Towney v Secretary Department of Communities and Justice

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Towney v Secretary Department of Communities and Justice [2023] NSWPIC 584
APPLICANT:	Cecil Towney
RESPONDENT:	Secretary, Department of Communities and Justice
MEMBER:	Cameron Burge
DATE OF DECISION:	3 November 2023
CATCHWORDS:	WORKERS COMPENSATION - Workers Compensation Act 1987; psychological injury; defence under section 11A relating to performance appraisal; requirement for reasonableness of conduct relied on and causal link with injury; the applicant suffered an accepted psychological injury; the respondent raised a defence per section 11A and relied on performance appraisal; the respondent tendered no statement evidence in support of its defence; it relied solely on source material and medical evidence. In particular, the respondent did not tender any evidence which traversed the applicant’s statement evidence that he had been pressured and felt bullied into signing a performance improvement plan; that the plan was not implemented appropriately and that it was left in place too long; the respondent also failed to traverse in statement evidence the applicant’s allegations he had complained about his supervisor’s conduct which he contended also caused his injury, and that he made a formal complaint about her; absent such evidence, the respondent has not discharged its onus of proving the conduct on which it relied was reasonable; as the test for a successful section 11A defence is twofold, namely whole or predominant cause and the conduct being objectively reasonable, the failure by the respondent to prove reasonableness is fatal to its defence; Held – matter remitted to President for referral to Medical Assessor to determine applicant’s permanent impairment.
DETERMINATIONS MADE:	The Commission determines: 1. The applicant suffered a psychological injury in the course of his employment with the respondent, with a deemed date of injury of 28 October 2015. 2. The injury referred to in [1] above was not wholly or predominantly caused by the reasonable actions of the respondent in relation to performance appraisal. 3. The matter is remitted to the President for referral to a Medical Assessor to determine the degree of permanent impairment arising from the following: Date of injury: 28 October 2015 (deemed) Body systems referred: psychological and psychiatric injury Method of Assessment: whole person impairment. 4. The documents to be referred to the Medical Assessor to assist with their determination are to include the following: (a) this Certificate of Determination and Statement of Reasons; (b) Application to Resolve a Dispute and attachments, and (c) Reply and attachments.

STATEMENT OF REASONS

BACKGROUND

The applicant, Cecil Towney was employed by the Department of Communities and Justice (the respondent) from 2010 as a support worker. He suffered a psychological injury in the course of his employment and claims permanent impairment compensation in respect of that injury.
The respondent alleges the applicant’s injury was wholly or predominantly caused by its reasonable actions with regards to performance appraisal and relies on s 11A (1) of the Workers Compensation Act 1987 (the 1987 Act) as a complete defence to the applicant's claim.

ISSUES FOR DETERMINATION

The parties agree that the only issue in dispute is whether the applicant's injury was wholly or predominantly caused by the respondent's reasonable actions with respect to performance appraisal.

PROCEDURE BEFORE THE PERSONAL INJURY COMMISSION

I am satisfied that the parties to the dispute understand the nature of the application and the legal implications of any assertion made in the information supplied. I have used my best endeavours in attempting to bring the parties to the dispute to a settlement acceptable to all of them. I am satisfied that the parties have had sufficient opportunity to explore settlement and that they have been unable to reach an agreed resolution of the dispute.
The parties attended a hearing on 27 September 2023. Mr Goodridge instructed by Mr Kospetas appeared for the applicant. Mr Barnes instructed by Ms Scott appeared for the respondent.
At the preliminary conference, the respondent withdrew its pleaded defences pursuant to
s 254 and 261 of the Workplace Injury Management and Workers Compensation Act1998 (the 1998 Act).

EVIDENCE

Documentary evidence

The following documents were taken into account:
(a) Application to Resolve a Dispute (the Application) and attachments, and
(b) Reply and attachments.

Oral evidence

There was no oral evidence called at the hearing.

