment. He said that the appellant queried whether her employment was to be terminated and he and Ms Findlay indicated that she was not being terminated, however it was a performance management issue which would need to be referred to Human Resources.

Ms Clare Findlay

Ms Findlay made a statement dated 6 May 2021.[11] She advised that she was the appellant’s direct manager. She described the appellant’s duties. She acknowledged that the appellant fulfilled parts of her role exceedingly well, however there had been an issue in 2018 in relation to her duties and she was placed on a performance management program.
[11] Reply, pp 47–56.
Ms Findlay confirmed that she had received an email from the appellant on 23 February 2021 asking whether she could stay with “H” until 10 am and then go into her office. She said that the email was sent at 8.25 am.
Ms Findlay said that, when she arrived at work, Ms Cusack enquired of her whether the appellant was working that day because the appellant was wearing a T shirt and thongs. She said that she then came across the email, so she went to the ward and the appellant was sitting with “H” in “H”’s room with her work spread out over the tray table, appearing dishevelled. She advised that she then asked Mr Maloney why the appellant was in “H”’s room and he said he did not know, so she inspected the notes, which recorded that “H” had been distressed and had requested the appellant to be with her and the appellant came in and stayed with “H” overnight. She also noted that the appellant’s name was handwritten indicating that she was “H”’s next of kin.
Ms Findlay stated that she consulted Mr Maloney (who was in charge of “H”’s ward) and together they met with the appellant in a room. Ms Findlay indicated that the concerns were whether “H” was receiving the best care, whether somebody was acting unprofessionally on the ward, whether the appropriate persons were being contacted on behalf of “H” and whether the next of kin were being respected and notified.
Ms Findlay advised that she and Mr Maloney were concerned about the appellant and were trying to get across to her that what happened was improper. She said they simply wanted to get the appellant to her home and calm her down. Ms Findlay observed that Mr Maloney handled the meeting very well, and she was surprised that the appellant took the comments negatively.
Ms Findlay further observed that the appellant was exhausted, emotional and in tears and it was apparent that she could not function properly, so they offered her EAP counselling, a taxi home, or for someone to drive her home, as she could not have performed her duties that day.
Ms Findlay stated that, when Mr Maloney mentioned going to court, he was only trying to make her understand that her staying with “H” was a poor decision and they could not allow her to continue with such inappropriate conduct. Ms Findlay remarked that the appellant had no reason to speak with “H” as “H” was not going to be admitted to the appellant’s program.
Ms Findlay remarked that the staff members did form professional relationships with the patients but were not permitted to cross the line to act as next of kin or become overly familiar with them. Ms Findlay denied that she advised the appellant that things were not “looking good” for the appellant.
Ms Findlay referred to the meeting on 1 March 2021. She said that she may have commented that the appellant did not need a support person because the meeting was not a performance meeting. She said that she was happy for the appellant to have a support person present.
Ms Findlay provided a summary of the appellant’s explanation about her relationship with “H” and the reason for her staying overnight in “H”’s room. Ms Findlay said that the appellant advised that she had asked Ms Findlay for permission to stay in the room, however Ms Findlay indicated that she would not have given permission for her to stay in a dying woman’s room as it was not a private area and others would be able to see what was on the appellant’s computer screen. Ms Findlay said that Mr Maloney commented that staying with a dying patient was not a service offered by the respondent to all patients. Ms Findlay stated that she advised the appellant that the appellant was a clinician and had attended the workplace in that capacity without her manager’s knowledge and that in the time the appellant spent with “H” she was not caring for her own patients, which amounted to an abandonment of her duties. Ms Findlay indicated that she asked the appellant whether she understood the consequences of abandoning her duties and the appellant responded that her employment could be terminated and queried whether that was to occur.
Ms Findlay referred to comments made during the meeting by Ms Irving and said that she warned Ms Irving that as a support person she should remain quiet, or she would be asked to leave the meeting.
Ms Findlay observed that, at the end of the meeting the appellant appeared emotional, so she suggested the appellant take a break. Ms Findlay advised that that was the last time she had seen the appellant. She said that, on the following morning, Ms Cusack advised that she had received a letter of resignation from the appellant, which Ms Findlay said shocked her because she had never told the appellant that she would lose her job. Ms Findlay said that it was agreed between her and Ms Cusack that Ms Cusack would take over the discussion with the appellant about her ongoing employment.

