St George Leagues Club Ltd v Wretowska - [2013] NSWWCCPD 64

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:	St George Leagues Club Ltd v Wretowska [2013] NSWWCCPD 64
APPELLANT:	St George Leagues Club Ltd
RESPONDENT:	Joanna Wretowska
INSURER:	Employers Mutual NSW Ltd
FILE NUMBER:	A1-7325/12
ARBITRATOR:	Mr M McGrowdie
DATE OF ARBITRATOR’S DECISION:	5 August 2013
DATE OF APPEAL HEARING:	15 November 2013
DATE OF APPEAL DECISION:	26 November 2013
SUBJECT MATTER OF DECISION:	Psychological injury; whether injury wholly or predominantly caused by reasonable action with respect to discipline; s 11A Workers Compensation Act 1987; alleged failure to give reasons
PRESIDENTIAL MEMBER:	Deputy President Bill Roche
HEARING:	Oral
REPRESENTATION:	Appellant:	Mr T Wardell, instructed by Edwards Michael Lawyers
Respondent:	Mr L Morgan, instructed by Beilby Poulden Costello
ORDERS MADE ON APPEAL:	1. The Arbitrator’s determination of 5 August 2013 is confirmed. 2. The appellant employer is to pay the respondent worker’s costs of the appeal, assessed at $2,530 plus GST.

INTRODUCTION

In this matter, the worker alleged that she suffered a psychological injury (Major Depressive Disorder with Anxiety) as a result of “harassment at her place of employment” between October 2010 and 12 November 2011. The employer did not dispute that the worker suffered a psychological injury, or that her employment was a substantial contributing factor to that injury. It argued that the injury was wholly or predominantly caused by reasonable actions taken, or proposed to be taken, with respect to discipline (s 11A Workers Compensation Act 1987).
The employer relied on two relevant “actions” in support of its s 11A defence. The first was the suspension of the worker on 12 November 2011, after having received complaints from work colleagues that, on that day, the worker had used racist, demeaning and offensive language in relation to Aboriginal people within the hearing of others at work, something the worker strongly denied. The second was a phone call to the worker by a manager on 14 November 2011 asking her to attend a meeting to discuss “not continuing her employment” because of the alleged racist remarks.
The Arbitrator found that the injury had not been wholly or predominantly caused by the relevant actions taken with respect to discipline and that, in any event, those actions were not reasonable.
The employer’s appeal raises the following issues: first, whether the Arbitrator erred in not finding that the worker’s accepted psychological injury was wholly or predominantly caused by action taken with respect to discipline, second, whether the Arbitrator erred in not finding that the relevant action taken was reasonable and, third, whether the Arbitrator gave adequate reasons for his findings on the first two issues.
For the reasons explained below, the appeal is unsuccessful and the Arbitrator’s determination is confirmed.

FACTUAL BACKGROUND

The respondent worker, Joanna (Ania) Wretowska, a 55 year old Jewish immigrant from Poland, started work for the appellant employer, St George Leagues Club Ltd (the Club), in July 1997. Though she was employed as a casual, she appears to have worked essentially full-time for the Club since that time. She worked as a bar attendant, gaming attendant and in the Club’s coffee shop and at functions. All was well with her employment until about October 2010 when she began to feel that management unfairly targeted her.
Documentary evidence established that Ms Wretowska was “spoken to” or “counselled” on several occasions between 7 February 2010 and 12 September 2011 over various issues. In addition, on 29 December 2010, the Club issued Ms Wretowska with a written warning for having been spoken to on five occasions on 18 December 2010 regarding her performance at work and for being late on nine occasions in the previous two months.
Ms Wretowska said that she was “picked on” because she was one of only a few workers on an “old award” and the Club was keen to sign people across to the new award.
Ms Wretowska said that, before the events that commenced in October 2010, she was always one of the first to be asked to do overtime. She believed that was because she was an excellent worker, which was consistent with her keeping employment for such a long time and being popular with all the patrons and guests at the Club.
Ms Wretowska said that a change in the Club’s policy on staff uniforms caused her issues and, on 24 May 2011, she produced a certificate from her general practitioner, Dr Johnson, stating that she was prone to getting respiratory illness and that she needed to wear added clothing to keep warm. The doctor asked that she be allowed to wear long sleeves and warm clothing to prevent her getting sick. On raising this with the human resources manager, Joni Deibert, Ms Wretowska was told she could reduce her hours but no flexibility was offered in relation to the uniform. Ms Wretowska said that other workers were allowed to wear warm clothing under their uniforms.
Not being allowed to wear long sleeves caused Ms Wretowska some short term discomfort and was, she said, indicative of the attitude the Club had towards her “which became more aggressively manifested during the course of [her] employment until [she] could take it no longer after the allegations of racism and intervening events including deliberate attempts to embarrass [her] in front of the patrons” who she had enjoyed serving.
Ms Wretowska’s history to Dr Ann Stephenson, a psychiatrist qualified by her solicitor, was that she frequently came in for criticism from the operations manager, Garry Carr. This started in early 2011 when he issued a memo that staff would no longer be able to purchase coffee at the coffee shop and that coffee would be available in the staff room. When Ms Wretowska asked about this, Mr Carr was allegedly abrupt and not inclined to discuss it. Further, the long established practice of Ms Wretowska ordering drinks for customers at the bar was to cease and she was told not to chat to customers.
At a staff meeting on 9 November 2011, concerning the restructure of the Club’s functions operations, employees were told that service to customers was to be on a “5-Star level”. Ms Wretowska responded that it was inappropriate to be providing “5-Star” service when the Club did not have a “5-Star clientele”. In her oral evidence, Ms Wretowska explained that she meant that the Club had a family based clientele rather than what might be regarded as a “5-Star” clientele. The food services manager told Ms Wretowska that if she was not prepared to work in that way her hours would be cut.
At the end of the meeting, Ms Wretowska was not prepared to sign the new procedures agreement because she did not agree with it and she suffered a long-standing back problem that restricted the weights she could carry. (Exactly how the new procedures agreement affected the physical requirements of Ms Wretowska’s job was not explained in the evidence.)
On 12 November 2011, the Club hosted a function for a local hostel. That evening, Gareth Heard, one of the Club’s duty managers, received a complaint from a member of staff that Ms Wretowska had said: “these people would be nothing without us Europeans”; that “they should just leave”; and that she used derogatory terms, such as “Abo”. The comments were said to have been heard by two other members of staff.
Mr Heard spoke to another employee, who confirmed the original complaint, and added that it was not an isolated incident and that Ms Wretowska had used the word “coon” several times. Mr Heard then spoke to a third employee, who said he had heard Ms Wretowska make racist remarks. Both employees were, according to Mr Heard, “visibly angry” about Ms Wretowska’s behaviour.
Mr Heard then spoke with a fourth person, the co-ordinator of the function, who said that she had not heard any racist remarks, but Ms Wretowska’s performance throughout the night had been terrible, disregarding instructions and generally not doing a good job.
Mr Heard and Michael Riley, the other duty manager at the time, called Ms Wretowska into an office to talk to her about the complaints. She “flatly denied everything that was said and demanded that the people accusing her of these comments do so in her presence”. She said she had never made any racist comments and that the terms she was said to have used were not even in her vocabulary.
Due to the seriousness of the claims, Mr Heard and Mr Riley sent Ms Wretowska to the staff room, to have a coffee, while they reconfirmed with two of the three witnesses what Ms Wretowska was alleged to have said. Mr Heard said the witnesses understood the seriousness of the situation and maintained that Ms Wretowska had made the comments. They seemed shocked that Ms Wretowska would deny everything.
Mr Heard and Mr Riley then telephoned the third witness, who had finished his shift, who reiterated his previous comments and “confirmed definitively” that Ms Wretowska had used the term “coon”. They then brought Ms Wretowska back into the office and spoke with her. She still denied making any racist remarks and could not understand why three different staff members would accuse her of doing so. Mr Riley told Ms Wretowska that she would be sent home early, that she was suspended for her shift the next day (Sunday, 13 November 2011) and would have to speak to senior management on Monday about the issue.
On Monday, 14 November 2011, Ms Wretowska saw Dr Johnson, who certified her unfit (in a non WorkCover medical certificate) for work from 12 November 2011 to 20 November 2011 because of a “[m]edical [c]ondition”.
Later on 14 November 2011, the human resources manager, Ms Diebert spoke to Ms Wretowska by telephone and asked her to come in for a meeting with her and the assistant general manager, Mr Derrig. Ms Wretowska was told she could bring a witness and that the meeting was to discuss the Club “not continuing her employment”. Ms Wretowska said she was not feeling well, but agreed to attend a meeting at 3.00 pm on Tuesday, 15 November 2011.
Ms Wretowska did not attend the proposed meeting on 15 November 2011, but faxed to the Club an initial WorkCover medical certificate from Dr Johnson, dated 15 November 2011, that certified her unfit from 12 November 2011 to 30 November 2011 due to a “[s]evere anxiety state precipitated by her work”. Under “[h]ow the injury occurred”, Dr Johnson wrote “excessive pressure at work”.
In a letter dated 15 November 2011, Ms Diebert wrote to the Club’s insurer, Employers Mutual NSW Ltd (Employers Mutual), stating, among other things:
“…, we are gathering information, specifically, statements from the employees who made the complaints against [Ms Wretowska]. We expect this claim will be declined for reasons stated in section 11A of the Workers Compensation Act. Please advise what other information you require to assist us in having this claim declined.”
In an email on Wednesday, 16 November 2011, from Ms Diebert to several staff members, identified only by their christian names, Ms Diebert outlined her contact with Ms Wretowska on Monday and added:
“[Ms Wretowska] did not show up for the meeting [scheduled for Tuesday, 15 November 2011] and she did not contact us, however a Workcover Medical Certificate was faxed to us stating that she is totally unfit for work until 30 November due to ‘severe anxiety state precipitated by her work’ and that this ‘injury’ occurred due to ‘excessive pressure at work’.
I have forwarded this to our insurance company and have spoken with them to do what we need to do to have the claim declined. William Adinkwuye is completing a statutory declaration with his statement of events, Mark Carnovale is bringing his written statement to me tonight when he comes to work and I will be speaking with TJ Wichman today. Section 11A of the Workers Compensation Act states that ‘No compensation for psychological injury caused by reasonable actions of [sic] employer’ – this means no compensation is payable for actions taken or proposed to be taken with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers.
[Ms Wretowska] has not indicated any problems with ‘excessive pressure at work’ to me at any stage, nor am I aware of her dropping shifts or going home early as a result of this. I believe the incident on Saturday night is the only incident she could be referring to.
Thank you so much DMs – particularly Mick Riley and Gareth Heard for following up on details and speaking with staff to confirm information on Saturday night. This is a big help to us. If anyone has any other information that relates to this claim (for example other incidents of ‘excessive pressure at work’) please forward it to me as soon as possible.
I will keep you updated.” (the reference to “DMs” is to the Club’s duty managers)
On referral from Dr Johnson, Ms Wretowska saw Natalie Wong, psychologist, on 14 December 2011. In a report to Dr Johnson dated 14 December 2011, Ms Wong said that Ms Wretowska advised that she had been experiencing anxiety and depressive symptoms as a direct result of bullying at work by managers.
On 13 January 2012, Ms Wretowska saw Dr Lucas Murphy, consultant psychiatrist, at the request of Employers Mutual and the doctor prepared a medicolegal report on that date.
On 31 January 2012, Ms Wretowska completed a worker’s injury claim form. Under “[w]hat happened and how were you injured”, she wrote “accused of racism and harassed by managers”. She gave the date and time of the injury as 12 November 2011 and said that she had not previously had another injury/condition that related to the injury/condition.
On 26 March 2012, Employers Mutual issued a s 74 notice denying liability for the claim on the ground that the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by the Club with respect to performance appraisal, discipline and “your possible dismissal from your employment”. Among other things, the insurer relied on three statutory declarations from co-workers who said that Ms Wretowska had made comments about visitors to the Club on 12 November 2011, such as “these [A]borigines should not be on this land”, “where would these abo’s be without us [E]uropeans”, and used the word “coon”.
On 10 April 2012, Ms Wretowska saw Dr Ann Stephenson, psychiatrist, at the request of her solicitors, and Dr Stephenson prepared a medicolegal report of that date.
In a statement dated 27 June 2012, Ms Wretowska said she found the suggestion that she had made racist comments “particularly offensive”. She said that the word “coon” was not one known to her and that she is not, and has never been, racist.

