Williams v Cubbyhouse Childcare NSW Pty Ltd - [2022] NSWPICPD 36

DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY A MEMBER
CITATION:	Williams v Cubbyhouse Childcare NSW Pty Ltd [2022] NSWPICPD 36
APPELLANT:	Dina Williams
RESPONDENT:	Cubbyhouse Childcare NSW Pty Ltd
INSURER:	Guild Insurance Ltd
FILE NUMBER:	A1-W3677/21
PRESIDENTIAL MEMBER:	Deputy President Michael Snell
DATE OF APPEAL DECISION:	7 September 2022
ORDERS MADE ON APPEAL:	1. The Certificate of Determination dated 11 November 2021 is revoked. 2. The matter is remitted for re-determination by a different Member, consistent with these reasons.
CATCHWORDS:	WORKERS COMPENSATION – section 11A(1) of the Workers Compensation Act 1987 – application of Manly PacificInternational Hotel Pty Ltd v Doyle [1999] NSWCA 465; Northern NSW Local Health Network v Heggie [2013] NSWCA 255, 12 DDCR 95; Jeffery v Lintipal Pty Ltd [2008] NSWCA 138 – error in applying s 789FD of the Fair Work Act 2009 (Cth) in the application of s 11A(1) of the 1987 Act
HEARING:	20 July 2022
REPRESENTATION:	Appellant:
Mr S Doupe, counsel
Walker Law Group
Respondent:
Mr P Perry, counsel
Lee Legal Group
DECISION UNDER APPEAL
MEMBER:	Ms D Moore
DATE OF Member’s DECISION:	11 November 2021

BACKGROUND AND INTRODUCTION

Dina Williams (the appellant) was employed by Cubbyhouse Childcare NSW Pty Ltd (the respondent) as a childcare worker from 2010, progressing from being a trainee to being an area manager responsible for a number of childcare centres in Sydney and the Central Coast. She sustained primary psychological injury with a deemed date of 22 January 2021 (her last day of work was 21 January 2021).[1] The appellant’s solicitors made a claim on her behalf by letter dated 11 February 2021. Guild Insurance Ltd (the insurer) accepted provisional liability on 19 February 2021.[2] On 19 May 2021 the insurer issued a decision denying liability for the claim. Payments of weekly compensation were made to 13 June 2021.[3] The respondent accepted the appellant had suffered a work-related psychiatric condition. It said the condition was wholly or predominantly caused by action taken or proposed to be taken by the respondent with respect to performance appraisal and/or discipline and was not compensable.[4] Various applications by the appellant for review of the decision by the insurer were declined.[5]
[1] Williams v Cubbyhouse Childcare NSW Pty Ltd [2021] NSWPIC 450 (the reasons), [1]–[2].
[2] Application to Resolve a Dispute (ARD), pp 41–46.
[3] Transcript of arbitration hearing, 8/10/21 (T1), T1 2.1.
[4] ARD, pp 47–51.
[5] ARD, pp 53–57, 59–63.
The current proceedings were commenced by way of an Application to Resolve a Dispute (ARD) dated 12 August 2021. The injury description was pleaded as follows:
“The [appellant] sustained primary psychological injuries arising out of or in the course of her employment with the respondent. 22 January 2021 is the deemed date of injury, being the last date worked.”
The proceedings were listed for hearing before Member Moore on 8 October 2021. Mr Doupe appeared for the appellant and Mr P Perry for the respondent. Counsel addressed and the Member reserved her decision. The Commission issued a Certificate of Determination dated 11 November 2021. The Member said she was satisfied the “injury was wholly or predominantly caused by the reasonable actions of her employer with respect to discipline within s 11A” of the Workers Compensation Act 1987 (the 1987 Act). There was an award in favour of the respondent.

ON THE PAPERS

Section 52(3) of the Personal Injury Commission Act 2020 provides:
“(3) 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 and enabling legislation without holding any conference or formal hearing.”
The parties submitted the appeal could be determined on the papers. Having read the material I formed the view that it was appropriate that an oral hearing be held. On 11 July 2022, I issued a Direction to the parties in the following terms:
“1.     It is noted that this matter is listed for an oral hearing on 20 July 2022 at 10.00 am in the President’s Court.
2.      The parties will be able to make submissions in support of their written submissions should they wish.
3.      The attention of the parties is drawn to State Transit Authority of New South Wales v Chemler [2007] NSWCA 249, particularly at [69]. The attention of the parties is drawn to Manly PacificInternational Hotel Pty Ltd v Doyle [1999] NSWCA 465, particularly at [4]–[5]. The parties are requested to be in a position to address on:
(a) whether there was error in how the Member approached the two questions posed in Doyle, and
(b) whether there was error in how the Member approached the issue of ‘reasonable action’, including having regard to the Member’s consideration of the definition of ‘bullying and harassment’ in the Fair Work Act 2009 (Cth).”
The matter was listed for hearing on 20 July 2022. Mr Doupe appeared for the appellant and Mr P Perry appeared for the respondent. Counsel made oral submissions, in addition to their written submissions, which are summarised below.

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 Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) have been met. The decision is not interlocutory.[6]
[6] Appellant’s supplementary submissions, 18/1/22; respondent’s supplementary submissions, 28/1/22.

