Australia: Injuries sustained post resignation found to have arisen - out of or in the course of employment

In the recent decision of Davis v Terrivic Pty Ltd [2016] NSWWCC 10, the New South Wales Workers' Compensation Commission (the Commission) found that personal injuries sustained by a worker in a motor vehicle accident following the Applicant's resignation of employment, occurred out of and in the course of her employment.

Associate Janine Oberhardt and Partner Robert Tidbury provide a summary of the Commission's decision.


The Applicant, Adele Davis was employed as an Assistant Manager with KFC at Broken Hill. On 7 May 2013, Ms Davis was involved in a motor vehicle accident and suffered significant injuries, including a brain injury which rendered her totally incapacitated for work for a period of more than 2 years. She made a claim for weekly compensation benefits.

The Commission heard that, immediately prior to the motor vehicle accident, Ms Davis had resigned from her employment with KFC. Whilst she had not verbally advised anyone of her resignation, she had left at the store a written letter to that effect upon which she attached her name badge. She then left the store, and on her evidence, started to drive to Renmark some 400 kilometres away, where the company director Ms Leonard resided. According to Ms Davis she had intended to speak with Ms Leonard and her husband to try and resolve workplace issues she was having with the Store Manager, Cameron Wilson. These issues had prompted her to submit her resignation. However, it was Ms Davis' evidence that she only intended her notice of resignation to take effect if those employment issues could not be resolved. It was on the way to Renmark that Ms Davis was involved in the motor vehicle accident.

The Respondent argued that Ms Davis was not entitled to weekly compensation because, at the time of the worker's resignation, Ms Davis had intended it to take effect immediately. As such it was contended that Ms Davis was no longer employed when she was involved in the accident. Therefore the worker's injuries did not arise out of or in the course of her employment.

The Commission was asked to determine:

  • Whether Ms Davis' employment had ceased prior to her embarking on her journey to Renmark;
  • If not, whether by leaving the store without a Manager present (as was company policy), she took herself out of the course of her employment by reason of misconduct.

Did the motor vehicle accident occur out of or in the course of employment?

The Commission found in favour of Ms Davis, finding that the accident took place in or out of the course of her employment.

In finding for Ms Davis, the Commission found that her resignation did not take immediate effect. It was noted that Ms Davis was required to provide two weeks' notice of resignation or forfeit her pay in lieu of such notice. There was no indication in her resignation letter as to whether she intended for her resignation to take immediate effect. Ultimately, the Commission accepted Ms Davis' evidence that she did not intend for it to take immediate effect, but rather sought to negotiate an acceptable outcome with the owner which would see a withdrawal of her resignation, or alternatively work for a further two weeks. Therefore, it was found that Ms Davis contract of employment with Terrivic Pty Ltd remained on foot.

The Commission was also satisfied that there was a causative connection between Ms Davis' employment and the accident, as the purpose of the journey was to complain of the difficulties she experienced with Mr Wilson and to negotiate a solution to her workplace problems. Similarly Ms Davis' injuries were suffered during ordinary working hours, a temporal nexus was established.

Did Ms Davis' actions in leaving the store amount to gross misconduct?

The Commission also rejected the Respondents submission that, by that leaving the store inadequately supervised, she took herself out of the course of her employment. It was noted by the Commission that in order to successfully raise such an argument, gross misconduct must be established. To this end it was noted that the store had been left in the hands of a person who was being trained as shift supervisor and had adequate length of service. Further no evidence was led to suggest that this person was not capable of looking after the store in a proper manner. Therefore, the Commission found that Ms Davis' actions in leaving the store could not be described as misconduct, let alone gross misconduct.

As a result, the Commission found that the injuries suffered in the motor vehicle accident arose out of and in the course of Ms Davis' employment and awarded her weekly compensation for the period of her injury related incapacity.

Takeaway points

  • Whether a worker's injuries occurred out of or in the course of their employment will depend on the facts and circumstances of each case.
  • In circumstances where personal injuries have been sustained by a worker following their resignation from employment, to determine whether such injury did or did not arise out of or in the course of their employment, involves a consideration as to what the parties' respective intentions were when the resignation was submitted. That is, was the resignation intended to take immediate effect?
  • In addition to looking at the parties' intentions, it is also necessary to consider whether a causal and temporal nexus between the injury and the worker's employment is established. In other words, it must be demonstrated that the activity in which the worker was engaged at the time of the injury was related to his or her employment. In this case, the worker was driving to meet with her employer to negotiate a solution for difficulties she was experiencing in the workplace.
  • An employer must establish gross misconduct (as opposed to misconduct) in order for there to be finding that a worker took themselves out of employment. This scenario most often arises in cases of workplace assault. Whether or not there is gross misconduct is a question of fact to be determined in each case.

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