Australia: Rude awakenings in the course of employment: when "place" only sets the scene for "activity" - 3 February 2016

Last Updated: 5 February 2016
Article by Aaron Clark

In this alert Aaron Clark, Senior Associate discusses recent decisions applying Comcare v PVYW1 (PVYW). While the headline has faded in the memories of the vast majority of the population, practitioners in the workers' compensation arena are still seeing the impact of this decision in applying its principles to unfortunate factual scenarios when employees are injured while on an interval between periods of actual work.

Background

The decision in PVYW garnered significant media coverage when the High Court of Australia announced its decision in October 2013. Many sniggered at the concept of an employee claiming workers' compensation for an injury that occurred from a light fitting that had become dislodged in a hotel room during sexual intercourse while on a work trip. The very concept that it could be considered "in the course of employment" seemed...well...wrong!

Ultimately the majority (French CJ, Hayne, Crennan and Kiefel JJ) agreed it wasn't to be accepted as occurring in the course of employment but not before laying down some principles regarding the test to be applied.

As a quick recap, PVYW stated when an injury is not suffered while engaged in actual work, for it to be in the course of employment, the employee:

  • must have been engaged in an activity or present at a place when the injury occurred; and
  • if it occurred by reference to a place – did the employer induce or encourage the employee to be there?
  • if it occurred by reference to an activity – did the employer induce or encourage the employee to engage in that activity?

Relevantly, they reasoned it is still important to look at the circumstances in which the worker is injured in determining a connection or association with employment: that is, it must be connected with the inducement or encouragement of the employer.

Recent decisions coming out of the Queensland jurisdiction in the matters of Simon Blackwood (Workers' Compensation Regulator) v Civeo Pty Ltd and Cumbers2(Civeo) (an appeal to the Industrial Court of Queensland) and the decision of Colin Harvey v Simon Blackwood (Workers' Compensation Regulator) and QANTAS Airways Limited3 (Harvey) are prime examples of how the application of this test can lead to different results based upon the circumstances.

In the matter of Civeo the injured worker, Mr Cumbers, was assaulted when asleep in his employer-provided accommodation on a worksite at Moranbah. In this case it was held the injury occurred at or by reference to "place" and that while not required to take up accommodation there, he was induced or encouraged by his employer to be there. It was therefore, accepted the injury occurred in the course of employment.

The main question in this appeal was whether employment was "a significant contributing factor" to the injury. The President of the Industrial Court, Martin J, noted the test contained in the Commonwealth legislation which PVYW considered, did not have this added requirement. And while the Court found the immediate cause of the injuries was due to the perpetrator of the assault, there were other contributing factors that needed to be considered.

The President quoted Newberry v Suncorp Metway Insurance4 which held that in determining significant contribution to the injury, the demands of the employment must contribute in some significant way to the occurrence of the injury. The fact he was induced to stay at the campsite operated by the employer, subject to the employer's rules and requirements and a practical requirement he sleep there, meant that employment was a significant contributing factor to the injury. The appeal was upheld.

The finding here is entirely consistent with the earlier decision of the Industrial Court of Queensland in Oaks Hotels and Resorts (Qld) Pty Ltd v Blackwood & Another5 which dealt with a fairly similar set of facts.

Compare this with the decision of the QIRC in the matter of Harvey.

Harvey involved a psychiatric injury occurring to the appellant, a long haul flight attendant with QANTAS accused of indecent dealings by a co-worker.

Here the appellant was on a layover in Los Angeles and in hotel accommodation provided by QANTAS. The hotel had a crew room where co-workers could socialise. The co-worker was allegedly "in a state of collapse" trying to get into her hotel room and had reportedly lost her key resulting in the appellant allowing her access to his room where she fell asleep. Mr Harvey was later woken up by police officers after the co-worker had made an allegation of indecent dealings.

While later cleared of any wrongdoing, the appellant had been remanded in custody in an Orange County jail. The medical evidence indicated the main stressors leading to the psychiatric injury were the unexpected arrest, the detention in jail and the accusation he had committed a sexual offence.

Counsel for the appellant contended the fact the appellant was asleep in his room at the time the police attempted the arrest was enough to characterise the injury as occurring by reference to "place" given the employer had encouraged him to stay and sleep in the hotel room.

It was argued to the contrary by the Regulator the injury suffered had nothing to do with the appellant sleeping, but instead due to his his arrest, being held on remand, and ultimately, the accusation itself.

Thompson C of the QIRC found that while the employer encouraged the appellant and the co-worker to be present in the crew room and at the hotel, the events that led to the injury (being the allegations made by the co-worker of indecent dealings and being woken up by police officers) could not be characterised by "place". Rather, it was the activity that led to the injury which in no way was encouraged or induced by the employer.

In this vein, the Commissioner referred to the principle that place was merely the setting or backdrop for the activity. Where an employee undertakes an activity that is not encouraged by the employer and gets injured, the injury will not be said to be in the course of employment merely by virtue of the fact the employer has required the employee to be at the place where the activity was undertaken.

Take away points

On first blush, employment may not seem to be a significant contributing factor based upon the immediate cause of the injury in many cases. However, consideration needs to be given to all of the factors of employment and not just the immediate cause.

All of these cases turn on their facts. While it may not always be readily apparent, it is important to analyse the evidence available to determine whether the injury occurred is to be characterised by reference to "place" or "activity" in determining whether it occurred "in the course of employment".

The High Court acknowledged the by-product of the test enunciated in PVYW has the effect of requiring the circumstances of the injury to exhibit a connection or association with employment and necessarily serves as a limiting provision on liability.

Workers' compensation regimes are similar but not identical. While it seems obvious, consideration should always be given to the wording of the legislation as subtle differences in the wording of legislation can provide a different result if the same set of facts were being applied in a different jurisdiction.

Footnotes

1 [2013] HCA 41
2 [2016] ICQ 001
3 [2015] QIRC 211
4 [2006] 1 Qd R 519
5 [2014] ICQ 23

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