THE MEMBER’S REASONS

The Member quoted from the appellant’s statement dated 29 March 2021. The appellant described being an area manager from 2016. The number of area managers was reduced from 3 to 2. This gave her an extra workload from 2020. Her load was also increased in 2020 due to the appointment of a new area manager who was in training for several months. The appellant said this increased the responsibilities of an area manager from about 8 centres to about 14.
The appellant stated that she refused to take some of the centres, there was not a proper case hand-over, records were not updated. She said that blame started to be put on her by Abby Revill, the new general manager. She described feeling unwell from about September 2020 and taking time off due to psychological symptoms in mid-December 2020. The appellant was blamed for a failure to comply with mandatory reporting requirements in December 2020. She said she had not previously been subject to management or disciplinary issues. The appellant said she experienced stress and anxiety and constantly feared losing her job. She received a final warning letter on 22 January 2021. She said she was “sick, upset, anxious and stressed”. A friend took her to Dr Dulawan, general practitioner, who issued a ‘work cover’ certificate and referred her to a psychologist. She said she received breach notices and emails. She described her treatment as “bullying”.[7] The Member also referred to a statement of Ms Sprod dated 22 July 2021, lodged as part of the appellant’s case. It was generally critical of Ms Revill.[8]
[7] Reasons, [12].
[8] Reasons, [19].
The Member dealt with the appellant’s medical case. She referred to a report dated 12 July 2021 from Ms Dilek (a treating psychologist). The report included:
“Issues include bullying, harassment and being targeted by management and in particular her General Manager. As such she was threatened with first and final warning letter and the possibility of being dismissed from her employment. It appears that as a result of being targeted and bulled [sic] and harassed at work Ms Williams is experiencing heightened levels of extremely severe depression, anxiety, stress, loss of confidence, lack of energy and motivation, loss of concentration, focus and sleep disorder which eventually led to her psychological injury at work.”[9]
[9] Reasons, [20].
The Member referred to a report from Dr Hong, a psychiatrist qualified by the appellant’s solicitors. The doctor recorded that after Ms Revill’s commencement “there were gradual changes and she felt bullied over time”. The appellant said there were constant meetings every one or two weeks and there was no proper handover. She said she was “trained in child protection, and they blamed her for not doing it even though information was not given to her to allow her to do it”. She said the first and final warning was given after an allegation “she did not attend to the mandatory reporting”.[10] Dr Hong reviewed other documentation. Dr Hong’s opinion was quoted. It read, in part:
“She has not felt supported and believes that she has been subjected to a pattern of behaviour, consistent with bullying and harassment, and that there were unfair criticisms regarding her performance. As a result of the described workplace difficulties, she developed a range of symptoms consistent with a chronic adjustment disorder.”
“Ms Williams’ work injury is a substantial contributing factor and there is no underlying or pre-existing condition.
Much of the described workplace dispute relates to performance and discipline matters and I agree this is the whole and predominant cause of the injury. Whether such administrative action is reasonable or not, is a matter for the appropriate expert to determine.”[11]
[10] Reasons, [28].
[11] Reasons, [32]–[33].
The Member referred to a further report from Dr Hong dated 27 July 2021. It commented on further material forwarded to the doctor, including material from her general practitioner that referred to family issues. Dr Hong concluded:
“Overall my view is that Ms Williams has a pre-existing psychiatric condition, but work had been a significant concurrent stressor, and a substantial and the major contributing factor to aggravation of this pre-existing condition.”[12]
[12] Reasons, [35].
The Member summarised the respondent’s evidence. Ms Revill said she first became aware of the claim when a certificate of capacity was submitted after the first and final warning letter was handed over on 22 January 2021. Ms Revill said that the appellant and another area manager were happy to spread the case load of area managers between them, while the third area manager, who was less experienced in compliance and regulations, spent time undergoing in-house training. Ms Revill said that her offer to take on some of the services was declined. She said a quality manager was appointed to provide them with some support. She said the appellant did not raise concerns about her case load being too high. Ms Revill said there was a significant issue regarding child protection that led to the first and final warning letter in January 2021. Ms Revill said there had been previous performance issues raised with the appellant on 24 June 2020 regarding breaches at the Kings Langley centre. She referred to a complaint by a staff member at Winston Heights regarding a request made to the appellant (which was refused) to take time off for a week following a family bereavement. This was after 24 June 2020. She referred to a request that the appellant “attend a meeting on 26 October 2020 to discuss a breach of National Regulations and National Law”. The appellant initially refused to attend the meeting, but ultimately did attend and “breaches at Prestons” were raised. Ms Revill said the “first formal performance meeting” with the appellant was held on 3 November 2020. The appellant “was not given any formal warnings - we just wanted to work on her performance issues. She continued to blame other people …”.
The Member, dealing with Ms Revill’s statement, said that on 2 December 2021 Samantha, a representative from the Department of Education (DOE), conducted a spot check/audit at Surveyor’s Creek. Samantha raised several breaches with the appellant. Ms Revill stated that issues were raised regarding the appellant’s management. Ms Revill said that after this meeting a “serious child protection issue” was raised with the appellant, who failed to escalate it, and then took two days’ leave, so that it was not raised with Ms Revill until some days later. Ms Revill referred to an incident on 20 January 2021 where an air conditioning unit was hanging by its cord from a wall at the Beverley Hills North centre. It was a safety risk and the appellant had been aware of it. The appellant was given her first and final warning letter on 21 January 2021, the “main focus” was the child protection breach.[13]
[13] Reasons, [36].
The Member referred to an email dated 22 October 2020 from Ms Revill to Mr Fionda, relating to the difficulties at Prestons. It said on 21 October 2020 the appellant was directed to be “on the floor” at Prestons in the afternoon as there were difficulties in getting an additional staff member to “cover the ratios”. It described the appellant driving on errands to Sutherland North, Caringbah and Beverley Hills, and then ringing Ms Revill at 4:10 to ask if she was still required at Prestons as “by now the numbers would have dropped”. Ms Revill said “Prestons had 43 children and 2 staff, from my understanding they also didn’t have a responsible person signed on”. The email said that on 22 October 2020 a staff member called in sick and therefore no staff would be on the floor today. A request went to the appellant to ask her to be on the floor. The appellant replied that she had “too many things today”. Ms Revill continued to Mr Fionda:
“[The appellant] has been told by me to be at Prestons today to which she said to me she has to complete an induction. I have told her she has to be at Prestons this afternoon and reminded [her] she is the area manager.
I said all this to ask, can we issue her with a show cause letter asking for her to explain why she felt delivering bloody uniforms and Ventolin more important than being on the floor as part of ratios at a service she manages?”[14]
[14] Reasons, [42].
The appellant was described as attending a meeting on 3 November 2020. The Member set out the minutes in part, which concluded with:
“When you’re available this week let’s get together and see if we can put a plan in place to help support you with prioritising your workload.”[15]
[15] Reasons, [44].
The Member referred to the minutes of a meeting on 3 December 2020 with a new recruit, Mary, who was in her second week. Mary discussed the visit by Samantha. The minutes are set out in the reasons at [46]. These included:
“Sam stated that she was mostly concerned about [the appellant] and not Mary, Sam stated that Mary was very competent however she was concerned about the responses [the appellant] gave …”.
On 21 January 2021 the “first and final” warning letter was given to the appellant. It is set out in the reasons at [50]. It refers to the key areas of concern that were outlined in a meeting with the appellant on 12 December 2020:
“1.     Failure to comply with mandatory reporting requirements
2.      Failure to oversee the staffing of each centre to meet the legislative requirements as defined in the Education and Care Services and National Law and Regulations
3.      Failure to ensure that the centre policies and procedures are implemented, reviewed, and updated as required
4.      Failure to provide ongoing support and education to staff, with particular attention to the regulatory compliance, supervision practices, policies, and procedures
5.      Failure to act as a liaison between the NS, staff and the licensee and represent Cubby OOSH in a professional manner
6.      Failure to ensure Quality Assurance checks are conducted and reports are created for each service and action taken as required
7.      Failure to ensure that accessibility and correct functions of all fire alarms, and that the rehearsal of emergency and evacuation procedures (lockdowns and evacuations) are conducted in accordance with Regulation 97 of the Education and Care Service National Regulations.”
The letter refers to a second meeting held on 20 December 2020 involving the appellant, Ms Revill and Ms Ashworth, the National People and Culture Manager. It said the respondent’s concerns were reiterated. It referred to alleged deficiencies in Child Protection Mandatory Reporting Requirements. It said:
“Following review of the matters raised and your responses to them, we have concluded that your conduct and performance is unsatisfactory, and we are therefore issuing you with this first and final warning.
Any future conduct/performance issues will result in further disciplinary action being taken where appropriate, potentially including the termination of your employment. As discussed, a sustained improvement in your conduct and performance is required in order to meet the standards expected and to fulfill your role and responsibilities as set out in your employment contract. As a result, you will be placed on a Performance Improvement Plan and I will meet with you weekly to review your progress …”.
The Member summarised the submissions of the appellant[16] and the respondent.[17] The appellant submitted that any action by the respondent with respect to performance appraisal or discipline was unreasonable. It was submitted Ms Revill carried out targeted action against the appellant. The appellant’s feelings of being bullied caused the injury. The appellant submitted the medical evidence supported the diagnosis of an Adjustment Disorder arrived at by Ms Dilek, psychologist. The respondent carried the onus of establishing the s 11A defence. Reference was made to the decision of Geraghty CCJ in Irwin v Director General of Education.[18]
[16] Reasons, [60]–[75].
[17] Reasons, [76]–[86].
[18] Geraghty CCJ, unreported, 18/6/1998 (Irwin), reproduced in Commissioner of Police v Minahan [2003] NSWCA 239 (Minahan), [27], [42].
The respondent submitted ‘discipline’ was the more relevant category under s 11A. It referred to Kushwaha v Queanbeyan City Council.[19] It submitted the respondent’s relevant actions were doubtlessly ‘discipline’. It referred to the summation of the principles governing s 11A(1) in Northern NSW Local Health Network v Heggie.[20] It was irrelevant that the appellant felt targeted by Ms Revill. The respondent referred to the decision of Keating P in Hartley v Dux Manufacturing Pty Ltd.[21]
[19] [2002] 23 NSWCCR 339 (Kushwaha), [154].
[20] [2013] NSWCA 255, 12 DDCR 95 (Heggie), [59].
[21] [2008] NSWWCCPD 55 (Hartley).
The Member concluded that the defence based on s 11A was made out.
The Member said the occurrence of a psychological injury, Adjustment Disorder, arising out of and in the course of the appellant’s employment, was not disputed. The Member said:
“The real issue is whether that injury was wholly or predominantly caused by the actions of the respondent with respect to performance appraisal and/or discipline within the meaning of s 11A or whether it was caused by the ‘bullying and harassment’ by Ms Revill as claimed by the [appellant].”
The Member said that a “useful starting point” was the definition of ‘bullying and harassment’ in the Fair Work Act2009 (Cth), which she quoted. The Member said she had an impression of the appellant being “comfortable, possibly even a little complacent in her role” and disliking being disciplined by Ms Revill. She said the appellant’s email dated 30 October 2020 “paints a picture of a very angry and defensive woman”.[22] She was “angry”, “not happy with management”, and not the dedicated and loyal worker who described herself to Dr Hong.[23] Contrary to the appellant’s evidence, Ms Revill offered to take on some of the additional tasks caused by one area manager undergoing training, an offer the appellant declined. The Member described this as “utterly inconsistent” with what the appellant said about extra workload.[24] The Member said she was left with “some concerns as to the [appellant’s] credibility”. She said “a number of people, including Mary, Samantha and Mr Fionda … contradict the [appellant’s] views on a number of occasions”.[25]
[22] Reasons, [92], [94].
[23] Reasons, [96].
[24] Reasons, [97]–[98].
[25] Reasons, [100].

