Pettiford and Comcare [2014] AATA 95 | Case summary

The Registrar is requested to list Application No. 2012/5159 for a directions hearing. Leave is granted to the parties to elect to attend by phone.

Pettiford and Comcare [2014] AATA 95 | Case summary | Zoe

[40]

Mr Backhouse testified that the reason he agreed to that arrangement was because he was of the opinion Ms Pettiford would probably resist any change to her hours of work and, because he saw his role as that of caretaker, he did not want to tackle the issue until the investigation into the complaint made against Mr Nugent was finalised.
Sometime after taking over the supervision of Ms Pettiford, Ms Kluver noticed that Ms Pettiford seemed to be commencing work at 7 am and finishing at 5 pm. Ms Kluver raised with Ms Pettiford her concern that working long days was inappropriate given the type of work she was required to perform which sometimes involved dealing with difficult and damaged people. Ms Kluver stated that notwithstanding these concerns she was persuaded that it was appropriate for Ms Pettiford to continue to work long hours because she had no other way of getting to and from work apart from travelling with her husband.
In January 2011 Ms Kluver noticed Ms Pettiford's timesheets consistently recorded a start time of exactly 7 am but finish times varied and were recorded to the minute. She raised the issue with Ms Pettiford who advised that the reason for this attendance pattern was because she was dropped at work the same time each day.
In February 2011 after being notified of CCTV footage showing Ms Pettiford arriving at work one morning at 7.20 am carrying shopping bags, Ms Kluver started calling Ms Pettiford at around 7 am. According to Ms Kluver sometimes Ms Pettiford did not answer her calls and the phone rang out.
Around February 2011, Ms Kluver became aware that Ms Pettiford was commencing work at 6 am on Fridays. Ms Kluver wrote to Ms Pettiford advising that she had not granted approval for Ms Pettiford to commence work before 7 am and directed her to cease doing so.
In a lengthy email to Ms Kluver sent on 1 March 2011, Ms Pettiford advised that for some time she had been starting work on Fridays at 6 am because her husband was required to start work at 6 am on Fridays. She wrote that it was her understanding that Mr Backhouse had briefed Ms Kluver about this arrangement: "under Len [Backhouse], I had believed this arrangement was acceptable as he had advised that as professionals we were trusted to manage our time and this included the discretion to arrive or leave". Ms Pettiford wrote that nonetheless she had no problems with following the direction not to start work before 7 am.

[44]

Comcare contends that Ms Pettiford's anxiety condition was a result of the direction. Counsel for Ms Pettiford, Mr Richards, disagrees and contends that the direction was a side issue and that the decision to return her to work under the supervision of Mr Nugent, who she believed had bullied and harassed her in the past and apprehended would do so in the future, was the main cause of her anxiety condition.
Ms Pettiford's condition will be "a result of" the direction, if it was an operative cause of the condition, even if there were other unrelated causes. (Hart v Comcare [2005] FCAFC 16; (2005) 145 FCR 29 at [18] - [26]; Commonwealth Bank of Australia v Reeve [2012] FCAFC 21; (2012) 125 ALD 181 at [54] - [56]; Drenth v Comcare [2012] FCAFC 86; (2012) 128 ALD 1 at [29]).
Ms Pettiford's actions in contacting a counsellor with the Employee Assistance Program shortly before the meeting with Mr Nugent is consistent with her claim that after being notified that Mr Nugent was to be reappointed as her supervisor she was in a state of heightened anxiety and had difficulties sleeping. I accept that Ms Pettiford was extremely distressed at the prospect of again being supervised by Mr Nugent. I also accept that she perceived that Mr Nugent had bullied and harassed her in the past and believed he was likely to do so again.
Nonetheless I cannot agree with the proposition that the direction did not contribute to Ms Pettiford's condition. The history to the 30 August 2011 meeting reveals that Ms Pettiford attached great significance to being able to align her work hours with those of her husband. The proposition that she was unaffected by the direction is inconsistent with the account she gave her GP within an hour of the meeting. The GP's clinical notes reveal that Mr Nugent's decision to change "previously agreed arrangements ... without any negotiated agreement" was something more than a "side issue". It is also inconsistent with the account prepared by Ms Pettiford shortly after the meeting, "Reflections re meeting with Paul 30 August 2011" in which she discussed the direction at some length.
It is notoriously difficult to identify what causes a person to develop a psychiatric illness. The task does not lend itself to empirical measurement or testing. It is not uncommon for there to be multiple causes. Where, as in this case, a particular event appears to have precipitated the onset of the condition, care must be taken not to overlook other stressors which might also have played a role. I think it more probable than not the main cause of Ms Pettiford's condition was the prospect of again being placed under the supervision of Mr Nugent. I am nonetheless satisfied that, while not the main cause, the direction was an operative cause of the condition.
I find that Ms Pettiford's condition was "a result of" the direction.