MEDICAL EVIDENCE IN DETAIL

Dr Johnson

The only evidence from Dr Johnson is in his medical certificates and clinical notes.
Ms Wretowska saw Dr Johnson on several occasions in 2010 and up to November 2011, but his notes have no reference to emotional problems of any kind until 14 November 2011 when he recorded:
“ssshe [sic] has not been at work [sic] few days and is having conflict at work re dress again
has not been sleeping or eating
will need to see someone re issues”
The only relevant entry prior to 14 November 2011 is on 24 May 2011, when Ms Wretowska attended with flu like symptoms. She said she had a problem at work “with her dressing” and that she had spoken to the union and needed a letter. Dr Johnson wrote a letter stating that Ms Wretowska was prone to getting respiratory illness and, as she also had a low body mass index, she needed to wear added clothing to keep warm. He requested that she be allowed to wear long sleeves and warm clothing to prevent her from getting sick.
The first WorkCover medical certificate, dated 15 November 2011, said that Ms Wretowska suffered from a “[s]evere anxiety state precipitated by her work” caused by “excessive pressure at work”.
On 22 November 2011, Dr Johnson recorded that Ms Wretowska had stress related symptoms and was not eating well. She had not heard from work and he suggested she involve a solicitor.
On 29 November 2011, Dr Johnson again recorded that Ms Wretowska was not eating well, was stressed, her home was in disarray, she was drinking alcohol, and needed “psychassistance”.
In his second certificate, dated 29 November 2011, Dr Johnson diagnosed a “[s]evere anxiety state precipitated by [sic] work incident”, but he gave no cause and no date of injury. In subsequent certificates, he said Ms Wretowska suffered from a “[s]evere anxiety state precipitated by incidents at work Psychological injury” that had been caused by “work place harassment and bullying over a period of time precipitated on date below”. The “date below” was 12 November 2012.

Ms Wong

Ms Wong’s evidence is in her report of 14 December 2011 to Dr Johnson and her notes. In her report, she recorded:
“[Ms Wretowska] advised that she has been experiencing anxiety and depressive symptoms as a direct result of bullying at work by managers. [Ms Wretowska] described a series of events in which she received scrutiny and criticism for actions which did not appear to be unreasonable, and they seem to have been based on unsubstantiated claims of misdemeanour and excessive compliance management for workplace requirements, such as uniform regulations. She disclosed that the recent events, in particular being informed by a manager over the phone that she was no longer employed, have lead [sic, led] to disruptions in her usual sleep and appetite patterns.
As [Ms Wretowska] is in the process of a WorkCover psychological claim, I intend to assist her ability to cope with current stressors based on a CBT approach, and hopefully help her manage the procedures and investigations which may ensue. Thank you for your referral Dr Johnson, and please do not hesitate to contact me at any stage should you require further information about [Ms Wretowska’s] progress.”
In her notes for 14 December 2011, Ms Wong recorded:
“- disc bullying events this yr at work re uniforms, tardiness – unsubstantiated comments, racist comment?
-   was told fired over the phone by manager – 2 witnesses
-   employed at st george leagues’ for 13 yrs
-   lodged claim att 15^th nov for dr Johnson – filled in form
-   …” (punctuation, abbreviations and capitalisation as per original)
On 3 January 2012, Ms Wong recorded, among other things:
“…
- disc bullying since 10 months ago – changes in mgt but want to assoc w/company? likes work part of identity for 14yrs; also age a problem for finding new work – worry re references, but suggested asking colleagues, ex-manager who was forced out of co…” (punctuation, abbreviations and capitalisation as per original)
At review on 18 January 2012, Ms Wong recorded, among other things:
“- …
-   reviewed bullying at work; customer service role and imposed/unfair limitations, false accusations (pushing chairs, targeted re uniform whereas other colleagues were not prev wc claim w/ slipped disc 10yrs ago)
-   in contact w/ 2 friends there – spoke w/ one who were [sic] having own troubles, other o/s- but calling on private line as co. finding out may cause friends trouble
-   main worry – re getting rid of fear when going back to work due to targeting by Gary Carr (prev operations mgr. now exec. mgr/mgt
-   Jared Schwarz now OP – can talk honestly w/ him like friend; HR mgr Joni Diebert
-   showed mistakes in initial plan written by EML. Emma backingham [sic]; feels story dismissed
-   disc WC system and ultimate control w/ Joanna – assertiveness ok; communication during RTW process and written support/medical [sic] from me and dr. Johnson
-   …” (punctuation, abbreviations and capitalisation as per original)

Dr Murphy

Dr Murphy’s evidence is in his reports of 13 January 2012 and 7 March 2012. In his first report, Dr Murphy took the following history:
“She has worked for the St George Leagues Club for the past 14 years as a casual contractor. She said that over the past 10 to 11 months, ‘I have been picked on any [sic] possible occasion for doing the wrong thing.’ She explained this as in the context of having taken on a self-appointed advocacy role (she does not belong to the union and is not a union representative) and she believes she may have offended some of the managers by disagreeing with their decisions.
She has never made a Workers Compensation claim before.
She claimed to have never taken time off work for stress-related illness in the past.
She feels that management may have an agenda to force her into redundancy and that she may be a target for this because she is outspoken, on a high rate of pay, casual and because of her increasing age. She repeated several times that she is not a racist and that management would have no reason to say this about her.
…
HISTORY OF THE PRESENTING INJURY
As alluded to above, Ms Wretowska explained that she feels that she may be being unfairly targeted by her employer. She categorically denied having made any racist comments and also insisted that she did not understand the meaning of the words or why anyone would find them offensive.
‘I don’t know how I can get over that thing. They accused me of making racist comments … I’m like a black sheep. They send me home. I’m not feeling well … we made arrangements, but I didn’t show up. They’re going to talk about continued employment. I only talked to the case manager twice … I received everything seven to 10 days later.
I didn’t do it. It’s not in my vocabulary. What does abo mean anyway? I still don’t know what I’m supposed to have said and I don’t know why they lied about it. I don’t even know what a coon is.
I’ve been in Australia for 30 years and I’m not a racist at all.’
…
She feels the employer is not treating her fairly and is pursuing its own agenda. She also accuses [sic] the affidavits were falsified. ‘They never gave me a chance to explain. They said that they wanted to talk about continued employment. Everybody was very upset and I wanted to talk about it with the other staff. Everybody knows what’s going on. They’ve been cutting jobs, introducing new changes and they put out a memo that we can’t drink coffee at work. In the last 10 to 12 months I’ve been picked on on every possible occasion for doing wrong things. I tried to complain to the manager but he didn’t like it. I’ve been confronted six or seven times about my uniform and I’ve even been told I have to work when I have a doctor’s certificate.’
Ms Wretowska experienced significant distress about the disciplinary matter in particular and feels anxious about her prospects of continued employment and her ability to find employment elsewhere, especially given that she has worked for St George Leagues Club for 14 years and would need a good reference in order to find work elsewhere.” (emphasis included in original)
Under “Current Psychiatric Symptoms & Functioning”, Dr Murphy said that, during the past two weeks, Ms Wretowska described symptoms consistent with a Major Depressive Disorder consisting largely of distress and worry complicated by insomnia and avoidance. He said she described problems with stress and muscle tension. She displayed significant anxious ruminations about her continued employment prospects and a “sense of bitterness and injustice about the way she has been treated by her employer, especially a Mr Gary Carr, whom she believes has a personal agenda to force her out of her current employment”. She did not trust the Club to treat her fairly; they were, she said, “just looking for another reason to frame me”.
Under “Executive Summary”, Dr Murphy said that Ms Wretowska suffers from a Major Depressive Disorder with Anxiety and that the “essential cause of her condition is the disciplinary action taken against her on 12 November 2011 after she (allegedly) made racially insensitive comments in the workplace”.
Dr Murphy said that the barriers to Ms Wretowska returning to work were:
“●      Mild ongoing symptoms.
●      Mistrust of her employer and, specifically, a sense of being picked on unfairly, for being outspoken.
●      Lack of other employment opportunities because of her age and CV.”
When asked to clarify how employment with the Club was considered to be a substantial contributing factor to Ms Wretowska’s psychological condition, Dr Murphy replied:
“Ms Wretowska’s [sic] has little in the way of non-work-related stressors and no identifiable past psychiatric history. She has, presumably, been resilient in the face of stress in the past.
There are no drug and alcohol factors and no evidence of Personality Disorder.
Therefore, the substantial contributing factor to her psychological condition is work-related and does relate to the events of 12 November 2011. Specifically, her distress, anxiety and depression arise out of anxiety about her ongoing financial security and employment prospects if the employer proceeds with disciplinary action against her for allegedly making racist comments at work.”
In response to whether Ms Wretowska’s treatment was “deemed reasonably necessary as a result of the reported injury sustained on 12/11/2011” and would the treatment have been required regardless of employment with the Club, Dr Murphy said:
“There is no evidence that Ms Wretowska would have required treatment were it not for the events of 12 November 2011. She has no past psychiatric history and it seems unreasonable to suggest that she would coincidentally require some now, especially given that the content of her distress is very closely related to anxiety about her work and financial security.”
In his second report, prepared in response to a letter (not in evidence) from Employers Mutual, Dr Murphy said:
“I refer to your letter to me dated 1 March 2012 requesting my further comments regarding [Ms Wretowska].
“Based on the information before me, I am of the opinion that [Ms Wretowska] has a psychiatric condition and that the substantial cause was distress about being performance managed, mistrust of her employer, and anxiety about her ongoing employment prospects. Caring for her ill mother was relevant as a minor stressor.
“As to the question of whether or not the employer acted reasonably (with respect to s11A of the act),
I see this as an industrial issue that is outside of my core expertise as a psychiatrist. You should consider arranging for a suitably qualified expert to review the employer’s policy, skills, and delivery of performance management, especially in [Ms Wretowska’s] case.
Ms Wretowska did not accuse the employer of inappropriate tone of voice, being indiscreet, or aggressive body-language. She did, however, express her opinion that she had not done anything wrong and that the employer held the agenda of replacing her with a younger, cheaper employee.
The employer has now supplied me with a list of performance issues covering 12 occasions since 7 February 2010 in which she was ‘spoken to’ for various misdemeanours. I have no information about what impact this had on Ms Wretowska, whether she engaged in the performance management process, whether she took appropriate responsibility for her actions, and whether her performance improved following the intervention.
“I would also like to point out that the relationship between Ms Wretowska and her employer objectively appears to be deteriorating, and that, in the event the insurer accepts liability for treatment, this will be a substantial barrier to returning her to her pre-index position that will require attention by her therapists.”
I trust that this report meets your requirements. Please do not hesitate to contact me if you require any further clarification.” (internal quotation marks and spacing as per original)

