Reichardt v Aurrum Pty Ltd
[2016] NSWWCCPD 39
•10 August 2016
| WORKERS COMPENSATION COMMISSION | ||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | ||
| CITATION: | Reichardt v Aurrum Pty Ltd [2016] NSWWCCPD 39 | |
| APPELLANT: | Joy Reichardt | |
| RESPONDENT: | Aurrum Pty Ltd | |
| INSURER: | CGU Insurance Ltd | |
| FILE NUMBER: | A1-6502/15 | |
| ARBITRATOR: | Ms J Snell | |
| DATE OF ARBITRATOR’S DECISION: | 30 March 2016 | |
| DATE OF APPEAL DECISION: | 10 August 2016 | |
| SUBJECT MATTER OF DECISION: | Psychological injury; s 11A of the Workers Compensation Act 1987; reasonable action taken with respect to discipline; whether action to suspend worker and initiate an investigation into an allegation of serious misconduct was reasonable; failure to comply with Practice Direction No 6; submissions not put to Arbitrator; application of principles in Brambles Industries Ltd v Bell [2010] NSWCA 162; 8 DDCR 111 | |
| PRESIDENTIAL MEMBER: | President Judge Keating | |
| HEARING: | On the papers | |
| REPRESENTATION: | Appellant: | Walker Law Group |
| Respondent: | Kaden Boriss | |
| ORDERS MADE ON APPEAL: | 1. The Arbitrator’s determination of 30 March 2016 is confirmed. | |
INTRODUCTION
The appellant worker, an assistant in nursing, was accused of serious misconduct involving an elderly resident of a care facility where she was employed. Upon receipt of that information the employer promptly initiated an investigation and reported the matter to the police. The employer also promptly informed the worker of the allegations and investigation in an after-hours phone call. The worker subsequently suffered a psychological injury.
This appeal challenges that Arbitrator’s finding that, in the circumstances of this case, the employer’s actions were reasonable, thus affording the employer a complete defence under s 11A of the Workers Compensation Act (the 1987 Act).
For the reasons that follow the appeal is unsuccessful.
BACKGROUND
From 2009, the appellant worker, Ms Joy Reichardt, was employed by the respondent employer, Aurrum Pty Ltd. Mr Reichardt worked part-time at Aurrum Erina, an aged care facility, as an assistant in nursing. She also worked part-time at another aged care facility, Peninsula Aged Care. Her duties included resident care, personal hygiene of residents, manual handling, hydration and nutrition.
On 1 May 2015, Ms Reichardt received a phone call from the employer’s clinical services manager, Ms Jenni Picker, informing her that an allegation had been made by a co-worker that she behaved in a sexually inappropriate manner while bathing a resident at the Aurrum Erina facility on 15 April 2015.
The alleged incident was referred to the NSW Police Force for investigation and an internal investigation was initiated by the employer. The police investigation was later discontinued on 5 May 2015 and the internal investigation was concluded by the employer on 3 June 2015. Ms Reichardt was cleared of any wrong doing in respect of the allegation of misconduct.
However, following the phone call on 1 May 2015, Ms Reichardt stopped work and she has not returned to work. Her current employment status with the respondent remains “absent without pay”.
Ms Reichardt claimed that she developed a psychological injury on 1 May 2015 due to the action taken by the employer on that day. On 9 July 2015 and 1 October 2015, the respondent’s insurer, CGU Insurance Ltd, issued a notice under s 74 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) denying the claim. The insurer claimed that the actions taken by it with respect to discipline were reasonable and therefore it claimed a complete defence under s 11A of the 1987 Act.
On 16 November 2015, Ms Reichardt filed an Application to Resolve a Dispute (the Application) in which she sought weekly benefits and lump sum compensation in respect of the psychological injury.
On 7 December 2015, the respondent filed a Reply to the Application disputing liability for the reasons identified in the s 74 notices.
The matter proceeded to conciliation and arbitration before a Commission Arbitrator, on two separate occasions, on 15 February 2016 and 1March 2016, following which the Arbitrator reserved her decision.
On 30 March 2016, the Arbitrator delivered her decision and a statement of reasons. She found that Ms Reichardt sustained a psychological injury due to the events of 1 May 2015. However, she also found that the employer’s actions taken or proposed to be taken with respect to discipline were reasonable, and therefore the employer’s s 11A defence succeeded. The Arbitrator issued a Certificate of Determination in the following terms:
“The Commission determines:
1. Award for the respondent.
A brief statement is attached to this determination setting out the Commission’s reasons for the determination.”
