Thinking | 10 June 2021

Latest case updates for self-insurers – June 2021

In our latest update for self-insurers, we look at a number of recent cases, including a decision that confirms the parameters of an employer’s duty of care regarding an employee’s mental health; when pain is considered a serious injury, whether pathological evidence is enough to consider an injury to be serious, and when an injury is considered to have occurred during employment.

By Ilona Strong and Grace Bowran-Burge

Victorian County Court finds employer did not breach its duty of care despite mental injury being reasonably foreseeable

Hall & Wilcox has successfully defended an application brought by a worker seeking damages for a psychiatric injury he sustained over the course of his employment as a sales consultant.

The decision confirms the parameters of an employer’s duty of care when they are on notice that an employee’s mental health is declining.

Background

The Plaintiff was employed as a sales consultant from 2010. In July 2012 he required some time off work for stress and other health issues and was subsequently transferred to a different sales department. In November 2012, the Plaintiff advised the Defendant that he was suffering from stress and at risk of suffering a mental injury due to the pressure of having to meet sales targets.

The Plaintiff took annual leave from November 2012 and returned to his sales consultancy role in January 2013. He was initially performing well; however, his performance then substantially deteriorated, prompting the Defendant to stand the Plaintiff down (with full pay) and have him medically assessed. While the Plaintiff was cleared fit to resume his role as a sales consultant in or about June 2013, it was clear to the Defendant that he was not ready to return and duties were not provided.

The Plaintiff alleged the Defendant had breached its duty of care in continuing to require him to meet sales targets, allowing him to work excessive hours, exposing him to an excessive workload and for failing to transfer him to a non-sales role when it knew or ought to have known the pressure of meeting targets was affecting his mental health.

Decision

His Honour found that:

it was foreseeable that the Plaintiff was at risk of suffering a psychological injury due to his work duties;
the Defendant had taken all reasonable steps to discharge its duty;
it was not incumbent upon the Defendant to reduce the Plaintiff’s sales targets, remove him from the sales area where he had worked for a number of years or change the type of calls he responded to; and
even if the Defendant had been in breach of its duty of care, such breach was not causative of the injury.

Accordingly, the Defendant was found not to have been negligent.

Commentary

This case provides an important reminder of what is, and what is not, expected of employers when dealing with a potential mental injury.

An employer, once on notice of the risk of mental injury, is required to take reasonable steps to prevent such injury occurring. However an employer is not required to construct an artificial position or grant an employee special favours.

Shearer v iSelect Services Pty Ltd (ABN 87 088 749 955) [2021] VCC 458 (5 May 2021)

Victorian County Court finds pain is not a serious injury

The County Court has recently rejected a serious injury application where pain was the primary consequence relied upon by the Plaintiff.

Background

The Plaintiff was employed as a boner by the Defendant, and had ceased employment at the age of 65. The Defendant had previously accepted liability for the Plaintiff’s back and shoulder injuries.

The Plaintiff claimed that but for his injuries he would have worked into his 70s and accordingly sought compensation for both his pain and suffering and economic loss.

At the time of the hearing, the Plaintiff was 71 and also suffering from a neurological condition, causing him difficulty walking, controlling his limbs and resulted in limited use of his arms. Disentangling the claimed workplace injuries to his neurological disorder was difficult and consequently the Plaintiff relied heavily on pain which was clearly not related to his neurological disorder.

Decision

Judge Bourke found there was a lack of evidence to demonstrate the Plaintiff would have continued working into his 70s. Her Honour relied on the employer’s evidence that there was nobody employed in the Plaintiff’s role over the age of 65, as well as the lack of evidence of any jobs available to meatworkers over 65.

Her Honour also dismissed the Plaintiff’s pain and suffering application, noting that while pain is subjective it must be objectively assessed for the purposes of a serious injury application. The Plaintiff’s treatment for his injuries was minimal and his medication consisted of Panadeine Forte.

Commentary

This case emphasises the importance of employer evidence in respect of economic loss claims, particularly when used to counteract a plaintiff’s claim that they would have continued working. It also provides a reminder that when assessing pain, the court will look at what the worker does to treat the pain, what doctors say about the pain and what evidence shows the disabling effect of the pain.

Madaroski v Colonial Meat Export Pty Ltd [2021] VCC 113 (23 February 2021)

Federal Court finds injury sustained after workshop did not arise in the course of employment

The full Federal Court has upheld a decision of the Administrative Appeals Tribunal, finding that an injury sustained in a hotel after a series of workshops is non-compensable. The decision serves to further clarify when an injury can be considered to have occurred during the course of employment.

