Wilkinson v State of New South Wales
[2020] NSWWCCPD 52
•13 August 2020
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | |
| CITATION: | Wilkinson v State of New South Wales [2020] NSWWCCPD 52 |
| APPELLANT: | Edie-Lee Wilkinson |
| RESPONDENT: | State of New South Wales |
| INSURER: | Employers Mutual Limited – as agent for the NSW Self Insurance Corporation |
| FILE NUMBER: | A1-6065/19 |
| ARBITRATOR: | Ms R Homan |
| DATE OF ARBITRATOR’S DECISION: | 17 February 2020 |
| DATE OF APPEAL DECISION: | 13 August 2020 |
| SUBJECT MATTER OF DECISION: | Section 11A(1) of the Workers Compensation Act 1987 – whether the respondent’s action with respect to discipline was reasonable; Northern New South Wales Local Health Network v Heggie [2013] NSWCA 255; 12 DDCR 95, Irwin v Director General of Education (Compensation Court of NSW, Geraghty CCJ, 18 June 1998, No 14068 of 1997, unreported) discussed and applied |
| PRESIDENTIAL MEMBER: | Deputy President Elizabeth Wood |
| HEARING: | On the papers |
| REPRESENTATION: | Appellant: |
| Mr C Tanner, counsel | |
| McNally Jones Staff | |
| Respondent: | |
| Mr M Hammond, counsel | |
| Turks Legal | |
| ORDERS MADE ON APPEAL: | 1. The Arbitrator’s Certificate of Determination dated 17 February 2020 is revoked and the following findings and orders are made in its place: (a) The appellant suffered a psychological injury on 15 February 2019 in the form of an exacerbation of a pre-existing condition in accordance with s 4(b)(ii) of the Workers Compensation Act 1987. (b) The injury did not result from reasonable action taken by the respondent in respect of discipline in accordance with s 11A(1) of the Workers Compensation Act 1987. (c) The matter is remitted to a different arbitrator for determination of the appellant’s entitlements to weekly compensation and treatment expenses pursuant to s 60 of the Workers Compensation Act 1987. |
INTRODUCTION AND BACKGROUND
Ms Edie-Lee Wilkinson (the appellant) was employed by the State of New South Wales (the respondent) as a civilian Crime Scene Officer, investigating crime scenes for the NSW Police Force in Broken Hill, New South Wales. The appellant commenced working in Broken Hill in January 2015. At that time, the appellant was married to Mr Trevor Wilkinson, however, the couple separated in about September 2015. The couple had one child of the relationship (the daughter), and the appellant had a son from a previous relationship. There were long standing custody issues in relation to the daughter after the break-up of the marriage.
On 23 January 2019, Mr Wilkinson attended the Broken Hill Police Station and made an application for an Apprehended Domestic Violence Order (ADVO) against the appellant. The appellant was served with a copy of the application for the ADVO, which directed the appellant to attend the Broken Hill Local Court on 15 February 2019.
The respondent then issued an Interim Risk Management Plan on 29 January 2019, which placed a restriction on the appellant, in that she was not to handle firearms or be involved in matters where firearms were present.
On 13 February 2019, the respondent handed the appellant a letter dated 7 February 2019, which contained a number of allegations of misconduct on the part of the appellant. The appellant ceased work on 15 February 2019, alleging that she suffered a psychological injury caused by two of the allegations, which she asserted were incorrect.
The appellant had previously suffered from a non-work related psychological condition.
The appellant lodged a workers compensation claim. The respondent disputed the claim on the basis that:
(a) the appellant did not suffer an injury within the meaning of s 4 of the Workers Compensation Act 1987 (the 1987 Act);
(b) the appellant’s employment was not a substantial contributing factor to any injury suffered by the appellant pursuant to s 9A of the 1987 Act, and
(c) in the event that the appellant did suffer an injury, it was not compensable because it was caused by reasonable action taken by the respondent in respect of discipline and/or performance appraisal, in accordance with s 11A(1) of the 1987 Act.
The appellant commenced proceedings in the Commission. The matter came to arbitration on 11 February 2020. The Arbitrator issued a written Certificate of Determination with a statement of reasons attached on 17 February 2020.
The Arbitrator found that the receipt of the letter alleging misconduct and the respondent’s subsequent investigation were the main contributing factors to the aggravation or exacerbation of the appellant’s psychological condition, but that the injury was caused by reasonable action taken or proposed to be taken by the respondent with respect to discipline, pursuant to s 11A(1) of the 1987 Act.
The appellant appeals the decision.
ON THE PAPERS
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) provides:
“(6) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Both parties have indicated that they are content to have the matter determined on the basis of the documents and written submissions and that the matter does not require an oral hearing.
I have had regard to Practice Directions Nos 1 and 6, the documents that are before me, and the written submissions by the parties indicating that the appeal can be determined on the basis of these documents. I am satisfied that I have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing and that this is the appropriate course in the circumstances.
THRESHOLD MATTERS
There is no dispute between the parties that the threshold requirements as to quantum and time pursuant to ss 352(3) and 352(4) of the 1998 Act have been met.
THE RELEVANT EVIDENCE
There is no dispute raised in this appeal as to the Arbitrator’s findings that the appellant suffered an injury in the form of an aggravation or exacerbation of her previous psychological condition and that the appellant’s employment was the main contributing factor to the injury in accordance with s 4(b)(ii) of the 1987 Act. The issues raised in this appeal are limited to the Arbitrator’s finding that the appellant’s injury was partly caused by the action taken by the respondent in investigating the allegations and to the Arbitrator’s conclusion that the disciplinary action taken by the respondent was reasonable. It is, therefore, not necessary to examine the evidence in relation to the findings not challenged on appeal. This summary is limited to the evidence pertaining to the Arbitrator’s conclusion that the actions taken by the respondent in respect of investigating the allegations were in part causative of the injury and that the disciplinary action taken by the respondent was reasonable.