The worker appeals the Arbitrator’s determination.
PRELIMINARY MATTERS
There is no issue that the threshold requirements of s 352(3) and (4) of the 1998 Act are satisfied. Therefore there is no impediment to the appeal proceeding.
ON THE PAPERS
Section 354(6) of the 1998 Act provides:
“(6) 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 without holding any conference or formal hearing.”
Having regard to Practice Directions Nos 1 and 6; the documents 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.
EVIDENCE
Joy Reichardt
In evidence is a statement of Ms Reichardt, dated 2 June 2015. Ms Reichardt describes receiving a message from Ms Picker on her mobile phone, following her shift at Peninsula Aged Care on the evening of 1 May 2015, requesting that she return the call “urgently”. The message was left on her phone at 18:57 and she returned the call at 21:15. When she returned the phone call that evening Ms Picker informed her that a complaint had been lodged against her “regarding an inappropriate sexual contact with a resident at Aurrum Erina”. She was told that she would receive a letter about the complaint and that the police would contact her. She was also informed that she was suspended from work with the respondent with full pay until 7 May 2015.
Ms Reichardt was extremely “shocked and upset from this discussion” with Ms Picker. That night she contacted “at least three friends on the phone” and a “Lifeline number, and fell asleep on that call”. She denied the allegations and states that she was upset about the lateness of the allegation because there is “a policy at work that any incidents involving elderly abuse should be reported immediately to the registered nurse on duty”.
Also in evidence is a chronology of events, prepared by Ms Reichardt dated 28 May 2015. The following is recorded in respect of the phone call of 1 May 2015:
“I was told there had been a complaint put in about me regarding an inappropriate sexual misconduct on the 15th April 2015 [two weeks ago] … I was shocked and told her so, I had been working there 2 weeks after the alleged incident and I get a call at 7pm at night. Jenni Picker told me I was suspended from work with full pay until Thursday 7.05.15, there would be a letter coming to me, a detective would be contacting me re interview 7 May.”
Ms Reichardt claims that at the completion of her shift on 1 May 2015 she approached Ms Picker to make a complaint of bullying by a colleague, however, she said she was “restricted for time” as she was due to commence her shift at Peninsula Aged Care so she did not “elaborate with [Ms Picker]”. She sent Ms Picker an email regarding the complaint the following day.
Jenni Picker
In evidence is a statement of Ms Picker dated 4 June 2015. She states that on 1 May 2015 that she received information from a staff member, Ms Horseman, an assistant in nursing, regarding an allegation of serious misconduct involving Ms Reichardt and a resident at Aurrum Erina. Ms Horseman had not witnessed the incident but had received the information from another colleague, that being, Sherlita Naylor. As a result, Ms Picker contacted Ms Naylor.
Ms Picker states that Ms Naylor described the incident of serious misconduct that Ms Reichardt allegedly engaged in on 15 April 2015. Ms Naylor informed Ms Picker that she had worked a morning shift with Ms Reichardt and that they had attended the personal care of a resident, during which Ms Reichardt “pulled his penis up and down to the point of ejaculation”. Ms Picker states that she discussed her concerns as to the lateness of the report with Ms Naylor, in view of the employer’s policy that such allegations be reported immediately by staff to the manager or supervisor so that a report can be made to the police or the NSW Department of Health within 24 hours. Ms Picker further states that Ms Naylor explained that she was “very concerned” about making a report and was fearful of “losing her shifts”. Ms Picker added that she told Ms Naylor and Ms Horseman that they needed to keep the matter confidential.
Ms Picker further spoke with Ms Naylor to clarify the “actual washing process of the resident” as there is a clear procedure when bathing male residents. Ms Naylor was adamant that there was “a definite difference in the actions” of Ms Reichardt and that those actions “were not conducive to the proper washing process”.
Ms Picker then contacted her manager, James Grealy, and as a result of that conversation a decision was taken to stand down Ms Reichardt from her duties on full pay pending the outcome of an internal investigation into the complaint. Ms Picker also states that she also spoke with Guido Lilio, the employer’s NSW director of human resources, who was responsible for handling the internal investigation.
Ms Picker further states that she contacted Brisbane Waters Local Area Command regarding the incident. She also notes that the police attended on the employer’s premises on 1 May 2015 to speak to the subject resident.