The respondent’s documentary evidence

In addition to the statement evidence lodged, the respondent relied upon the respondent’s “Managing Misconduct” Policy Directive and procedures, and the Position Description for a Transition Aged Care Program (TACP) Case Coordinator.[12] The document “Position Description” was not the subject of submissions by the parties and was not referred to by the Member in her reasons. Nor does it appear relevant to the issues on appeal.
[12] Respondent’s Application to Lodge Additional Documents (ALAD) dated 10 December 2024.
In respect of the Managing Misconduct Policy Directive at 1.2, the document provides definitions of what constitutes “Misconduct” as follows:
(a)    “Behaviour or conduct which seriously or repeatedly breaches expected standards, as identified in relevant legislation (such as the Health Services Act 1997 or the Health Practitioner Regulation National Law (NSW)), registration standards or codes/guidelines approved by a National Health Practitioner Board or NSW Health policies (such as the Code of Conduct);
(b)    Refusal to carry out a lawful and reasonable direction given by a line manager or another member of staff authorised to give the direction;
(c)    Reportable (ie child-related) conduct as defined under the Ombudsman Act 1974 (including allegations relating to conduct outside the workplace);
(d)    Corrupt conduct as defined under the Independent Commission Against Corruption Act 1988;
(e)    Serious wrongdoing that could be the subject of a public interest disclosure under the Public Interest Disclosures Act 1994, ie relating to corrupt conduct, maladministration, serious and substantial waste, or failure to deal appropriately with Government Information;
(f)    Criminal charges or convictions that have an adverse impact on the workplace or the role or performance of the staff member (including such offences committed outside the workplace and/or work hours, or prior to appointment to NSW Health);
(g)    Making vexatious allegations, or knowingly making false or misleading public interest disclosures;
(h)    A failure to comply or cooperate with the processes for investigating or managing misconduct set out in this Policy Directive.”[13]
[13] Respondent’s ALAD dated 10 December 2024, p 8.
The mandatory requirements of the Policy Directive were set out on the first page of the document, and included the requirement that:
“A person who is subject of a misconduct process must be afforded the right to a support person being present at any interviews. Other support may also need to be offered to all affected persons, where appropriate.”[14]
[14] Respondent’s ALAD dated 10 December 2024, p 2.
The Policy Directive at 2.3 provides:
“Advising the staff member
A staff member who is the subject of an initial review regarding potential misconduct should be informed that an issue has been raised about them as soon as credible details indicating potential misconduct have been identified, and it is deemed safe and appropriate to do so (Information Sheet 7). Any verbal advice should be confirmed in writing.”[15]
[15] Respondent’s ALAD dated 10 December 2024, p 10.
The Policy Directive at 5.3 provides:
“Advice to a staff member who is subject to a misconduct process
Written advice must be provided to the staff member about the allegations against him or her and about the investigation process. The advice must contain sufficient information about the allegations to allow the staff member to provide a considered response.”[16]
[16] Respondent’s ALAD dated 10 December 2024, p 17.

The medical evidence

The issue in this appeal is limited to the question of whether the respondent’s actions were reasonable, which is not a medical issue. It is therefore not necessary to summarise the whole of the medical evidence. It is convenient, however, to note the entries in the clinical notes recorded by the appellant’s general practitioners on 1 March 2021 and 10 March 2021.

Dr Judith Nall-Bird, general practitioner

The appellant consulted Dr Nall-Bird of the Young District Medical Centre on 1 March 2021.[17] The history recorded by Dr Nall-Bird was:
“Has been terminated from her job, devastated
Issue with relationship with Palliative patient
Had been warned off seeing her
Feels she can’t challenge the decision
Feels she can no longer work there
‘Abandonment of duties’ when she sat with patient overnight
‘Professional misconduct’ when she took the patient home to see her garden
Good family support and they are aware of the issues”.
[17] Respondent’s ALAD dated 21 February 2025, pp 86–87.
Dr Nall-Bird issued the appellant with a medical certificate, certifying that the appellant was unfit for work from 1 March 2021 to 29 March 2021.[18]
[18] ARD, p 91.