The medical evidence as to causation
Dr Maher Aljarmakani, the appellant’s general practitioner, provided a report dated 30 April 2019.[1] Dr Aljarmakani confirmed that the appellant had attended Dr Melanie Mateo (a general practitioner from the same medical practice) on 15 February 2019 and had first consulted Dr Aljarmakani on 20 March 2019. Dr Aljarmakani reported that, at the consultation with Dr Mateo, the appellant complained of stress and anxiety relating to her ex-husband filing charges against her and her workplace placing her under observation.
[1] Application to Resolve a Dispute (ARD), pp 28–29.
The clinical note recorded by Dr Mateo in relation to the attendance by the appellant was consistent with the complaint as reported by Dr Aljarmakani.[2] Dr Mateo recorded a diagnosis of anxiety.
[2] Respondent’s Application to Admit Late Documents (AALD), p 19.
Dr Mateo issued a WorkCover certificate of capacity on 21 February 2019.[3] In response to a question as to how the injury or disease was work related, Dr Mateo wrote that the appellant’s anxiety and panic attacks first started “when she was restricted by the workplace after an allegation of misconduct.”
[3] ARD, 30–32.
Dr Mateo also provided a medical report dated 29 May 2019, directed to the appellant’s legal representatives.[4] Dr Mateo provided the history that the appellant had restrictions placed on her capacity to carry firearms because the appellant’s ex-husband had accused her of entering his house and had applied for an ADVO against the appellant. Dr Mateo said that, subsequently, the appellant received a letter in which allegations of misconduct were made and she was informed that there would be an investigation. Dr Mateo said that the appellant was off work for a few days after receiving the letter. Dr Mateo added that, when the appellant returned to work on 15 February 2019, the she experienced symptoms of panic attacks on her way to work and when she arrived at work. Dr Mateo was asked by the appellant’s legal representatives to provide her opinion as to whether the appellant’s condition resulted from the receipt of the letter of allegations, as opposed to the restriction placed on the appellant with respect to firearms. Dr Mateo responded that, following the receipt of the ADVO application and the firearm restriction being placed on her, the appellant continued to work without restriction and without anxiety. Dr Mateo noted the appellant did not work following receipt of the letter and, on her return to work on 15 February 2019, the appellant suffered panic attacks. Dr Mateo was of the opinion that the symptoms were therefore attributable to going to work after receipt of the letter of misconduct.
[4] AALD, pp 72–73.
Dr Kavita Seth, the appellant’s treating psychiatrist, reported to Dr Mateo on 20 March 2019.[5] Dr Seth’s principle diagnosis was a “relapse of depression and anxiety most likely due to workplace allegations.”[6]
[5] AALD, pp 622–625.
[6] AALD, p 625.
The application for an ADVO
The application for an ADVO was made by Sergeant Craig Gilby (the Sergeant).[7]
[7] ARD, pp 11–13.
In the application for the ADVO, the Sergeant described how Mr Wilkinson and the appellant were married in 2011 and that, after moving to Broken Hill, the marriage deteriorated, and they separated in September 2015. The Sergeant said that they remained civil toward each other but that there were issues in relation to visitation rights with the daughter which were resolved through the Family Court.
The Sergeant reported that Mr Wilkinson then received letters complaining about the daughter’s care from the appellant posted in NSW Police Force envelopes. The Sergeant cited the following further reasons for the application:
(a) at the start of December 2018, Mr Wilkinson received a telephone call from the appellant about the health of their daughter and the conversation became heated. Mr Wilkinson alleged that the appellant said that “I can get you whether I’m in town or not,” following which the appellant hung up. Mr Wilkinson said he felt concerned;
(b) on Saturday 12 January 2019, the appellant collected the daughter from Mr Wilkinson’s care and indicated that she and the daughter were going to Adelaide;
(c) at about 9.30 pm on 19 January 2019, Mr Wilkinson locked his house and went out for the night. Mr Wilkinson noted that the lock to the back door was flimsy and could be easily opened. At about 4.30 pm the next day, Mr Wilkinson returned and noticed that there was a NSW Police Force badge on the kitchen table with the appellant’s name on it, and
(d) Mr Wilkinson immediately took the badge to the police station. Mr Wilkinson complained that he felt it was a form of intimidation, that the appellant did not have keys to his house and did not have his consent to enter the house. The Sergeant reported that Mr Wilkinson was becoming increasingly concerned about the appellant’s behaviour and that he feared for his safety.[8]
[8] Application for an ADVO, ARD, p 12.
The letter of allegations
An incomplete copy of the letter containing the allegations of misconduct was annexed to the ARD.[9] The allegations were expressed as follows:
[9] ARD, pp 8–9.
“Allegation 1:
It is alleged that between 9.30pm, Saturday 19 January 2019 and 4.30pm, Sunday 20 January 2019 you (or someone else at your request) broke into the home address of Mr Trevor Wilkinson … It is also alleged while you or someone else were inside the premises, a NSWPF name plate in the name of ‘Edie-Lee Wilkinson’ was placed on the kitchen table to intimidate Mr Trevor Wilkinson.
Allegation 2:
It is alleged that your behaviour and actions towards Mr Trevor Wilkinson has caused Mr Trevor Wilkinson to feel intimidated and to fear for his safety. Subsequently, police have issued an Interim Apprehended Domestic Violence Order (ADVO) naming you as the defendant.