In the evening of 1 May 2015, Ms Picker attempted to contact Ms Reichardt but her call went to voicemail. She states that Ms Reichardt returned her call later that night. Ms Picker recalls informing Ms Reichardt of the allegation and that she was stood down pending the internal investigation. She further states that Ms Reichardt commenced to cry and stated that it “was disgusting that someone would make these comments about her and she was worried about her reputation”. Ms Picker referred Ms Reichardt to the employee assistance counselling services. She advised that a formal letter would be forwarded to her and that the matter was confidential.
Ms Picker also states that she was informed that Ms Naylor provided a statement to police of the alleged incident.
Mark McAlpine
In evidence is a statement of Mark McAlpine, the employer’s human resources business partner, dated 4 June 2015. Mr McAlpine states that from 11 May 2015 he took responsibility of the internal investigation. He states that on 15 May 2015 he conducted a meeting with Ms Picker and Ms Reichardt, during which time Ms Reichardt had a support person. Following that meeting on a date not identified, Mr McAlpine states that he reinterviewed Ms Naylor, “again a face to face meeting”. He states that during the meeting Ms Naylor said that she was troubled by the alleged behaviour and indicated that she procrastinated about reporting the incident for two weeks, and eventually on the advice of her husband raised it with Ms Horseman.
NSW Police Force COPS Event
In evidence is the NSW Police Force COPS Event in respect of the subject incident. It records the “Date/Time Reported: 01/05/2016 20:30” and “PERSON REPORTING PICKER, JENNY”. It also records that on 4 May 2015 that Ms Picker was informed about the result of police enquiries into the incident and “[n]o further police action”.
Letter from Guido Lilio
In evidence is a letter from Mr Lilio addressed to Harmers Workplace Lawyers, dated 9 December 2015, which contains a chronology of events. The relevant parts of the letter are extracted below:
“The relevant and pertinent facts are as follows:
5. April 29, 2015. Ms Naylor, an Aurrum employee who was working with JR on the day of the Alleged Incident, provided a statement outlining the Alleged Incident to Aurrum Erina management. Aurrum management notified both the local Police and the Aged Care Complaints Investigation Scheme (Department of Social Services) of potential elder abuse incident under the Aged Care Act;
6. 1 May 2015. JR was formally advised by Aurrum Erina management of the Alleged Incident and was advised that she would be stood down with pay pending a full and thorough investigation;
…
10. 19 May 2015. Aurrum management met with Ms. Naylor regarding the Alleged Incident she witnessed involving JR and [the resident]. Ms. Naylor provided a detailed witness statement confirming her recollection of the occurrence of the Alleged Incident;
…”
THE ARBITRATOR’S REASONS
The proceedings before the Arbitrator were run on a narrow basis. It was not contested that Ms Reichardt suffered an injury in compensable circumstances. The issue before the Arbitrator was whether the action taken or proposed to be taken by the employer with respect to the disciplinary issue was reasonable, such that it afforded the employer a complete defence under s 11A of the 1987 Act.
After much discussion before the Arbitrator on the first day of the arbitration hearing on 15 February 2016, Ms Reichardt’s counsel, Mr Moffit, stated that he relied only on the allegation that the injury was due to the phone call between Ms Picker and Ms Reichardt on 1 May 2015. He eschewed reliance on any subsequent events.
The following brief summary of the Arbitrator’s reasons is confined to her findings on that issue.
The Arbitrator accepted the employer’s submission that there was nothing contained in the phone call to Ms Reichardt on 1 May 2015 that was unreasonable in terms of its content or tone. She confined the assessment of the reasonableness of the employer’s conduct to whether it was reasonable for the employer to have made the phone call ([61]).
The employer’s counsel, Mr Saul submitted that the employer’s actions were reasonable having regard to the following factors (at [63]):
“(a) That the allegation first came to Ms Picker’s attention on 1 May 2015;
(b) It was a very serious allegation;
(c) The policy of the employer was that any suspected abuse be reported immediately and there was an obligation to report the allegation within 24 hours to the Police or NSW Department of Health;
(d) That Ms Picker acted carefully by discussing the matter with Ms Naylor and asking her about what she allegedly witnessed; then contacting her manager Mr Grealy and the HR Manager Mr Lilio;
(e) That Ms Picker, having received advice that the appropriate course of action was that Ms Reichardt was to be stood down on full pay while an investigation was undertaken, acted promptly on 1 May 2015 to notify Ms Reichardt of this by ringing her at 18:57;
(f) When this telephone call went to message bank the only message left was for Ms Reichardt to ring Ms Picker urgently, so she was not to hear about the allegation in just a voicemail;
(g) That in the actual telephone conversation at 21:15 on 1 May 2015, there is no suggestion that Ms Picker spoke in an accusatory manner or inappropriate tone;
(h) That Ms Reichardt ceased duty at 1pm on 1 May 2015 and was not on duty again until 5 May 2015 and so it would not have been appropriate to wait until then to tell her in person, because of the risk of the Police contacting her before she was notified by the employer of the allegation; and
(i) That Ms Picker could not have made the telephone call earlier on 1 May 2015 because of the need for her to first take the steps she did in speaking to Ms Naylor and her superiors.”