Dr Stephenson

To understand the relevance of Dr Stephenson’s evidence, set out in her report of 10 April 2012, it is necessary to look in detail at the history she took from Ms Wretowska, which covers several matters not in her statement. Regrettably, this involves some repetition of matters previously mentioned, but is necessary to give the evidence from Dr Stephenson its proper context.
Under “History of Injury”, Dr Stephenson recorded that in early 2011 Mr Carr issued a memo stating that staff would no longer be able to purchase coffee from the coffee shop and that it was available in the upstairs staffroom. As Ms Wretowska preferred the coffee from the coffee shop, she asked Mr Carr why the change had occurred. Dr Stephenson said that a “[c]onfrontation resulted from this inquiry” and, instead of answering Ms Wretowska, Mr Carr walked out. He came back and asked what Ms Wretowska wanted to talk about. Ms Wretowska said there did not seem to be anything to talk about as the decision had been made. From then on, whenever Mr Carr went onto the Club’s floor, Ms Wretowska was criticised.
Ms Wretowska had initially been informed that her role was customer service and it had been normal for her to greet customers. She was told that she was “there to push the chairs, not talk to the customers”. Frequently Ms Wretowska was approached by customers wishing to be served or asking whether or not a promotion was taking place. On one occasion, Mr Carr admonished Ms Wretowska in front of customers, preventing her from responding to a customer. Twenty minutes later, the customer asked why Ms Wretowska had ignored her. Eventually, different supervisors became involved in informing Ms Wretowska not to talk to customers or answer their questions.
On a day when Ms Wretowska was working as a gaming attendant, it was necessary for her to go to the bar and order a drink. She was called to the office and warned she was not allowed to walk into the bar, even if requested by customers. Because of complaints by supervisors, Ms Wretowska received a written warning from Mr Carr that under no circumstances should she walk into the bar. This was a new rule, as for 13 years she had followed the usual practice.
Dr Stephenson noted that Ms Wretowska experienced a problem with the change in uniform. Whereas the previous uniform had long sleeves so that warm clothing could be warn underneath, with a vest on top, the uniform for winter 2011 had short sleeves and no jumpers or arm coverings were allowed in air conditioned areas and outdoor settings, even when it was raining. On the second or third day that Ms Wretowska wore the new uniform on night shift, she wore a long-sleeved shirt. Ms Diebert told her she was not permitted to wear a long sleeve t-shirt or to cover her arms when working.
Ms Wretowska was called to the office and confronted by Mr Carr and Ms Diebert. Ms Wretowska asked why there were different rules for her and other people who wore warm clothes and covered their arms in cold working conditions. Ms Wretowska was told “[w]e are not talking about other people”. Ms Wretowska was called to the office about four times (though it is unclear, the inference is that this was because of the uniform). Ms Wretowska finally became sick, as a result of flu, which she believed was associated with working in cold conditions.
Ms Wretowska had never received warnings from management in her previous 13 years with the Club. She admitted to being “a person who expressed an opinion at times”, but it had never been a problem.
With regard to the meeting on 9 November 2011, staff were informed that the functions operation was to be restructured, requiring waiters to undertake all food and drink services at a “5-star level”. Ms Wretowska said “[w]hy do we want a 5-star service if we don’t have a 5-star clientele?” She told Dr Stephenson that 13 people attended the meeting and everyone was unhappy with what had been discussed, but no one else expressed an opinion. The food services manager said that “[w]e know you are not happy with this procedure. If you are not happy and not prepared to work in this way, be aware that your hours will be cut”.
At the end of the meeting, employees were required to sign up to the procedures and agreement. Ms Wretowska did not sign the agreement. She saw the operations manager and said she was not prepared to work in that way because she had a slipped disc from 10 years ago and she did not believe the Club could provide a five-star service.
After two days’ off, Ms Wretowska worked on 12 November 2011. The history of the events on 12 November 2011 recorded by Dr Stephenson is essentially consistent with the summary previously set out and will not be repeated.
Ms Wretowska told Dr Stephenson that she saw the doctor (Dr Johnson) on Monday, 14 November 2011, and reported she had not slept or eaten for two days. After returning home from seeing the doctor, she found a message on her phone from Ms Diebert. She returned Ms Diebert’s call and was asked if she would be attending work that day. Ms Wretowska said that she had attended the doctor because she had been sick, unable to eat or sleep. Ms Wretowska agreed to attend work the following day.
At the end of the conversation, Ms Diebert told Ms Wretowska to “[b]ring a witness with you, because we are going to discontinue your employment”. Ms Wretowska returned to the doctor (the following day) and was given a certificate for two weeks off work. After two weeks, she saw the doctor (Dr Johnson) again, stating that she was neither eating nor sleeping and had lost five kilograms in weight. Ms Wretowska requested her general practitioner to refer her to a psychologist.
Ms Wretowska told Dr Stephenson that her biggest problem was that she cannot receive a satisfactory written reference from her employer of 14 years.
Dr Stephenson then set out Ms Wretowska’s social, work and family background. She was born in Warsaw, Poland, second in a family of two brothers and two sisters. She came to Australia in 1984, when she was 21. Her first job in Australia was in a factory that manufactured caravans. She lived and worked in Port Hedland in Western Australia for two and a half years before returning to Sydney where she worked in a factory making car brakes. She then worked at North Sydney Leagues Club for 10 years, working in the coffee shops and bistro, and then started with St George Leagues Club.
Under “Symptomatology”, Dr Stephenson noted that “[s]leep impairment has existed since November 2011” with Ms Wretowska experiencing initial insomnia and broken sleep. She had no interest in eating and had lost weight. She was “tense and aggravated, losing her temper easily”. She felt “washed out” and experienced difficulties in concentrating and sustaining thought. Her memory was impaired. She experienced lassitude and had difficulty carrying out simple routine activities such as housework and showering or bathing.
Dr Stephenson said that Ms Wretowska blamed herself to the extent that she believed if she had not expressed her opinions at work, things would not have reached the stage they have.
At the consultation with Dr Stephenson, Ms Wretowska answered appropriately, but with a limited range of vocabulary, taking into account that Polish is the language spoken with close relatives.
Dr Stephenson diagnosed Ms Wretowska as suffering from Major Depression or Adjustment Disorder with Depression but expressed no opinion on causation.

