WORKERS’ COMPENSATION – “injury” – definition – exclusionary provision – administrative action in respect of employee’s employment – bank manager suffered major depressive disorder – multiple causes – organisational and staffing changes with respect to manager’s branch, humiliation in having to report unsatisfactory results in telephone conference, visit to branch by regional manager who did not spend time with manager, distribution of unsatisfactory results of customer satisfaction survey, impending further telephone conference – whether Administrative Appeals Tribunal erred in construction of exclusionary provision – whether any of causes capable of falling within exclusionary provision

Commonwealth Bank of Australia v Reeve [2012] FCAFC 21 (8 March 2012)

Last Updated: 8 March 2012

FEDERAL COURT OF AUSTRALIA

Commonwealth Bank of Australia v Reeve
[2012] FCAFC 21

Citation:		Commonwealth Bank of Australia v Reeve [2012] FCAFC 21
Appeal from:		Reeve and Commonwealth Bank of Australia [2010] AATA 893
Parties:		COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124) v MARK REEVE and ADMINISTRATIVE APPEALS TRIBUNAL
File number:		WAD 384 of 2010
Judges:		GRAY, RARES AND TRACEY JJ
Date of judgment:		8 March 2012
Catchwords:		WORKERS’ COMPENSATION – “injury” – definition – exclusionary provision – administrative action in respect of employee’s employment – bank manager suffered major depressive disorder – multiple causes – organisational and staffing changes with respect to manager’s branch, humiliation in having to report unsatisfactory results in telephone conference, visit to branch by regional manager who did not spend time with manager, distribution of unsatisfactory results of customer satisfaction survey, impending further telephone conference – whether Administrative Appeals Tribunal erred in construction of exclusionary provision – whether any of causes capable of falling within exclusionary provision
Words and phrases:		“administrative action”
Legislation:		Administrative Appeals Tribunal Act 1975 (Cth) s 44 Administrative Decisions (Judicial Review) Act 1977 (Cth)ss 5, 8 Acts Interpretation Act 1901 (Cth) ss 15AA, 15AB, 15AD(a),15AD(b) Federal Court of Australia Act 1976 (Cth) s 20(1A) Safety, Rehabilitation and Compensation Act 1988 (Cth) ss 4, 4(1), 5A, 5A(1), 5A(2), 5A(2)(a), 5A(2)(f), 5B, 6(1)(a) and (b), 14(1), Pt VIII Workers Rehabilitation and Compensation Act 1986 (SA) s 30
Cases cited:		Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 applied Canute v Comcare (2006) 234 CLR 535 applied Clements v Independent Indigenous Advisory Committee[2003] FCAFC 143, cited Fellowes v Military Rehabilitation and Compensation Commission [2009] HCA 38; (2009) 240 CLR 28 applied Hart v Comcare [2005] FCAFC 16 (2005) 87 ALD 341, cited John Holland Group Pty Ltd v Robertson [2010] FCAFC 88;(2010) 185 FCR 566 applied Leon Fink Holdings Pty Ltd v Australian Film Commission(1979) 141 CLR 672 applied Parker v President of the Industrial Court of Queensland[2009] QCA 120; [2010] 1 Qd R 255 referred to PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission (2011) 192 FCR 393 applied SZBYR v Minister for Immigration and Citizenship [2007] HCA 26; (2007) 235 ALR 609 applied The Commonwealth v Rutledge [1964] HCA 63; (1964) 111 CLR 1 referred to Tuite v Administrative Appeals Tribunal [1993] FCA 71;(1993) 40 FCR 483, cited Workcover Corporation of South Australia v Summers(1995) 65 SASR 243, cited
Date of hearing:	17 August 2011
Place:	Perth
Division:	GENERAL DIVISION
Category:	Catchwords
Number of paragraphs:	76
Counsel for the applicant:	Mr T Howe QC with Mr D Richards
Solicitor for the applicant:	Dibbs Barker Lawyers
Counsel for the first respondent:	Mr TJ Hammond
Solicitor for the first respondent:	Slater & Gordon
The second respondent submitted to any order the Court might make, save as to costs

