The Importance of Knowing Where you Work!

Avon Products Pty Limited v Margaret Falls [2010] ACTCA 21 (31 August 2010)

Background

Ms Falls was an Avon sales manager who allegedly sustained a mental injury arising from bullying and harassment by her supervisor. Ms Falls was responsible for the operational area of Avon located exclusively within the ACT. The evidence was that she spent approximately eight to ten hours a day working in the ACT. It was also her habit to perform about two to three hours of work at home each evening, doing bookwork. The worker lived in Jerrabomberra, NSW.

Ms Falls sought a declaration pursuant to s36 of the Workers Compensation Act that the ACT was the territory or state with which her employment was connected when she worked for Avon, so as to be awarded compensation under ACT law.

Section 36B(3) of the Act reads:

'A worker's employment is connected with:

1. The territory or state where the worker usually works in the employment
2. If no territory or state, or no single territory or state, is identified by paragraph (a) – the territory or state where the worker is usually based for the purposes of the employment
3. If no territory or state, or no single territory or state is identified by paragraph (a) or (b) – the territory or state where the employer's principal place of business in Australia is located.

First instance

Before Special Magistrate Cush, in the proceedings at first instance, the employer contended that the worker's base for employment was Jerrabomberra, her direct manager's office was in Bargo, NSW and the employer had its head office in NSW. It was agreed between the parties that Ms Falls worked in both the ACT and in NSW, and therefore, did not 'usually work' in either place. As such, the argument centered around the second limb of the test.

Special Magistrate Cush took a different view from the parties. His Honour looked to the evidence that she was responsible for a district wholly within the Australian Capital Territory, she spent eight to ten hours a day performing her duties which were to recruit, train and motivate sellers, making home visits and training calls, and then she spent a further two to three hours each day performing bookwork at home in Jerrabomberra in NSW, but she also did some bookwork in the ACT.

It was held that her 'primary and essential duties' were performed in the ACT and that her bookwork was performed at a place solely determined by Ms Falls. Accordingly, Ms Falls 'usually worked' only in the ACT, and therefore was an ACT worker for the purposes of the Act. The employer appealed to the Supreme Court. Chief Justice Higgins dismissed the
appeal, stating:

He accepted that the test for identifying what it meant to 'usually work' was not mathematical, and that the reference must be given to those places where the worker was 'expressly or by necessary implication' contracted to work in the contract of employment with the employer.

Court of Appeal

At the commencement of the appeal, Counsel for the employer made an application to adduce additional evidence consisting of a further affidavit from the human resources manager of Avon products which affirmed the provision of a dedicated fax machine and telephone line to Ms Falls' home office for Avon services. Counsel for Ms Falls also tendered a new affidavit, confirming this dedicated home phone line. Their Honours considered it was in the interests of justice to admit it. The evidence remained that Ms Falls performed work in the ACT, carrying out her sales manager functions in her territory-specific area, and performed work in her home office in NSW, primarily bookwork and planning.

Turning to the first tier of the test to determine where Ms Falls 'usually worked'the court of appeal found that she usually worked in the ACT and she usually worked in NSW.

The Court of Appeal had no doubt that a requirement, or the absence of a requirement as to where work is performed is not relevant:

As no single state or territory was identified under s36B(3)(a), the court was then to look at the second limb of the test of where Ms Falls was 'usually based' for the purposes of her employment pursuant to s36B(3)(b). Their Honours concluded that the evidence before the court showed no particular usual base.

That Ms Falls did some work from home did not necessarily mean that place was her base, for the purposes of her employment:

The court did comment that what would have particular relevance is the  provision by the employer of a place from which the employee is expected to operate.

Having found no single territory or state that she usually worked or was based, their Honours turned to the third limb of the test, as to where the employer's principal base of business was located in Australia. Their Honours held that the relevant state of connection was NSW because the head office of Avon, and its principal place of business, was located in Brookvale in Sydney, NSW.

Conclusion

Their Honours have confirmed that looking to where a person was required to perform duties as the place where the person 'usually worked' is an incorrect interpretation of the test.

The legislation requires one to look at where work is usually performed, "as a matter of fact", and then if necessary, where the worker is usually based, and finally, if it remains necessary, where the employer's principal base of business is located.

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