Background and case history

In the early hours of Thursday 14 April 2016, the Applicant slipped and fell on wet tiles in the main foyer area of the Novotel Hotel in Melbourne, injuring her left hip at 2.30am after socialising with a work colleague. The Applicant was staying at the hotel for the purposes of attending workshops conducted by her employer, Telstra. The Applicant lodged a Comcare claim. Liability was rejected on the basis that her injuries did not arise out of her employment.

The Applicant appealed this decision to the Administrative Appeals Tribunal, who concluded that while Telstra had induced the Applicant to be at the hotel, her injury had occurred because she was socialising with a friend, not because she was at the hotel. Because Telstra had not induced or encouraged the Applicant to socialise with friends, her injuries were not work caused.

Full Federal Court appeal

On appeal, the Applicant argued her injury occurred by reference to the place her employer had induced or encouraged her to be, and the timing of this injury was irrelevant. The full Federal Court upheld the Tribunal’s decision, finding that the activity the Applicant had engaged in (socialising with friends) severed the connection between her injury and her employment.

Commentary

While this decision is of assistance to self-insurers in assessing whether an injury has arisen in the course of employment, it is important to acknowledge the complexity of these type of claims. The full Federal Court acknowledged this was a difficult and borderline case and went so far as to note that the Applicant’s case may have been different if her injury had occurred at 8:30pm rather than 2:30am, or if the fall had occurred in the bathroom in the Applicant’s hotel room rather than the hotel lobby. Each case must be assessed on its own facts.

Dring v Telstra Corporation Ltd [2021] FCAFC 50 (9 April 2021)

Radiology not determinative: Victorian County Court finds worker’s back injury not serious despite pathology

The County Court recently rejected a serious injury application for pain and suffering, despite the radiological evidence demonstrating a disc protrusion and possible nerve impingement.

Background

On 6 February 2013 the Plaintiff injured his back while lifting a coffee machine at work. A CT scan taken around the time of the Plaintiff’s injury recorded a left disc protrusion with possible mild nerve impingement.

At the hearing the Plaintiff alleged that because of his back injury he was unable to pursue social tennis, soccer, surf fishing or weight lifting. Somewhat unusually, the Plaintiff alleged that his back injury also reduced his capacity to breed snakes and lizards. At the hearing the Plaintiff was working full time for an alternate employer with a substantially increased income and two young children.

Decision

Judge Bourke found the Plaintiff was a credible witness but had a tendency to overstate the severity of his back condition, describing himself as ‘devastated’ and a ‘shell of a man’ when he was able to work full time in a well-paid job and start a young family. She also noted he remained able to fish and walk his dogs as well as go on trips with his partner. Her Honour also highlighted the Plaintiff’s lack of treatment, (failing to see an orthopaedic surgeon, no pain medication and no physiotherapy) and, ultimately, found the Plaintiff’s consequences could not be considered serious.

Commentary

This case reinforces that the significance of what has been lost ought to be informed to an extent by what has been retained. Here, following the injury, the Plaintiff had secured full-time employment, started a family and continued to enjoy his life.

De Santis v Victorian WorkCover Authority [2021] VCC 279 (22 March 2021)

Court of Appeal finds rejected impairment claim not a bar to serious injury

The County Court has recently held that a rejection of liability does not prevent workers from pursuing a serious injury application, as the determination of impairment is not a pre-requisite when liability is rejected.

Background

The Plaintiff, a Tasty Truck van loader, submitted a claim for permanent impairment seeking lump sum compensation in respect of:

an injury sustained to his cervical spine throughout the course of his employment and in particular on 23 September 2011; and
an injury sustained to his lumbar spine throughout the course of his employment and in particular on 14 December 2011.

The claims agent allocated each injury a separate claim number and processed them separately. Liability was rejected for the lumbar spine and conciliation issued an outcome certificate certifying a genuine dispute. Liability was accepted for the cervical spine and assessed at 5% whole person impairment.

Subsequently, Judge Lauritsen found that without the assessment of impairment of the lumbar spine, the Plaintiff could not rely upon this injury for the purposes of his serious injury application.

Decision

The Court of Appeal found that a serious injury application cannot hinge on there having been a determination of a degree of impairment because a determination is only given when liability has been accepted.

Commentary

The splitting of the impairment claim in this case resulted in a situation where the rejected claim was considered sufficiently finalised for the Plaintiff to pursue a serious injury application. Had the impairment claim not been split, the Plaintiff would not have been able to pursue the serious injury application for the cervical or lumbar spine until the liability dispute for the lumbar spine had been finalised.

Shah v Victorian WorkCover Authority [2021] VSCA 137 (18 May 2021)