Your actions include:
– In April 2018, you sent letters to Mr Trevor Wilkinson and to his mother regarding child care issues in official NSWPF envelopes and sent an email to Mr Trevor Wilkinson using your NSWPF work email address.
…
– On 6 June 2018, you attended the home address of Mr Trevor Wilkinson uninvited and caused a disturbance. You left the location after being spoken to by police (by phone).
– In September 2018, you made enquiries regarding obtaining a firearms licence and received an application form for same.
– In early December 2018, it is alleged that during a telephone conversation with Mr Wilkinson you stated in words to the effect of ‘I can get to you whether I’m in town or not’ which caused Mr Wilkinson worry.”
The letter indicated that, if proved, the conduct would constitute a serious breach of the NSW Police Force Code of Conduct and Ethics and if it was found the appellant had broken into Mr Wilkinson’s house, it would constitute a crime under the Crimes Act 1900. The appellant was invited to provide a statement within two weeks from receipt of the letter.
The appellant’s statement
The appellant provided a statement dated 18 October 2019.[10] The appellant stated that she was served with an application for an ADVO brought by Mr Wilkinson dated 23 January 2019. The appellant said that, after being served with that document, the respondent placed restrictions on her duties which meant that she was prevented from examining crime scenes or exhibits which involved firearms. The appellant said that those restrictions did not have any effect on her, and she continued with her duties without time off or medical treatment.
[10] ARD, pp 6–7.
The appellant stated that on 13 February 2019, she was required to attend the Acting Inspector’s office where she was handed a document dated 7 February 2019 addressed to her, making allegations of misconduct against her. The appellant said that two of the allegations against her must have been partially invented. This was because the ADVO application filed on behalf of Mr Wilkinson did not allege that she (or someone on her behalf) broke into Mr Wilkinson’s house, or that there had been an interim ADVO put in place naming her as a defendant.
The appellant asserted that her psychological injury was caused by the “essentially false allegation of misconduct.”[11]
[11] Appellant’s statement, ARD, p 7.
The appellant added that, at the end of the investigation process, she received a letter from the respondent indicating that a finding had been made that she did not engage in misconduct and no disciplinary action was taken against her.
THE ARBITRATOR’S REASONS
The Arbitrator identified the issues she was required to determine. She reviewed the evidence and summarised the submissions made by both parties. The Arbitrator quoted the definitions of injury in s 4 of the 1987 Act and psychological injury in s 11A(3) of the 1987 Act, and the disentitling provision of s 11A(1) of the 1987 Act. The Arbitrator noted that the onus rested with the respondent to establish that the psychological injury was caused by reasonable action taken by it in respect of discipline or performance appraisal. The Arbitrator reviewed the authorities in respect of ascertaining the whole or predominant cause of the injury and whether the respondent’s actions were reasonable.[12]
[12] Manly Pacific International Hotel v Doyle [1999] NSWCA 465; 19 NSWCCR 181 (Doyle); Hamad v Q Catering Limited [2017] NSWWCCPD 6 (Hamad); Commissioner of Police v Minahan [2003] NSWCA 239 (Minahan); Northern New South Wales Local Health Network v Heggie [2013] NSWCA 255; 12 DDCR 95 (Heggie); Irwin v Director General of Education (Compensation Court of NSW, Geraghty CCJ, 18 June 1998, No 14068 of 1997, unreported) (Irwin).
The Arbitrator formed the view that the evidence established that the psychological symptoms experienced by the appellant on and after 15 February 2019, diagnosed by both Dr Seth and the treating psychologist Ms Walsh as depression and anxiety, were capable of a diagnosis of a psychological disorder. The Arbitrator noted the history of the appellant’s longstanding psychological issues, but said that the clinical notes indicated that in the period leading up to February 2019, those symptoms were well controlled. The Arbitrator accepted that the appellant had experienced an exacerbation of her psychological symptoms on 15 February 2019. The Arbitrator noted that her conclusion was consistent with the opinion of Dr Mateo, who formed the view that the appellant’s condition was an exacerbation of a disease within the meaning of s 4(b)(ii) of the 1987 Act.
The Arbitrator observed that, for the exacerbation to be compensable, it must be causally related to the appellant’s employment and the appellant’s employment must be the main contributing factor to the exacerbation of the disease.
The Arbitrator referred to the appellant’s evidence that the cause of her injury was specifically the respondent’s allegations of misconduct made against her. The Arbitrator further referred to and discussed the medical evidence that supported that assertion and the fact that the appellant was able to work up until that time. She rejected the respondent’s submission that the appellant had not discharged the burden of proving that the exacerbation was work related. The Arbitrator particularly referred to the evidence of Dr Mateo and concluded that the letter alleging misconduct and the subsequent internal investigation were the main contributing factor to the aggravation or exacerbation of the appellant’s psychological condition.
The Arbitrator proceeded to consider and determine the issue of whether the injury was wholly or predominantly the result of reasonable action on the part of the respondent. The Arbitrator noted the appellant’s submission that the respondent was unable to discharge the onus of proof because it had failed to adduce any medical evidence to establish the whole or predominant cause of the appellant’s injury. The Arbitrator rejected that submission on the basis that the appellant’s own evidence was that the cause of the injury was the letter making the misconduct allegations and, in the Arbitrator’s view, the subsequent investigations.
