In this issue we discuss the recent High Court decision in Comcare v PVYW where a Commonwealth Public Servant claimed for injuries sustained whilst engaged in private, lawful, sexual activity on a work trip.
The High Court has now provided clarity to employers on what type of injuries can be considered to have been sustained "in the course of" employment.
The reasoning will be able to be relied upon by employers looking to respond to claims for injuries sustained whilst employees are engaged in behaviour that is not sanctioned or encouraged by employers.
Many readers will be familiar with the on-going saga in the case of Comcare v PVYW  HCA 41 (30 October 2013).
The employee in question was employed by a Commonwealth Government agency and required to visit a regional office of the agency to observe a budget review process, meet regional staff and undertake training. She was booked to stay overnight at a nearby motel by her employer and during the course of the evening she engaged in sexual intercourse with an acquaintance.
During that activity, the glass light fitting above the bed was pulled from its mount by either by the employee or her acquaintance and it struck the employee on the nose and mouth causing her physical injuries and a subsequent psychological injury Initially, Comcare (the employing body's workers' compensation insurer) denied liability and the employee took the matter on review to the Administrative Appeals Tribunal. The Tribunal agreed with the employer and denied compensation. The employee then appealed to the Federal Court.
In both the Federal Court and on review at the Full Federal Court, the Court agreed that the employee's injuries were compensable. The employer, through Comcare, then took the matter to the High Court.
The High Court considered the leading authority of Hatzimanolis v ANI Corporation Limited (a case from the early 1990s) which, it was said, contained the relevant test as to whether an injury was sustained "in the course of the employment". That test was:
It should now be accepted that an interval or interlude within an overall period or episode of work occurs within the course of employment if, expressly or impliedly, the employer has induced or encouraged the employee to spend that interval or interlude at a particular place or in a particular way.
The High Court considered whether the Hatzimanolis case had determined that irrespective of gross misconduct, an employer who requires an employee to be present at a particular place away from their usual place of work, will be liable for any injury which the employee suffers whilst present there.
The High Court considered this test, strictly applied, would lead to the unusual outcome that the employer would effectively become the insurer for the employee during the entire work trip. That would be so even though the injury might be suffered in the course of an activity clearly unrelated to employment (as it was in this case).
The High Court, without overruling Hatzimanolis determined that the test was actually in two parts and that either or both parts may be relevant depending on the circumstances of the injury. The Court said:
"When an activity was engaged in at the time of injury, the question is:
Did the employer induce or encourage the employee to engage in that activity?
When injury occurs at and by reference to a place, the question is:
Did the employer induce or encourage the employee to be there?
If the answer to the relevant question is affirmative, then the injury will have occurred in the course of employment."
The Court said the question of whether to ask about the location versus the activity depended on how the injury was sustained. For instance, in Hatzimanolis where compensation was approved, the employee in question was absent from his usual work site and injured in the course of an out of hours activity that was encouraged by his employer. The Court determined that the activity test set out above was satisfied because the employer had induced or encouraged the employee to engage in the activity even though the location of the accident was not a location where the employee in question had been induced or encourage to attend by his employer.
Applying the reasoning to the Comcare case, the activity that caused the injury was not an activity that was induced or encourage by the employer and therefore the injury was non-compensable.
Expanding on the reasoning further, the Court said that if, for example, the light fitting had been insecurely fastened into place and simply fell upon the respondent "the injury suffered by her would have arisen by reference to the motel. The employer would be responsible for injury because the employer had put the respondent in a position where injury occurred because of something to do with the place. Liability in those circumstances is justifiable. Liability for everything that occurs whilst the employee is present in that place, is not."
The decision of the High Court was a majority judgement with four of the six judges agreeing with Comcare's position and allowing the appeal against compensation.
The minority judges did not accept the majority's analysis set out above. Justice Bell said, "The analysis is one which postulates that a person may be in the course of employment for one purpose and not in the course of employment for another purpose. The distinction is between purposes within the ambit of the employer's encouragement to be at a place and those that are not. On this analysis, if the light fitting had fallen of its own motion whilst the respondent was having sexual intercourse, any resulting injury would be compensable. In such an event, the circumstance of the injury- that it was occasioned by a defect in the premises – would be within the ambit of the employer's encouragement to stay at the motel. It would be an injury arising in the course of the respondent's employment. "
WHAT DOES THE CASE MEAN FOR EMPLOYERS?
Employer groups have welcomed the decision as one supportive of their interests. It would seem that the Court has drawn a clear line between those injuries sustained outside of the usual work day that are compensable and those that are not.
At any time, if a claim is made for an injury which an employer considers to be sustained outside of the work day or not in the course of employment, specific advice should be obtained and submissions for the compensation authority prepared along the lines of the factors now identified as relevant by the High Court.
For instance, if an employee sustains an injury during a work-related function (for example, the annual Christmas Party) and the injury occurred whilst engaging in activity not induced by the employer (e.g. conduct in breach of a workplace policy on bullying and harassment), it is now possible to argue (adopting the Comcare line of reasoning) that the injury was caused whilst engaged in an activity not "induced or encouraged" by the employer – and therefore, not "in the course of employment".
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.