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 384 of 2010

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:

COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124) Applicant

AND:	MARK REEVE First Respondent ADMINISTRATIVE APPEALS TRIBUNAL Second Respondent

JUDGES:	GRAY, RARES AND TRACEY JJ
DATE OF ORDER:	8 MARCH 201
WHERE MADE:	PERTH

THE COURT ORDERS THAT:

1. The appeal be dismissed.
2. The application be dismissed.
3. The applicant pay the first respondent’s costs of the appeal and the application. 

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 384 of 2010

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:

COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124) Applicant

AND:	MARK REEVE First Respondent ADMINISTRATIVE APPEALS TRIBUNAL Second Respondent

JUDGES:	GRAY, RARES AND TRACEY JJ
DATE:	8 MARCH 2012
PLACE:	PERTH

REASONS FOR JUDGMENT

GRAY J:

The nature and history of the proceeding

1. The central question in this appeal is whether the Administrative Appeals Tribunal (“the Tribunal”) erred in the construction it adopted of the phrase “administrative action”. That phrase occurs in an exclusion in the definition of “injury” in s 5A of the Safety, Rehabilitation and Compensation Act 1988(Cth) (“the SRC Act”). The exception provides that an “injury”:

does not include a disease, injury or aggravation suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee’s employment.

Section 5A(2) of the SRC Act contains a list of specific actions that are taken to be “reasonable administrative action” for the purposes of the definition, but the subsection states specifically that those instances are given “without limiting” subs (1).

2. The first respondent, Mark Reeve, was employed by the applicant, the Commonwealth Bank of Australia (“the CBA”) as a branch manager. On 21 July 2008, he suffered an episode that the Tribunal recognised as the onset of a major depressive disorder. There was no dispute that this condition was contributed to, to a significant degree, by Mr Reeve’s employment with the CBA. It therefore constituted a “disease” within the definition of that term in s 5B of the SRC Act. Unless it was the result of administrative action of the kind referred to in the exclusion in s 5A(1), the condition constituted an “injury”, for which the CBA was liable to pay compensation to Mr Reeve, pursuant to s 14(1) of the SRC Act.
3. On 2 October 2008, the CBA made a determination accepting liability to pay compensation to Mr Reeve under the SRC Act in respect of an injury described as “major depression – single episode” on 21 July 2008. On 12 October 2009, following a reconsideration of that determination by the CBA on its own motion, the CBA revoked that determination and determined that it was not liable to pay compensation to Mr Reeve in respect of the alleged injury. Mr Reeve applied to the Tribunal for review of the decision of 12 October 2009. The decision and reasons for decision of the Tribunal were published on 12 November 2010. The Tribunal set aside the decision under review. In substitution for that decision, the Tribunal decided that the CBA is liable, pursuant to s 14(1) and Pt VIII of the SRC Act, to pay compensation to Mr Reeve in respect of an injury, namely major depressive disorder, sustained by him on 21 July 2008. The Tribunal also dealt in its decision with the costs of the proceeding in the Tribunal.
4. The document that initiated the proceeding in this Court was filed on 9 December 2010. It contained both a notice of appeal pursuant to s 44 of theAdministrative Appeals Tribunal Act 1975 (Cth) (“the AAT Act”) and an application pursuant to s 5 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (“the ADJR Act”), seeking to set aside the Tribunal’s decision. On 23 December 2010, an amended document was filed invoking s 44 of the AAT Act and s 8 of the ADJR Act. It is not clear why the CBA felt it necessary to rely on the ADJR Act at all. There is authority that the specific procedure under s 44 of the AAT Act should be adopted, at least in the absence of special circumstances. See Clements v Independent Indigenous Advisory Committee [2003] FCAFC 143 at [3] per Gray ACJ and North J, quoting Davies J in Tuite v Administrative Appeals Tribunal [1993] FCA 71; (1993) 40 FCR 483 at 484, and the cases to which Davies J referred in the passage quoted. The adoption of the procedure under s 44 of the AAT Act makes it unnecessary to join as a party in this Court the Tribunal, as was done in the present case (the Tribunal entered a submitting appearance, save as to costs). As all of the grounds on which the CBA relied appear to be grounds of error of law, the proceeding was dealt with as an appeal under s 44 of the AAT Act.