THE ARBITRATOR’S REASONS

The Arbitrator’s decision starts with the heading “Background”. This part of the decision (from [1] to [43]) sets out some of the factual background to the claim, but also records several observations about those matters and about Ms Wretowska. It also sets out the matters leading up to 12 November 2011, as recorded in Dr Stephenson’s report.
While the Arbitrator accepted (at [8]) that Ms Wretowska “speculated” that she may have been “picked on” because she was one of only a few workers on the old award, and the Club was keen to sign people across to a new award, he said the evidence did not extend to support such a conclusion.
The Arbitrator said it seemed that during 2010 and 2011 there were changes introduced at the Club, which affected all staff, and Ms Wretowska did not easily accommodate those changes. He formed the impression that, as a long-standing employee, Ms Wretowska’s responses to changes “were not met with a particularly sympathetic approach” ([16]).
He added (at [17]) that Ms Wretowska had her opinions and attempted to convey them to management and, perhaps, there was a greater concern by management to implement the changes than consideration of Ms Wretowska’s views, which understandably would have led to some conflict. He said it was also understandable that Ms Wretowska would have felt “some distress”, but he did not get the impression that she “could be described as a ‘shrinking violet’”.
After recounting the events on 12 and 14 November 2011, the Arbitrator said that Ms Wretowska was “clearly distressed” by them and saw Dr Johnson. (He did not appear to be aware that Ms Wretowska saw Dr Johnson before the telephone conversation with Ms Diebert on 14 November.)
He noted (at [24]) that it was agreed that, for the purposes of the claim, it was not necessary to embark upon an inquiry as to whether Ms Wretowska had or had not made racial comments, but rather whether the s 11A defence was made out. He set out s 11A and said there was no doubt that Ms Wretowska suffered a psychological injury caused by the actions of her employer.
The Arbitrator set out part of the letter of 15 November 2011 Ms Diebert wrote to Employers Mutual (reproduced at [24] above) and the s 74 notice, which attached three statutory declarations from staff who had been at the function on 12 November 2011. He acknowledged that Ms Wretowska had always denied the allegations and said that “coon” was not a word known to her and not in her vocabulary.
The Arbitrator said that, whether or not the complaints (about Ms Wretowska’s alleged racist statements) were well founded, there was “no doubt that the statements were of a serious nature and if accepted could well have led to [Ms Wretowska’s] dismissal” ([30]). Similarly, he said that Ms Wretowska’s reaction to the Club’s approach would have been “heavily influenced and affected by the events that had occurred over a period of time” ([32]).
Dealing with the telephone call on 14 November 2011, the Arbitrator said (at [35]) that the call would have:
“conveyed to [Ms Wretowska] that she would be required to ‘show cause’ as to why her employment should not be terminated, or indeed, that her employment was likely to be terminated. This understandably would have had a severe impact on [Ms Wretowska].”
He then noted (at [37]) that Ms Wretowska had told Dr Murphy that “[t]hey never gave [her] a chance to explain. They said they wanted to talk about continued employment”. He added (at [38]) the complaint to the doctor that in the last 10 to 12 months she had been picked on on every possible occasion against a background of the Club cutting jobs and Ms Wretowska believing there was an “agenda to force her out”. He noted (at [39]) Dr Murphy’s opinion that the substantial contributing factor to the condition was work related and related to the events of 12 November 2011 and the threat to her employment.
The Arbitrator referred to Dr Murphy’s report of 7 March 2012, in which the doctor said that the performance issues since 7 February 2010 were industrial issues outside his expertise, but the doctor commented that the relationship between Ms Wretowska and the Club appeared to be deteriorating, a comment the Arbitrator thought was made in the context of what had been happening since early 2010.
The Arbitrator recorded (at [41]) that, in cross-examination, Ms Wretowska had agreed that she did not consult her doctor prior to 14 November 2011 concerning any emotional upset or psychological injury. He then set out details of the compensation claimed, the issues in dispute, and the procedure before the Commission, before setting out, from [48] to [60], his “Findings and Reasons”.

The Arbitrator said (at [49]) that, while it was true that the events of 2010 and 2011 leading up to the allegation of the racial comments in November 2011 did not cause Ms Wretowska to seek immediate medical treatment, “they were, nevertheless, significant and impacted on” her. He added that, when Ms Wretowska sought treatment in November 2011, following the racial comments, “it was against a backdrop of these earlier incidents” ([50]).
The Arbitrator said (at [51]) that:
“In the absence of the allegation of racial comments it is likely that [Ms Wretowska] would have avoided suffering an incapacity for work. Nonetheless, it could not be said that the applicant would have suffered a decomposition following the racial comments allegation had it not been for there having been a series of incidents beforehand.”
After acknowledging that the Club bore the onus of establishing that the events surrounding 12 November 2011 were the whole or predominant cause of Ms Wretowska’s injury, the Arbitrator said, at [53] and [54]:
“53. I am not satisfied that the making of allegations of racial comments and the employer’s actions to deal with those were ‘wholly or predominantly’ the cause of the psychological injury given the events which preceded and which, given the histories provided by the applicant to doctors and her psychologist, were significant events which when combined with the events surrounding 12 November 2011, led to her psychological decomposition.
54. Whilst the events concerning the 12 November 2011 allegations may be described as the proximate cause of her incapacity and whilst the events which preceded may not alone have led to psychological injury, when the preceding events were combined with the events in relation to 12 November 2011, psychological injury resulted. ‘Proximate’ does not equate with ‘predominant’ in the context of this case given that the earlier events were clearly significant and combined with the events of 12 November 2011 to cause injury and incapacity (see decision of Roche DP in McCarthy v Department of Corrective Services [2010] NSWWCCPD 27 at [157]).”
Assuming that the events on 12 November 2001 and following were the predominant cause of the injury, the Arbitrator said that the actions of the Club had “not been proven to be reasonable in any event” ([57]). He added, at [58]:
“I say this having regard to [Ms Wretowska’s] long employment which must be weighed in the assessment of what is reasonable action. Here, [Ms Wretowska] was told before a formal meeting involving the Assistant General Manager, that she was suspended and that she was to attend the meeting at which her [sic] not continuing her employment would be discussed, even before a full investigation had been conducted.”
The Arbitrator said that Ms Wretowska “might be forgiven for thinking that her employment was unlikely to be continued notwithstanding her denials and notwithstanding that a full investigation had not been completed” ([59]). He “note[d]” that the statutory declarations from staff members in relation to the allegations all post-dated the scheduled time for Ms Wretowska to attend the meeting and that the letter dated 15 November 2011 from Ms Diebert to Employers Mutual stating that the Club expected the insurer to decline the claim under s 11A was written immediately after Ms Wretowska had faxed a medical certificate of unfitness prior to the scheduled meeting on 15 November 2011. He said it was not enough that the employer regarded its actions as reasonable (Jeffery v Lintipal Pty Ltd [2008] NSWCA 138 (Jeffery)).
With regard to the events preceding 12 November 2011, the Arbitrator said that Ms Wretowska’s clear perception was that she was being “targeted and victimised” ([60]). However, it was not necessary, in terms of Ms Wretowska’s reaction, for those events to have in fact been deliberate victimisation (State Transit Authority (NSW) v Chemler [2007] NSWCA 249; 5 DDCR 286). That the events occurred was not in issue. Ms Wretowska perceived those events as a pattern that culminated in November 2011 when she was told of the meeting to discuss her not continuing her employment with the Club.
Under “Summary”, the Arbitrator concluded, “having regard to all these matters” ([61]), that Ms Wretowska was entitled to weekly compensation as claimed as a result of psychological injury suffered in the employ of the Club. He then set out the awards of compensation and made costs orders.

ISSUES IN DISPUTE

The issues in dispute in the appeal are whether the Arbitrator erred in:
(a)     finding that Ms Wretowska’s psychological injury was not wholly or predominantly caused by the “actions” of the Club on 12 and 14 November 2011 following receipt of complaints from a number of staff that she had made racist comments on 12 November 2011 (causation);
(b)     finding that the Club had not discharged the onus of establishing that its “actions” with respect to discipline on 12 and 14 November 2011 were reasonable (reasonableness), and
(c)     failing to give adequate reasons for the findings referred to in (a) and (b) above.
As the third issue is said to be interrelated with the first two, it is convenient to deal with it as part of those issues.

