Stephens and Commonwealth Bank of Australia

[2010] AATA 972

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2010] AATA 972

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No  2009/5853

GENERAL ADMINISTRATIVE DIVISION		)
Re		NEVILLE STEPHENS

Applicant

And COMMONWEALTH BANK OF AUSTRALIA

Respondent

DECISION

Tribunal  Senior Member Bernard J McCabe

Date 17 November 2010

Place Brisbane

Decision  The Tribunal affirms the decision under review.

.....................[Sgd].........................

Senior Member

CATCHWORDS

COMPENSATION – psychiatric adjustment disorder – whether events qualify as reasonable administrative action – identification of performance issues reasonable – administrative action reasonable and in good faith – decision affirmed.

Administrative Appeals Tribunal Act 1975 (Cth), s 35(2)

Safety, Rehabilitation and Compensation Act 1988 (Cth), s 5A(2)

Hart v Comcare [2005] FCAFC 16

REASONS FOR DECISION

3 December 2010  Senior Member Bernard J McCabe        

1.      I delivered an oral decision at the conclusion of the hearing. The respondent subsequently requested written reasons for the decision. These reasons have been prepared from my notes.

2.      Peter Stephens developed a psychiatric disorder that is connected with his experience in the workplace. He applied for compensation under the Safety, Rehabilitation and Compensation Act 1988 (Cth) (“the Act”). His former employer, the Commonwealth Bank (“the Bank”), accepts that the applicant experiences an adjustment disorder that is connected to events in his workplace but says (in the reviewable decision dated 9 July 2009) that it is not liable because the events in question qualify as “reasonable administrative action” within the meaning of s 5A(2) of the Act.

3.      The medical evidence clearly establishes the applicant experiences an adjustment disorder that was diagnosed in April 2009. His treating doctor’s clinical notes and his own claim form clearly indicate that the applicant is reacting to the news from his supervisor that the applicant would be placed on a continuous improvement program (“CIP”) in April 2009 and the subsequent negotiations over a termination payout. The news about the CIP followed a performance review in March. In that performance review, which was included in the T documents, the applicant’s supervisor, Mr Hawker, had suggested the applicant needed improvement in a number of areas. Mr Hawker said he became convinced that CIP was the best option because it would enable Mr Stephens and Mr Hawker to address the performance issues that were identified.

4.      Mr Stephens, who was self-represented, felt the Bank had dealt with him unfairly in a number of respects since he commenced employment there in 2008. He said he was being unfairly blamed for the poor performance of a portfolio of loans for which he was responsible. He said the difficulties were attributable to the failings of others within the Bank, and the global financial crisis. He said he was undermined by his assistant and he was not appropriately supported by his supervisors who had taken clients from him and failed to investigate complaints. He said Mr Hawker in particular had not given him proper credit for the many examples of good work. Mr Stephens said he did not reply to the performance appraisal which had been provided to him in draft because he was considering his response and had not been provided with a time-frame for responding. He had also expected to complete a 15-month plan in consultation with Mr Hawker, although Mr Hawker said it was up to Mr Stephens to take the initiative with respect to the response to the performance appraisal and the 15 month plan. Mr Stephens said he felt humiliated by the way he had been criticised for the poor performance of his portfolio during a conference (called an “offsite”) attended by other managers who were asked to report on progress and their plans for new business.

5.      Mr Stephens also referred to what he regarded as an “ageist” comment. I am not satisfied after hearing the evidence of Mr Hawker that such a comment was made or was intended. I think Mr Stephens misunderstood what was said.

6.      Mr Hawker gave oral evidence at the hearing and provided a statement. He explained he did not hold Mr Stephens responsible for the poor performance of the loan portfolio in the past. He recognised there were “historical issues” that might explain what had gone wrong. He said he was more concerned by behavioural issues that he had observed before and after the performance review. He said he was particularly concerned about the applicant’s motivation and initiative, and about his attitude towards the Bank. He agreed there were issues with team work and some questions over customer relationships but he said he did not give much weight to reports he had heard second-hand about events occurring before he arrived.

7.      Mr Stephens questioned Mr Hawker in detail about the contents of the performance review document. I am satisfied the document reflects Mr Hawker’s fair and honest assessment of the applicant’s performance. Mr Hawker made it clear he did not set out to mention every aspect of Mr Stephen’s behaviour in that document. It was intended to be a concise summary to which Mr Stephens would be invited to respond. Mr Hawker appears to have put considerable thought into the preparation of the document. The document suggests on its face (and Mr Hawker’s evidence confirmed) that the opinions were based on investigation and observation of the applicant’s behaviour.

8.      I also accept Mr Hawker’s evidence that he was becoming increasingly concerned in March and early April 2009 over the applicant’s ability to meet the serious business challenges that lay ahead of the Bank in that region. The applicant’s failure to respond in a vigorous way to the performance review and his underwhelming performance at the offsite conference confirmed that the employer had a reasonable basis for proposing a CIP program. I also accept Mr Hawker’s evidence that the subsequent negotiations over a termination payout were conducted in a fair and reasonable manner.

9. I accept that the performance review process and the proposal to introduce the CIP program were “administrative action” within the meaning of s 5A(2). The negotiations that ensued over the termination payout were probably in the same class because there was a failure to obtain a benefit in the form of a satisfactory termination payout. The question is whether all that amounted to reasonable administrative action.

10.     Decision-makers in cases like this must satisfy themselves that performance management measures are not being used to extend and compound bullying behaviour. An employee who is being harassed can sometimes be his own worst enemy – or second worst enemy – when he engages in conduct that prompts performance management even though the offending conduct is, in truth, merely an understandable response to the harassment he experienced at the hands of managers or co-workers. Administrative action is not reasonable if it forms part of (or is incidental to) a campaign of harassment or victimisation. But I do not think that is what happened here.

11.     There was nothing capricious, irrational, improper, unlawful, insensitive or unusual about the Bank’s administrative action in this case. There was no suggestion of a witch-hunt or a setup or victimisation. Mr Hawker identified performance issues and he proposed addressing them through appropriate remedial measures. I am satisfied he did so on a reasonable basis and in good faith. The question is not whether he and his colleagues conducted the process perfectly or even wisely; it does not matter if he could have done a better job. That is not the test. As it happens, I thought Mr Hawker demonstrated considerable tact and attempted to deal with the problems he had identified in an open and helpful way. The Bank’s administrative action was reasonable.

12.     There may have been other factors that contributed in a minor way to the development of the applicant’s condition, or which set the scene for it to develop. But I am satisfied the condition developed as a result of the reasonable administrative action in the sense explained in Hart v Comcare [2005] FCAFC 16.

Conclusion

13.     The reviewable decision is affirmed.

14. I would add that I have made orders under s 35(2) of the Administrative Appeals Tribunal Act 1975 (Cth) directing that the names of any Bank customers be deleted from the transcript. Any documents filed with the Tribunal that bear the names of customers should also be withheld and not published to any person apart from the Tribunal and its staff, the parties and their legal representatives unless the names of customers are redacted. I have also made a direction under the same section in relation to certain evidence given by the applicant in the course of his closing submissions about the personal life of one of his colleagues.

I certify that the 14 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member Bernard J McCabe.

Signed: ............................[Sgd].............................................
  Patrick MacDonald, Associate

Dates of Hearing  16 November 2010
  17 November 2010
Date of Decision  17 November 2010
Date of Written Reasons                3 December 2010

Applicant  Self-represented

Counsel for the Respondent          Mr D Richards