[48]

Comcare contends that the direction constitutes reasonable administrative action; Ms Pettiford disagrees. The determination of whether the direction was reasonable involves an objective judgment, taking into account the direction itself, the reason it was issued and the circumstances surrounding its issue.
Ms Pettiford was the only psychologist employed in the Mudgee office. The hours she was working in August 2011 meant that on one day out of five there was no psychologist available to staff and clients of the Mudgee office. As Ms Kluver pointed out if Ms Pettiford's hours were spread over a five-day week her clients would be afforded greater flexibility and access to her services (a view shared by Ms Salt). Starting work at 7 am meant she was working alone for up to an hour each day and raised potential health and safety problems. In addition, the events of early 2011 had raised legitimate concerns about Ms Pettiford's pattern of attendance.
In deciding staffing matters Centrelink had responsibilities to its clients and staff, including any affected employee. Given the staffing arrangements in the Mudgee office it was not unreasonable to require Ms Pettiford to attend the office five days a week and abandon early start times notwithstanding her stated preferences and the personal inconvenience she would inevitably suffer. Of itself the decision to require Ms Pettiford to work standard hours in my opinion was reasonable.
However the assessment of whether the direction was reasonable cannot be made at an abstract level but requires consideration to be given to the circumstances surrounding the issue of the direction. These include any provisions governing the conditions of Ms Pettiford's employment. At the time the direction was made Ms Pettiford's employment was governed by the Centrelink Agreement 2009-2011, an agreement binding on Ms Pettiford and the Chief Executive Officer of Centrelink, made under s 328 of the Workplace Relations Act 1996 (Cth) (the Agreement). For the reasons discussed below I am of the opinion that when the direction was issued it was not made in accordance with the provisions of the Agreement. Had those provisions been complied with I would have no hesitation in finding that the direction was reasonable. However they were not and for that reason I conclude the direction was not reasonable administrative action.

[62]