Mr Moffit submitted that it was telling that the letter from Mr Lilio to Ms Reichardt’s lawyers dated 9 December 2015 referred to a statement (from Ms Naylor) allegedly setting out her observations of the alleged misconduct which had inexplicably not been introduced into evidence. It was submitted that this was a significant factor because, as he put it, “the objective evidence we know is as weak as water” (T2, 34.4)
The Arbitrator found (at [67]) that “the evidence is not clear” concerning whether Ms Naylor provided a written statement. She noted that the letter from Mr Lilio contained errors concerning the timing of the notification to the police. She concluded (at [68]) that Mr Lilio may well have been in error about when Ms Naylor provided the statement. She added “it is also not clear to me whether this reference to ‘statement’ in this paragraph means a written or oral statement”.
The Arbitrator inferred that if Ms Naylor had provided a written statement on 29 April 2015, she would have told Ms Picker about it on 1 May 2015 when they discussed the allegations and further that Ms Picker would have included reference to it in her statement. For those reasons the Arbitrator was not satisfied that she could place any weight on paragraph five of Mr Lilio’s letter in reference to an alleged statement by Ms Naylor on 29 April 2015.
In any event, the Arbitrator was not persuaded about the significance of such a statement if it existed. She noted that the matter had been run on the basis that Ms Reichardt suffered injury on 1 May 2015 as a result of the phone call from Ms Picker. It was not suggested that the injury arose by hearing about the allegations due to any delay by the employer in responding to any allegations made to it.
The Arbitrator rejected a submission that Ms Reichardt was in a vulnerable state when notified of the allegations on 1 May 2015, because Ms Reichardt did not say she told Ms Picker about being bullied. Her evidence was that she “approached Jenni Picker in her office…I was restricted for time…so I did not elaborate with Jenni” ([70]).
In any event, the Arbitrator found that the evidence did not disclose that Ms Reichardt was psychologically affected by bullying during her shift on 1 May 2015 ([71]). So much was clear from the fact that Ms Reichardt was able to finish her shift and attend her second job until 9.00 pm that evening. Furthermore, the medical evidence failed to establish that Ms Reichardt was in a vulnerable state on 1 May 2015.
The Arbitrator rejected the submission that the making of the phone call on 1 May 2015 on a Friday night was not reasonable. She concluded that although a face to face meeting may have been preferable, as Ms Reichardt worked part time she was not due to report for duty again until 5 May 2015, it was not reasonable to wait until then to inform Ms Reichardt of the allegations and its decision to stand her down pending an investigation, particularly as the police had already been informed. Furthermore if a face to face meeting had been arranged between 1 and 5 May 2015, that would have necessitated a call to Ms Reichardt, during which the purpose of such a meeting would have been discussed with her in any event.
The Arbitrator rejected (at [73]) Mr Moffit’s submission that Ms Reichardt had been denied procedural fairness because she was not informed of the identity of the complainant or asked for her response during the phone call on 1 May. The Arbitrator concluded that the purpose of the phone call on 1 May was merely to notify Ms Reichardt of the allegations and that she had been stood down on full pay pending an investigation. There was nothing in Ms Reichardt’s statement or that of Ms Picker’s to suggest that the employer had reached any conclusion about that investigation.
The Arbitrator concluded that, viewed objectively and based on the employer’s knowledge at the time of the phone call on 1 May 2015, the employer acted reasonably ([74]). The Arbitrator noted the competing duties of the employer to the patients, their families and staff, and to Ms Reichardt. She concluded that Ms Picker’s actions on 1 May struck a fair balance in dealing with those competing obligations ([74]).
For these reasons the Arbitrator was satisfied that the employer had established its defence under s 11A.
GROUNDS OF APPEAL
The appellant’s grounds of appeal did not comply with the provisions of Practice Direction No 6. The Practice Direction requires that the appeal application must state briefly but specifically the grounds relied upon in support of the appeal. The Practice Direction specifically states that it is not acceptable merely to allege the Arbitrator erred in law, fact or discretion, or that the decision is against the evidence or the weight of the evidence.
Appeal grounds must identify the respects in which the error of law, fact or discretion is alleged to have occurred as well as any material findings it is said the Arbitrator should or should not have made and any material facts it is said the Arbitrator should or should not have found.
In substance, the challenges to the Arbitrator’s determination are that the Arbitrator erred in:
(a) finding that the employer’s actions with respect to the making of a telephone call to Ms Reichardt on 1 May 2015 were reasonable actions (Grounds 1 and 2);
(b) finding that she could not be satisfied of the existence of an alleged statement by Ms Naylor, which is alleged to have occurred on 29 April 2015 (Grounds 3 to 7);
(c) failing to weigh the respective interests of the parties (Ground 8), and
(d) failing to find that the appellant was a vulnerable person prior to the injury (Ground 9).
DISCUSSION
The reasonableness of the telephone call on 1 May 2015 (Grounds 1 and 2)
Submissions
The appellant alleges, first, that the Arbitrator defined her task too narrowly when addressing the question of reasonableness. She submits that the Arbitrator “did not give sufficient attention” to the employer’s knowledge of her antecedents; including her employment record, the absence of similar reports about her, alternative explanations for what was alleged, her age, the possibility of a mistake and the inherent implausibility of the allegations.
Second, the appellant submits that the Arbitrator erred in the scope of her enquiry into the phone call itself. The appellant does not assert that there was anything unreasonable about Ms Picker’s tone during the phone call. Rather, she alleges “it becomes a question of whether it was reasonable for the employer to have made the call”.
The appellant further submits:
“By limiting the enquiry to the phone call and whether it was made, the arbitrator could not and did not give proper consideration to the employer’s failure to consider a) the strength of the allegation prior to any investigation, b) whether the allegation was wrong, and c) whether an investigation was warranted at all. The Arbitrator was unable to properly consider all matters relevant to the question whether the employer’s actions were reasonable…”
Finally, the appellant submits that by incorrectly defining the exercise the Arbitrator asked herself a wrong question which is an error of law: Craig v South Australia [1995] HCA 58; 184 CLR 163.
Discussion and findings
This is an appeal under s 352 of the 1998 Act. The section is directed to the identification and correction of errors of fact, law or discretion.
The decision of Allsop J (as his Honour then was) in Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833 (Branir) (Drummond and Mansfield JJ agreeing) is instructive in the context of the need to establish error. His Honour observed (at [28]):
“in that process of considering the facts for itself and giving weight to the views of, and advantages held by, the trial judge, if a choice arises between conclusions equally open and finely balanced and where there is, or can be, no preponderance of view, the conclusion of error is not necessarily arrived at merely because of a preference of view of the appeal court for some fact or facts contrary to the view reached by the trial judge.”
In Northern NSW Local Health Network v Heggie [2013] NSWCA 255 (Heggie) Sackville AJA (Ward JA agreeing) quoted (at [71]) with apparent approval the observations of Allsop J in Branir. His Honour added that Justice Allsop’s observations need to be borne in mind particularly: “…where the challenge is to an evaluative judgment such as the reasonableness of actions by an employer with respect to discipline”.
The appellant’s arguments before the Arbitrator on the reasonableness of the phone call focussed on the timing of the call, the breach of the employer’s policy in reporting such incidents, the lack of any specifics of the allegation being provided to Ms Reichardt until a meeting two weeks later, and the receiving of the phone call by Ms Reichardt after having worked a double shift on 1 May 2015.
The matters going to the objective reasonableness of the employer’s conduct upon which the appellant now seeks to rely were not matters that were put in submissions to the Arbitrator as matters relevant to her consideration of the reasonableness of the employer’s conduct. Therefore, it is not an error of law for the Arbitrator not to have referred to them (Brambles Industries Ltd v Bell [2010] NSWCA 162; 8 DDCR 111).
The Arbitrator’s finding (at [61]) that there was nothing said during the phone call that was unreasonable in terms of its tone or manner is consistent with the evidence of Ms Picker and Ms Reichardt. That finding was properly made.
The Arbitrator was then required to determine whether it was reasonable to make the phone call, having regard to matters known at that time. For the reasons discussed below that is what the Arbitrator did. It follows that I reject the submission that the Arbitrator erred in the scope of her enquiry into the phone call itself.