The Arbitrator concluded that she was satisfied that the issuing of the letter and the internal investigations were actions with respect to discipline, relying on Heggie. The Arbitrator observed that she was required to determine whether those actions were reasonable. She noted the appellant’s submission that the actions were not reasonable because the allegations were not factually correct and were not reflected in the ADVO application. The Arbitrator further noted the respondent’s submissions that the veracity of the allegations were not determinative of whether the actions were reasonable.
The Arbitrator accepted that there was no evidence that, at the time the allegations were made, an interim order had been issued in response to the application for an ADVO and that the application for the ADVO did not specifically allege that the appellant or another person had broken into Mr Wilkinson’s home. The Arbitrator made the following observations:
“I do not accept, however, that the inaccuracies I have found above involved a degree of negligence or carelessness in the preparation of the document such as to render the respondent’s action in issuing it unreasonable. Rather the inaccuracies appear to reflect a lack of precision in interpreting and representing the ADVO application. The evidence before me does not indicate that the inaccuracies were deliberate or malicious.
Apart from these discrepancies, I am satisfied that the manner in which the allegations were expressed broadly aligned with the information set out in the ADVO application. It is clear from a comparison of the two documents that the allegations of misconduct derived from the ADVO application and were not otherwise invented or concocted by the employer.
The allegations in the ADVO application did not involve matters unrelated to the [appellant’s] work. The allegations suggested a misuse of the [appellant’s] position within the NSW Police Force to threaten or intimidate Mr Wilkinson. If correct, the allegations suggested a serious breach of the relevant code of conduct and a breach of the Crimes Act. Whether or not the allegations were true, I am satisfied that it was reasonable and appropriate for the allegations to be investigated by the respondent.
The evidence does not indicate that the allegations in the ADVO application were treated as factually correct by the employer or that they resulted in any final disciplinary action. Rather, interim safety measures were put in place while the allegations were investigated and the [appellant] invited to respond to them.”[13]
[13] Wilkinson v State of New South Wales [2020] NSWWCC 47 (Reasons), [116]–[119].
The Arbitrator concluded that she was satisfied that the manner in which the allegations were put to the appellant was reasonable, noting that the allegations were expressed to be not yet proven or asserted to be factually correct. She observed that the detail and manner in which the allegations were made were such that the appellant would be able to meaningfully respond to them and that the time frame for doing so was appropriate. Further, the appellant was advised of the consequences if the allegations were proved.
The Arbitrator noted that the appellant was able to successfully respond to the allegations, her response was given appropriate consideration and there was no disciplinary action taken or any record of the complaint entered in her personnel file. The Arbitrator concluded that there was nothing in the evidence before her that suggested the investigation of the allegations or the outcome was procedurally unfair or unreasonable.
The Arbitrator proceeded to conclude that the implementation of the Interim Risk Management Plan was also reasonable and appropriate disciplinary action on the basis that:
(a) the plan did not represent final management action;
(b) the strategy was voluntary, and
(c) the appellant was made aware of and provided with appropriate support services.
The Arbitrator determined that, having regard to the evidence as a whole, the appellant’s psychological injury was predominantly caused by reasonable action taken by the respondent in respect of discipline in accordance with s 11A(1) of the 1987 Act.
The Certificate of Determination issued on 17 February 2020 records:
“The Commission determines:
1. Award for the Respondent.”
GROUNDS OF APPEAL
The appellant asserts that the Arbitrator erred in fact and law and brings twelve grounds of appeal, namely:
(a) Ground One: An “error of law in that the Arbitrator applied the wrong test when purporting to evaluate whether a defence pursuant to section 11A was available, by failing to consider the correct and relevant question of whether the actions of the respondent were reasonable on an objective basis, and by erroneously requiring evidence of subjective wrong-doing – negligence, carelessness, malice and the deliberate expression of inaccurate allegations – as a necessary basis for a finding that the actions of the respondent were not reasonable;”
(b) Ground Two: An “error of law in that the Arbitrator reversed the onus of proof, in effect approaching her task of evaluating whether the defence pursuant to section 11A was available to the respondent on the basis that the worker needed to demonstrate that the actions of the employer ‘involved a degree of negligence or carelessness’ and ‘were deliberate or malicious’ in order to establish that such action was not reasonable;”
(c) Ground Three: “An error of law in that the Arbitrator sought to redefine the meaning of reasonable, adopting an interpretation that:
(i)is misconceived;
(ii)is contrary to standard English usage;
(iii)requires an element of negligent or deliberate wrongdoing, and
(iv)was not open to her;”
(d) Ground Four: “An error of law in that the Arbitrator treated her finding that there was an absence of negligence, carelessness, malice or the deliberate expression of inaccurate allegations as necessarily indicating that the actions of the respondent were reasonable;”
(e) Ground Five: “An error of law in that the Arbitrator failed to properly determine whether the respondent had discharged its onus pursuant to section 11A;”
(f) Ground Six: “An error of mixed fact and law in that the Arbitrator failed to find that the actions of the respondent were not reasonable;”
(g) Ground Seven: “An error of mixed fact and law in that the Arbitrator treated an unfounded allegation of criminal conduct as a mere inaccuracy and not as action by the employer that was unreasonable;”
(h) Ground Eight: “An error of mixed fact and law in that the Arbitrator treated an unfounded allegation that an interim ADVO had been issued against the worker as a mere inaccuracy and not as action by the employer that was unreasonable;”
(i) Ground Nine: “An error of mixed fact and law in that the Arbitrator erroneously concluded that the employer was not careless or negligent;”
(j) Ground Ten: “error of mixed fact and law in that the Arbitrator failed to dismiss the respondent’s defence pursuant to section 11A;”
(k) Ground Eleven: “An error of mixed fact and law in finding that the worker’s injury resulted from “the letter alleging misconduct and the subsequent investigation”, notwithstanding that there was no evidence that “the subsequent investigation” caused her injury”, and
(l) Ground Twelve: “An error of mixed fact and law in that the Arbitrator failed to find that the worker suffered a compensable injury, and in failing to award relief, as claimed.”