The legislation

5. Section 5A of the SRC Act provides:

(1) In this Act:

injury means:

(a) a disease suffered by an employee; or

(b) an injury (other than a disease) suffered by an employee, that is a physical or mental injury arising out of, or in the course of, the employee’s employment; or

(c) an aggravation of a physical or mental injury (other than a disease) suffered by an employee (whether or not that injury arose out of, or in the course of, the employee’s employment), that is an aggravation that arose out of, or in the course of, that employment;

but does not include a disease, injury or aggravation suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee’s employment.

(2) For the purposes of subsection (1) and without limiting that subsection, reasonable administrative action is taken to include the following:

(a) a reasonable appraisal of the employee’s performance;

(b) a reasonable counselling action (whether formal or informal) taken in respect of the employee’s employment;

(c) a reasonable suspension action in respect of the employee’s employment;

(d) a reasonable disciplinary action (whether formal or informal) taken in respect of the employee’s employment;

(e) anything reasonable done in connection with an action mentioned in paragraph (a), (b), (c) or (d);

(f) anything reasonable done in connection with the employee’s failure to obtain a promotion, reclassification, transfer or benefit, or to retain a benefit, in connection with his or her employment.

6. Prior to 13 April 2007, there was a definition of “injury” in s 4 of the SRC Act. From the words “injury means” down to the words “that employment” at the end of para (c), the definition was almost identical to the present one. The exclusion was very different, however. It read:

but does not include any such disease, injury or aggravation suffered by an employee as a result of reasonable disciplinary action taken against the employee or failure by the employee to obtain a promotion, transfer or benefit in connection with his or her employment.

The change was effected by the Safety, Rehabilitation and Compensation and Other Legislation Amendment Act 2006 (Cth).

7. In the Explanatory Memorandum to the Safety, Rehabilitation and Compensation and Other Legislation Amendment Bill 2006 (Cth), there was a Regulation Impact Statement, which dealt at some length with the proposed change to the exclusion in the definition of “injury”. The Regulation Impact Statement included the following:

The SRC Act aims to prevent compensation claims being used to obstruct legitimate management action by excluding claims where an injury (usually a psychological injury) has arisen as a result of reasonable disciplinary action or a failure to obtain a promotion, transfer or benefit in connection with the employee’s employment.

The term, “disciplinary action”, has been interpreted in a number of court and tribunal decisions very narrowly to mean formal disciplinary action taken under, for example, the Public Service Act 1999 (or prior to this the Public Service Act 1922) or action taken pursuant to an award or certified agreement.

Consequently, investigations undertaken to determine: whether a probationary appointment should be annulled; formal disciplinary proceedings should be instituted; or management counselling provided to an employee, have been found not to constitute “disciplinary action”.

Claims for injuries purportedly arising in these circumstances have been allowed, which was not the intention of the Act.

In Re Tan and Comcare (1997), the AAT held that a session described as a “counselling session” was not counselling but a preceding step, a “discussion, an investigation of complaints”, which did not attract the “disciplinary action” exclusion. In Re Murray and Comcare (1998), the AAT held that “disciplinary action” did not include investigations undertaken prior to formal disciplinary action under section 61 of the Public Service Act 1922.

As a result of decisions such as these, employers under the SRC Act are exposed to liability for workers’ compensation in a much wider range of circumstances than was intended when the legislation was enacted. The narrow terms of the exclusion provision relating to “disciplinary action” is also inconsistent with a broader exclusion for ‘management actions taken reasonably’ which are a feature of all Australian jurisdictions, except the Northern Territory.

