June 17, 2020

BACKGROUND

Basten JA in the Court of Appeal of the Supreme Court of New South Wales put the factual background to the appeal in this way:

"On 16 June 2010 Michel Carroll was killed by her de facto partner, Steven Leslie Hill. Both were employed by a family company, S L Hill & Associates Pty Ltd, which carried on its business of financial advising from the family home in Wamberal. The attack by Mr Hill was inspired by paranoid delusions and, having been charged with murder, he was found not guilty on the ground of mental illness. 

At the time of her death, Ms Carroll had two dependent children, one a teenage son and the other a baby of a few weeks. The children made claims for workers compensation. The family company having been deregistered, the claims were resisted by the appellant, the Workers Compensation Nominal Insurer (“Nominal Insurer”)."

The headnote of the judgement adds:

"On 19 December 2018, an arbitrator at the Workers Compensation Commission determined that Ms Carroll died as a result of injury arising out of and in the course of her employment and ordered payments in favour of the two children, in accordance with the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (“Workplace Injury Act”).

On 16 January 2019, the Nominal Insurer lodged an appeal against that determination under s 352 of the Workplace Injury Act. On 22 July 2019 Deputy President Wood dismissed the appeal.

The Nominal Insurer appealed the Deputy President’s decision to the Court of Appeal under s 353 of the Workplace Injury Act. That appeal was limited to a decision in a point of law."

At [34] the Court of Appeal held:

 "First, it is not in doubt that a person can suffer compensable harm as a result of a physical attack, verbal abuse, sexual harassment or bullying at work. The source of such conduct may be a co-worker or a supervisor. It is not uncommon for claims to be made for psychological injury resulting from steps taken on behalf of an employer, such as transfer, demotion, or even dismissal. Section 11A(1) of the Workers Compensation Act precludes compensation being payable for such an injury if it was “wholly or predominantly caused by reasonable action taken ... on behalf of the employer”. Such an injury caused by conduct which would not be described as “reasonable action” is compensable. It does not matter whether the conduct was carried out on the basis of mistaken facts, or vindictively and without any justification (such as the refusal of a sexual advance). There is no reason to exclude delusional conduct from a potential cause of compensable harm. Section 11A is a constraint on payment of compensation for psychological injury, not physical injury, but the underlying logic must extend to physical injuries. In principle, the conduct of a co-worker or supervisor (Mr Hill was both) forms part of the employment conditions of the injured worker."

As to the risk of domestic violence manifesting when a person are both working at/from home in the "same business":

"There may, of course, be domestic violence between couples who work from home in the same business which would not attract liability on the part of the employer to pay compensation, because the violence had no connection with the work conditions of either party. However, on the findings of fact, that was not this case. The findings of fact demonstrated a palpable and direct connection between Mr Hill’s delusions, Ms Carroll’s employment and the harm suffered by her." (at [37] my emphasis).

 

At the hearing before the WCC this was factual finding had been made:

" [262] The medical and lay evidence in this case provides a basis upon which it could be concluded that the first respondent’s delusional beliefs were founded upon his perception as to how Ms Carroll was conducting her employment activities, which was part of the causal link. The Arbitrator clearly identified that she needed to consider the fact of Ms Carroll’s employment, which included that Ms Carroll’s role was to deal with AMP, and that Ms Carroll was answerable to, and needed to deal with, [Mr Hill], who was also the appellant’s employee.”

The decision of the Court of Appeal (New South Wales) can be found here:


COMMENT

This case offers insight as to the scope of the risks of injury an employer might have to consider when people are working from home. The risks must be properly identified, assessed and where necessary - properly responded to and managed. In the aftermath of the COVID-19 pandemic and its impact on working places and schedules this case tells us that checking that the heights and placement of a desk, chair and computer is not the only risk to be considered. There are many other factors that will need to be considered. While this case was decided on its own facts - there are messages from this case about the safety of workers when working at home that includes psychological risks (say distress from isolation or say managing home schooling at the same time as working) and unique physical risks (say, for example, a house fire).