FINDINGS AND REASONS

The s 11A defence

Section 11A (1) relevantly provides:
“No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by her on behalf of the employer with respect to … performance appraisal…”
In this matter, there is no question the applicant suffered a psychological injury. The only issue is whether that injury was brought about by the respondent’s reasonable actions with respect to performance appraisal.
An employer which seeks to make out a defence pursuant to s 11A carries the onus of establishing that defence: Pirie v Franklins Limited [2001] NSWCC 167 and Department of Education and Training v Sinclair (2005) NSWCA 465.
“Wholly” and “predominantly” separate concepts, and a finding of one or the other must be considered. In Smith v Roads and Traffic Authority of NSW [2008] NSWWCCPD 130 (Smith), an Arbitrator matter of finding that the subject injury was “wholly or predominantly” caused by action taken by the respondent employer. Snell ADP (as he then was) said at [62] that the concepts “wholly” and “predominantly” are different concepts, and if such findings were to be made, “it needed to be one or the other”.
The phrase “wholly or predominantly caused” has been held to mean “mainly or principally caused”. The test of causation to be applied is that described in the oft-cited passage of his Honour Kirby P (as he then was) in Kooragang Cement Pty Ltd v Bates (1994) 35 NSWLR 452.
In cases such as the present, where the applicant’s injury is said to have arisen over a period of time as a disease process rather than as a result of a specific traumatic event, it has been held that a respondent employer ought to tender medical evidence in support of its defence in relation to s 11A. In Hamad v Q Catering Limited [2017] NSWWCCPD 6 (Hamad), the respondent employer was unable, on the available evidence and in the absence of any medical evidence dealing appropriately with the topic, to discharge its onus of proving the workers' psychological injury resulted wholly or predominantly from its reasonable actions taken or proposed to be taken with respect to discipline.
The effect of the decision in Hamad is that reliance on factual material alone will not always be sufficient to make out a s 11A defence. Where factual evidence is adequate, it is often in cases where there is an allegation of a single event which has given rise to psychological injury.
In accordance with Deputy President Snell’s decision in Hamad, medical evidence in a case such as the present one is required which addresses those relative causative contributions before a finding as to whether the reasonable actions of a respondent “wholly or predominantly” caused the injury at issue.
In order to successfully raise a defence under s 11A, the respondent must not only show the requisite causal connection between its actions and the applicant’s injury, it must also satisfy the Personal Injury Commission (Commission) that its actions were reasonable. That is, the defence under s 11A must satisfy two requirements.
Considering the meaning of reasonableness, Geraghty J in Irwin v Director General of Education NSWCC 14068/97, 19 June 1998 (Irwin) said:
“… the question of reasonableness is one of fact, weighing all the relevant factors. That test is less demanding than the test of necessity, but more demanding than the test of convenience. The test of ‘reasonableness’ is objective and must weigh the rights of employees against the object of the employment. Whether an action is reasonable should be attended, in all the circumstances, by questions of fairness.”
In Ivanisevic v Laudet Pty Ltd (unreported, 24 November 1998), Truss CCJ said:
“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 affected.”
These passages were quoted with approval by Foster AJA (Sheller and Santow JJA agreeing) in Commissioner of Police v Minahan [2003] NSWCA 239 (Minahan), where his Honour said:
“I prefer the construction which has been accorded to it in the decisions in the Compensation Court referred to in this judgement and in his Honour’s judgement. The words ‘reasonable action’, in a statute dealing with Workers’ Compensation rights of employees should be given a broad construction, unfettered by considerations as to whether the employee can or cannot also bring an action at common law against the employer, founded upon a duty of care”. (at [42]).
In Ritchie v Department of Community Services [1998] 16 NSWCCR 727, Armitage J said:
“It is apparent that the test in this case is an objective one where one must weigh the consequences of the respondent’s conduct against the reasons given for it. It follows of course, from the objective nature of the test, that the evidence given by the applicant as to the perceived unreasonableness of the respondent’s conduct or from the respondent as to the reasonableness of its conduct from its perspective will not be determinative of this issue.”