LEGISLATION
Section 11A of the 1987 Act relevantly provides:
“11A No compensation for psychological injury caused by reasonable actions of employer
(1) No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers.
(3) A psychological injury is an injury (as defined in section 4) that is a psychological or psychiatric disorder. The term extends to include the physiological effect of such a disorder on the nervous system.
(4) This section does not affect any entitlement to compensation under this Act for an injury of a physical nature even if the injury is a physical symptom or effect of a psychological injury, so long as the injury is not merely a physiological effect on the nervous system.
…
(6) This section does not extend the definition of injury in section 4. In particular, this section does not affect the requirement in section 4 that a disease is not an injury unless it is contracted by the worker in the course of employment.
This section does not affect section 9A (No compensation payable unless employment substantial contributing factor to injury).
...”.
SUBMISSIONS
The relevant submissions of both parties are discussed in my consideration of the appellant’s grounds of appeal below.
THE RELIEF SOUGHT
The appellant seeks to have the Arbitrator’s Certificate of Determination revoked and the following orders made in its place:
(a) “The applicant received a psychological injury meeting the definitions in sections 11A(3) and 4 of the [1987 Act] on 15 February 2019.
(b) The defence raised by the respondent pursuant to section 11A of the1987 Act is dismissed.
(c) The respondent to pay weekly compensation to the applicant, at the rate of:
(i)$1,865.25 per week for the period 15 February 2019 to 28 April 2019, and
(ii)$201.82 per week for the period 29 April 2019 to 5 August 2019.
(d) The respondent to pay the applicant’s medical expenses in respect of treatment resulting from her psychological injury, upon production of invoices, receipts and/or HIC Notice of Charge.”
The respondent submits that the appeal should be dismissed.
CONSIDERATION
Ground Eleven
It is convenient to address Ground Eleven before dealing with the remaining grounds of appeal. Ground Eleven asserts “error of mixed fact and law in finding that the worker’s injury resulted from ‘the letter alleging misconduct and the subsequent investigation’, notwithstanding that there was no evidence that ‘the subsequent investigation’ caused her injury.”
The appellant contends that there was no basis for the Arbitrator’s finding that the appellant’s injury resulted from the “subsequent investigation.” The appellant asserts that the injury resulted solely from being confronted with the unfounded allegations.
The respondent’s submission is limited to the assertion that this ground is not a separate ground of appeal, but rather constitutes a statement of what should occur if the preceding grounds of appeal raised were successful.
The appellant pleaded her case as “a personal injury and/or aggravation of a disease” within the meaning of s 11A(3) of the 1987 Act which was caused by the appellant “receiving allegations of misconduct that were demonstrably incorrect and which were eventually dismissed.”[14] In her statement, the appellant steadfastly asserted that her injury was caused by the allegations that:
(a) she (or somebody on her behalf) broke into Mr Wilkinson’s house in circumstances where Mr Wilkinson did not make such an allegation, and
(b) she had been served with an interim ADVO.
[14] ARD, Part 4 – Injury Details.
The appellant denied that her psychological injury was caused by the implementation of the Interim Risk Management Plan.
The respondent disputed that the appellant suffered a compensable injury or that the appellant’s employment was a substantial contributing factor to her injury in accordance with s 9A of the 1987 Act, on the basis that her psychological condition resulted from domestic issues. In the alternative, the respondent asserted that the injury was wholly or predominantly caused by reasonable action taken by the respondent in respect of performance appraisal and/or discipline in accordance with s 11A(1) of the 1987 Act. The notice issued pursuant to s 78 of the 1998 Act did not identify the particular actions taken by the respondent which it considered were wholly or predominantly causative of the injury and were reasonable, although there was some discussion in relation to the reasons for issuing the Interim Risk Management Plan.
Dr Mateo’s evidence was that the appellant did not work following receipt of the letter and on her return to work on 15 February 2019, the appellant suffered panic attacks. Dr Mateo was of the opinion that the symptoms were therefore attributable to going to work after receipt of the letter of misconduct. Dr Seth, the appellant’s treating psychiatrist, diagnosed a relapse of depression and anxiety which she said was most likely due to workplace allegations.
The respondent did not adduce medical evidence on causation. At arbitration, the Arbitrator did not seek clarification from the respondent of what it asserted to be the causative actions which were said to be reasonable. The respondent’s relevant submissions made were that:
(a) the appellant’s distress arose from a personal matter unrelated to her employment;[15]
[15] Transcript of Proceedings of 11 February 2020 (T), T 3.15–19.
(b) once an ADVO was “taken out” by a member of the police force on Mr Wilkinson’s behalf, because the appellant was an employee of the respondent, the respondent was required to take action;[16]
[16] T 4.5–7.
(c) the appellant complained of being extremely distressed by the allegations;[17]
(d) the appellant’s reaction was not in response to the requirement to respond to the allegations but was an overall response to her relationship difficulties;[18]
(e) the appellant’s distress involved “an element of the [respondent] writing to her and saying, look, these allegations have been made, we need you to respond and she responds and fairly quickly thereafter says no further action … or no action is to be taken against her;”[19]
(f) the medical evidence relied upon by the appellant was not based on a proper history of the appellant’s significant past psychological condition so that the appellant has not discharged her onus of proving that:
(i)she suffered an injury within the meaning of s 4 of the 1987 Act, or
(ii)her employment was the main contributing factor to the injury;[20]
(g) the case was more of a discipline case than a performance appraisal case,”[21] and
(h) the allegations were serious and in circumstances where the appellant was employed by the respondent and had access to firearms, it was incumbent upon the respondent to investigate those allegations and ensure that members of the public are safe.[22]
[17] T 5.12–16.