CAUSATION

Submissions

Though he did not appear at the arbitration, Employers Mutual’s solicitor, Mr Wardell, prepared its submissions on appeal.
He conceded that there had been a number of instances of what the Arbitrator described as “conflict” between Ms Wretowska and the Club prior to 12 November 2011, some of which could be described as instances of discipline or performance appraisal. The issue, however, was whether the relevant actions on the part of the Club with respect to discipline were at least the predominant cause of the psychological injury.
Mr Wardell argued that the evidence overwhelmingly supports the proposition that Ms Wretowska’s psychological injury was predominantly caused by the actions taken by the Club with respect to discipline on 12 and 14 November 2011, regardless of whether the “preceding events” may have contributed to that injury. He said that so much was virtually conceded by the Arbitrator when he said that:
(a)     in the absence of the allegation of racial comments, it was likely that Ms Wretowska would have avoided suffering an incapacity for work ([51]);
(b)     Ms Wretowska was clearly distressed by these events (on 12 and 14 November 2011) and attended her general practitioner on Monday, 14 November 2011 ([21]), and
(c)     communicating to Ms Wretowska that her not continuing to be employed was to be discussed would have had a severe impact on Ms Wretowska ([35]).
Though the Arbitrator added that it could not be said that Ms Wretowska would have suffered a decomposition following the racial comments allegation had it not been for the series of incidents beforehand, Mr Wardell submitted there is no medical evidence to support this statement because no doctor, other than the psychiatrist qualified by the Club, Dr Murphy, addressed causation.
He highlighted the fact that, prior to 12 November 2011, Ms Wretowska had not sought medical treatment for any psychological symptoms and had not had time off work due to such symptoms. Though she may have been angered by the “preceding events” and “conflicts” with the Club, at no stage in any history to any doctor, or in her statement, did she give evidence of being distressed, upset or anxious as a result of those events or conflicts. There was no evidence that Ms Wretowska was distressed prior to 12 November 2011, but clear evidence of distress after the events of 12 and 14 November 2011.
In the absence of evidence that Ms Wretowska was a “time bomb” waiting to happen, the temporal proximity between the disciplinary actions taken by the Club and Ms Wretowska’s sudden and drastic psychological decomposition was a relevant matter to be taken into account when undertaking an inquiry as to the predominant cause of the injury and this was a factor given insufficient weight by the Arbitrator.
In summary, Mr Wardell’s submission was that the evidence overwhelmingly supports the proposition that the predominant cause of her injury was the taking of the relevant disciplinary actions and the Arbitrator was plainly wrong to reach a different conclusion.
While the Arbitrator identified two material contributing factors to the injury: first, Ms Wretowska’s perception that the events preceding 12 November 2011 constituted harassment and, second, the events on and after that date, he failed to identify the evidence to support his view that the preceding events were significant and failed to explain the respects in which they were significant. He also failed to explain why the Club had not discharged the onus of establishing why the events on 12 and 14 November 2011 were not the predominant cause of the injury. He said that the Arbitrator had to “consider and determine which of the causative factors identified by him could be regarded as the predominant cause”.
Mr Morgan, of counsel, appeared for Ms Wretowska at the arbitration and on appeal. He referred to Ms Wretowska’s evidence of conflict with several supervisors prior to 12 November 2011. He submitted that the evidence from Ms Wong detailed “a multifactorial basis for the symptoms complained of rather than discrete events as submitted by” the Club.
He argued that, while Dr Murphy said the injury related to the events of 12 November 2011, the doctor did not say that it was wholly or predominantly related to the events of 12 November 2011 or 14 November 2011, in concert, or isolation. This analysis was reinforced when looked at in the context of the reference to anxiety arising out of ongoing financial security and employment prospects if the Club proceeded with disciplinary action.
Mr Morgan highlighted that, in his report of 7 March 2012, Dr Murphy confirmed that the psychiatric condition was substantially caused by:
(a)     distress about being performance managed;
(b)     mistrust of Ms Wretowska’s employer, and
(c)     anxiety about ongoing employment prospects.
The doctor referred to the issue being an industrial one and recommended that an expert review the Club’s policy, skills and delivery of performance management.
Mr Morgan referred to the history recorded by Dr Stephenson of workplace conflict, but conceded that the doctor made no specific observation about the whole or predominant cause of Ms Wretowska decompensating. However, given the detailed history Dr Stephenson took of events leading up to “the incident in question”, and the reference to the discontinuation of Ms Wretowska’s employment, Dr Stephenson “no doubt place[d] considerable significance on their role in the development of the condition”.
Mr Morgan argued that the Club’s submissions on the causation issue were hamstrung by its own failure to have relevant medical evidence on this critical point. He said that Dr Stephenson’s evidence was “to the contrary” and, in any event, the Club has the onus.
On the question of whether Ms Wretowska had ever been upset over work events prior to 12 November 2011, Mr Morgan referred to an entry in Dr Johnson’s notes on 24 May 2011, which recorded that Ms Wretowska had a problem at work “with her dressing” and that she spoke to the union and needed a letter. He said that the Club called no evidence from staff with respect to Ms Wretowska’s evidence about conflicts at work in the months leading up to 12 November 2011.
Mr Morgan challenged, as being unsupported by medical evidence, Mr Wardell’s assertion that there was a clear temporal proximity between the disciplinary actions taken by the Club and Ms Wretowska’s sudden decomposition. Mr Morgan’s main point was that the Club’s case on causation was “without … appropriate medical evidence”.
Dealing with the alleged failure to give reasons, Mr Morgan said the Arbitrator was “rather hamstrung in his analysis”, noting that the Club did not rely on statements from co-workers or relevant decision makers describing the actions they took and setting out their reasons. If the Club is to establish that the actions were reasonable and that they were the whole and predominant cause of the injury, evidence to that effect ought to have been called. To then attack the lack of reasons on the Arbitrator’s part was disingenuous. Ms Wretowska’s oral evidence provided a more than adequate basis for the Arbitrator to make the findings detailed in his reasons.

Discussion

It is accepted that the Club carries the onus of establishing that the injury was wholly or predominantly caused by the relevant actions by the Club with respect to discipline and that those actions were reasonable (Department of Education and Training v Sinclair [2005] NSWCA 465; (2005) 4 DDCR 206 at [18] (Sinclair); Commissioner of Police v Minahan [2003] NSWCA 239 at [25]; 1 DDCR 57 (Minahan)). The relevant actions the Club relied on were the suspension on 12 November 2011 and the telephone call on 14 November 2011.
It is also accepted that the meaning of “predominantly caused” is “mainly or principally caused” (Ponnan v George Weston Foods Ltd [2007] NSWWCCPD 92 at [24]).
The test of causation in workers compensation matters is the commonsense test, not the proximate cause test or the but for test (Kooragang Cement Pty Ltd v Bates (1994) 35 NSWLR 452; 10 NSWCCR 796). Scientific certainty is not required, but the decision maker must feel actual persuasion of the occurrence or existence of the fact in issue before it can be found (Redlich JA, Harper JA and Curtain AJA in N O M v DPP [2012] VSCA 198 at [124]). In the present case, the Arbitrator was not satisfied that the events on 12 and 14 November 2011 were the whole or predominant cause of Ms Wretowska’s psychological injury.
Contrary to Mr Wardell’s submission, I do not accept that the Arbitrator “virtually conceded” that Ms Wretowska’s injury was predominantly caused by the events on 12 and 14 November 2011. The Arbitrator’s statement that, in the absence of the allegation of racial comments, it was likely that Ms Wretowska would have avoided any incapacity for work was merely an acknowledgment that those events were important and, as he later said, may well have been the proximate cause of the incapacity. However, that did not determine the question of causation under s 11A.
It is trite law that a condition can have multiple causes (ACQ Pty Ltd v Cook [2009] HCA 28 at [25] and [27]). That is especially so in cases concerning a psychological injury where, in many cases, multiple events over a long period have contributed to the injury. Just because Ms Wretowska stopped work after the events of 12 and 14 November 2011, and did not have time off work before that time and did not seek treatment for emotional conditions until 14 November 2011, does not mean that those events were the whole or predominant cause of her injury. It is necessary to look at the whole of the conduct alleged to have caused the injury and to consider the evidence in light of that conduct.
Similarly, the Arbitrator’s statements that Ms Wretowska was distressed by the events on 12 and 14 November 2011, and that the conversation on 14 November 2011 had a severe impact on her, did not amount to a concession by him that those events were the predominant cause of the injury. Those statements were no more than a recognition that the events on 12 and 14 November 2011 were important and were considered as part of the Arbitrator’s overall evaluation of the evidence.
While it is correct that there is no direct expert evidence that Ms Wretowska would not have suffered a decomposition following the racial comments allegation had it not been for the incidents before 12 November 2011, that is not the correct test of causation and, in any event, the medical evidence has to be viewed in the context of the histories recorded.
Dr Johnson’s evidence is of limited assistance, but he did record, among other things, that Ms Wretowska’s anxiety state had been caused by workplace “harassment and bullying over a period of time”. This was consistent with Ms Wretowska’s complaints to Ms Wong that her symptoms were a “direct result of bullying at work by managers” and with Dr Murphy’s history that the Club had not been treating her fairly and had “picked on her on” every possible occasion.
Dr Stephenson’s “History of Injury” contains a detailed history from Ms Wretowska of the following matters: a “confrontation” (with Mr Carr); a written warning from Mr Carr that Ms Wretowska was not to walk into the bar; Ms Wretowska being admonished by Mr Carr, in front of customers, and prevented from responding to customer enquiries; a “problem” with the new uniform (which Ms Wretowska believed demonstrated that there were different rules for her compared to other staff); Ms Wretowska refusing to sign a new procedures agreement; and the events on 12 and 14 November 2011. All these matters occurred after many years of service without adverse notice prior to late 2010 or early 2011.
It was against this “History of Injury” that Dr Stephenson diagnosed Ms Wretowska to suffer from Major Depression or an Adjustment Disorder with Depression. Dr Stephenson then dealt with prognosis and the psychiatric impairment scale. It seems acceptably clear that Dr Stephenson was not asked to comment on causation. That was no doubt because Employers Mutual conceded that Ms Wretowska’s injury had been caused by her employment and it was not necessary for Ms Wretowska to prove the cause of her condition or to prove the matters in s 11A. However, it is equally clear that, in reaching her conclusion on diagnosis, Dr Stephenson took into account the full history she recorded, which included many incidents of conflict and friction between Ms Wretowska and the Club’s management in the months before 12 November 2011.
Ms Wong’s history that Ms Wretowska experienced anxiety and depressive symptoms “as a direct result of bullying at work by managers” is a compelling indication that all of the events Ms Wretowska complained of to the medical experts played a part in causing her injury.
It follows, from the above analysis, that the medical experts all took histories of significant conflict over an extended period prior to 12 November 2011 and it was open to the Arbitrator to conclude that Ms Wretowska would not have decompensated had it not been for that conflict. In other words, the conflicts in the months up to November 2011 were matters that clearly, based on the medical histories, and as a matter of commonsense, played an important role in the development of Ms Wretowska’s injury.
These histories were consistent with Ms Wretowska’s oral evidence at the arbitration where, when asked about “deliberate attempts to embarrass her”, she said, at T9.31 – 15 May 2013:
“A. I was not allowed to talk to the customers, for example. I had a manager come up to me and told me that I am not allowed to talk to the customers when that was basically my job, to be that. And I also being told that I’m not allowed to talk to them, just have to push the chairs, to do my job. And I was regularly chased by Mr Garry Carr, doesn’t matter what circumstances, he was looking what I’m doing and normal things we were allowed to be done, all of a sudden I was not allowed to do it.”
Ms Wretowska said the process of harassment, especially by Gary Carr, had gone on for about 10 months before November 2011. The direction not to talk to customers, which has not been challenged by the Club, was clearly significant to Ms Wretowska because a lot of the customers were also her friends and there were a lot of elderly people at the Club who needed help (T10.13-21 – 15 May 2013).
Thus, the evidence was clear and unchallenged that significant events occurred prior to November 2011 that troubled Ms Wretowska. The submission that there is no evidence that Ms Wretowska had ever been distressed or upset as a result of the incidents prior to November 2011 is incorrect. The whole thrust of Ms Wretowska’s complaints to Drs Stephenson, Johnson, Murphy and Ms Wong was that she suffered symptoms of anxiety and depression because of her treatment by the Club’s management over several months up to and including 12 and 14 November 2011.