Reasonableness is judged having regard to fairness appropriate in the circumstances, including what went before or after a particular action (see Burke J in Melder v Ausbowl Pty Ltd [1997] 15 NSWCCR 454). Armitage J in Jackson v Work Directions Australia Pty Ltd [1998] NSWCC 45 stated:
“Only if the employer’s action in all the circumstances was fair could it be said to be reasonable”. (see also Northern NSW Local Health Network v Heggie [2013] NSWCA 255 (Heggie), where it was held that the reasonableness of a person’s actions is assessed by reference to the circumstances known to that person at the time the action is taken).”
In this matter, it is appropriate to deal firstly with the question of the reasonableness of the respondent’s actions.
The applicant’s statement evidence concerning his placement on a performance appraisal plan is set out from paragraphs 7 to 21. I do not propose to repeat verbatim the applicant’s evidence, however, to the extent that it deals with the reasonableness or otherwise of the respondent’s conduct, I accept it.
In paragraph 12 of his statement, the applicant says:
“12. I attended a meeting on 11 September 2014 with my employer and received support from Ms Jackie Kirk who was my colleague at FACS and also a member of the union. A member of the HR Department was also present during this meeting.
13.    At this meeting, I was asked to sign off on the performance management plan. I was not willing to sign such performance management plan, as I did not agree with it. I was bullied, pressured and intimidated by my employer such that I was forced to sign the performance management plan because if I had not done so, my job security would be affected.
14.    Leading up to and including this meeting, I felt bullied, intimidated, threatened and mistreated by my employer. As a result, I have suffered a psychological injury…
19.    The performance management plan eventually lasted for a period of approximately one and a half years, which was substantially longer than the usual six months. The extended duration of such performance management plan placed tremendous and unnecessary pressure upon my ability to perform at work as my employer would constantly mistreat me during this process.”
As already noted, the respondent bears the onus of proving its conduct was reasonable. The difficulty for the respondent in this matter is that very little of the applicant’s statement evidence concerning the respondent’s alleged unreasonableness is properly traversed or contested.
Whilst the respondent has placed email correspondence into evidence, there is not a single statement provided by a supervisor or manager of the applicant which deals with the circumstances of the meeting on 11 September 2014 leading up to his placement on the performance plan, nor is any reason given in statement evidence as to why he remained on that plan for so long.
The respondent has placed in evidence an unsigned timeline of events apparently authored by Ms Melton, whose role in the entire process is not at all clear. In terms of the lead up to the meeting on 11 September 2014 and what transpired at it, the respondent’s evidence is at best cursory and at worst non-existent. The timeline relevantly states:
“• Mr Towney's supervisor commenced performance management processes with him in January 2014.
•    The matters were not resolved through support and supervision and progressed to development of a work plan in early June 2014. Arrangements were made to discuss the work plan with Mr Towney upon his return from a residential placement at Sydney University 2 to 6 June 2014…
•    Mr Towney was expected to resume duties on 23 June 2014. He did not and again failed to contact or respond to contact from the workplace. He finally replied to message on 25 June 2014.
•    Mr Towney was directed on Special Purpose leave from 26 June 2014 until his fitness for duties was confirmed as there were significant risks to his health and wellbeing and to that of other staff in the workplace.
•     Medibank Health Solutions (MHS) advice was sought for a fitness for duty/independent medical (!MA) assessment.
•    Following the MHS report Mr Towney returned to work and responded to complaints re conduct where he had failed to follow procedures re child protection matters.
•    He commenced a Work Plan on 11.September 2014. This plan identified areas for improvement in his performance and was structured with a range of supports. Formal monitoring was undertaken monthly with additional supervision provided.”
As can be seen, the timeline of events relied on by the respondent makes no mention of the allegations of bullying and pressure made by the applicant which he said led to his agreeing to the performance plan and which he says caused him considerable distress. As an aside, the timeline is also not signed by anyone, so it cannot be said to form a statement. Nevertheless, I have taken its contents into account, as there was no objection raised to its inclusion. That being so, the question is the weight I should afford to the document.