There is no argument that at the meeting of 31 August 2011 Mr Nugent directed Ms Pettiford to work "standard hours" and told her that this was "non-negotiable". I understand Mr Nugent's use of the term "standard hours" to mean default regular hours as defined by the Agreement, namely seven hours, 30 minutes each day, Monday to Friday, commencing in this case at 8.05 am (ten minutes before the opening time of the Mudgee office) or, if elected by the employee the subject of the direction, finishing at 5.15 pm (fifteen minutes after the office closing time). In addition within those parameters, the Agreement provides that the directed employee can elect to take a lunch break of 30, 45 or 60 minutes (see cl 64.10).
Mr Nugent testified that when he met with Ms Pettiford he was unaware of the requirement to "genuinely negotiate" contained in cl 64.2 of the Agreement. He stated that it was his understanding that the Merit Protection Commissioner had ruled that it was reasonable that Ms Pettiford work "standard hours", a ruling with which Mr Backhouse, Ms Kluver and Ms Wade agreed. He stated that he had decided not to discuss the matter with Ms Pettiford because he had formed the view she would probably resist any variation to her hours, and, therefore discussion would be futile and simply delay the implementation of the new hours arrangement.
As Comcare points out, the meeting of 31 August 2011 was not the first time concerns had been raised with Ms Pettiford about her hours of work. Concerns were raised by Mr Nugent and Ms Salt in early 2010, by Mr Backhouse in mid-2010 and by Ms Kluver in early 2011. It will be recalled that in early February 2010 following discussions with Mr Nugent and Ms Salt it was agreed that Ms Pettiford would commence work at 7 am, take a sixty-minute lunch break and work a nine-day fortnight. In May 2010 Mr Backhouse agreed to Ms Pettiford's request to return to a four-day week on a trial basis. Despite some misgivings Ms Kluver agreed to continue that arrangement when she took over as Ms Pettiford's supervisor in August 2010. Apart from the 6 am Friday starts, a practice which apparently started in late 2010 and ceased after Ms Kluver's direction issued in February 2011, there is no evidence that prior to the 31 August 2011 meeting, Ms Pettiford's "regular hours" had not been approved by her supervisors.
Three points can be made about this evidence. First, lack of awareness of the requirement to "genuinely negotiate" explains but does not explain away Mr Nugent's action. Second, there is no "escape" clause in the Agreement in respect of employees who are considered by managers to be difficult to negotiate with. Indeed, the possibility of negotiations failing is specifically recognised by clauses 64.8 to 64.10 of the Agreement. Third, it is implicit within the structure of clause 64 that the requirement that the employer undertake genuine negotiations with the employee arises every time management seeks to change the employee's regular hours. This is clear because it is only after an attempt has been made to "design, genuinely negotiating where necessary, the employee's regular hours" and has failed that the "default regular hours" provisions kick in. The fact that previous attempts at negotiation had failed does not allow the employer to avoid attempting the process the next time that management seeks to alter the employee's regular hours.
I accept that in early 2010, Mr Nugent genuinely negotiated with Ms Pettiford about her spread of hours. However when he took over her supervision some 18 months later he made no attempt to do so. That Ms Pettiford might have strongly resisted any change does not obviate the requirement to "genuinely negotiat[e]". As her supervisor, Mr Nugent was required under the terms of the Agreement to at least attempt to negotiate the design of Ms Pettiford's hours before exercising the default hours option. That she had made a complaint about him in the past because of, among other things, action he had taken about her hours of work, does not obviate that requirement.
It is not possible to say whether, had discussion taken place, a compromise might have been reached, as happened in February 2010. It is to be noted that the continuation of Ms Pettiford's (then) current hours and default regular hours were not the only options available even if the objective sought to be achieved was the alignment of Ms Pettiford's hours of work with office opening hours. For example, it was open to the parties to agree to Ms Pettiford commencing early one day per week.
In my opinion it cannot be said that because Mr Backhouse and Ms Kluver held discussions with Ms Pettiford about her hours of work in the intervening period between Mr Nugent being removed as her supervisor and resuming that role in August 2011, the requirement to "genuinely negotiate" was satisfied. While Mr Backhouse told Ms Pettiford that in his opinion 7.45 am was a preferable start time, he concedes he did not press the issue. As will be recalled, in May 2010, shortly after taking over her supervision he gave written approval for Ms Pettiford to commence work at 7 am and work a four-day week. He did not raise the issue again during the balance of the period Ms Pettiford was under his supervision. While Ms Kluver had misgivings about the arrangement she inherited from Mr Backhouse, apart from raising her concerns she took no steps to negotiate a change to Ms Pettiford's hours during the 12 months she acted as her supervisor. Ms Kluver's action in raising with Ms Pettiford the 6 am Friday starts and the recording of attendance times could not be characterised as discussions concerning the design of Ms Pettiford's regular hours.
The reluctance of Mr Backhouse and Ms Kluver to negotiate with Ms Pettiford about her spread of hours is understandable. They were concerned that if they pressed the issue they might find themselves the subject of a complaint. They in effect treated Ms Pettiford with kid gloves. Whatever the reason for that approach in my opinion it could not be said that either genuinely negotiated with Ms Pettiford over the design of her hours of work.
The Agreement does not define what is meant by the phrase "genuinely negotiating" for the purpose of cl 64.2. In my opinion while it does not impose a requirement on Centrelink to conduct exhaustive negotiations it nonetheless requires "the employee and their supervisor/manager to together design, genuinely negotiating ... the employee's regular hours". Where, as in this case, the team leader/manager seeks to vary existing arrangements, in my opinion, cl 64.2 requires as a minimum that the employee be given notice of the proposed changes, the consequences of failing to reach agreement and an opportunity to respond. This did not occur. Mr Nugent simply notified Ms Pettiford that her hours of work were to be varied and that he was not prepared to discuss the issue further. It may be that the reason he took that approach was because he thought the time had come to bite the bullet. It may also have been that he had misinterpreted the Merit Review Commissioner's report as approval not only for the decision to change Ms Pettiford's hours but for the approach he took to the decision's implementation. Whatever the reason he did not genuinely negotiate with Ms Pettiford prior to exercising the default hours option.
I cannot agree with the proposition put by Centrelink that because of the long history to the discussions between Ms Pettiford and her supervisors, the action of directing Ms Pettiford to work standard hours without discussion constitutes action taken in a reasonable manner. In my opinion the obligation imposed by cl 64.2 to "genuinely negotiat[e]" was not satisfied and therefore the power to direct Ms Pettiford to work default hours option could not be exercised. I find the direction was neither reasonable administrative action nor taken in a reasonable manner.

[72]

Comcare contends that the action of sending the offending letter was not employment related citing in support the comments of Windeyer J in Federal Broom Co Pty Ltd v Semlitch [1964] HCA 34; (1964) 110 CLR 626 at 621 (reproduced at paragraph [87] below). Comcare submits the decision communicated to Ms Pettiford on 13 March 2012 could not be characterised as one relating to some feature of the workplace or environment or otherwise connected to her employment but rather it was a decision about the employment relationship itself.
Ms Pettiford disagrees citing in support the comments of Kitto J in Federal Broom at 632-633 (reproduced at paragraph [86] below). She contends it is "a nonsense" to suggest that the actions of Centrelink in attempting to return her to work did not relate to her employment, reasoning that were it not for her employment she would not have been exposed to the offending letter. She contends that the decision that she be returned to work was a "state of affairs" to which she was exposed in relation to the performance of her duties and fits squarely within the analysis employed by Kitto J in Federal Broom.
In Federal Broom the High Court examined the definition of "injury" in s 6(1) of the Workers' Compensation Act 1926-1960 (NSW), relevantly "the aggravation, acceleration, exacerbation or deterioration of any disease, where the employment was a contributing factor to such aggravation, acceleration, exacerbation or deterioration; ...".
In that matter Ms Semlitch injured her back at work, was incapacitated as a result and paid workers compensation for a period. During that period her then latent schizophrenia resurfaced and became acute. The Court of Appeal dismissed an appeal against the decision of the NSW Workers Compensation Commission to award Ms Semlitch compensation on account of her schizophrenia. In a dissenting judgement, Else-Mitchell J reasoned that if the incident during which Ms Semlitch sustained her physical injuries had aggravated etc. her existing psychiatric condition, it was that incident and not the employment, or any factor in the employment that contributed to the aggravation. On appeal to the High Court, Kitto J (with whom Taylor and Owen JJ agreed) rejected that reasoning (at 632-633):

[78]

The submission advanced by Comcare assumes that a neat distinction will always be able to be drawn between a decision concerning a feature of the workplace or otherwise connected to the employee's employment and one about the employment relationship itself. There will sometimes be a degree of overlap between the two. The action of communicating a decision to terminate an employee's employment is but one example. It could be characterised both as an "event" or "occurrence" in the course of the employment and a decision about the employment relationship itself.
The offending letter advised Ms Pettiford of a number of things: Dr Burek's opinion that she was fit for work and Centrelink's decision to accept that opinion and to take steps to facilitate her return to work. While falling short of a direction or requirement to return to work, the effect of the letter was that subject to Ms Pettiford's feedback and consultation with her treating psychiatrist, she was expected to return to work.
While undeniably a decision about the employment relationship, the more difficult question is whether, as Ms Pettiford contends, it could be said to constitute "employment" within the definition of disease used in the Act. Kitto J in Federal Broom was not, as I understand Ms Pettiford to argue, referring to an incident or state of affairs relating to "work", to use a neutral term, but to "some incident or state of affairs to which the worker was exposed in the performance of his duties and to which he would not otherwise have been exposed" [emphasis added]. That qualification was echoed by the comments made by Windeyer J: "some event or occurrence in the course of the employment or some characteristic of the work performed or the conditions in which it was performed".
I accept as argued by Ms Pettiford that "but for" the fact that she was an employee of Centrelink she would not have been exposed to the decision about her return to work. However that is not the test imposed by s 5B of the Act to determine whether the necessary causal relationship exists between the claimed ailment and the employee's employment. Rather the applicable test is whether the employee's "employment" in the narrow sense employed by Kitto and Windeyer JJ, contributed to that ailment, or its aggravation.
For these reasons I conclude that the communication of the offending decision did not fall within the scope of the phrase "the employee's employment with the Commonwealth" as used in s 5B of the Act.

Pettiford and Comcare [2014] AATA 95 (27 February 2014)

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Pettiford and Comcare [2014] AATA 95 (27 February 2014)

Legislation Cited (5)

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