While it is accepted that Ms Wretowska did not seek medical treatment for psychological symptoms before 14 November 2011, that is not determinative of the causation issue in dispute in this case. She did see Dr Johnson on 24 May 2011 because of a “prob[lem]” at work with her “dressing”, which she apparently believed had caused her flu like symptoms at that time. The attendance on Dr Johnson was consistent with Ms Wretowska’s evidence that the uniform issue was a problem for her and that she had been “picked on” and treated unfairly and unequally compared to other members of staff. It clearly affected her sufficiently to prompt her to seek assistance from Dr Johnson.
While the temporal proximity between the events on 12 and 14 November and Ms Wretowska’s attendance on Dr Johnson on 14 November 2011 was important, and was considered by the Arbitrator, it was not the only matter to consider and, in light of the medical histories, was not determinative. I do not accept that the Arbitrator gave that matter insufficient weight.
I do not accept Mr Wardell’s submission that the evidence overwhelmingly supports the proposition that the predominant cause of Ms Wretowska’s injury was the disciplinary action. This submission has ignored two critical things: first, the Club carries the onus of proof and, second, the Club failed to call evidence directed to the whole or predominant cause.
The Club relied heavily, but not exclusively, on the evidence from Dr Murphy. Though Dr Murphy’s history of the events preceding 12 November 2011 was not as detailed as Dr Stephenson’s, he recorded that, consistent with Dr Stephenson’s history, Ms Wretowska said she had been picked on on every possible occasion for doing the wrong thing and that she felt that she had been “unfairly targeted by her employer”.
While Dr Murphy recorded that Ms Wretowska experienced significant distress about the disciplinary matter “in particular”, he did not suggest that the earlier events played no role in the development of her condition. Indeed, he expressly acknowledged that Ms Wretowska’s mistrust of the Club and her sense of being picked on unfairly, for being outspoken, were barriers to her returning to work. Thus, the earlier events were clearly significant factors.
What is more important, however, is that Dr Murphy was never asked to comment on causation in the terms of s 11A. Instead, Employers Mutual’s case manager asked Dr Murphy’s opinion on whether employment was a “substantial contributing factor” (s 9A) to Ms Wretowska’s psychological condition. That is an entirely different question to whether actions taken with respect to discipline were the whole or predominant cause of the injury.
As it is well accepted that an injury can have more than one substantial contributing factor, the doctor’s answer that the substantial contributing factor to Ms Wretowska’s psychological condition was work related, and related to the events of 12 November 2011, was an acknowledgment that those events satisfied the test in s 9A, but did not address the test of whole or predominant cause in s 11A.
When one considers Dr Murphy’s observations under “Current Psychiatric Symptoms & Functioning”, where he recorded that Ms Wretowska displayed “significant anxious ruminations about her continued employment prospects” and a “sense of bitterness and injustice about the way she has been treated by her employer, especially a Mr Gary Carr, whom she believes has a personal agenda to force her out of her current employment”, it is clear that a combination of factors caused the injury.
Ms Wretowska’s statements that she did not trust the Club to treat her fairly and that they were “just looking for another reason to frame me” reinforces this conclusion. That distrust did not arise wholly or predominantly from the events on 12 and 14 November 2011, but arose from the several events over the preceding months, as recounted by Dr Stephenson and Ms Wong.
There is a further, more compelling, reason for reaching this conclusion. In response to a request from Employers Mutual, Dr Murphy provided a supplementary report in which he commented further on causation (see [49] above). Though that further report has inappropriately placed quotation marks, its meaning is clear. Dr Murphy attributed Ms Wretowska’s injury to:
(a)     distress about being performance managed;
(b)     mistrust of the Club, and
(c)     anxiety about her ongoing employment prospects.
I firmly reject Mr Wardell’s submission that the quotation marks in this report indicate that Dr Murphy was reproducing part of the letter from Employers Mutual and that his opinion is only found in the passages starting with the words “I see this as”. In a letter intended to seek Dr Murphy’s “further comments regarding [Ms Wretowska]”, it is untenable to suggest that the author of that letter, a case manager with Employers Mutual, wrote the words in the paragraph starting “[b]ased on the information before me, I am of the opinion that”. Those words were written by Dr Murphy and make it clear that he was providing his opinion on causation and that his opinion was that several factors contributed to the injury.
At the arbitration, Mr Morgan referred to and relied on Dr Murphy’s second report as giving “three elements as being contributory to [Ms Wretowska’s] presentation” (T28.25 – 1 July 2013). In reply, counsel for the Club did not challenge that submission on the ground put by Mr Wardell on appeal, but merely said (at T34.10 – 1 July 2013) that Dr Murphy’s comment on the reasonableness of the Club’s actions was not within the doctor’s expertise. That submission was appropriate and was not disputed on appeal, but does not assist on the issue now argued by Mr Wardell.
The issue on appeal is an entirely new point, namely, that the opinions in the second paragraph of Dr Murphy’s second report are not his but are those of the claims officer from Employers Mutual. That suggestion is, as I have already said, untenable. In any event, as it was not a point raised at the arbitration, when any uncertainty about the report could have been clarified by tendering the letter from Employers Mutual, it is not a point that can be raised on appeal in the way that Mr Wardell has sought to do (Metwally v University of Wollongong (No 2) [1985] HCA 28; 60 ALR 68; 59 ALJR 481).
I have not overlooked Mr Wardell’s submission that Ms Wretowska did not stop eating and sleeping until after 12 November 2011. That only goes to the manifestation of the symptoms of her condition and, though relevant, is not determinative of the whole or predominant cause of the condition.
I do not accept Mr Wardell’s submission that the Arbitrator had to consider and determine which of the causative factors identified by him could be regarded as the predominant cause. He had to determine whether the actions relied on by the Club with respect to discipline were the whole or predominant cause of the injury. He considered that question and was not satisfied on that issue. That conclusion was open and disclosed no error.
It follows that the Arbitrator was well justified, and did not err, in concluding that the Club had not discharged the onus it carried on the issue of the whole or predominant cause of the injury. His reasons for not being satisfied were clearly stated, namely, the events that preceded 12 November 2011, which, given the medical histories, were significant events that, when combined with the events on 12 and 14 November 2011, led to Ms Wretowska’s psychological decomposition.
The Arbitrator’s reasons were supported by the histories recorded by the medical experts, as reviewed above, and provided an explanation of the basis for his conclusion. They satisfied his obligation to give reasons (Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 280). If the Arbitrator erred in failing to give adequate reasons, and I were to re-determine the mater, noting that the parties consented to that course if the appeal was successful, I would, for the reasons explained above, reach the same conclusion.
In light of this finding, it is not necessary to consider the reasonableness issue. However, if I am wrong on the causation issue, and the injury was wholly or predominantly caused by the actions taken on 12 and 14 November 2011, it is appropriate that I also deal with whether the actions were reasonable.

REASONABLENESS

Submissions

Mr Wardell submitted that, given the seriousness of the allegations, which were made by three staff members who were upset and “visibly angry”, and given the fact that Ms Wretowska had denied the allegations and was presumably also upset, the only possible conclusion is that the suspension was reasonable and was undertaken in a reasonable way (Northern NSW Local Health Network v Heggie [2013] NSWCA 255 (Heggie)).
Mr Wardell argued that it was sufficient, to establish the reasonableness of the suspension, for the Club to establish that three members of staff had reported that Ms Wretowska had made racist comments, that the supervisors had confirmed that those allegations had been made, and had sought Ms Wretowska’s response. It was also relevant that the suspension was not intended to be long term or indefinite.
In respect of the phone call on 14 November 2011, Mr Wardell said that the Arbitrator accepted that, if it were accepted that Ms Wretowska made the comments alleged, it could well have led to her dismissal. If it was reasonable for the Club to have considered dismissal as an option, it can hardly, so it was argued, be unreasonable for it to have provided Ms Wretowska with advance warning that that was the case. It was relevant that Ms Diebert advised Ms Wretowska that she had the right to bring a witness and took steps to deal with the situation expeditiously.
The Arbitrator’s approach appears to have been “infected” by an impermissible inference that the employer had resolved to terminate Ms Wretowska’s employment without undertaking a “full investigation”. Mr Wardell made three points on this issue: first, it was inappropriate to determine reasonableness by reference to events that occurred after the actions were taken, second, an investigation had already been carried out on 12 November 2011, and, third, the Arbitrator failed to identify the respects in which the investigation on 12 November 2011 was incomplete or deficient.
It was submitted that, the Arbitrator took irrelevant matters into account or failed to give appropriate weight to other matters. They were:
(a)     the Arbitrator took into account Ms Wretowska’s “long employment” but made no reference to the need to weigh this against the seriousness of the allegations made and the possible consequences. This “clearly suggests a distortion of the reasoning process”;
(b)     the Arbitrator took into account that Ms Wretowska “might be forgiven for thinking that her employment was unlikely to be continued notwithstanding her denials and notwithstanding that a full investigation had not been completed”, which invited impermissible speculation about what may or may not have occurred after the relevant actions under consideration had taken place;
(c)     Ms Wretowska’s subjective impression is of limited relevance when the inquiry involves an objective assessment of the reasonableness of the actions taken;
(d)     the Arbitrator observed that the statutory declarations from staff did not come into existence until after the proposed meeting was to take place and he arguably fell into error of law in taking them into account;
(e)     the Arbitrator took into account the letter of 15 November 2011 from the Club to Employers Mutual and it was an error of law to take it into account as it related to events which occurred after the relevant action under consideration, and
(f)      the Arbitrator failed to take into account matters which would support a conclusion that the Club’s actions were reasonable, namely, that the actions were serious and could warrant dismissal, that she was suspended for a short period pending a meeting suggests a serious flaw in his reasoning process.
Mr Wardell also submitted that the Arbitrator failed to give “sufficient reasons” on this issue and failed to identify the basis upon which it was concluded that the relatively uncontroversial facts were not sufficient to discharge the onus particularly in light of the finding that the complaints that Ms Wretowska had made racist comments “were of a serious nature and if accepted could well have led to [Ms Wretowska’s] dismissal”.