It is important to state that the above observation is not a criticism of Ms Anderson; rather, it is a comment on the state of the evidence.
Likewise, there are a number of emails from Casework Manager Ms Anderson as to her interactions with the applicant, however, they are silent in relation to the matters raised by him in his statement.
The applicant also said in his statement:
“23. l reported my work-related psychological injuries and mistreatment to my employer. At one stage I had lodged a complaint against my manager Emma Crago and FACS about the mistreatment I was experiencing during the course of my employment with FACS. I was not advised that a workers compensation claim could be made nor did my employer lodge such claim after my reporting.
24. I had requested that my employer transfer me to work in a different position within the FACS Department. However, no suitable job role was offered to me. This was despite the fact that my employer knew the issues I was having at work with my manager.
25 Despite my ongoing work-related psychological symptoms, l persisted with my employment as best I could until 28 October 2015 where I was placed on special leave. In April 2016, I was medically retired from my employment due to my injuries.”
None of the matters raised in those paragraphs are traversed in statement evidence by the respondent, which carries the onus of proving its actions were reasonable.
Without evidence which challenges the applicant’s assertions, I am inclined to accept them. The failure of the respondent to traverse allegations of unreasonableness on the part of its staff members in the circumstances of this matter must be fatal to its defence under s 11A.
The contemporaneous material provides assistance to the Commission in setting out a timeline of events and various issues raised by the respondent with the applicant concerning his performance, however, it is conspicuously silent in addressing the manner in which the performance plan was implemented. Without direct evidence from those who put the applicant on the performance plan, it is difficult to accurately contextualise the reasonableness or otherwise of the respondent’s position. Nor does the email material address the matters raised in the applicant’s statement concerning his relationship with his supervisor and the suggestion he felt pressured into agreeing with the performance plan despite not agreeing with it.
In these circumstances, the Commission is left with uncontested statement evidence from an applicant who alleges he was forced into signing a performance improvement plan on pain of his job security being placed in jeopardy; allegations by him that he had felt bullied, intimidated, threatened and mistreated leading up to and including the meeting at which the performance plan was placed before him, and a suggestion the plan was unreasonably long. He also asserts ongoing issues surrounding his supervisor, about whom he made a complaint. In reply, the respondent offers no evidence to traverse those assertions.
Whilst Mr Barnes submitted the source material established not only the causal connection between the respondent’s actions in relation to performance appraisal and the applicant’s injury, but also that the respondent’s actions were reasonable, I do not accept that submission.
To my mind, it is extraordinary that a respondent would seek to raise a defence pursuant to
s 11A yet provide no statement evidence to rebut the applicant’s assertions of its unreasonableness in circumstances where it is incumbent upon the respondent employer to prove reasonableness in order to maintain its defence.
It may well be that the respondent and its employees acted perfectly reasonably towards the applicant in both establishing and maintaining the performance appraisal plan. However, it is not the Commission’s role to guess this was the case. Absent some direct evidence which contradicts the applicant’s statement as to the circumstances leading up to and including both the implementation and conduct of the performance appraisal upon which the respondent relies, or which traverses the applicant’s allegations surrounding his supervisor; I cannot be satisfied that the respondent acted reasonably. Accordingly, the respondent’s defence under s 11A must fail.
Given my findings in relation to reasonableness, it is not necessary to establish whether the respondent’s actions with respect to performance appraisal were the whole or predominant cause of the applicant’s injury, as the defence under s 11A must satisfy both the requirements of a relevant causal connection and that of reasonableness.
As the requirement for reasonableness has not been made out, neither has the defence pursuant to s 11A.

SUMMARY

For the above reasons, the Commission will make the findings and orders set out on page 1 of the Certificate of Determination.

[2023] NSWPIC 584

3 November 2023