...

Objectives

The Government’s primary objective with the workers’ compensation scheme established under the SRC Act, is to minimise the human and financial cost of work-related injury and disease while at the same time providing appropriate compensation and support for employees injured or made ill through employment. In this context, the Government is seeking to strike a balance between the obligations of employers covered by the scheme to employees injured or made ill through work and the need to ensure that the costs of the scheme are maintained at a reasonable level.

It was the original intention of the legislation to ensure that there is a close connection to employment as the cause, aggravator or contributor of a worker’s disease or injury, before eligibility for workers’ compensation can be established.

A further objective, through the exclusionary provisions, was to ensure that the wide range of legitimate human resource management actions, when undertaken in a reasonable manner, do not give rise to eligibility for workers’ compensation.

Achieving these objectives would restore Parliament’s original intention regarding the operation of these provisions.

8. The Regulation Impact Statement also canvassed three options for the definition of “injury”. The first option involved no change. The second involved an exhaustive list of what constitutes “reasonable administrative action”, without any “catch-all” provision to cover actions not listed. The third option was to exclude injuries arising from “reasonable administrative action” and provide a non-exhaustive list. The Regulation Impact Statement recommended the adoption of the third option, for the following reasons:

The SRC Act should prevent workers’ compensation claims being used to obstruct legitimate administrative action by excluding claims where an injury has arisen as a result of such action.

An exhaustive list, as under Option 2, would provide certainty about particular actions and decisions which constitute reasonable administrative action. A list would also provide for clarity of workers’ compensation eligibility and thus minimise the scope for uncertainty and disputation.

In providing for a non-exhaustive list of exclusionary provisions, Option 3 would be more comprehensive in ensuring that injuries claimed to arise from reasonable administrative action are not compensable. This option would reduce the risk of future loopholes emerging in the exclusionary provisions.

On balance, the additional comprehensiveness of Option 3 compared to Option 2 makes this the preferred option.

9. The Explanatory Memorandum included notes on clauses. The notes on the main amendments, in Sch 1, included the following notes on the definition of “injury”:

The new definition retains all the elements of the existing definition of injury but extends the exclusionary provisions.

The existing definition of injury excludes any disease, injury or aggravation suffered by an employee as a result of reasonable disciplinary action taken against the employee or failure by the employee to obtain a promotion, transfer or benefit in connection with his or her employment. The new definition makes it clear that the exclusions will extend to all reasonable management activities.

The facts

10. In August 2007, Mr Reeve began working as the manager of the CBA’s branch at Mt Hawthorn, a suburb of Perth. For the half year ended 31 December 2007 and the half year ended 30 June 2008, reviews of the performance of the branch concluded that the branch exceeded or met expectations in relation to customer service.
11. The CBA organised its Perth branches into areas, each with an area manager. Until 30 June 2008, the Mt Hawthorn branch was in the north area. From 1 July 2008, it was transferred to the Perth area. Mr Reeve had not met the area manager of the Perth area, or had any contact with him, prior to that date. Prior to the move, an assistant manager at Mt Hawthorn, who Mr Reeve regarded as a high performing staff member, had been moved to another branch. After the change of area manager, an employee whose responsibilities included negotiating loans (called a “lender”) who was also regarded highly, was moved to another branch. The replacement at Mt Hawthorn was unenthusiastic about being moved there.
12. Several times a week, telephone conferences were held between the area manager and the managers of the various branches in the area. In these conferences, the performance of the various branches was discussed. The discussion included the results of customer satisfaction surveys, conducted for the CBA by an external company. Such survey was called a customer experience survey, or CES. Customers who had had recent transactions with the CBA were asked to rank the standard of service in various areas on a scale from 1-10. The CBA regarded a 9 or a 10 rating as having value, but a rating of 8 or less counted as a zero. The customers who were surveyed were not told that the results would be evaluated in this way.
13. On Friday, 18 July 2008, there was a telephone conference in the morning. Mr Reeve had to report a lending referral outcome to all of the other branch managers in the area and to be questioned by the area manager. He found this to be stressful. He felt that he was embarrassed and humiliated. Later on the same day, Mr Reeve received the results of a CES. The results were poor. He was aware that there would be another telephone conference on the following Monday morning, at which the results would be discussed. He did not feel that he could face such a conference and began contemplating suicide.
14. Also on Friday, 18 July 2008, the area manager made an unannounced visit to the Mt Hawthorn branch. Mr Reeve felt that the area manager did not take the opportunity to engage in any personal discussion with him.
15. On the morning of 21 July 2008, Mr Reeve arrived at the Mt Hawthorn branch early. He made three attempts to take his own life, but could not go through with any of them. He went home and subsequently sought medical advice.