Discussion

A preliminary point must be noted. As this is an appeal under s 352 of the Workplace Injury Management and Workers Compensation Act 1998, it is necessary for the Club to establish that the Arbitrator’s decision is affected by an error 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 (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.”
Sackville AJA (Ward JA agreeing) quoted the above passage, with apparent approval, at [71] in Heggie and added that Allsop J’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”. His Honour added, at [72]:
“A fortiori, if a statutory right of appeal requires a demonstration that the decision appealed against was affected by error, the appellate tribunal is not entitled to interfere with the decision on the ground that it thinks that a different outcome is preferable: see Norbis v Norbis [1986] HCA 17; 161 CLR 513, at 518-519, per Mason and Deane JJ.”
Consistent with this statement, Spigelman CJ observed in Vines v Australian Securities and Investment Commission [2007] NSWCA 126 (at [8]):
“8 Where, as here, the relevant statutory test turns on whether or not the Court is ‘satisfied’ of a matter involving a broad evaluative judgment, then the case law indicates that the degree of restraint which an appellate court should manifest is of the same order as that applicable to a discretion, in the strict sense of that word. (See Norbis v Norbis (1986) 161 CLR 513 esp at 517-518, 540; Singer v Berghouse (1994) 181 CLR 201 esp at 210-212; Coal and Allied Operations Pty Limited v Australian Industrial Relations Commission (2000) 203 CLR 194 esp at [19], [27], [32]; Russo v Aiello (2003) 215 CLR 643 at [27]; Director of Public Prosecutions v El Mawas (2006) 66 NSWLR 93; (2006) NSWCA 154; at [3]-[4] and [64]-[70].) A statutory provision expressed in terms of whether a decision maker is ‘satisfied’ of a particular matter is accurately characterised as conferring ‘a very wide discretion’. (See Buck v Bavone (1976) 135 CLR 110 at 119.)”
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):
“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.”
And by Truss CCJ in Ivanisevic v Laudet Pty Limited (unreported, Compensation Court of NSW, Truss CCJ, 24 November 1998):
“In my view when considering the concept of reasonable action the Court is required to have regard not only to the end result but to the manner in which it was effected.”
Both of the above passages were quoted and approved by Foster AJA (Sheller and Santow JJA agreeing) in Minahan.
I intend to approach the alleged error on the reasonableness issue by reference to the above principles.
I do not accept that the only possible view open to the Arbitrator was that the suspension was reasonable. Mr Wardell’s reliance on Heggie to support this submission was misplaced. In that case, the employer had received a written complaint that Mr Heggie had been “verbally and physically aggressive towards” a patient and had pushed the patient’s fist into her mouth causing it to bleed. Mr Heggie submitted a report about the incident, which said that the patient had attempted to bite him and struggled as he and other staff attempted to control her.
The next day, police attended the hospital in response to a report of an assault the previous evening. In addition, the nurse manager decided to formally investigate the alleged aggressive incident and to stand Mr Heggie down pending the completion of the investigation. Mr Heggie was informed by letter, hand delivered to him on 7 June 2009, that serious allegations had been made against him and that he was suspended on full pay.
In considering the reasonableness of the decision to suspend Mr Heggie, and initiate an inquiry into the allegations, Sackville AJA noted, as the Arbitrator had pointed out, that the decision to suspend “was made in conformity with” the hospital’s applicable Policy Directive, which provided that, “if at any point in the assessment of an allegation there is a reasonable belief that a serious violence offence may have occurred, the employee should be suspended immediately” ([162], emphasis included in original). While compliance with the Policy Directive was not determinative of the objective reasonableness of the hospital’s actions, it was “a highly relevant consideration” ([162]).
In the present case, the alleged racial comments do not come close to the kind of conduct involved in Heggie. Further, there was no “Policy Directive”, or equivalent, that required the Club’s staff to be suspended in the event of such allegations being made. It follows that it is untenable to say that the only possible conclusion is that the suspension was reasonable.
Before dealing further with Mr Wardell’s submissions, it is appropriate to look again at the Arbitrator’s reasons on this issue. Those reasons were stated at [58]. Essentially, he gave three reasons for his conclusion on the reasonableness issue:
(a)     Ms Wretowska’s long employment (with the Club) had to be weighed in the assessment of what was reasonable action (and the Club did not do that);
(b)     Ms Wretowska was told before the formal meeting involving the assistant general manager (Mr Derrig) that she was suspended, and
(c)     that Ms Wretowska was to attend the meeting at which her not continuing her employment would be discussed, before a full investigation had been conducted.
The Arbitrator added, in the first sentence at [59], that Ms Wretowska might be forgiven for thinking that her employment was unlikely to be continued notwithstanding her denials and notwithstanding that a full investigation had not been completed.
The Arbitrator then “note[d]” two things in the second sentence at [59]: first, that the statutory declarations from staff members in relation to the allegations all post-dated the scheduled time for Ms Wretowska to attend the meeting, and, second, the letter of 15 November 2011 from Ms Diebert to Employers Mutual was written immediately after Ms Wretowska had faxed a medical certificate of unfitness prior to the scheduled meeting on 15 November 2011.
In the third sentence at [59], the Arbitrator said that it was not enough that the employer regarded its actions as reasonable (Jeffery).