In assessing whether conduct is reasonable, the Commission has consistently applied the principles stated by Geraghty CCJ in Irwin v Director General of School Education (unreported, Compensation Court of NSW, Geraghty CCJ, 18 June 1998, No 14068 of 1997) (Irwin):
“The question of reasonableness is one of fact, weighing all the relevant factors. The test is less demanding than the test of necessity, but more demanding than a test of convenience. The test of ‘reasonableness’ is objective, and must weigh the rights of employees against the objective of the employer. Whether an action is reasonable should be attended, in all the circumstances, by a question of fairness.”
In determining whether the psychological injury was caused by reasonable disciplinary action taken or proposed to be taken by the employer, Sackville AJA said in Heggie (at [61]) that the reasonableness of an employer’s action for the purpose of s 11A is to be:
“determined by the facts known to the employer at the time or that could have been ascertained by reasonably diligent inquiries.”
His Honour added:
“Ordinarily, the reasonableness of a person’s actions is assessed by reference to the circumstances known to that person at the time, taking into account relevant information that the person could have obtained had he or she made reasonable inquiries or exercised reasonable care. The language does not readily lend itself to an interpretation which would allow disciplinary action (or action of any other kind identified in s 11A(1)) to be characterised as not reasonable because of circumstances or events that could not have been known at the time the employer took the action with respect to discipline.”
His Honour further noted (at [62]) that “[m]any actions with respect to discipline, such as suspension on full pay while serious complaints are investigated, are necessarily taken without the employer having the opportunity to establish the full facts”. His Honour added that this is particularly so where the employer is required to take into account the safety and well-being of staff, and I would add, in the present matter, residents.
The Arbitrator correctly identified these principles (at [74]) and applied them in assessing the reasonableness of the employer’s conduct. It follows that the appellant’s submission that the Arbitrator erred by asking herself the wrong question must be rejected.
The objective facts are as follows. On 1 May 2015, Ms Horseman informed Ms Picker of information which if accepted involved serious misconduct on the part of Ms Reichardt. Before taking any action adverse to Ms Reichardt, Ms Picker took steps to question Ms Naylor who was the source of the information. Ms Picker also took steps to clarify the precise circumstances and the accuracy of the information she had received before proceeding further. She remonstrated with Ms Naylor concerning her delay in bringing these matters to her attention. She also ensured that the information that had been given to her by Ms Naylor and Ms Horseman were kept confidential. These actions were reasonable in the circumstances.
Ms Picker’s next steps were to contact her manager Mr Grealy and the New South Wales director of human resources, Mr Lilio. As a result of those conversations the allegation was also referred to the police at the Brisbane Waters local area command. Ms Picker acted promptly to contact Ms Reichardt and spoke to her at the first available opportunity to advise her that the allegations had been made and that she would be stood down pending an internal investigation.
The Arbitrator considered and took into account all of these factors. The Arbitrator correctly found that it would have been unreasonable to wait until 5 May 2015, when Ms Reichardt next reported for duty, to advise her of the allegations. As the Arbitrator correctly pointed out, by then it was conceivable that Ms Reichardt could have heard of the allegations by reason of the police investigation.
The Arbitrator objectively weighed (at [74]) the competing obligations of the employer to its staff, the residents, many of whom were elderly, their families, and Ms Reichardt. As I have indicated, this is the correct approach to the assessment of the reasonableness of the employer’s actions, and one that has been consistently applied in the Commission (Irwin).
The allegations made against Ms Reichardt were extremely serious. The events were observed by and reported by an independent witness. In view of the employer’s competing obligations, as discussed, it was open to the Arbitrator to conclude that the institution of an investigation at the earliest opportunity was reasonable. It was also open for the Arbitrator to conclude that the employer’s actions in informing Ms Reichardt of the allegations and of the internal investigation at the earliest opportunity was also reasonable. The Arbitrator correctly found that those actions struck a fair balance when dealing with its competing duties. Those findings were open on the evidence and do not involve error.
I reject the submission that it was unreasonable for the employer not to consider the “inherent implausibility” of the allegations proceeding further. Without a transparent process of investigation the employer was in no position to make any determination on the plausibility of the allegation. In any event, having been in receipt of a direct eyewitness account of the alleged misconduct it would have been impossible for the employer to conclude as of 1 May 2015 that the allegations were inherently implausible.
I am not satisfied that any error of the kind discussed in Branir and Heggie has been established with respect to the Arbitrator’s findings on the question of the reasonableness of the employer’s conduct. The evidence overwhelmingly supported the Arbitrator’s conclusions. The appellant’s submissions in substance merely express disagreement with the Arbitrator’s conclusions and fall well short of demonstrating error. It follows that grounds one and two of appeal fail.