Dr Diane Larcombe, general practitioner

The appellant attended Dr Larcombe, who was from the same practice as Dr Nall-Bird and who was the appellant’s usual treating general practitioner. The clinical note dated 10 March 2021 noted that the appellant:
“had meeting as documented in Judith Nall Bird's notes on 01/03/2021
felt she was going to be fired at end of meeting so she handed in her resignation which has not been accepted as yet
was spending time with a patient who was also a friend and the patient had asked [the appellant] to be with her teary +++ throughout consult
had a witness in [Ms Irving], [Mr Maloney] with her for second meeting with [Ms Findlay] and [Mr Maloney]
felt she was going to be dismissed on the spot at that meeting
[Mr Maloney] actually said to her ‘lots of people die alone’ implying she did not have to go to a dying friend when asked”.[19]
[19]Respondent’s ALAD dated 21 February 2025, p 87.
Dr Larcome issued a Certificate of Capacity indicating that the appellant had no capacity for work from 10 March 2021 to 7 April 2021.[20]
[20] ARD, pp 114–116.

LEGISLATION

Section 11A of the 1987 Act relevantly provides as follows:
“11A No compensation for psychological injury caused by reasonable actions of employer
(1) No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers.”

THE MEMBER’S REASONS

The Member noted that the appellant claimed weekly payments as a result of injury in the form of an aggravation, acceleration, exacerbation and/or deterioration of a disease, diagnosed as a major depressive disorder with anxiety, an acute stress disorder and chronic adjustment disorder with depressed mood. The Member further noted that the respondent accepted that the appellant suffered a psychological injury but denied liability on the basis that the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by the respondent in respect of performance appraisal or discipline, in accordance with s 11A of the 1987 Act.
The Member identified the issues in dispute as:
(a) whether the appellant’s employment with the respondent was the main contributing factor to her injury, and
(b) if so, whether the injury was wholly or predominantly caused by the respondent’s reasonable actions with respect to performance appraisal/discipline.
The Member referred to the numerous statements made by the appellant. She observed that the issues arose from the care the appellant provided to “H”, who was a long-term friend of the appellant and a resident of the respondent’s facility. The Member noted that “H” was not the appellant’s patient but that the appellant had assumed the role of ensuring that “H” was well looked after.
The Member provided a detailed summary of the appellant’s evidence contained in her statements, and the evidence of Ms Findlay, Mr Maloney, Ms Cusack and Ms Irving. She summarised the submissions of the parties. The Member reviewed the legislation and the relevant authorities applicable to matters falling within the parameters of s 11A of the 1987 Act. The Member summarised the medical evidence.
The Member turned to the question of whether the meetings that occurred on 23 February 2021, 25 February 2021 and 1 March 2021 fell within the definition of ‘discipline’. She referred to Northern New South Wales Local Health Network v Heggie,[21] which she said established that the definition was a broad concept that was capable of extending to the entire disciplinary action, including the initial inquiry and investigation. The Member found that the disciplinary process commenced from 23 February 2021 and included the meetings on 25 February 2021 and 1 March 2021 and that she was satisfied that the meetings fell within the definition of ‘discipline’.
[21] [2013] NSWCA 255 (Heggie).
The Member observed that the appellant’s first attendance with her general practitioner in relation to stressors in the workplace did not occur until after the three meetings. She remarked that there was no contemporaneous evidence to show that the appellant suffered an injury as a result of the conduct of the respondent’s employees prior to 1 March 2021 and there was no evidence of any incapacity related to her employment prior to that date.
The Member reviewed relevant authorities and distilled a summary of what she considered some of the key principles relevant to the determination of whether the actions were reasonable.
The Member considered it significant that the appellant admitted that she had stayed overnight to care for “H” without permission. She acknowledged that the appellant had done so, “allegedly” at the request of Ms Hill, however observed that the conduct was not approved by the appellant’s supervisor, Ms Findlay, or Mr Maloney, the nurse unit manager and that there was no evidence that Ms Hill indicated to the appellant that she was to stay overnight. The Member pointed out that “H” was not one of the appellant’s patients, but the appellant was a friend to “H”, and, as the Member described, “the lines between friendship and professional conduct became somewhat blurred.”[22] The Member observed that the appellant did not report to Ms Hill, Ms Hill was not the nurse unit manager and did “not appear to have the jurisdiction to alter rosters for the respondent”.[23]
[22] Payne v Mercy Public Hospital Inc [2025] NSWPIC 137 (reasons), [69].
[23] Reasons, [69].
The Member formed the view that it was correct for the respondent to question the appellant about her activities involving “H”, particularly where there were independent carers who were not advised of the appellant’s actions and when the appellant’s direct line supervisor and the nurse unit manager were also not informed until after the event. The Member said that the records did not establish that the appellant signed in as a visitor or that the appellant had approval to stay overnight as a visitor. The Member observed that those were standard requirements in a care facility, and it appeared that the appellant had disregarded them and any potential consequences that might flow from those actions. The Member provided as an example, the legal complexities that might flow if the appellant was injured, or if something occurred to “H” when the appellant was present without approval in her capacity as a visitor or an employee rostered on for the shift.
The Member concluded that the respondent’s actions in questioning the appellant in respect of staying overnight on this and previous occasions were “entirely reasonable and appropriate, given that facilities such as the respondent’s are subject to high regulation and scrutiny.”[24] The Member considered that it would be negligent for the respondent to have failed to investigate the issue and there would have been significant outcomes if something occurred which was adverse to “H”, who was not the appellant’s patient, while the appellant was with her without approval.
[24] Reasons, [70].
The Member referred to the appellant’s submission that she had been “ambushed”. The Member said that there were two meetings that had to be aborted because the appellant was visibly upset, the appellant was offered the services of EAP support, and transport home, which she declined. The Member described the discussion that took place as undoubtedly “uncomfortable and possibly even unexpected” but considered that the manner in which the discussions were executed was reasonable. The Member indicated that she could not make a finding that the appellant was “ambushed”.
The Member further referred to the issue of the potential breach of privacy and confidentiality. The Member acknowledged that “H”’s room was a private room but observed that it was accessible by “other staff” who could have been privy to the information on the appellant’s computer screen. The Member considered that the appellant played down that allegation, submitting that there were no such breaches or any compromised confidentiality. The Member observed that a staff member was required to ensure privacy and confidentiality in respect of personal information and that working on a laptop in a non-secure area does not ensure the safety of that information. The Member reiterated that the respondent’s concerns were well-placed and appropriate and consistent with “Privacy Legislation”, therefore it was reasonable for the respondent to discuss this action with the appellant, so that the respondent’s actions were reasonable.