The Member described the respondent’s actions as “drawing the [appellant’s] unsatisfactory work performance to her attention”, “asking her to improve”, “suggesting ways that could achieve that end” and “offering assistance”. She said that such actions fell within the “wider sense” of the word ‘discipline’ as that term was used by Neilson CCJ in Kushwaha. The Member said that when concerns were raised about the appellant’s conduct “there were many offers of assistance to her to address those various concerns”.[26] The Member referred to the decision in Hartley. The Member said that the actions of the respondent over the last “several months” of the appellant’s employment, in emails and meetings, were “a good guide to the reasonableness of” its actions. The Member did not accept the statement of Ms Sprod, that Ms Revill took an instant dislike to many staff members. She said this did not confirm bullying and harassment, it was simply Ms Sprod’s “own opinion”.[27]
[26] Reasons, [103]–[104].
[27] Reasons, [105]–[106].
The Member referred to Dr Hong’s view that most of the appellant’s issues “relate to performance and discipline matters” and this was “the whole and predominant cause of the injury”. She referred also to the evidence of Dr Smith, psychiatrist qualified by the respondent, and said the causation test in Hamad v Q Catering Ltd[28] was satisfied.[29] The Member said:
“110. In short, the evidence overall and indeed the tone of the [appellant’s] evidence suggests to me that it was she who developed a serious gripe or grudge against Ms Revill, becoming unhappy with her management style. There is nothing in the evidence of Ms Revill that suggested that she ‘bullied’ the [appellant] with a view to forcing her to quit her job as the [appellant] claimed.”
111. This ties in with the meeting between Ms Revill and Samantha, which paints a picture of a difficult employee who was not amenable to being told what to do by her superior, and was herself prone to blaming others for her shortcomings.”[30]
[28] [2017] NSWWCCPD 6 (Hamad).
[29] Reasons, [108]–[109].
[30] Reasons, [110]–[111].
The Member did not accept the evidence of Ms Dilek on the basis Ms Dilek “simply accepted what she was told” by the appellant. She rejected the assertion that an employee, Gada, was “in cahoots with Ms Revill”, as a reflection of the appellant’s anger. She dealt with an argument that “other staff members were not disciplined” as “not relevant to the [appellant’s] particular circumstances”.[31] The Member said “I am able to summarise by saying that I accept the respondent’s submissions”. She said the appellant thought she was “unfairly treated”, but this was not evidence of bullying or harassment. The Member referred to the decision in Minahan, to which she said she had had regard. The Member made factual findings:
“118. The extensive evidence from the respondent about the various problems at some of the centres under the management of the [appellant] more than warranted some disciplinary measures given as I said the nature of the respondent’s business.
119. I am not persuaded that she was bullied or harassed either within the definition in the Fair Work Act referred to previously (victimising, humiliating, intimidating or threatening …) or in what may be described as a lay definition. Rather, her own conduct and behaviour warranted ‘reasonable management action’ which required the making of decisions about ‘poor performance’ and ‘disciplinary action’ which I am satisfied was carried out in a reasonable way.
120. I have had regard to the decision in Minahan where it was stated that ‘whether the action is reasonable should be attended in all the circumstances by a question of fairness’ and concluded that the employer’s actions were both fair and reasonable, particularly having regard to the offers of assistance made to the [appellant] on several occasions.”
[31] Reasons, [112]–[114].
The Member concluded that the defence pursuant to s 11A(1) of the 1987 Act was established and entered an award for the respondent.

LEGISLATION

Section 11A(1) of the 1987 Act 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.”

THE NATURE OF THE APPEAL

The appeal is one brought pursuant to s 352(5) of the 1998 Act, which provides:
“An appeal under this section is limited to a determination of whether the decision appealed against was or was not affected by any error of fact, law or discretion, and to the correction of any such error. The appeal is not a review or new hearing.”
In Raulston v Toll Pty Ltd[32] Roche DP applied Whiteley Muir & Zwanenberg Ltd v Kerr[33] to the nature of the appeal process pursuant to s 352 of the 1998 Act:
“(a)    [A Member], though not basing his or her findings on credit, may have preferred one view of the primary facts to another as being more probable. Such a finding may only be disturbed by a Presidential member if ‘other probabilities so outweigh that chosen by the [Member] that it can be said that his [or her] conclusion was wrong’.
(b)     Having found the primary facts, the [Member] may draw a particular inference from them. Even here the ‘fact of the [Member’s] decision must be displaced’. It is not enough that the Presidential member would have drawn a different inference. It must be shown that the [Member] was wrong.
(c)     It may be shown that [a Member] was wrong ‘by showing that material facts have been overlooked, or given undue or too little weight in deciding the inference to be drawn: or the available inference in the opposite sense to that chosen by the [Member] is so preponderant in the opinion of the appellate court that the [Member’s] decision is wrong’.”[34]
[32] [2011] NSWWCCPD 25; 10 DDCR 156 (Raulston).
[33] (1966) 39 ALJR 505, 506.
[34] Raulston, [19].
In Workers Compensation Nominal Insurer v Hill[35] Basten JA said:
“With respect to errors of fact finding, the line between preferring a different result and identifying error is by no means easy to draw, but that is clearly what the Deputy President sought to do by adopting the language complained of. It was also what Barwick CJ sought to do in Whiteley Muir in using such language to identify the difference between an appeal based on a finding of error and a hearing de novo (and, one must now add, a rehearing). If, on an appeal by way of rehearing, the court asked whether the findings of fact were ‘open’ to the trial judge, that might demonstrate an unduly limited understanding of the court’s function; however, that language is not out of place in determining an appeal from factual findings under s 352(5).”[36]
[35] [2020] NSWCA 54 (Hill).
[36] Hill, [20].
In Heggie Sackville AJA said:
“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.”[37]
[37] Heggie, [72].

GROUNDS OF APPEAL

The appellant raises the following grounds of appeal:
(a)    Error in fact and law in failing to find that the appellant’s injury was caused by the bullying and harassment occasioned to her by the general manager of the respondent, Ms Abby Revill. (Ground No. 1)
(b)    Error in fact and law in finding that the appellant’s injury was wholly or predominantly caused by reasonable actions of the respondent with respect to discipline within the meaning of s 11A of the 1987 Act. (Ground No. 2)
(c)    Error in fact in the acceptance of, and weight placed on, the statement of Ms Abby Revill dated 29 March 2021. (Ground No. 3)

THE PARTIES’ WRITTEN SUBMISSIONS

Ground No. 1

Appellant’s submissions

The Member, in her reasons at [89], set out a definition of ‘bullying and harassment’ which she described as that in the Fair Work Act. The appellant submits the quote is “not accurate or correct”. The appellant quotes from s 789FD of the Fair Work Act. The two quotes are not identical. The version quoted by the appellant is consistent with s 789FD as it currently appears in the Federal Register of Legislation. The appellant submits the incorrect reference is not determinative of error, but “is indicative of the incorrect approach taken”.[38]
[38] Appellant’s submissions, [20]–[22].
The appellant refers to a well-known passage, from the decision of Roche DP in Attorney-General’s Department v K,[39] in which the Deputy President at [52] sets out, by reference to authorities, a summation of a number of principles relevant to the proof of psychological injury. The appellant refers to that decision at [54] which includes the following:
“A worker’s reaction to the events will always be subjective and will depend upon his or her personality and circumstances. It is not necessary to establish that the worker’s response was ‘rational, reasonable and proportional’.”[40]
[39] [2010] NSWWCCPD 76 (K).
[40] Appellant’s submissions, [24]–[25].
The appellant submits the Member accepted the appellant felt unfairly treated and this played on her mind. She submits the perceived unfair treatment caused the psychological injury. The appellant submits it was made clear in K that as long as the events are “real and not fanciful”, it is not necessary for the appellant to demonstrate that her reaction was “rational, reasonable or proportional”. The failure to apply the approach described in K is submitted to be appealable error.[41]
[41] Appellant’s submissions, [26]–[31].
The appellant also submits the evidence of the independent medical experts qualified by the parties on the causation issue may be of assistance but is not necessarily determinative.[42]
[42] Appellant’s submissions, [32]–[33].

Respondent’s submissions

The respondent says the appellant does not challenge that the respondent’s actions, taken from September 2020 to 22 January 2021, were “with respect to discipline” and had a causal role in the psychological injury. This was consistent with the opinion of Dr Hong, the psychiatrist qualified by the appellant, together with Dr Smith qualified by the respondent.[43]
[43] Respondent’s submissions, [5]–[8].
The respondent seeks to characterise the appellant’s argument in Ground No. 1 as an argument based on the Member’s failure to find that the injury was one caused by ‘bullying or harassment’. It then submits this is ambiguous, as it is unclear whether the complaint relates to the characterisation of the relevant actions, or the finding that the injury resulted wholly or predominantly from those actions. It submits the Member gave reasons for finding the actions should not be characterised as ‘bullying’ or ‘harassment’.[44]
[44] Respondent’s submissions, [9]–[11].
The respondent says that, if the issue being raised is that of causation, the appellant cannot establish error. It submits the meeting on 12 December 2020 was unquestionably disciplinary. When the appellant consulted Dr Meegoda, general practitioner, in December 2020 this was a reaction to the meeting. The respondent made submissions to this effect and the Member said, in the reasons at [116], that she accepted the respondent’s submissions. The respondent submits its submissions are summarised at [76] to [86] of the reasons and are transcribed. The Member’s adoption of the respondent’s submissions is submitted to be “a satisfactory means for the tribunal to reveal its own reasoning process”.[45]
[45] Respondent’s submissions, [13]–[14].
The respondent refers to the causation test in s 11A(1) and to the decision in Hamad. It submits that in this matter, as in Hamad, there were a number of factors that were potentially causative of psychiatric injury. It was necessary that the Member look to expert evidence in assessing which factors were predominant. It is submitted the Member’s conclusion that disciplinary action was the whole or predominant cause is beyond challenge.[46] It submits the appellant’s argument that the Member erred in failing to apply K becomes irrelevant. Those actions which fell outside the category of ‘discipline’ may have led to a perception of bullying or harassment, but the Member concluded it was the disciplinary action taken that was the cause of the injury.[47] The appellant may have felt bullied by the disciplinary action; it was up to the Member to determine whether the disciplinary actions were reasonable applying an objective test. Reference is made to Minahan.[48]
[46] Respondent’s submissions, [15]–[16].
[47] Respondent’s submissions, [17].
[48] Respondent’s submissions, [18]–[19].

Appellant’s submissions in reply

The appellant submits that, if an employer’s actions were properly classifiable as ‘bullying and harassment’, they would not be entitled to the protection granted under s 11A(1). The appellant submits that if actions, determined to constitute bullying and harassment, contribute to a worker’s psychological injury, s 11A offers the employer no protection. It is submitted that the Member conflated “the issues of bullying and harassment with the assessment of disciplinary actions taken by the employer …”. The appellant submits that ‘bullying and harassment’ by Ms Revill was consistent with Dr Hong’s report. The Member accepted the appellant’s evidence of unfair treatment and bullying. She then failed to address it. She failed to apply the approach in K.[49]

Ground No. 2

[49] Appellant’s submissions in reply, [4]–[11].

Appellant’s submissions

The appellant submits that the respondent, to establish its defence under s 11A(1), needed to prove:
(a)    the relevant injury to which the defence is said to apply;
(b)    that the injury was wholly or predominantly caused by action taken or proposed to be taken with respect to one of the protected classes of action, and
(c)    that the action taken or proposed to be taken was (objectively) reasonable.
The appellant submits that if the respondent fails to establish either (b) or (c) the defence is not made out (there is reference to Canterbury Bankstown Council v Gazi).[50] It was necessary that the Member assess each of those matters individually. If (b) is made out, it is necessary to consider whether the relevant action was (objectively) reasonable. The appellant refers to Irwin, Heggie and Jeffery v Lintipal Pty Ltd.[51] [52]
[50] [2019] NSWWCCPD 14, [145].
[51] [2008] NSWCA 138 (Jeffery), [33].
[52] Appellant’s submissions, [38]–[44].
The appellant submits the Member failed to identify the actions she objectively assessed to determine their reasonableness. The appellant refers to the reasons at [102] and [118]. It is submitted these paragraphs failed to identify what action caused the injury or the basis on which the action was assessed to be reasonable. This is consistent with the respondent’s submissions which failed to demonstrate what action was causative or whether it was reasonable. Reference is made to the respondent’s submissions as summarised by the Member in the reasons at [76] to [86].[53] The appellant submits the respondent’s dispute notice suffered from the same defect and refers to Mateus v Zodune Pty Ltd.[54] The appellant submits the Member erred in finding that the s 11A(1) defence was made out.
[53] Appellant’s submissions, [45]–[49].
[54] [2007] NSWWCCPD 227, [45].

Respondent’s submissions

The respondent submits the reasons at [105] identified the meetings and emails “over several months prior to the [appellant] voluntarily ceasing work upon receipt of the warning letter” as being the whole or predominant cause of injury. It submits these meetings and emails were the disciplinary actions identified at [12] to [19] and [36] to [51] of the reasons. It submits the respondent determined that disciplinary action was necessary, took that action, which was set out, and it was that action that led to the appellant’s decompensation. The appellant saw her general practitioner after the meeting on 12 December 2020. Following the disciplinary meeting and email on 21 January 2021, the appellant felt “very sick to a point where she had to pull over and stop driving” and saw Dr Dulawan. She was considered “too unwell to work”. The Member identified the causative actions and assessed their reasonableness.[55]
[55] Respondent’s submissions, [23]–[29].
The respondent submits the appellant has not submitted that the respondent acted unreasonably. The Member accepted she was obliged to follow Minahan. She found it was reasonable that the respondent undertook disciplinary measures, its business was that of childcare and there were reported problems at centres under the appellant’s management.[56]
[56] Respondent’s submissions, [30]–[32].

Appellant’s submissions in reply

The appellant submits the Member was required to identify the actions that were causative of psychological injury, and then objectively determine the reasonableness of those actions. It submits this was not carried out “with the specificity required”. The appellant disputes the respondent’s submission that it was “very clear” that the meetings and emails described in the reasons at [12] to [19] and [36] to [51] are the disciplinary meetings and the emails flowing from those meetings. It submits the Member “recited” (rather than “reviewed”) the evidence, which was “not indicative that proper consideration” of the two elements of the test in s 11A(1) occurred. The appellant submits the Member took a “broad brush” approach which was not properly available. She should have identified “each instance” of discipline or performance appraisal “so as to assess the objective reasonableness of that purported action”. She submits the Member failed to evaluate whether the actions were objectively reasonable.[57]

Ground No. 3

[57] Appellant’s submissions in reply, [12]–[18].

Appellant’s submissions

The appellant refers to Raulston at [25], a passage in which reference is made to Fox v Percy.[58] The appellant submits the evidence of the appellant, Ms Revill and “briefly, Ms Sprod” was evaluated at [90] to [113] of the reasons. Although “not explicitly stated” it is clear the Member accepted the evidence of Ms Revill and disregarded that of the appellant and Ms Sprod. Ms Sprod was a former employee who worked with the respondent while Ms Revill was general manager. There was no relationship between Ms Sprod and the appellant. She had nothing to gain, she was an independent witness. The appellant submits the evidence of Ms Revill must be scrutinised against that of Ms Sprod.[59]
[58] [2003] HCA 22; 214 CLR 118 (Fox v Percy), [24] and [27].
[59] Appellant’s submissions, [56]–[63].
The appellant submits Ms Revill’s credibility should have been questioned. Ms Sprod stated that Ms Revill said she would offer Ms Sprod further training in her position but none was given. This was consistent with the appellant’s evidence of an offer of further training made to her, that was not forthcoming. The Member failed to consider this, and accepted Ms Revill’s evidence that “help was available if needed” (at [98] of the reasons). Ms Sprod questioned Ms Revill’s honesty in dealing with the Department of Education (her statement at [12] to [13]). Ms Sprod’s evidence of Ms Revill’s dealing with other employees was consistent with complaints made by the appellant (Ms Sprod’s statement at [6] to [10]). The appellant submits none of this was addressed by the Member, who dealt with Ms Sprod’s evidence at [106] of the reasons:
“I am also mindful of the statement of Ms Sprod who clearly felt that Ms Revill took ‘an instant dislike’ to many members of staff, but I cannot accept that her comments can be construed as amounting to confirmation that Ms Revill ‘bullied and harassed’ the [appellant]. It is merely a statement of her own opinion of Ms Revill.”

The appellant submits the Member failed to consider the evidence of Ms Sprod, resulting in an “unquestioned acceptance of Ms Revill’s evidence”. It is submitted this constitutes factual error.

Respondent’s submissions

The respondent quotes the following passage from Fox v Percy:
“In some, quite rare, cases, although the facts fall short of being ‘incontrovertible’, an appellate conclusion may be reached that the decision at trial is ‘glaringly improbable’ or ‘contrary to compelling inferences’ in the case.”[60] (excluding references)
[60] Fox v Percy, [29].
The respondent refers to Ms Sprod’s evidence that Ms Revill failed to provide training to her (Ms Sprod) after saying she would. The respondent refers to Ms Revill’s evidence that she offered further training to the appellant, which the appellant declined. It refers to the appellant’s evidence that offers of further training, if they were ever made, were without substance, an expression it describes as unexplained. It submits similar assertions were made at [66] to [68] of the appellant’s submissions. It submits “none of this remotely suggests that Member Moore has reached a conclusion that is glaringly improbable or contrary to compelling inferences” (respondent’s emphasis).[61]
[61] Respondent’s submissions, [33]–[37].
The respondent submits the Member was obliged to weigh the credibility of competing evidence. The Member gave reasons for accepting that of Ms Revill and treating that of the appellant with caution. It submits that even if there was error, it is not established that it affected the outcome. The question was the reasonableness of the respondent’s actions, not only those of Ms Revill but also those of Mr Fionda. If the evidence of Ms Sprod were preferred to that of Ms Revill where the two conflicted, that preference “would have no bearing on the determination of the two relevant questions”.[62]
[62] Respondent’s submissions, [38]–[39].

Appellant’s submissions in reply

The appellant submits the Member provided no reasons for acceptance of Ms Revill and her rejection of the evidence of the appellant and Ms Sprod. This is only implicit, nowhere can it “be ascertained why the [M]ember formed that view”. The Member gives no reasons for rejecting Ms Sprod’s evidence. The appellant submits this is not irrelevant to the outcome; where Ms Revill was the only person who gave evidence for the respondent, “the evidence of Ms Sprod is crucial”. Ms Sprod “clearly impugns the credibility of Ms Revill”. It is submitted this supports the evidence of the appellant regarding Ms Revill’s credibility. The respondent has provided no evidence to dispute that of Ms Sprod. It is evidence which ought to have affected the outcome. It was not properly addressed by the Member.[63]

THE PARTIES’ ORAL SUBMISSIONS

[63] Appellant’s submissions in reply, [19]–[28].

The respondent

The submissions were transcribed. I will note the main points that were made.
Mr Perry referred to Manly PacificInternational Hotel Pty Ltd v Doyle.[64] He noted the reasons of Fitzgerald JA at [5] and accepted that the onus of establishing a defence pursuant to s 11A(1) of the 1987 Act fell on the employer.[65] Mr Perry referred to the acceptance by Dr Hong (qualified in the appellant’s case) that most of the appellant’s “issues” related to “performance appraisal and discipline” which was the “whole or predominant cause of injury”. Mr Perry submitted that the Member referred to this, noted that Dr Smith was of a similar view, and relied on that evidence in concluding that that part of the defence had been made out. He submitted the Member correctly said that the medical evidence on this issue was “all one way”.[66]
[64] [1999] NSWCA 465; 19 NSWCCR 181 (Doyle).
[65] Transcript 20 July 2022 (T2), T2 6.28–8.9.
[66] T2 11.1–27.
Mr Perry referred to Secretary, Department of Education v BB.[67] He quoted from a reference in that decision to Roncevich v Repatriation Commission where Kirby J said that courts should “avoid an overly pernickety examination of the reasons” and that 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”.[68] He submitted “That’s where the focus ought be”.[69] Mr Perry said without disagreement that the actions the subject of s 11A(1) relied on by the Member were with respect to ‘discipline’.[70]
[67] [2021] NSWPICPD 21 (BB).
[68] [2005] HCA 40; 222 CLR 115, [64].
[69] T2 12.24–32.
[70] T2 13.11–22.
Mr Perry referred to a meeting involving the appellant, Ms Revill and Mr Fionda on 12 December 2020. He submitted there were consultations with the appellant’s medical practitioner following this meeting. He submitted the meeting made some contribution as did events thereafter.[71] Mr Perry referred to a letter from Ms Revill dated 21 January 2021.[72] He submitted the letter had a significant effect on the appellant’s health.[73] Mr Perry submitted that it was necessary to rely on medical evidence to deal with the causation issue in s 11A.[74] He submitted that, on the medical evidence, the predominant cause of the psychological injury was discipline.[75]
[71] T2 15.11–22.
[72] Reply, p 87.
[73] T2 14.30–15.6.
[74] T2 17.1–7.
[75] T2 19.14–18, 20.6–13.
Mr Perry referred to the Member’s reference to bullying and harassment. He said those words did not appear in the pleaded allegation of injury. He referred to the how the appellant’s case was described to the Member. Mr Perry submitted the appellant’s case was described on the basis that “Ms Revill took a personal disliking to the [appellant] and commenced bullying, harassing, undermining, acting with bias against the [appellant] and personally not professionally criticising the [appellant]”. Mr Perry submitted that in those circumstances it was “not inappropriate that the Member should look to what was no more than a useful starting point, the definition of bullying and harassment”.[76]
[76] T2 20.15–22.1.
Mr Perry referred to State Transit Authority of New South Wales v Chemler.[77] Basten JA in Chemler said:
“… In so far as his findings constituted a rejection of the need for an intention to harass, there was no error of law. Nor is it necessary to determine whether the Respondent’s response was a misperception as to the intention or attitudes of his fellow workers. In contrast to discrimination law, the proper focus in this context is the consequence of conduct on the claimant and not, even in a limited sense, the motivation, intention or other mental state of the co-worker or supervisor. If conduct which actually occurred in the workplace was perceived as creating an offensive or hostile working environment, and a cognizable injury followed, it was open to the Commission to conclude that causation was established.[78] (omitting references)
[77] [2007] NSWCA 249 (Chemler).
[78] Chemler, [69].
Mr Perry submitted that, “to the extent that the actions fall within discipline the question of the subjective response of the worker ceases to have the same effect”. He submitted “… if a worker is disciplined and has the impression that the discipline amounts to bullying, that does not rob the action of its effect for the purposes of the defence under section 11A. The reason for that is that it is an objective test”. He referred to Heggie.[79] If, on an objective view, an employer’s actions are reasonable, it does not matter that the worker’s subjective view is that the actions are unreasonable.[80] If actions outside those which are causative are not reasonable, that is not a relevant matter (there is reference to Doyle). Mr Perry submitted the Member adequately addressed the issue of ‘wholly and predominantly’.[81]
[79] T2 22.11–20.
[80] T2 23.10–16.
[81] T2 23.29–24.3.
Mr Perry then moved to the issue of whether the relevant actions were reasonable, having regard to the Member’s consideration of the definition of ‘bullying and harassment’. He referred to offers of assistance to the appellant, on which the Member relied.[82] Reference was made to the reasons at [88] where the Member said:
“The real issue is whether that injury was wholly or predominantly caused by the actions of the respondent with respect to performance appraisal and/or discipline within the meaning of s 11A or whether it was caused by the ‘bullying and harassment’ by Ms Revill as claimed by the [appellant].”
[82] T2 24.30–26.3.
Mr Perry conceded that if an action in respect of discipline constituted bullying then a defence based on s 11A would fail. It could not be reasonable.[83] He submitted that the reference to bullying was “incompatible with it being reasonable”, and the appellant’s contention overall was that Ms Revill bullied her.[84] Mr Perry submitted that the reference to the definition in the Fair Work Act was a “useful starting point”, nothing more turned on it.[85] Reference was made to the reasons at [119] where it was said:
“I am not persuaded that she was bullied or harassed either within the definition in the Fair Work Act referred to previously (victimising, humiliating, intimidating or threatening …) or in what may be described as a lay definition. Rather, her own conduct and behaviour warranted ‘reasonable management action’ which required the making of decisions about ‘poor performance’ and ‘disciplinary action’ which I am satisfied was carried out in a reasonable way.”
[83] T2 27.20–28.
[84] T2 29.1–9.
[85] T2 29.14–23.
Mr Perry submitted the reasons at [119] perceived two competing contentions, whether Ms Revill’s actions constituted ‘bullying and harassment’ and whether the ‘bullying and harassment’ extended over matters other than discipline.[86] He submitted the Member did not say “if it’s A the respondent wins and if its B the [appellant] wins and there’s nothing in between”. She gave reasons for accepting that the predominant cause was discipline and for her conclusion about reasonableness, at [116] and [119] to [120].[87] Mr Perry referred to the Member’s reasons at [119]. He described the approach as saying its actions “weren’t bullying, they weren’t harassing, they were reasonable actions with regard to discipline”. He submitted the Member had not “mislead herself or taken herself off on some definition that excludes – that’s contradictory to section 11A”.[88] Mr Perry submitted the reference to the Fair Work Act had not led to “a path of error”. He described this as “a useful tool for the Member to use and quite appropriate for her to look around given that she’s presented with a submission with bullying in it”.[89]
[86] T2 31.29–34.
[87] T2 32.17–23.
[88] T2 33.27–28.
[89] T2 35.29–36.10.

The appellant

The appellant’s counsel referred to the fact that the case was presented in a fashion that referred to an allegation of bullying and harassment. He submitted that, irrespective of that circumstance, the Member had a responsibility to address the matter in accordance with law. Mr Doupe referred to the passage from Chemler set out at [62] above. He submitted the injury occurred because the appellant “perceived certain conduct to be hostile or harassing or offensive”, causing the injury, which was not in issue.[90] Mr Doupe referred to the question framed in the reasons at [88]. He referred to the reasons at [90] where the Member said:
“I have some doubts as to whether the actions of Ms Revill in particular (and others as referred to in her statement) could be regarded as bullying and harassment for reasons that follow.”
[90] T2 37.15–39.7.
Mr Doupe submitted this demonstrated that the Member fell into error, in approaching the matter by reference to whether the actions of the respondent fell within the definition of ‘bullying and harassment’ in the Fair Work Act. Mr Doupe submitted this was inconsistent with Chemler.[91] The appellant’s submissions referred to the reasons at [110] where it was said “There is nothing in the evidence of Ms Revill that suggested that she ‘bullied’ the [appellant] with a view to forcing her to quit her job as the [appellant] claimed.” The appellant submitted this demonstrated an incorrect approach in assessing the respondent’s actions by reference to whether they fitted the definition of ‘bullying and harassment’ in the Fair Work Act.[92] He submitted it was a theme that continued throughout the reasons (referring to the reasons at [119]).[93]
[91] T2 39.25–33.
[92] T2 39.25–30.
[93] T2 40.14–15.
The appellant submitted that the current matter could be distinguished from BB to which the respondent referred. It was submitted that in BB the reasons were “fulsome” and “understandable”. Mr Doyle submitted that in BB the Member at first instance scrutinised the evidence of each of the medical professionals and a psychologist, and that evidence was accepted or rejected for reasons that were clearly articulated.[94]
[94] T2 42.16–20.
Mr Doupe referred to the passage of Doyle referred to in the Direction issued on 11 July 2022 (see [73] below). He submitted it was necessary to refer to the first of the questions raised in Doyle at [5] (whether the injury was “wholly or predominantly caused” by relevant action) before dealing with the second question raised in that paragraph. He submitted there was nothing in the reasons that revealed this first question was actually considered. The appellant accepted that the Member rejected the submission that “the cause was bullying”. The appellant submits it was error to fail to consider these questions “in the manner prescribed by Doyle”.[95]
[95] T2 43.1–28.

Further submissions

Mr Perry in reply submitted that s 11A(1) required the Member to assess the reasonableness of “that action” with respect to discipline that caused the psychological injury, referring to Heggie at [59]. He submitted that the Member did look at “the reasonableness of the disciplinary action taken by [Ms] Revill”.[96] He submitted that this test of reasonableness is “objective”, different to that in Chemler, where a perception of bullying may be sufficient.[97]
[96] T2 44.18–45.13.
[97] T2 45.22–34, 44.7–10.
On 25 July 2022, the appellant’s counsel forwarded an email to the Commission (the respondent’s solicitor was copied in) drawing its attention to a decision of Acting Deputy President Parker SC, in a matter of Mieth v Sydney Trains[98] issued on 14 July 2022. The decision raised “bullying/harassment”, psychological injury and the decision in Chemler. The covering email referred to the reasons in that decision at [70] to [80]. It is convenient to briefly deal with that reference. The Acting Deputy President referred to the decision of Basten JA in Chemler at [69] and to that of Roche AP in K, both of which he applied. He found error in how the Member in Mieth dealt with the proof of psychological injury where a worker reacted to real “innocuous events” that he perceived to be “offensive and hostile”. Unlike the current matter, the subject matter was the proof of injury by a worker pursuant to s 4 of the 1987 Act, as opposed to proof by an employer of the causation test in s 11A(1), which is an objective test. Mieth can be appropriately distinguished on that basis from the issues in the current matter.

CONSIDERATION – GROUND NO. 1

[98] [2022] NSWPICPD 27.

‘Wholly or predominantly’

Section 11A(1) of the 1987 Act presupposes the existence of an ‘injury’. In Doyle Fitzgerald JA (Mason P agreeing) said:
“4. Before this Court, it was not disputed that Mr Doyle’s employment was a substantial cause of his psychological injury. That being so, the Compensation Court was required to decide whether (i) the whole or predominant cause of Mr Doyle’s psychological injury was the appellant's action with respect to Mr Doyle’s transfer from one position to another, and, (ii) if so, whether the appellant’s action with respect to Mr Doyle’s transfer was reasonable.
5. Mr Doyle was entitled to succeed in the Compensation Court if either issue identified in the preceding paragraph was decided in the negative. If Mr Doyle established that his psychological injury was not ‘wholly or predominantly caused by ... action taken .... by ... [the appellant] with respect to [Mr Doyle’s] transfer’, he is entitled to be compensated although the appellant’s material ‘action’ was ‘reasonable’. Conversely, if Mr Doyle’s psychological injury was ‘wholly or predominantly caused by ... action taken ... by [the appellant] with respect to [Mr Doyle’s] transfer’, he is entitled to be compensated if he established that the appellant’s ‘action’ was not ‘reasonable’.”[99]
[99] Doyle, [4]–[5].
The Member, in her reasons at [6], correctly noted it was common ground that the appellant had suffered psychological injury in the course of or arising out of employment. The ‘liability’ issue to be considered was whether the respondent had established its defence pursuant to s 11A(1). The respondent’s case as ultimately presented was that the relevant actions alleged to support the defence were actions with respect to discipline. In Heggie Sackville AJA said:
“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.”[100] (emphasis in original)
[100] Heggie, [59].
Although the issue of ‘injury’ was conceded by the respondent, it was necessary to identify the actions of the respondent that caused the psychological injury before the s 11A(1) defence could be considered. The appellant submits the Member failed to consider the issue of whether the injury resulted wholly or predominantly from relevant action or proposed action by the respondent (see [70] above). The injury allegation in the ARD is set out at [2] above. The respondent’s reason for denying liability pursuant to s 11A(1) was described in the dispute notice dated 19 May 2021:
“Whether your psychiatric injury was wholly or predominantly caused by the action taken or proposed to be taken by your employer with respect to performance appraisal and/or discipline in accordance with section 11A of the Workers Compensation Act 1987.”[101]
[101] ARD, p 48.
The respondent stated that its dispute notice relied on the report of Dr Smith, which said that there was a work-related condition of adjustment disorder. The doctor said the predominant cause of her adjustment disorder “was her perception that she was subject to unreasonable allegations of poor performance in the context of an unreasonable workload without adequate support.” Dr Smith said this diagnosis “was predominantly caused by the actions taken or proposed to be taken by her employer with respect to performance review”.[102]
[102] Reply, p 7.
Dr Hong, psychiatrist, was qualified in the appellant’s case and reported on 4 June 2021. He said:
“Ms Williams developed an adjustment disorder. Her symptoms started in late 2020 and steadily escalated in correlation with a number of workplace changes, particularly since January 2021.”
“Much of the described workplace dispute relates to performance and discipline matters and I agree this is the whole and predominant cause of the injury. Whether such administrative action is reasonable or not, is a matter for the appropriate expert to determine.”[103]
[103] ARD, p 73.
The Member relied on the evidence of Dr Hong and Dr Smith, saying:
“108. I also note that Dr Hong concluded that most of the issues described by the [appellant] ‘relate to performance and discipline matters and I agree this is the whole and predominant cause of the injury. Whether such administrative action is reasonable or not, is a matter for the appropriate expert to determine.’
109. Dr Smith was of a similar view, such that there was medical evidence to satisfy the requirements referred to in Hamad.”

The appellant submitted that the opinion of Dr Hong was not necessarily determinative (see [38] above). The Member did not treat it as necessarily determinative, she simply agreed with and accepted Dr Hong’s opinion on this topic. This was open to her on the evidence.
The Member referred to the fact that the appellant “had significant responsibilities given the nature of the respondent’s business, and that failures in the proper management of the various child care centres would be extremely serious”. She referred to “issues at Prestons” described in an email dated 22 October 2020. She said:
“It is with this in mind that I am persuaded that the respondent’s actions in ‘drawing the [appellant’s] unsatisfactory work performance to her attention, in asking her to improve that performance, of suggesting ways that could achieve that end, of offering assistance and or training was ‘discipline’ using the wider sense of that word’ as Neilson J said in Kushwaha.”[104]
[104] Reasons, [101]–[103].
In Kushwaha Neilson CCJ discussed the meaning of ‘discipline’ in s 11A(1) of the 1987 Act. His Honour referred to some decisions of the Compensation Court of New South Wales together with dictionary definitions and said:
“It can be seen, therefore, that the primary meaning of ‘discipline’ is learning or instruction imparted to the learner and the maintenance of that learning by training, by exercise or repetition. The narrow meaning of punishment, chastisement is secondary to the primary meaning although this word is often used in this sense in popular speech. It is this narrow meaning which weighed on my mind in Bottles’ case. However, the word used in an Act of Parliament must be given its full meaning, unless the context otherwise requires. Such a context does not appear to me to be called for in the interpretation of s 11A(1).”[105]
[105] Kushwaha, [152].
The correctness of his Honour’s interpretation of the meaning of ‘discipline’ in s 11A(1) is not challenged on this appeal.
I accept that the Member dealt with the issue of whether the psychological injury was caused wholly or predominantly from actions or proposed actions of the respondent with respect to discipline. It follows that I reject the argument that the Member failed to deal with this issue.
A number of the submissions supporting Ground No. 1 deal with whether the relevant actions that caused the conceded injury were appropriately characterised as ‘reasonable’ actions or should rather have been characterised as ‘bullying and harassment’. There is overlap between those submissions and the submissions dealing with Ground No. 2 and it is convenient to deal with them together below.

CONSIDERATION – GROUND NO. 2

The objective nature of the test

The passage from Heggie quoted at [74] above refers to the need for assessment of the reasonableness of the disciplinary action that caused the psychological injury.
In Jeffery Basten JA, dealing with s 11A(1) of the 1987 Act in the context of ‘transfer’, said:
“There is a clear distinction to be drawn between a statutory test which requires an objective assessment by the Commission of the reasonableness of the action of the employer and a test by which it is sufficient for the employer to demonstrate to the Commission that, in all the circumstances, the action appeared to it to be reasonable. In my view, the present statutory provision engages the former test ... If it were sufficient that the employer took action because it appeared to the employer, on grounds upon which it was reasonable to rely, to be reasonable action, the legislature could have said so. However, it did not. In my view, if, in the view of the Commission, the action taken by the employer in transferring an employee is not reasonable in all the circumstances, the employer cannot rely upon s 11A because it held a genuine belief, based on reasonable grounds, that its action was reasonable.”[106]
“The reasonableness of the action should properly be assessed by reference to the facts giving rise to the transfer, rather than the contractual relationship between the employer and a third party. The contractual relationship is not, of course, irrelevant: it may mean that the conduct of the third party becomes a relevant factor in assessing the reasonableness of the transfer.”[107]
[106] Jeffrey, [50].
[107] Jeffrey, [44].
Dr Hong’s opinion did not suggest any relevant causal factors beyond those that were the subject of the appellant’s allegation of work-related psychological injury. The doctor said:
“Problems developed when the new general manager took over in September 2020, and her stress level steadily escalated. She has not felt supported and believes that she has been subjected to a pattern of behaviour, consistent with bullying and harassment, and that there were unfair criticisms regarding her performance. As a result of the described workplace difficulties, she developed a range of symptoms consistent with a chronic adjustment disorder.”[108]
[108] ARD, pp 72–73.

‘Reasonableness’

It followed that the remaining issue in determining the success of the respondent’s defence pursuant to s 11A(1) was whether its relevant actions, on objective assessment, were ‘reasonable’. This determination is different to the test described in Chemler at [62] above, which applies to the proof of psychological injury by a worker.
This issue of ‘reasonableness’ was complicated by the references in the Member’s reasoning to ‘bullying and harassment’ and to what she described as the definition of that phrase in the Fair Work Act. The Member in her reasons at [87] referred to the fact that the respondent had conceded the occurrence of “a psychological injury, identified as an adjustment disorder, arising out of and in the course of her employment with the respondent”. In her reasons at [88], the Member described the question before her in the following terms:
“The real issue is whether that injury was wholly or predominantly caused by the actions of the respondent with respect to performance appraisal and/or discipline within the meaning of s 11A or whether it was caused by the ‘bullying and harassment’ by Ms Revill as claimed by the [appellant].” (emphasis added)
The way in which the Member formulated the question, described as the “real issue” in the reasons at [88], would have been unobjectionable if the word ‘reasonable’ was inserted before the word “actions” and if the question had concluded after the words “within the meaning of s 11A”. The balance of the question formulated an additional inquiry that was not part of the causation test in s 11A(1). Additionally, the “real issue” formulated did not acknowledge that the respondent carried the onus on the issue and the appellant did not.
The Member described the definition of ‘bullying and harassment’ in the Fair Work Act as “a useful starting point” in answering the question posed. Mr Perry submitted that, given the way in which the appellant addressed on ‘bullying and harassment’ (see the following paragraph) it was not inappropriate that the Member took this as a “starting point” in her consideration of the defence (see [61] above). The definition as quoted in the reasons at [89] read:
“A worker is bullied at work if:
·a person or group of people repeatedly act unreasonably towards them or a group of workers
·the behaviour creates a risk to health and safety.

Unreasonable behaviour includes victimising, humiliating, intimidating or threatening….