The alleged statement of Ms Naylor (Grounds three to seven)
Submissions
The appellant alleges a number of errors of fact and law in relation to the Arbitrator’s treatment of the alleged written statement of Ms Naylor. In substance the appellant alleges that the Arbitrator erred:
(a) in failing to find that Ms Naylor provided a written statement to her employer on 29 April 2015;
(b) in failing to apply the Jones v DunkelJones v Dunkel [1959] HCA 8; 101 CLR 298 (Jones v Dunkel) test and failing to consider whether it was more likely than not that Ms Naylor did make a written statement;
(c) by concluding it was not “clear” to her whether the alleged statement was written or oral, and
(d) in failing to properly consider or weigh the employer’s failure to explain the absence of the alleged statement.
Discussion and findings
The only references in the evidence to a written statement by Ms Naylor are contained in Mr Lilio’s letter (at paragraph five and ten). The Arbitrator concluded that she could not place any weight on paragraph five of the letter. The Arbitrator gave a series of reasons for reaching that conclusion. Those reasons are as follows.
First, Mr Lilio stated in the letter that the police were notified of the alleged events on 29 April 2015. That was not correct. The information from the police report indicates that the matter was reported on 1 May 2015 at “20.30”. The person reporting it was stated to be Ms Picker.
Second, the police records are consistent with Ms Picker’s evidence regarding the timing of the report.
Third, the police report recorded that Ms Reichardt was next due to report for duty on 5 May 2015. That was consistent with Ms Picker’s evidence of the timing of events. However, it was inconsistent with a report to the police on 29 April 2015, as asserted by Mr Lilio.
The Arbitrator drew the inference that if Ms Naylor had provided a written statement to the employer on 29 April 2015 she would have told Ms Picker about it, when Ms Picker contacted her to discuss the allegations on 1 May 2015, and there would have been a reference to it in Ms Picker’s statement. There was not.
Ms Picker said in her statement that she was “informed by Sherlita [Naylor]” of the allegations of misconduct. She did not state that she received a written statement. At paragraph 10 of Ms Picker’s statement she said that she further spoke with Ms Naylor to clarify the circumstances of the allegations. The overwhelming inference is that these were oral communications and are consistent with there being no written statement as at 1 May 2015.
Until 1 May 2015, Ms Naylor had been reluctant to bring the allegations forward. She was a new employee and was concerned that her employment would be prejudiced if she reported the matter. It would be inconsistent with such a reluctance to report the matter, that Ms Naylor had prepared a written statement of her own volition on the 29 April 2015. Furthermore, apart from Mr Lilio’s evidence, which the Arbitrator did not accept as reliable, there is no evidence that Ms Naylor volunteered a written statement on 29 April 2015.
Mr McAlpine, the human resources manager said in his statement of 4 June 2015 that he re-interviewed Ms Naylor in a face to face meeting where she again described the details of the alleged incident. Ms Naylor confirmed to Mr McAlpine that she procrastinated about the report for two weeks and eventually, after discussions with her husband, raised it with her colleague Ms Horseman. Those statements are also inconsistent with the apparent existence of a written statement prior to 1 May 2015.
In view of the above, the Arbitrator’s conclusions regarding the reliability of Mr Lilio’s evidence and the weight it should be given, were open on the evidence and did not involve error.
The submission that the “Arbitrator did not inquire or apparently consider whether it was more likely than not that Ms Naylor’s statement was created” is untenable and I reject it.
For the reasons given above, the Arbitrator (at [68]) was analysing what weight if any that could be attached to Mr Lilio’s reference to there having been a statement. The Arbitrator was merely stating that the reference to the word “statement” in Mr Lilio’s letter could be equally consistent with a written statement or an oral statement and it was not clear what was being alleged. It was an appropriate observation. If the reference to “statement” in Mr Lilio’s letter is a reference to an oral statement then the whole of the appellant’s submissions to the Arbitrator on this issue fall away.
As I have indicated, in essence the Arbitrator found that the only evidence pointing to the existence of a statement being made by Ms Naylor on 29 April 2015 was that of Mr Lilio. She concluded for the reasons explained above, with which I agree, that it was unreliable and inconsistent with all other evidence.