While the Arbitrator would have erred in determining reasonableness by reference to events that occurred after the actions were taken (Heggie at [61]), I do not believe that is what he did. The Arbitrator considered the length of service, and other matters, as they were on 14 November 2011. The length of Ms Wretowska’s service with the Club was a fact known at the time of the actions concerned and there is no evidence that the Club considered that matter when it decided to suspend her. That was a factor the Arbitrator was entitled to take into account in determining the reasonableness of the Club’s actions.
Mr Wardell’s submissions about paragraph [59] of the decision seem to relate mainly to the Arbitrator’s comments in the second sentence of that paragraph. However, there are two possible interpretations of that sentence. The first is that the Arbitrator merely “note[d]” certain matters that were not in dispute and placed no particular weight on them. That is, as Mr Morgan submitted, these comments were merely obiter and not an essential part of the Arbitrator’s reasons.
The alternative (and preferred) interpretation is that the Arbitrator’s reference to when the statutory declarations were obtained was a reference to the fact that, as at 14 November 2011, the investigations had not been completed and yet the Club was going to discuss not continuing Ms Wretowska’s employment.
If the Arbitrator regarded the obtaining of the statutory declarations as part of the investigation process into Ms Wretowska’s conduct on 12 November 2011, he erred. The evidence from Ms Diebert establishes that the statutory declarations were obtained for the purpose of “gathering information” to defend an anticipated claim for compensation, not as part of an investigation into the events on 12 November 2011.
However, this error is of no consequence because the reason the statements were later obtained is irrelevant to the issue to which the Arbitrator directed his attention, namely, whether, at the time Ms Deibert rang Ms Wretowska, a “full investigation” had been conducted. That is because it was open to the Arbitrator to regard the investigation as incomplete, as he clearly did, in the absence of any signed statements. It was clearly unfair to force an employee to show cause why his or her employment should not be terminated before a full inquiry into the circumstances surrounding the matter of concern.
At a minimum, in a matter of this kind, where the worker denied making any inappropriate comments, and at least one potential witness (the co-ordinator at the function on 12 November 2011) did not hear any such statements, that required a full investigation and the taking of detailed statements setting out not only what was allegedly said but also the context and manner in which it was said.
Nothing in the Arbitrator’s approach was inconsistent with Heggie. The Arbitrator did not determine reasonableness by reference to events after 14 November 2011, but merely considered that it was not reasonable to discuss not continuing Ms Wretowska’s employment when the Club had not conducted a “full investigation”.
As to the third sentence at [59], the Arbitrator merely recorded that the test of reasonableness is an objective one (Jeffrey). It followed that the Club’s belief as to the reasonableness of its conduct, as may have been expressed in the letter of 15 November 2011, was irrelevant. That observation was clearly correct, but played no part in the Arbitrator’s determination on the reasonableness issue.
It follows that, whether the comments in the second and third sentences at [59] were obiter, or were part of the Arbitrator’s essential reasons, his reference to the statutory declarations and the letter of 15 November 2011 involved no error that has affected the result. The Arbitrator was entitled to consider that the investigation was incomplete and that, in those circumstances, Ms Diebert’s comments in the telephone conversation on 14 November 2011 were not reasonable.
The Arbitrator was also entitled, in making an evaluative judgment of the kind involved in this case, to conclude that the suspension was not reasonable because the Club did not take into account Ms Wretowska’s long period of employment and suspended her before a formal meeting with senior management. While there may have been other matters the Arbitrator could have considered on this issue, there is no compulsory checklist that an Arbitrator must complete before reaching a conclusion on reasonableness.
It is correct that, while the Arbitrator noted that the matter was serious, he did not refer to the short period of the suspension pending a meeting being held. However, I do not believe that that omission was such that, but for it, a different result would have followed. The shortness of the period of suspension was not decisive, especially if the decision to suspend was not reasonable. For reasons stated, the Arbitrator was not satisfied that the suspension was reasonable. That finding was open to him and disclosed no error.
One would have thought that, weighing Ms Wretowska’s rights against the Club’s objectives, a reasonable (fair) approach on 12 November 2011, given the conflicting accounts, would have been to caution Ms Wretowska against the use of racially insensitive language (noting her denials) and to arrange a meeting where the issues could be more fully discussed and, if necessary, counselling arranged. Instead, the Club peremptorily suspended Ms Wretowska. Viewing the matter objectively, given that there was no issue of patient (or, in this case, staff or guest) safety involved, or any policy directive that required Ms Wretowska to be suspended, as there was in Heggie, that was not reasonable. (I have assumed, though there was no direct evidence on it, that the Club’s objectives were to provide a harmonious workplace free of racially insensitive or inappropriate comments that staff may find offensive.)
As to the Arbitrator’s reference (in the first sentence at [59]) to Ms Wretowska being told that she was to attend a meeting at which her not continuing to be employed would be discussed, though a full investigation had not been conducted, this was, as already noted, an appropriate matter for the Arbitrator to consider. The submission that an investigation had already been carried out on 12 November 2011 misses the point.
It is true that Mr Heard had spoken to four potential witnesses on 12 November 2011, and to Ms Wretowska. However, it cannot be seriously suggested that that investigation was anything like exhaustive or “full”. It did not obtain any detail of the surrounding circumstances in which Ms Wretowska allegedly made the comments attributed to her, the tone that was used, or the general context of the comments (other than noting that Aborigines were present at the Club and that the comments were alleged to have been made in one of the Club’s kitchens).
I would have thought that, as a matter of basic fairness, the Club would have investigated these matters, and obtained signed statements, before telling an employee of long standing, who had not previously come under adverse notice for matters of this kind, that she was to attend a meeting with senior management to discuss not continuing her employment. In this context, the Arbitrator’s reference to the absence of a full investigation was a matter he was entitled to consider in determining reasonableness.
It is true that the Arbitrator did not explicitly elucidate why it was that the investigation on 12 November 2011 was incomplete. It is doubtful that he had to. He had to explain the basis for his conclusion and he did that. Nevertheless, as explained above, the clear and compelling inference is that he thought the investigation had not been completed because no statements had been obtained and that that should have been done before suspending Ms Wretowska and before telling her that not continuing her employment was to be discussed.
I reject the submission that the Arbitrator took into account irrelevant matters or failed to give sufficient weight to other matters. This really amounts to a complaint that the Arbitrator did not accept the Club’s position. He did not have to. Ms Wretowska’s long employment with the Club was a matter the Arbitrator was entitled to take into account, as was the absence of a full investigation.
I do not accept that the Arbitrator did not weigh the length of Ms Wretowska’s employment with the seriousness of the allegations and the possible consequences. He acknowledged that the matter was serious and that it “could” well have led to Ms Wretowska’s dismissal (it is important to note that the Arbitrator did not say that the incident would have or should have led to her dismissal). Despite those matters, he concluded that the actions were not reasonable. In making an evaluative judgment about the reasonableness of the actions, exactly what more he was expected to say to “weigh” those matters is unclear.
The Arbitrator did not impermissibly speculate about what may or may not have occurred after the relevant actions had taken place. His reference to Ms Wretowska being forgiven for thinking that her employment was unlikely to be continued was a reference to her evidence that she believed, from the conversation with Ms Diebert on 14 November 2011, that she had been sacked. That evidence starts at T14.5 – 15 May 2013:
“Q. Yes. Did she say that you would be discussing not continuing your employment?
A. Yes.
Q. So there was - just going back - so that the statement made over the telephone that that was going to be a discussion but your employment was not actually terminated over the phone. That’s correct isn’t it?
A. No, she told me that I won’t have a - I mean she told me that I’m not going to work anymore for St George.
Q. Well they weren’t the words that you referred to just a few - a couple of minutes ago.
A. Yeah but
Q. You said she said you’re going to talk about
A. No she make a statement. She didn't actually - she didn’t actually let me speak, she just - she just say what’s going to happen, that's how the conversation
ARBITRATOR: Well what did she say? As best as you can recall, what were the words that she used? What did she say to you?
MS WRETOWSKA: She just said, well first of all I said I’m not feeling well and I didn’t want to come. She said to me, can you come this time? And I said, I’m not well. She said, you have to come and see us. What time you can make - ah, come? And I said, look I’m not feeling well. She goes, what time you’re going to be there tomorrow? So I said, three o’clock. She goes, no four o’clock. And then she said to me basically you can bring the witness. What we’re going to talk to discontinue your employment.”
That Ms Wretowska held this view is confirmed by the history Ms Wong took on 14 December 2011 that Ms Wretowska had been told over the phone that she had been “fired” and by Dr Stephenson’s history that Ms Wretowska was told to bring a witness because “we are going to discontinue your employment”. This evidence well justified the Arbitrator’s conclusion that, as a result of the conversation with Ms Diebert, Ms Wretowska thought that her employment was unlikely to be continued.
Whether Ms Diebert said the meeting was to discuss “not continuing [Ms Wretowska’s] employment” or to “discontinue [Ms Wretowska’s] employment”, the very clear impression, objectively conveyed by the words used by Ms Diebert, was that Ms Wretowska’s fate had effectively been determined and that she was required to show cause why her employment should not be terminated because of something that she strongly denied doing.
While I agree that Ms Wretowska’s subjective impression is not relevant to the question of reasonableness, viewing objectively the words used by Ms Diebert, the impression they conveyed was that, as the Arbitrator found, Ms Wretowska had to show cause why her employment should not be terminated. That was not reasonable because it assumed that Ms Wretowska was guilty of conduct that justified her dismissal unless she could prove otherwise. Moreover, the Arbitrator did not speculate about what may or may not have occurred after the conversation. He correctly assessed the reasonableness of the words used in the context of the situation on 14 November 2011.
Given that the Club had already suspended Ms Wretowska, a reasonable approach might have been to arrange a meeting to discuss the events of 12 November 2011 and to point out that, if she disputed the allegations, she should bring a witness to those events. Ms Diebert did none of those things. The invitation to bring a witness was directed to having a witness present at the proposed meeting. It is unclear how that would have assisted Ms Wretowska in defending the allegations against her, which she strongly denied.
Contrary to Mr Wardell’s (surprising) submission, Ms Diebert did not say to Ms Wretowska that the meeting was to discuss the allegations against her and the possible termination of her employment. She said the meeting was for one reason only: to discuss not continuing Ms Wretowska’s employment. Viewing the matter objectively, that was not reasonable and the Arbitrator was well justified in reaching that conclusion.
In all the circumstances, I am not satisfied that, in reaching a conclusion on an “evaluative judgment such as the reasonableness of actions by an employer with respect to discipline” (Heggie at [71]), the Arbitrator erred in his approach or his conclusion.
I am fortified in this view by a number of factors that the Arbitrator did not refer to, but which were fully canvased at the oral hearing of the appeal in the event that the appeal was upheld and the matter re-determined by me, a course that the parties consented to.
Those matters relate to the Club’s previous handling of disciplinary matters involving Ms Wretowska. The evidence is that the Club appears to have adopted the following graduated or progressive procedure: the duty manager spoke to Ms Wretowska and provided counselling; if considered necessary, an Employee Issue Report or a Counselling And/Or Discipline Record was prepared noting whether remedial coaching or training was necessary and if there were any outstanding issues relating to the report; if necessary, a formal warning letter would be issued (and had been issued to Ms Wretowska on 29 December 2010 over unrelated matters) providing full details of the problem, advising what was expected, and stating that any further breaches of any Club rule may result in the termination of employment.
This procedure was essentially consistent with the “progressive” approach set out in the December 2011 version of the Club’s Employee Handbook in evidence. I note, however, though it is not critical to the outcome, that there is no evidence of the Employee Handbook that applied in November 2011.
None of the steps listed at [186] above were followed on 12 and 14 November 2011. The Club suspended Ms Wretowska without counselling or warning and gave her no written notice of the complaint against her. She was then directed to attend a meeting at which not continuing her employment was the only topic for discussion.
I do not accept Mr Wardell’s submission (unsupported by any evidence) that the seriousness of the matter justified a departure from the usual protocols for dealing with disciplinary matters. As I have already noted, unlike Heggie, there was no issue of personal safety or assault involved, and no issue of potential interference with witnesses. In saying that, I have not overlooked the evidence that one of the complainants is of African descent and another of Pacific Islander descent and that they were both angered and upset by Ms Wretowska’s alleged comments.
I believe that Dr Murphy fairly summarised the matter, and put it in its proper perspective, when he said that Ms Wretowska had been accused of making “racially insensitive comments in the workplace”. While such comments, if made, were clearly unacceptable, it would seem reasonable that, after a proper investigation into whether the statements had been made, including the exact context and circumstances in which they were made, and taking into account that Ms Wretowska’s first language is not English, it would then be appropriate to consider what, if any, action to take. (With regard to Ms Wretowska’s English skills, Dr Stephenson recorded that she has a limited vocabulary and still speaks Polish to her close relatives: see [66] above.)
If the allegations were substantiated then, depending on the findings of the investigation as to the surrounding circumstances, reasonable action may consist of counselling, a verbal warning, being placed on probation, attending cultural awareness education, or a written warning with a direction of what is expected in the future. The Club did none of these things. Instead, it immediately suspended Ms Wretowska and then directed her to attend a meeting at which not continuing her employment was the only topic for discussion. I am firmly of the view that that was not reasonable.
For completeness, I should add that, even if part of the discipline process was reasonable, for example, the inquiry by Mr Heard on 12 November 2011, s 11A requires that the Commission look at the entire process to see if it was reasonable (Sinclair at [35], [69], [95] and [97]). Looking at the entire process, I am not satisfied that the Club’s actions with respect to discipline were reasonable. For the reasons explained above, it acted precipitously in suspending a long term employee, before exploring other options, and acted unfairly in telling her to attend a meeting at which her not continuing to be employed would be discussed.
Finally, I should say something about the Arbitrator’s alleged failure to give reasons. In assessing whether reasons are adequate, it is always necessary to keep in mind the context in which the decision is made (Sarian v Elton [2011] NSWCA 123). The Arbitrator’s reasons on the reasonableness issue were given as an alternative to his main finding on causation. It is therefore understandable that they were not as detailed as they might otherwise have been.
However, as with the causation issue, the Arbitrator explained the basis for his conclusion and, while some issues could have been covered in greater detail, or with more clarity, his reasons were adequate to enable the parties to understand why the Club had not made out its s 11A defence. There was no failure of the process of fact-finding (Waterways Authority v Fitzgibbon [2005] HCA 57; 79 ALJR 1816 at [129]–[130]). For reasons stated, the Arbitrator made an evaluative judgment that was open to him on the evidence.
Further, as Kirby J observed in Roncevich v Repatriation Commission [2005] HCA 40 at [64]; 222 CLR 115, courts should avoid an “overly pernickety examination of the reasons”. The focus of attention “is on the substance of the decision and whether it has addressed the ‘real issue’ presented by the contest between the parties”. The Arbitrator addressed the real issue and explained the basis for his conclusion.

CONCLUSION

The Arbitrator’s decision on causation was open to him and involved no error. In the alternative, if he erred on that issue, for the reasons given by the Arbitrator, and the additional reasons in this decision, the Club’s actions were not reasonable and it failed to establish a defence under s 11A in any event.

DECISION

The Arbitrator’s determination of 5 August 2013 is confirmed.

COSTS

The appellant employer is to pay the respondent worker’s costs of the appeal, assessed at $2,530 plus GST.

Bill Roche
Deputy President

26 November 2013

I, KATHRYN CAMP, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF BILL ROCHE, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE