Out of hours phone call confirmed as reasonable management action
Out of hours phone call confirmed as reasonable management action; Presidential decision confirms the limits in the use of multiple medical reports in workers compensation proceedings; Employer fined $240,000 following safety incident involving work experience student; The NSW District Court clarifies the application of the primary duty of care.
NSW Workers' Compensation
“Out of hours phone call confirmed as reasonable management action”
Reichardt v Aurrrum Pty Ltd  NSWWCCPD 39
An out-of-hours phone call from a manager to an employee informing the employee of allegations of serious misconduct, an investigation and the employee’s suspension was found to be reasonable in all the circumstances.
The employer succeeded in establishing the defence under s11A of the Workers Compensation Act 1987 (NSW) (WC Act) at first instance. The Arbitrator’s decision was confirmed on appeal.
The employer operated an aged care facility. A complaint of serious misconduct, essentially alleging elder abuse, was received by the employer about one of its Assistants in Nursing.
The complaint was heard by a manager who, on the same day, made enquiries with an eye-witness to the incident and consulted with her superiors about the appropriate course of action. A decision was made by the manager and her superiors that an investigation would need to be conducted and that the police should be informed. It was also decided that the employee should be stood down on full pay while the matter was investigated.
Knowing that the employee worked part time and would not be coming back to work for a number of days, the manager attempted to contact the employee by phone in the early evening on the day the complaint was received. The employee did not answer the phone and so the manager left a voice message for the employee to urgently return her call.
Some hours later, the employee called the manager back at which point the manager informed the employee of the allegations made against her and that an investigation would be conducted. The manager also informed the employee that she would be suspended on full pay while the investigation was conducted and that the police had been informed of the allegations.
The employee subsequently allegedly suffered psychological injury as a result of the phone call and submitted a worker’s compensation claim.
Liability for the employee’s psychological injury was denied by the employer’s insurer on the basis that the injury was caused as a result of reasonable action taken by the employer (s11A of the WC Act).
The Arbitrator in the first instance found that there was nothing contained in the phone call to the employee that was unreasonable in terms of its content or tone.
The Arbitrator found that it was reasonable for the employer to have made the phone call when it did because the employee would not be on duty again for a number of days and it would not have been appropriate to wait to tell her in person as there was the possibility that the police might contact her first.
The Arbitrator also found that the manager took appropriate steps before contacting the employee in that she made further inquiries with the eye-witness and consulted with her superiors. It was not unreasonable for the manager to have called late in the day because those preliminary steps needed to be taken before the employee was called.
The employee argued that the phone call was unreasonable because she was in a vulnerable state on the day of the call as a result of alleged workplace bullying. The employee said that she had tried to inform the manager of bullying earlier in the day but could not find the time and so “did not elaborate” with the manager.
The Arbitrator found that there was insufficient evidence to suggest that the employee was in a vulnerable state or that the employer knew about this vulnerable state.
The Arbitrator concluded that, viewed objectively and based on the employer’s knowledge at the time of phone call, the employer acted reasonably.
The employer’s defence succeeded. The employee appealed the Arbitrator’s decision.
On Appeal, the employee argued that the Arbitrator had erred in finding that the employer’s actions with respect to making the phone call were reasonable actions, had failed to weigh the respective interests of the parties and had failed to find that the employee was a vulnerable person prior to suffering psychological injury.
Judge Keating rejected all the employee’s grounds of appeal and found that the conclusions and findings reached by the Arbitrator were open for her to reach and that no error was made by the Arbitrator. The Arbitrator’s determination was confirmed.
Comment – what can your business learn from this decision?
Acting quickly but thoroughly on complaints of serious misconduct is essential.
Employers should think carefully, not rush any communication, about the best way to inform an employee of a complaint or any allegations made against them.
The manager in this case was careful and thoughtful in her approach to the allegations and the phone call with the employee. As a result, a successful s11A defence was available to the employer.
“Presidential decision confirms the limits in the use of multiple medical reports in workers compensation proceedings”
Waldron v Agrimac International Pty Limited  NSWWCCPD 35
Parties are limited in the number of forensic reports relied upon in workers compensation proceedings.
Multiple medical reports may be relied upon by parties for history only but not for any medical opinion they contain.
Karen Leigh Waldron (the Appellant) suffered injury to her right shoulder on 3 June 2005 when she fell whilst walking down stairs in the course of her employment with Agrimac International Pty Ltd (the Respondent). The parties previously entered into a Complying Agreement for lump sum compensation of 11% whole person impairment (WPI) for the right upper extremity and scarring.
In 2012, the Appellant later claimed that she suffered injury to her cervical spine. In the most recent proceedings, the Appellant made a claim for lump sum compensation for a further 7% WPI for the cervical spine and 2% WPI for scarring.
The Respondent denied the further claim for compensation and denied the alleged injury to the cervical spine.
Decision at first instance
The primary issue in dispute was whether the Appellant suffered injury to her cervical spine. During the Arbitration phase, an interlocutory issue arose relating to the medical reports and how such reports could be relied upon by the parties.
Clause 49 of the Workers Compensation Regulation 2011 (now regulation 44 of the Workers Compensation Regulation 2016) (the Regulation) provided that only one forensic medical report can be admitted into evidence on behalf of a party.
Sub-clause 49(3) provided that an additional forensic report may be admitted where the treating doctor is qualified in a different speciality.
The medical reports of Drs Ashwell, Miller, Oates and Powell were admitted into the proceedings in accordance with the decision in McCarthy v Patrick Stevedores No. 1 Pty Ltd  NSWWCCPD 96 (McCarthy). In McCarthy, it was determined that additional medical reports could be admitted into evidence as witness statements, with their use being limited for the purpose of the history recorded.
Arbitrator Edwards ultimately determined on the balance of probabilities that the Appellant did not suffer injury to her cervical spine on 3 June 2005.
The Appellant appealed against Arbitrator Edwards’ decision.
The Appellant appealed on a number of grounds, including the use of the medical evidence admitted in accordance with the decision in McCarthy.
The Appellant argued that the Respondent made submissions on the examination findings and that these findings were medical opinion. Accordingly, the use of such reports in this manner was not consistent with the principles in McCarthy.
The Respondent submitted that objective examination findings were relevant and admissible and that McCarthy did not provide any limits on the admission of such objective findings.
Decision on Appeal
Acting President Snell noted that the decision in McCarthy provided:
That medical reports admitted as a witness statement were no longer forensic reports but become lay witness evidence;
That evidence from a medical report that was expert medical evidence was not admissible, as this would be forensic medical evidence and would contravene clause 49 of the Regulation; and
Evidence in medical reports from doctors that goes to what the worker reported, history and/or complaints at examination was admissible as this was lay evidence.
Snell AP considered that examination findings by a medical specialist was not an objective process and involved expert opinion. Accordingly, he determined that the Respondent’s submissions on the clinical examination findings contained in the reports of Drs Oates and Powell admitted in accordance with McCarthy went beyond their valid use as lay evidence.
Snell AP noted that the parties agreed at Arbitration that the reports were admitted on a restricted basis and that the opinions were not to be considered and determined that despite submissions on the reports by the Respondent, Arbitrator Edwards in his reasoning did not consider the opinions contained in the reports or the Respondent’s submissions on the opinion.
Accordingly, each ground of appeal was dismissed by Snell AP and the Arbitrator’s order in respect of the alleged cervical spine injury was confirmed.
Work Health & Safety
“Employer fined $240,000 following safety incident involving work experience student” Attorney General of New South Wales v Tho Services Limited (in liquidation) (ACN 000 263 678)  NSWCCA 221
A work experience student suffered thermal burns to his eyes from welding after his employer failed to properly induct and supervise him.
In 2013, Mr Alex Thomas (the Worker) began a work experience placement at Tho Services Limited (the Company).
The Worker was inducted onto the premises by the Workshop Manager by way of a “visitors” induction which took 15 to 20 minutes. He was provided with safety equipment, including a pair of welding gloves and safety glasses. The Worker was to assist in welding a metal staircase and was to be supervised in the workshop by another employee (the Supervisor).
The Supervisor supplied the Worker with a welding helmet and instructed the Worker in use of the MIG welding torch. The welding helmet was a manual helmet, which required the visor section to be pushed down over the eyes to prevent a flash burn.
The Worker had only ever used an automatic helmet at school where the visor automatically darkened to the light.
The Worker was never instructed on how to wear the manual helmet, how to flip the visor down or further advised that the visor must be down while welding to ensure that injury to his eyes did not occur.
The Worker welded with the visor up at various times during the day until the afternoon shift supervisor observed that he was welding with the visor up and instructed him to stop. The Worker advised that he did not know he had to wear the visor down and had welded with the visor up all day. The Worker complained that his vision was blurry and the following day he still could not see properly.
The Worker was referred to an eye surgeon who diagnosed him with bilateral thermal burns and suffered 75% bilateral visual incapacity.
The Company was prosecuted for breach of the Work Health and Safety Act 2011 (NSW) (WHS Act) for failing to comply with a health and safety duty, which exposed the Worker to a risk of death or serious injury or illness – a “Category 2 offence”.
The Company pleaded guilty to the offence.
Decision at first instance
At first instance, District Court Judge Curtis made orders for the charge to be dismissed and for the Company to pay SafeWork NSW’s costs.
Curtis DCJ held that general deterrence was not necessary as the Company had since gone into liquidation. Curtis DCJ also took into consideration that the Worker received compensation for his injuries and that the Company was to pay costs and concluded that there was no need for further deterrence.
The NSW Attorney-General appealed the decision on a number of grounds, including that Curtis DCJ erred because the sentence imposed was “manifestly inadequate”.
Decision on Appeal
The NSW Court of Criminal Appeal (NSWCCA) agreed that the order to dismiss the charge without imposing a penalty was manifestly inadequate.
In his decision, Justice Harrison held that there was a flagrant breach, which occurred as a result of an “egregious and systemic failure to supervise a young and vulnerable person”.
The NSWCCA held that Curtis DCJ fell into error on a number of grounds in his decision.
It was noted that:
The induction process did not provide that workers must wear the welding helmet and weld with the visor down.
The Worker was not provided with any instruction or information on how to use the welding helmet and the risk of injury if the visor was not used correctly.
The Workshop Manager and supervisors were not properly trained by the Company on the induction of work experience students and no processes existed about the handover of work experience students to supervisors.
Harrison J was critical of the lack of penalty imposed and commented that not only was it manifestly inadequate but also non-existent, particularly for an offence of this seriousness, the significance of the risk and the simple control measures available to prevent the risk.
The NSWCCA determined that the Company should be re-sentenced and considered a number of factors including the seriousness of the offence and the need for general deterrence.
The Company was convicted and fined $240,000.00.
Comment – what can your business learn from this decision?
Employers have a primary duty of care to ensure the work health and safety of all workers.
Section 7 of the WHS Act defines “worker” to include (amongst others) “a student gaining work experience.”
The above decision reminds employers of the importance of conducting thorough induction processes for all workers, including instruction in the use of safety and personal protective equipment and ongoing training.
“The NSW District Court clarifies the application of the primary duty of care”
SafeWork NSW v Rawson Homes Pty Ltd  NSWDC 237
The NSW District Court has held that the primary duty of care, which is owed to “other persons” under work health and safety legislation, does not include workers.
Rawson Homes Pty Ltd (the Company) was the principal contractor for the construction of a residential home. In October 2013, the boom of a concrete truck collapsed, seriously injuring one worker and missing other workers (the Workers). The Workers were employed by contractors and sub-contractors engaged by the Company.
SafeWork NSW (SafeWork) commenced proceedings against the Company for a breach of the Work Health and Safety Act 2011 (NSW) (WHS Act) and the Company was charged with a “Category 2 Offence”.
It was alleged the Company failed to comply with a health and safety duty and breached the primary duty of care under sub-section 19(2) of the WHS Act, which provides that a person conducting a business or undertaking (PCBU) has the duty to ensure, so far as is reasonably practicable, “that the health and safety of other persons is not put at risk from work carried out as part of the conduct of the business or undertaking”.
The Company defended the charge and argued that it did not owe a health and safety duty under sub-section 19(2) of the WHS Act.
The Company submitted that the duty owed by a PCBU to workers is found in sub-section 19(1) of the WHS Act, while the duty under sub-section 19(2) to ensure the health and safety of “other persons” extends to persons other than workers.
SafeWork argued that the reference to “other persons” meant “persons other than the PCBU” and accordingly it applied to workers. It submitted that sub-section 19(1) of the WHS Act imposed a positive duty to ensure the health and safety of workers, while the duty under sub-section 19(2) obliged a PCBU to ensure that health and safety was not put at risk.
District Court Judge Kearns did not agree with SafeWork’s submission that the duty to “other persons” meant “all other persons other than the PCBU”. He noted that sub-section 19(1) already imposed a duty in relation to workers and that this duty was wider than that imposed under sub-section 19(2).
Kearns DCJ had regard to the Second Reading Speech and the Explanatory Memorandum, which suggested that sub-section 19(2) was to apply to persons other than workers. For Kearns DCJ, the approach taken by the Company was consistent with the objects of the WHS Act, which in section 3 also made a distinction between “workers” and “other persons”.
Accordingly, Kearns DCJ concluded that the reference to “other persons” in sub-section 19(2) of the WHS Act was to be interpreted as “persons other than workers”.
As the Workers were clearly “workers” as defined by the WHS Act, sub-section 19(2) did not apply and the Company was therefore found to have been charged under the incorrect provision.
Kearns DCJ made Orders to dismiss the Summons against the Company.
Comment – what can your business learn from this decision?
This decision confirms that the primary duty of care under section 19 of the WHS Act imposes a positive work health and safety obligation on PCBUs in relation to their own workers and also a parallel but distinct obligation toward “others” (such as visitors).
While on this occasion the prosecution failed as it was pleaded incorrectly, it is now clear that PCBUs should be alert and responsive to their obligations towards both “workers” and “others” in the workplace.
Sydney FC & Workplace Law
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