[18] T 5.25–30.
[19] T 6.1–8.
[20] T 6.1–7.33; T 9.7–26.
[21] T 8.14–16.
[22] T 8.18–28.
In her submissions, the appellant disputed that her case bore any relationship to being served with the application for an ADVO or the imposition of the firearms restrictions.[23]
[23] T 9. 31–T 10.2.
The Arbitrator concluded that:
“… Dr Mateo was specifically asked by the [appellant’s] solicitor whether the condition resulted from receiving the letter containing allegations of misconduct rather than the previous restriction in relation to her exposure to firearms. Dr Mateo, in response, specifically attributed the symptoms to going to work after receiving the letter alleging misconduct. Dr Mateo said the [appellant] continued to work with no anxiety after the firearm restriction.
On the basis of Dr Mateo’s evidence, I am prepared to accept that the letter alleging misconduct and the subsequent internal investigation were the main contributing factor to the aggravation or exacerbation of the [appellant’s] psychological condition. No medical evidence to contradict Dr Mateo’s opinion has been filed by the respondent.”[24]
[24] Reasons, [108]–[109].
The Arbitrator further concluded that:
“The evidence indicates that the [appellant] was in fact able to successfully respond to the allegations. A written response was prepared on her behalf by the Public Service Association. A further response was prepared by the [appellant] directly. It is apparent that the [appellant’s] response was given appropriate consideration and resulted in a final decision that the allegations were not sustainable and the [appellant] had not engaged in misconduct. As a result, no disciplinary action was taken and no record of the complaint entered onto her personnel file. Nothing in the material before me suggests that the investigation of the allegations of misconduct or the outcome was procedurally unfair or otherwise unreasonable.”[25]
[25] Reasons, [121].
The respondent’s submissions at arbitration were of little assistance in the identification of the actions taken by the respondent with respect to discipline which were said to be reasonable. Even if those submissions could be said to indicate reliance on the respondent’s actions subsequent to the allegations being made in the letter dated 7 February 2019, there is no factual or medical evidence to support the notion that those subsequent actions (about which there is little information) were causative of the appellant’s injury.
The Arbitrator based her conclusion that the respondent suffered injury as a result of receiving the letter of allegations and the subsequent investigations on the opinion of Dr Mateo. Dr Mateo’s evidence was that the appellant suffered injury following receipt of the letter of allegation and on her return to work on 15 February 2019 when she suffered panic attacks. Dr Mateo’s evidence is not supportive of the conclusion reached by the Arbitrator that the psychological injury was in any part caused by the subsequent investigations. That proposition was not squarely raised before the Arbitrator by either party, not supported by any medical evidence and there was no other basis upon which it was open to the Arbitrator to form that view.
It follows that Ground Eleven of the appeal succeeds and the Arbitrator’s findings that the subsequent internal investigation was a contributing factor to the aggravation or exacerbation of the applicant’s psychological condition, which action was reasonable, are revoked.
Ground One
Ground One of the appeal alleges that the Arbitrator applied the wrong test when evaluating whether the defence pursuant to s 11A(1) was available to the respondent. The appellant says that the Arbitrator failed to ask the correct question of whether the respondent’s actions were reasonable on an objective basis. The appellant alleges that the Arbitrator erroneously required evidence of wrongdoing, namely negligence, carelessness or malice and of deliberately making inaccurate allegations as a basis for a finding that the respondent’s actions were reasonable.
The appellant refers to Heggie as authority for the proposition that, for the purposes of s 11A, the test of reasonableness is an objective test. The appellant submits that the Arbitrator’s focus on the absence of negligence, carelessness and malice and lack of a deliberate intention to express those inaccurate allegations is indicative that the Arbitrator regarded that the respondent’s subjective beliefs were determinative of whether the respondent’s actions were reasonable. The appellant quotes the following passage from the judgment of Sackville AJA in Heggie:
“It is not enough that the employer believed in good faith that the action with respect to discipline that caused psychological injury was reasonable. Nor is it necessarily enough that the employer believed that it was compelled to act as it did in the interests of discipline.”[26]
[26] Heggie, [59(iv)].
The appellant asserts that the Arbitrator misdirected herself by taking into consideration whether the respondent’s actions were prompted by malice or conducted in a careless or negligent manner and by concluding that the absence of those subjective features indicated that the respondent’s actions were reasonable.
The respondent submits that the Arbitrator correctly applied Heggie in that she identified that the respondent bore the onus of proof, carefully considered the serious nature of the allegations and arrived at the relevant findings. The respondent also relies on a passage from Sackville AJA’s judgment in Heggie, in which his Honour observed:
“In my opinion, the better view is that the reasonableness of an employer’s action for the purposes of s 11A(1) of the [1987] Act is to be determined by the facts that were known to the employer at the time or that could have been ascertained by reasonably diligent inquiries. The statutory language directs attention to whether the psychological injury was caused by reasonable disciplinary action taken or proposed to be taken by the employer. Ordinarily, the reasonableness of a person’s actions is assessed by reference to the circumstances known to that person at the time, taking into account relevant information that the person could have obtained had he or she made reasonable inquiries or exercised reasonable care. The language does not readily lend itself to an interpretation which would allow disciplinary action (or action of any other kind identified in s 11A(1)) to be characterised as not reasonable because of circumstances or events that could not have been known at the time the employer took the action with respect to discipline.”[27]
[27] Heggie, [61].
The respondent contends that all the respondent knew at the relevant time was that an application for an ADVO had been made which contained serious allegations.
In submissions in reply, the appellant asserts that the respondent had failed to address the Arbitrator’s erroneous reasoning that, in order to determine whether the actions were unreasonable, it was necessary to find that the appellant had acted negligently, carelessly or with malice, or had deliberately made inaccurate allegations. The appellant says that the respondent made no submission as to why those matters, which do not appear in the legislation, were relevant to a determination of whether the respondent’s actions were reasonable in accordance with s 11A(1) of the 1987 Act.
A decision as to whether the actions of the respondent were reasonable requires a broad evaluative judgment.[28] Sackville AJA made the following observation in Heggie:
“The following propositions are consistent both with the statutory language and the authorities that have construed s 11A(1) of the [1987] Act:
(i) A broad view is to be taken of the expression ‘action with respect to discipline’. It is capable of extending to the entire process involved in disciplinary action, including the course of an investigation.
(ii) Nonetheless, for s 11A(1) to apply, the psychological injury must be wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer.
(iii) An employer bears the burden of proving that the action with respect to discipline was reasonable.
(iv) The test of reasonableness is objective. It is not enough that the employer believed in good faith that the action with respect to discipline that caused psychological injury was reasonable. Nor is it necessarily enough that the employer believed that it was compelled to act as it did in the interests of discipline.
(v) Where the psychological injury sustained by the worker is wholly or predominantly caused by action with respect to discipline taken by the employer, it is the reasonableness of that action that must be assessed. Thus, for example, if an employee is suspended on full pay and suspension causes the relevant psychological injury, it is the reasonableness of the suspension that must be assessed, not the reasonableness of other disciplinary action taken by the employer that is not causally related to the psychological injury.
(vi) The assessment of reasonableness should take into account the rights of the employee, but the extent to which these rights are to be given weight in a particular case depends on the circumstances.
(vii) If an Arbitrator does not apply a wrong test, his or her decision that an action with respect to discipline is or is not reasonable is one of fact.”[29] (emphasis in original)
[28] Heggie, [71], [171] and [179] per Sackville AJA (Basten and Ward JJA agreeing).
[29] Heggie, [59].
The powers of a Presidential member on appeal are limited to the identification of error of fact, law or discretion and to the correction of such error.[30] The principles that apply to overturning factual decisions on appeal have been frequently discussed in Presidential decisions and a summary of those principles was provided by Roche DP in Raulston v Toll Pty Ltd.[31] The appellant, however, asserts error of law on the basis that the Arbitrator applied the wrong test in her evaluation of the whether the respondent’s actions were reasonable.
[30] Section 352(5) of the 1998 Act.
[31] [2011] NSWWCCPD 25, [19]–[27].
In a joint judgment in Minister for Immigration and Multicultural Affairs v Yusuf,[32] McHugh, Gummow and Hayne JJ said:
“identifying a wrong issue, asking a wrong question, ignoring relevant material or relying on irrelevant material in a way that affects the exercise of power is to make an error of law [and] doing so results in the decision-maker exceeding the authority or powers given by the relevant statute.”[33]
[32] [2001] HCA 30; 206 CLR 323 (Yusuf).
[33]Yusuf, [82].
The Arbitrator’s reasoning process in arriving at the conclusion that the respondent’s conduct was reasonable involved the Arbitrator:
(a) accepting that there was no evidence that an interim ADVO had been issued and that the application for the ADVO did not allege that the appellant, or a person on her behalf, had broken into Mr Wilkinson’s house, which she considered amounted to “inaccuracies”;[34]
(b) considering that the allegations otherwise broadly reflected the information in the ADVO application;[35]
(c) not accepting that the inaccuracies involved a degree of negligence or carelessness, such that the respondent’s actions in issuing the allegations were unreasonable;[36]
(d) concluding that the inaccurate allegations derived from the ADVO application were not otherwise invented or concocted by the respondent;[37]
(e) observing that, if correct, the allegations involved serious breaches of the respondent’s code of conduct and the criminal law and were matters that were not unrelated to the appellant’s employment;[38]
(f) being satisfied that it was reasonable and appropriate that the allegations be investigated by the respondent whether or not the allegations were true,[39] and
(g) being satisfied that the manner in which the allegations were made was reasonable, given that it was indicated that the allegations were not proven, were sufficiently detailed so as to allow the appellant to respond to them within a reasonable time and no disciplinary action in relation to the allegations was taken.[40]
[34] Reasons, [115]–[116].
[35] Reasons, [117].
[36] Reasons, [116].
[37] Reasons, [117].
[38] Reasons, [118].
[39] Reasons, [118].
[40] Reasons, [120].
The Arbitrator further concluded that the subsequent investigation was conducted in a timely and fair manner.
The cause of the appellant’s psychological injury was the respondent’s action in making two unfounded allegations in relation to the appellant’s conduct. The question for the Arbitrator to determine was whether the making of those allegations was reasonable. The question was not whether the issue of the letter of allegations generally, which otherwise were not causative of the injury, was reasonable action taken by the respondent. Nor was it the implementation of the Interim Risk Management Plan, the restrictions placed on the appellant with respect to firearms, or the process of the subsequent investigations.