The Tribunal’s reasons

16. In the course of its reasons for decision, the Tribunal referred to dictionary definitions, quoted passages from the Explanatory Memorandum (which are included in those quoted in [7] above) and quoted the words of the former exclusion in the definition of “injury” in s 4(1) of the SRC Act. The Tribunal then said:

48. Although subs (2) of s 5A of the SRC Act, which lists (in paras (a)−(f)) categories of action that the phrase “reasonable administrative action” in subs (1) is “taken to include”, is expressed not to limit subs (1), the categories of action listed therein are, in the Tribunal’s opinion, indicative of the kinds of action which the legislature intended should constitute “administrative action” within the meaning of subs (1).

49. Having regard to the literal words of the exclusionary provision in s 5A(1), and of s 5A(2), and the abovementioned extract from the relevant Explanatory Memorandum, the Tribunal is of the opinion that the phrase “reasonable administrative action taken in a reasonable manner in respect of the employee’s employment” in the exclusionary provision in s 5A(1) of the SRC Act is, in accordance with its ordinary meaning, limited to reasonable and “legitimate human resource management actions” (as described in the Explanatory Memorandum) taken in a reasonable manner in respect of an employee’s employment, and does not include “reasonable administrative action taken in a reasonable manner in respect of” any matter other than (and not including) an employee’s employment, including matters of general administration, management and the implementation of policy, even if such action indirectly or incidentally affects the employment of employees.