The Member returned to the issue of “abandonment of duties” and remarked that she did not understand what was meant by the term and said that the appellant did not abandon her duties as that phrase was legally defined. The Member noted that the appellant continued to work until she was told to go home. The Member said that the appellant had stayed overnight in the premises without authorisation and was not fit for work the next morning because of fatigue and her emotional state. The Member remarked that those matters did not constitute abandonment of duties and observed that the evidence of Ms Findlay conflicted with that of Mr Maloney as to how the appellant abandoned her duties. The Member concluded that the use of that term was misplaced, but that was not sufficient to make the respondent’s conduct unreasonable, noting that the concept of reasonableness did not require a standard of perfection and that all of the circumstances had to be considered objectively.
The Member formed the view that the appellant probably knew that her conduct was at least questionable if not inappropriate. She referred to the appellant having only advised Ms Findlay by email the following morning that she had stayed overnight. She remarked that the appellant had known that she needed Ms Findlay’s approval to work in “H”’s room, especially because “H” was not the appellant’s patient and the carers had not been advised.
The Member referred to the appellant’s hand-written telephone number recording the appellant as the next of kin of “H”. The Member noted that the file was not in evidence and while that was inappropriate and unprofessional conduct when “H” had her own carers, she could not make any finding about that issue because of the absence of evidence. The Member added that, in any event, that was immaterial to her finding already made that the disciplinary process was reasonable action to address the appellant’s conduct, which was outside of her authority and put privacy and confidentiality in jeopardy.
The Member observed that the appellant submitted that the process was not reasonable because the support person, Ms Irving, was silenced. The Member said that the requirement that the support person remain silent was consistent with the role of a support person, Ms Irving was not present in the meeting as an advocate, and she was not privy to the relevant events involving “H”. The Member declined to make a finding in respect of whether the respondent’s treatment of Ms Irving was dismissive.
The Member referred to the various authorities discussed by her and concluded that, after a review of the evidence, the overall disciplinary action constituted reasonable action within the meaning of s 11A of the 1987 Act. She pointed out that:
(a)    the appellant was made aware of the issues for discussion and the seriousness of those issues;
(b)    three meetings were conducted, with the first two having to be aborted because of the appellant’s emotional state and the third meeting was conducted with the appellant having the benefit of a support person;
(c)    she accepted that the appellant was told that she would not be terminated but that the allegations were serious and would involve intervention by Human Resources;
(d)    the appellant had many years of experience in health care and was aware of the issues;
(e)    the appellant was aware that “H” was not her patient, so that she was required to sign the visitor’s book or have approval from “H”’s carers to stay overnight, as well as from her line manager and the nurse unit manager, which she did not do;
(f)    the appellant was requested by a nurse on duty to stay with “H” but she did not report to that nurse and there was no record of the appellant being required to stay overnight, which the appellant did voluntarily;
(g)    the appellant’s inappropriate relationship with “H”, the fact that “H” was not the appellant’s patient, and the concerns about privacy and confidentiality, in the context of the respondent’s regulatory environment, were all appropriate matters to be discussed with the appellant;
(h)    the appellant admitted that she had stayed overnight and that she used her laptop in “H”’s room, so that the allegations were not exaggerated;
(i)    the term “abandonment of duty” appeared to have been used inappropriately, but that did not detract from the respondent’s need to discuss and address the appellant’s behaviour which had the potential to constitute inappropriate and unprofessional behaviour, and
(j)    the policies and procedures were referred to in the notice issued pursuant to s 78 of the 1998 Act and were “well-documented”.
The Member formed the view that, given the appellant’s role, the nature of the employment, and the requirement for adequate competencies to be demonstrated, the disciplinary process and the way it was carried out constituted reasonable actions, taking into account the rights and obligations of both the respondent and the appellant.
The Member concluded:
“For the reasons above, I find that the psychological injury was wholly or predominantly caused by the reasonable action taken by the respondent with regards to discipline. This means the s 11A defence succeeds and there will be an award for the respondent.”[25]
[25] Reasons, [79].
The Certificate of Determination issued on 9 April 2025 records:
“The Commission determines:
1. Award for the respondent.”