Applying the principles set out in Heggie, where the psychological injury is wholly or predominantly caused by the respondent’s disciplinary action, it is the reasonableness of that action that must be assessed. As referred to above, the principles enunciated by Sackville AJA in Heggie included the following observation:
“Where the psychological injury sustained by the worker is wholly or predominantly caused by action with respect to discipline taken by the employer, it is the reasonableness of that action that must be assessed. Thus, for example, if an employee is suspended on full pay and suspension causes the relevant psychological injury, it is the reasonableness of the suspension that must be assessed, not the reasonableness of other disciplinary action taken by the employer that is not causally related to the psychological injury.”[41] (emphasis in original)
[41] Heggie, [59].
The assessment of reasonableness should take into account the rights of the appellant and the objectives of the respondent, and whether an action is reasonable should, in all the circumstances, be addressed by a question of fairness, as observed by Geraghty CCJ in Irwin.
Again applying the observations of Sackville AJA in Heggie, the reasonableness of the respondent’s actions should be assessed “by reference to the circumstances known to that person at the time, taking into account relevant information that the person could have obtained had he or she made reasonable inquiries or exercised reasonable care.”[42]
[42] Heggie, [61].
It is apparent that, despite having referred to and quoted the principles in Irwin and Heggie, the Arbitrator’s reasoning process fell short of those considerations. I accept that the Arbitrator erred by failing to apply the principles enunciated in the above authorities in her assessment of whether the respondent’s actions were reasonable. The absence of malice and/or negligence, and whether the respondent’s actions were careless or involved a deliberate intention, are matters that are not determinative of the question of reasonableness. The Arbitrator did not turn her mind to the rights of the appellant or to questions of fairness. Nor did she look to the knowledge the respondent could have obtained had the respondent made reasonable inquiries or exercised reasonable care. Insofar as the Arbitrator took into account the respondent’s actions in putting in place the Interim Risk Management Plan and the subsequent investigations, her consideration went beyond the actions that were causative of the injury, contrary to the principle enunciated in Heggie. Having failed to apply the correct test, the Arbitrator’s conclusion that the respondent’s actions were reasonable is an error of law and is revoked.
The remaining grounds of appeal
Both Ground One and Ground Eleven of the appeal have succeeded and the Arbitrator’s determination that the actions of the respondent in making the allegations and the subsequent investigation were reasonable is revoked. It is therefore not necessary to consider the remaining grounds of appeal.
On the basis of the identified errors, the Arbitrator’s determination dated 17 February 2020 that there is an award for the respondent is revoked.
RE-DETERMINATION
Section 352(5) of the 1998 Act limits the intervention powers of a Presidential member to the identification and correction of error. The appellant has identified error on the part of the Arbitrator in respect of her conclusion that the respondent’s actions were reasonable. Section 352(7) of the 1998 Act provides that on appeal, the decision may be confirmed or revoked, and a new decision made in its place. I am therefore entitled to re-determine the issue of whether the respondent’s action in respect of giving the appellant the letter of allegations, which included two unfounded allegations, was reasonable.
It is apparent that the application for an ADVO formed the basis upon which the letter of allegations was made. The respondent submits that all the respondent knew at the relevant time was that an application for an ADVO had been made which contained serious allegations. It is not contested by the respondent that the allegation that the appellant (or someone on her behalf) had broken into Mr Wilkinson’s house was not an allegation made in the application for the ADVO. It is also not contested that an interim ADVO had not been served on the appellant. Both of those allegations were serious in nature, with serious consequences for the appellant if proved.
I accept that, had such allegations been made, it would have been incumbent upon the respondent to investigate them and the manner adopted by the respondent would have been appropriate. However, as Sackville AJA observed in Heggie, the reasonableness of an employer's action is to be determined by the facts known to the employer or which could have been known, following reasonably diligent inquiries. That takes into account the relevant information that the person could have obtained had the respondent made reasonable inquiries or exercised reasonable care. It is not enough that the respondent might have acted in good faith, or that the respondent thought it had an obligation to act as it did.
In the circumstances of this case, the respondent’s action in making the two allegations was not undertaken following diligent inquiries or with reasonable care. There was no factual basis contained in the application for the ADVO for making the unfounded allegations. In the absence of a factual basis for doing so, the respondent’s objective to investigate those two purported allegations was misplaced. Adopting the notion of “fairness” referred to by Geraghty CCJ in Irwin, it was not fair to the appellant that the respondent asserted that those very serious allegations had been made when, had reasonable care been taken, it would have been apparent that they had not.
Applying the above authorities to the facts of this case, the respondent’s action in making those allegations was not reasonable action with respect to discipline and the defence relied upon by the respondent pursuant to s 11A(1) of the 1987 Act is not made out.
It follows that the appellant is entitled to claim weekly compensation and treatment expenses pursuant to s 60 of the 1987 Act. The respondent’s liability for that compensation has not been determined by a primary decision maker. I therefore do not have jurisdiction to determine those matters as my power to determine matters is limited to the correction of error in accordance with s 352(5) of the 1998 Act. Consequently, it is necessary to remit the remaining issues to an arbitrator for determination.
DECISION
The Arbitrator’s Certificate of Determination dated 17 February 2020 is revoked and the following findings and orders are made in its place:
(a) The appellant suffered a psychological injury on 15 February 2019 in the form of an exacerbation of a pre-existing condition in accordance with s 4(b)(ii) of the Workers Compensation Act 1987.
(b) The injury did not result from reasonable action taken by the respondent in respect of discipline in accordance with s 11A(1) of the Workers Compensation Act 1987.
(c) The matter is remitted to a different Arbitrator for determination of the appellant’s entitlement to weekly compensation and treatment expenses pursuant to s 60 of the Workers Compensation Act 1987.
Elizabeth Wood
DEPUTY PRESIDENT
13 August 2020
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