17. The Tribunal then dealt with submissions that the provision of the customer satisfaction survey on 18 July 2008 constituted reasonable administrative action taken in a reasonable manner in respect of Mr Reeve’s employment, because the survey outcomes constituted a reasonable appraisal of Mr Reeve’s performance within the meaning of s 5A(2)(a) of the SRC Act or constituted something reasonable done in connection with Mr Reeve’s failure to obtain a benefit or to retain a benefit in connection with his employment, within the meaning of s 5A(2)(f) of the SRC Act, the relevant benefit being Mr Reeve’s salary bonus. The Tribunal said that, although it was common ground that 40% of Mr Reeve’s annual salary bonus was dependent on his branch achieving satisfactory CES outcomes, there was no evidence that, at any time prior to 21 July 2008, Mr Reeve had failed to obtain or retain any part of his salary bonus by reason of unsatisfactory CES outcomes. The Tribunal found that Mr Reeve had achieved his full salary bonus for the year ending 30 June 2008. The Tribunal rejected a submission that s 5A(2)(f) of the SRC Act extended to fear of failing to obtain a benefit, holding that a failure to obtain or retain a benefit did not include a fear or an expectation or any other anticipatory state of mind as to failing to obtain or retain a benefit. The Tribunal held that s 5A(2)(f) of the SRC Act was inapplicable to Mr Reeve’s case.
18. The Tribunal also rejected a submission that the CES outcomes constituted appraisal of Mr Reeve’s performance. It found that the CES outcomes for Mr Reeve’s branch comprised one of seven key performance indicators relevant to an appraisal of his employment performance. It found that the CES outcomes for all 15 branches in the Perth area were provided on a weekly basis to the area manager and the 15 branch managers for the purpose of discussion at a weekly telephone conference. The Tribunal took the view that the weekly CES outcomes and their discussion at that conference could not be regarded as an appraisal of Mr Reeve’s performance. Such an appraisal within the meaning of s 5A(2)(a) of the SRC Act would include a reasonable individual performance appraisal by a person responsible for conducting such an appraisal, typically the employee’s immediate supervisor, and typically involving a one-to-one meeting and discussion between the appraiser and the person being appraised. In the Tribunal’s view, the CES outcomes constituted an appraisal by the customers surveyed of various areas of a branch’s customer service performance and the subsequent telephone conferences involved a discussion of various agenda items, including CES outcomes, amongst the area manager and the various branch managers.
19. The Tribunal then turned to consider whether the exclusion was otherwise applicable. It identified the relevant employment events and circumstances which it found collectively caused Mr Reeve to suffer major depressive disorder on 21 July 2008. They were: the implementation of the organisational restructure and staffing changes affecting Mr Reeve’s branch in June 2008; the telephone conference on 18 July 2008 at which Mr Reeve reported unsatisfactory results for his branch and felt embarrassed and humiliated; the unannounced visit by the area manager to Mr Reeve’s branch later that day during which Mr Reeve felt that the area manager did not engage in any personal discussion with him or relate supportively to him; the receipt by Mr Reeve in the late afternoon of 18 July 2008 of the CES scores for the first two weeks of July, including his branch’s unsatisfactory scores; and Mr Reeve’s feeling that he could not face the prospect of participating in the next telephone conference on 21 July 2008, at which he would have to report on his branch’s unsatisfactory CES scores. The Tribunal said that none of those events or circumstances involved action taken in respect of Mr Reeve’s employment, within the meaning of the exclusion in s 5A(1) of the SRC Act. The implementation of the organisational restructure and staffing changes and the telephone conference on 18 July 2008 constituted administrative or management action which affected Mr Reeve but the action was not taken in respect of Mr Reeve’s employment. The visit of the area manager to Mr Reeve’s branch on 18 July 2008 was for the purpose of meeting the lender and discussing matters with him. It was not action taken by the area manager in respect of Mr Reeve’s employment. The receipt of the CES scores later on 18 July 2008 and Mr Reeve’s feeling that he could not face the prospect of participating in the next telephone conference on 21 July 2008 did not constitute action taken in respect of Mr Reeve’s employment. The Tribunal also said that the introduction and implementation of the CES process itself did not constitute action taken in respect of Mr Reeve’s employment. Those actions were management actions taken by the CBA for the purpose of measuring quality of customer service in its various branches.
20. The Tribunal did not have to address the question of the reasonableness of any of the actions it regarded as contributing to Mr Reeve’s condition, or the question whether any of those actions were taken reasonably. It concluded that Mr Reeve’s major depressive disorder, suffered on 21 July 2008, was contributed to, to a significant degree, by his employment with the CBA but was not suffered by him as a result of reasonable administrative action taken in a reasonable manner in respect of his employment within the meaning of the exclusionary provision in s 5A(1) of the SRC Act. Accordingly, the Tribunal found that Mr Reeve’s major depressive disorder was an “injury”, as defined in s 5A(1) of the SRC Act and therefore compensable pursuant to s 14(1) and Pt VIII of the SRC Act. Mr Reeve was taken to have sustained that injury on 21 July 2008.

The appeal

21. The amended notice of appeal described the question of law raised by the appeal as:

whether the Tribunal’s construction and application of the expression “a disease . . . suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee’s employment” in s 5A(1) of the SRC Act (the statutory expression) constituted an error of law within s 44(1) of the AAT Act.