As the employer submits it is not correct to state that the Arbitrator was using the wrong test when using the word “clear”. There is nothing to establish that she eschewed the civil standard. Rather, the Arbitrator used the word “clear” when assessing whether a statement from Ms Naylor existed at all (on the balance of probabilities). In so doing, the Arbitrator was guided by the errors noted above, together with the detailed written statement of Ms Picker.
Further, I reject the appellant’s submission that the Arbitrator erred by not applying the Jones v Dunkel test. That submission is founded on there being an unexplained failure to produce the purported statement of Ms Naylor. The absence of such statement was not unexplained. Mr Saul, on instructions, expressly denied its existence (T2 41.13).
The findings in relation to Mr Lilio’s statement were in essence a finding as to the credibility or reliability of Mr Lilio’s statement. Such a finding may only be impugned on appeal pursuant to the principles in Fox v Percy [2003] HCA 22; 214 CLR 118 (Fox v Percy). The appellant’s submissions fail to identify any “incontrovertible facts or uncontested evidence” to support a submission or that the Arbitrator’s finding was “glaringly improbable” or “contrary to compelling inferences” (Fox v Percy).
The submission that the Arbitrator failed to explain the reasons for her conclusion concerning the probable existence of a pre-1 May 2015 statement by Ms Naylor is equally untenable. Her reasons are referred to at [37] to [39] above. Those reasons adequately discharged the statutory requirement to give “brief” reasons pursuant to s 294(2) of the 1998 Act and r 15.6 of the Workers Compensation Commission Rules 2011.
In any event, as the Arbitrator noted (at [69]) she was not persuaded by the appellant’s submissions concerning the significance of there being a statement dated 29 April 2015. As the Arbitrator correctly observed, the appellant sought fit to run the matter before the Arbitrator on the basis that Ms Reichardt suffered an injury on 1 May 2015 as a result of being told, in a phone call of that date, of the allegations and being stood down on full pay. The appellant did not argue that, due to any delay by the employer, Ms Reichardt heard of the allegations by rumour in the workplace before being officially notified. It follows that even if the Arbitrator erred in finding that on the balance of probabilities there was no statement made on 29 April 2015 it would have had no bearing on the ultimate outcome.
It follows that grounds three to seven of appeal fail.
Weighing up process (Ground 8)
Submissions
The appellant alleges that the Arbitrator erred in not properly weighing the rights of the applicant as required in Irwin.
The appellant submits that ultimately what is required of the employer in framing a response in a case such as this is to properly consider the nature of the allegations, the effect of its own proposed actions on the employer and the accused worker. The appellant also submits that the employer failed to follow these principles. If it had, it would have found that the allegations were inherently implausible and by permitting the allegations to become known amongst its workforce embarrassment would be caused to the accused worker.
The appellant further submits that there is no evidence that the employer addressed these important considerations, nor did the Arbitrator, notwithstanding her reference to Irwin.
Discussion and findings
The Arbitrator identified and applied the correct test of reasonableness as set out in Irwin (at [60] above and at [58] of Reasons). The appellant’s submissions merely assert that the Arbitrator did not properly weigh the respective interests and therefore did not apply the correct tests. I reject the submission.
The factors the Arbitrator took into consideration in assessing the reasonableness of the employer’s actions are referred to at [65]–[69] of this decision. Assessed objectively, it was open to the Arbitrator to find that those actions struck a fair balance in dealing with its competing obligations based on the facts known to the employer at the time those actions were taken (Heggie at [61]).
For the reasons that have already been given I reject the submission that the Arbitrator failed to properly weigh the respective interests. Assessed objectively, the Arbitrator’s conclusions were open on the evidence. I am not satisfied that any legal, factual or discretionary error has been established. It follows that ground eight of appeal fails.
Ms Reichardt’s alleged vulnerability (Ground 9)
The appellant submits that the employer’s actions were not reasonable because she was in a vulnerable state on 1 May 2015 because she alleged she had been bullied at work that day and had notified Ms Picker about the incident.
I reject the appellant’s submission. The evidence revealed that Ms Reichardt may have made an attempt to report such an alleged incident of bullying to Ms Picker, but for the reasons explained by the Arbitrator (at [70]) no such report was ever made. Therefore, if Ms Reichardt was in a vulnerable state the employer could not have known about it at the time Ms Picker informed her of the allegation. Moreover, the Arbitrator was correct to find that there was no medical evidence that Ms Reichardt had been psychologically affected by alleged acts of bullying.
It follows that ground nine of appeal fails.
DECISION
The Arbitrator’s determination of 30 March 2016 is confirmed.
Judge Keating
President
10 August 2016
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