Reasonable management action that's carried out in a reasonable way is not bullying.
An employer or manager can:
·make decisions about poor performance
·take disciplinary action
·direct and control the way work is carried out.”
The definition in s 789FD of the Fair Work Act that applied as at the date of deemed injury was as follows:
“789FD When is a worker bullied at work?
(1)     A worker is bullied at work if:
(a) while the worker is at work in a constitutionally‑covered business:
(i) an individual; or
(ii) a group of individuals;
repeatedly behaves unreasonably towards the worker, or a group of workers of which the worker is a member; and
(b) that behaviour creates a risk to health and safety.
(2)     To avoid doubt, subsection (1) does not apply to reasonable management action carried out in a reasonable manner.
(3)     If a person conducts a business or undertaking (within the meaning of the Work Health and Safety Act 2011) and either:
(a) the person is:
(i) a constitutional corporation; or
(ii) the Commonwealth; or
(iii) a Commonwealth authority; or
(iv) a body corporate incorporated in a Territory; or
(b) the business or undertaking is conducted principally in a Territory or Commonwealth place;
then the business or undertaking is a constitutionally‑covered business.”
The term ‘bullying and harassment’ is not to be found in the New South Wales Workers Compensation legislation. The appellant’s pleading of ‘injury’ in the ARD did not rely on an allegation of ‘bullying and harassment’. The way in which the appellant’s case was opened before the Member did make positive allegations dealing with the respondent’s behaviour towards the appellant:
“The respondent relies on section 11A of the 1987 Act to say that a psychological work 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 performance appraisal and discipline, as such pleading a ‘defence to the claim’. This is rejected by the [appellant]. It is the [appellant’s] case that the predominant cause of psychological work injury was the conduct of the general manager on behalf of the employer, amounting to bullying, micromanagement, amounting to harassment, unfair treatment and personal criticisms of the [appellant]. This takes the cause of the work injury outside of the bounds of section 11A …
Should the Member be against the [appellant] on this matter, it is the [appellant’s] case that any performance appraisal or proposed discipline to be taken by or on behalf of the employer was entirely unreasonable and unsupported by facts.”[109]
[109] T1 5.8–28.
The Member returned on a number of occasions to the concept of ‘bullying and harassment’. The reasons at [90] read:
“I have some doubts as to whether the actions of Ms Revill in particular (and others as referred to in her statement) could be regarded as bullying and harassment for reasons that follow.”
The appellant relied on a statement of Ms Sprod (another employee of the respondent) dated 22 July 2021.[110] Ms Sprod described Ms Revill’s dealings with another employee, “Marilyn”, who she said Ms Revill “took an instant dislike to”. Ms Sprod described attending a disciplinary meeting involving Ms Revill and Marilyn which left Marilyn “very distraught”; she said that Ms Revill “made Marilyn’s life a misery”. Ms Sprod referred to Ms Revill reducing staffing numbers (arguably below Departmental guidelines) after “Covid hit” in 2020. Ms Sprod referred to the respondent losing two tenders because of the quality of the tender documents submitted. Ms Sprod referred to Ms Revill’s dealings with the Department regarding a staff member driving while unlicenced. Ms Sprod said that her centres were ultimately divided between “Nancy” and the appellant. Ms Sprod said that eventually she (Ms Sprod) was made redundant, and her role was taken over by Ms Revill’s friend Gada, under a different title. Ms Sprod’s statement was generally critical of Ms Revill’s actions. The reasons at [106] dealt with Ms Sprod’s statement:
“I am also mindful of the statement of Ms Sprod who clearly felt that Ms Revill took ‘an instant dislike’ to many members of staff, but I cannot accept that her comments can be construed as amounting to confirmation that Ms Revill ‘bullied and harassed’ the [appellant]. It is merely a statement of her own opinion of Ms Revill.”
[110] ARD, pp 36–40.
At [91] to [114] of the reasons the Member set out multiple references to evidence on which she commented. At [110] the reasons say:
“In short, the evidence overall and indeed the tone of the [appellant’s] evidence suggests to me that it was she who developed a serious gripe or grudge against Ms Revill, becoming unhappy with her management style. There is nothing in the evidence of Ms Revill that suggested that she ‘bullied’ the [appellant] with a view to forcing her to quit her job as the [appellant] claimed.”
At [117] it is said:
“The [appellant] I think did indeed feel ‘unfairly treated by her employer’, and this constantly played on her mind as she told Dr Hong. But this in itself is not evidence of bullying or harassment, rather a statement of how she felt about Ms Revill.”
At [119] the Member concluded:
“I am not persuaded that she was bullied or harassed either within the definition in the Fair Work Act referred to previously (victimising, humiliating, intimidating or threatening …) or in what may be described as a lay definition. Rather, her own conduct and behaviour warranted ‘reasonable management action’ which required the making of decisions about ‘poor performance’ and ‘disciplinary action’ which I am satisfied was carried out in a reasonable way.”
This passage tended to invert the onus of proof. There was no onus on the appellant to establish that she was ‘bullied or harassed’, either within a definition in the Fair Work Act or within a “lay definition”. The reasons did not nominate any “lay” definition of ‘bullying and harassment’ or ‘bullying or harassment’ (both terms are used) that should be applied in the absence of that in the Fair Work Act being appropriate. The Member found that the appellant’s “conduct and behaviour” warranted ‘reasonable management action’. The phrase ‘reasonable management action’ was to be found in s 789FD of the Fair Work Act, in both the section as quoted in the reasons at [89] and in the definition as at the deemed date of injury (see [92] above). It was not part of the test in s 11A(1) of the 1987 Act, which referred to ‘reasonable action’ taken or proposed to be taken by the employer in respect of one of the categories set out in s 11A(1). Section 11A(1) did not deal with ‘reasonable management action, in circumstances where a worker’s “conduct and behaviour” warranted it. The section provided a defence to the payment of compensation in certain specified circumstances (in which the employer carried the onus of proof).
The reasons at [120] referred to the decision in Minahan as authority that “whether the action is reasonable should be attended in all the circumstances by a question of fairness”. This was a reference to a passage in Minahan in which Foster AJA quoted with approval from a decision of Geraghty CCJ in Irwin v Director-General of School Education (unreported, 18 June 1998):
“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.”[111]
[111] Minahan, [27].
The Member made formal findings at [121]:
“I am satisfied that the [appellant’s] accepted psychological injury was wholly or predominantly caused by the reasonable actions of her employer with respect to discipline within s 11A of the 1987 Act such that there will be an award for the respondent.”
The discussion and formal findings in the reasons at [120] to [121] is unexceptionable. However, it is necessary that the reasons be read as a whole.[112] The “real issue” referred to in the reasons at [88] raised the issue of whether the injury was caused by ‘bullying and harassment’. The definition of that term was described at [89] of the reasons as a “useful starting point”. The question requiring answer was not whether the appellant had been bullied and/or harassed but rather whether the respondent had discharged its onus of establishing that the appellant’s conceded psychological injury was wholly or predominantly caused by the reasonable actions of the respondent with respect to discipline. The Member reasoned towards her ultimate factual conclusion in the context of whether the evidence established that the appellant was bullied and/or harassed. This consideration was raised in the reasons at [88], [90], [106], [110], [117] and [119]. This was not the statutory test. It was not a test that appeared in the New South Wales workers compensation legislation. The inappropriateness of the test is accentuated when one has regard to what the Member adopted as the definition of those words in her reasons at [89]. The reasoning at [119] considers whether the appellant was ‘bullied or harassed’, or rather whether her “conduct or behaviour warranted ‘reasonable management action’”. This suggests that in the absence of a finding of ‘bullying or harassment’ the available alternative finding was that the appellant’s “conduct or behaviour warranted reasonable management action”. This misstates the test in s 11A(1) and where the onus lay to satisfy that test.
[112] Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430, 444.
The Member dealt with the application of s 11A(1) of the 1987 Act by reference to an incorrect test. This affected the result and constituted appealable error.

CONCLUSION

It follows from the above that Grounds Nos. 1 and 2 succeed. It is unnecessary to deal with Ground No. 3. Resolution of the broad evaluative test in s 11A(1) of the 1987 Act has miscarried. It is appropriate that the matter be remitted for re-determination by a different Member, consistent with these reasons.

DECISION

The Certificate of Determination dated 11 November 2021 is revoked.
The matter is remitted for re-determination by a different Member, consistent with these reasons.

Michael Snell
Deputy President

7 September 2022