GROUNDS OF APPEAL

The appellant brings 10 grounds of appeal, as follows:
(a)    Ground A: The Member erred in law by failing to deal with the submission that the respondent failed its own Policy Statement;
(b)    Ground B: The Member failed to properly assess the evidence of Ms Findlay;
(c)    Ground C: The Member failed to make findings regarding what was said at the meeting on 23 February 2021;
(d)    Ground D: The Member committed error of fact and law in failing to deal with the alleged issue of abandonment of duties;
(e)    Ground E: The Member erred in law in failing to deal with the submission that it was the respondent’s employee who called the appellant to come in to sit with patient “H” or make a finding of what the facts were;
(f)    Ground F: The Member erred in law and fact in failing to identify the rules, policies or regulations regarding interactions between staff and patients;
(g)    Ground G: The Member erred in fact and law in inventing evidence in order to establish facts;
(h)    Ground H: The Member erred in fact and law in inventing the supposed regulation and scrutiny;
(i)    Ground I: The Member erred in fact and law regarding the manner in which discipline was effected, and
(j)    Ground J: The Member erred in fact and law by referring to the Privacy Legislation.

SUBMISSIONS

The appellant lodged her appeal on 8 May 2025 without the benefit of the transcripts of proceedings recorded on 21 February 2025 and 13 March 2025. The transcripts became available to the parties on the Commission’s Pathway Portal on 14 May 2025. On that date the appellant was directed by a Delegate of the President to lodge any supplementary submissions she wished to make by 28 May 2025. The appellant lodged amended submissions on 23 May 2025, which included references to the transcripts relevant to the appeal grounds and the amendments were underlined.
The respondent was directed to include any submissions in relation to the transcripts in its submissions attached to its Notice of Opposition to Appeal Against Decision of a Member (Opposition). The Opposition was lodged on 16 June 2025, which was within the timeframe set by the Delegate of the President.

The parties’ submissions in respect of the application of Culhana

The parties are ad idem that:
(a)    Culhana is authority for the proposition that in an appeal from findings of fact, the correct approach is that set out in Warren v Coombes[26] and Fox v Percy.[27] That is, where the Member had some advantage over the Presidential Member when making findings of fact (such as observing the demeanour of a witness), deference should be afforded the Member’s findings of fact;
(b)    it is not sufficient for the Presidential Member to dismiss an appeal on the basis that the Member’s findings of fact were “open” on the evidence, and
(c)    in this case, the Member had no advantage over the Presidential Member because there was no oral evidence given and the witnesses were not cross-examined.
[26] [1979] HCA 9.
[27] [2003] HCA 22.

The appellant’s submissions

The appellant refers to the observation made by Free JA in Culhana at paragraph [99] that the appeal is a rehearing and not a hearing de novo. The appellant submits that the Presidential Member does not have to find legal error in order to reach a different conclusion to that of the Member.
The appellant observes that the effect of Culhana on this case is significant. The appellant points to the grounds of appeal and submits that, for the reasons already expressed in its substantive submissions, the Presidential Member should find in favour of the appellant in respect of the errors of law identified. The appellant submits that in addition, and in accordance with Culhana, the Presidential Member should reject the respondent’s defence under s 11A because:
(a)    it failed to comply with its own policy statement (Ground A);
(b)    the evidence adduced from Ms Findlay was incomplete and thus unreliable (Ground B);
(c)    on the basis of the consistent evidence of the appellant and Ms Findlay, the Presidential Member should make a factual finding that Mr Maloney spoke about the possibility of the appellant having to face court and that the appellant was told she was in a lot of trouble, which was not reasonable conduct (Ground C);
(d)    the appellant was charged with abandonment of duties when that had not yet occurred, which made the substance and manner in which the appellant was disciplined unreasonable (Ground D), and
(e)    the Member failed to identify the applicable rules, policies or regulations, the “standard matters” in a care facility, the “high regulation and scrutiny” and the particular provision in the “Privacy Act” which the Member considered justified the actions of the respondent (Grounds F, G, H, and J).
The appellant raised a potential further ground of appeal. The Direction issued by the Delegate of the President did not provide the parties with the opportunity to raise further grounds of appeal and the appellant did not seek leave to do so. I have not considered the purported additional ground in this appeal.

The respondent’s submissions

The respondent submits that the opportunity provided to the parties to make submissions in relation to Culhana did not extend to making other substantive submissions on the merits of the appeal.
The respondent disputes that the Presidential Member does not have to find legal error and that an appeal to a Presidential Member constitutes a re-hearing “at large”. The respondent refers to the decision of Phillps P, in Ferguson v Connemara Jack Pty Ltd,[28] in which his Honour said:
“I do not accept the appellant’s suggestion, and I put it no higher than a suggestion, that error may no longer be necessary to prove for an appeal to be upheld.”[29]
[28] [2025] NSWPICPD 55 (Ferguson).
[29] Ferguson, [49].
The respondent submits that error of the kind referred to in Warren v Coombes and Fox v Percy must be established and says that without error, the Commission does not have jurisdiction to intervene at the Presidential level. The respondent asserts that the appellant’s submission on this point must be rejected.
The respondent refers to the appellant’s submissions that, on the basis of Culhana, the Presidential Member should reject the respondent’s s 11A defence for the reasons set out at paragraph [93] above and submits that the submissions are non-responsive to the direction for submissions and are simply a reiteration of the submissions already made. The respondent submits that the appellant has not explained how the wider approach to an appeal would result in a different approach to that taken before Culhana, and how that leads to an error of fact, law or discretion.
The respondent submits that the Direction issued by the Delegate of the President was very specific in its terms and the appellant’s submissions are in breach of those terms by failing to specifically identify how, in the light of Culhana, the findings would be different.
The respondent asserts that the appellant has simply repeated her submissions already made and for the same reasons provided by the respondent in the substantive submissions, the appeal should be dismissed.

As to Ground A

The appellant’s submissions

The appellant submits that the respondent’s own Policy Directive requires that a person who is the subject of a misconduct process must be afforded the right to have a support person attend any interviews. The appellant says that both Mr Maloney and Ms Findlay had formed the view before the first meeting on 23 February 2021 that it was likely that the appellant was guilty of misconduct. The appellant asserts that she submitted to the Member that she was not afforded the opportunity of a support person at that meeting, but the Member failed to deal with that submission. The appellant contends that the failure to do so was a factor that should have been considered when assessing whether the respondent’s action in the disciplinary process was reasonable. The appellant submits that, had the Member dealt with the submission about the requirement of its own policy, she could have found that the respondent’s actions in disciplining the appellant were not reasonable.
The appellant asserts that Mr Maloney at least informed the appellant that there were concerns in relation to privacy and that the appellant did not have the permission of the nurse unit manager to perform her work at “H”’s bedside. The appellant points to the evidence of Mr Maloney, in which Mr Maloney denied ever commenting that the appellant could be taken to court and submits that that evidence was inconsistent with the evidence of Ms Findlay that he did in fact speak to the appellant about that possibility. It is unclear how that submission relates to the assertion that the respondent failed its own Policy Directive.