In the course of the hearing of the appeal, questions were raised as to the adequacy of the expression of the question of law raised by the appeal. Counsel for the applicant undertook to submit a revised question of law. On 15 September 2011, the applicant filed a document containing the following six questions:

1. Properly construed, is the expression ‘administrative action’ in section 5A(1) of the Safety, Rehabilitation and Compensation Act 1988 (the SRC Act) limited to actions which are ‘human resource management actions’?
2. Properly construed, is the meaning of the expression ‘administrative action’ in section 5A(1) of the SRC Act narrowed or constrained by the specific categories of action enumerated in section 5A(2)?
3. Do the facts found by the Tribunal concerning implementation, in June 2008, of an organisational restructure fall within, or outside, the meaning of the expression ‘action taken ... in respect of the [First Respondent’s] employment’ in section 5A(1) of the SRC Act?
4. In light of the facts found (or apparently accepted) by the Tribunal, was the Tribunal correct in finding that particular administrative or management actions fell outside the scope of the expression ‘action taken in respect of the [First Respondent’s] employment’ as it appears in section 5A(1) of the SRC Act?
5. In light of the facts found (or apparently accepted) by the Tribunal, was the Tribunal correct in finding that particular administrative or management actions taken by the Applicant fell outside paragraph 5A(2)(a) of the SRC Act?
6. In light of the facts found (or apparently accepted) by the Tribunal, did the Tribunal err in failing to find that particular administrative or management actions taken by the Applicant fell within section 5A(2)(e) of the SRC Act?

It is not altogether clear that these questions are expressed appropriately as questions of law that arise on the appeal.

22. There were 22 grounds of appeal specified in the amended notice of appeal filed on 23 December 2010. Not all of them constituted grounds relating to questions of law. There was much repetition and overlap. In essence, the applicant sought to raise the question whether the Tribunal erred in law in construing the exclusion in s 5A(1) of the SRC Act as being limited to reasonable and legitimate human resource management actions and whether the Tribunal erred in construing “in respect of the employee’s employment” as being limited to direct effects on the employment of the particular employee.

The proper construction of the exclusion

23. Any attempt to apply to the exclusionary words in s 5A(1) of the SRC Act a construction that would promote the purpose or object underlying the legislation (in accordance with s 15AA of the Acts Interpretation Act 1901 (Cth) (“the Acts Interpretation Act”)) produces difficulty. The clear purpose of the SRC Act is to provide entitlements to compensation for persons injured in their employment. It is possible to invoke all of the cannons of construction about reading beneficial legislation broadly. On the other hand, the purpose of the Act that amended the exclusion was clearly to narrow entitlements to compensation by broadening the exclusion. The way in which the exclusion is now drafted gives rise to a difficulty in determining how far Parliament intended the broadening of the exclusion to go.
24. In this respect, it is necessary to bear in mind the principle that is taken to have been established by Hart v Comcare [2005] FCAFC 16 (2005) 87 ALD 341 at[21]- [23]. That principle is that, however many separate causes of an injury may have arisen out of, or in the course of, an employee’s employment, if any one of those causes falls within the exclusion, the employee is wholly disentitled to compensation in respect of that injury. It follows that the more broadly the exclusion is construed, the more destructive it becomes of the right to compensation afforded by the SRC Act. For instance, if the exclusion were to be construed so that any action that could be described as falling within the ordinary meaning of “administrative action”, taken by an employer, and commencing a chain of causation that resulted in injury to an employee of that employer, it is difficult to see that any employee would have any entitlement to compensation. Some examples surfaced in the course of argument on the appeal. It could be argued that an injury to an employee in falling down stairs at his or her workplace was the result of administrative action in directing that employee to work at that workplace. If a truck driver became injured as a result of a motor vehicle collision, it could be said that the injury was the result of the administrative action of directing the driver to drive a particular route on that day. In the present case, it could be said that Mr Reeve’s injury resulted from the administrative action of appointing him to manage the Mt Hawthorn branch of the CBA. Counsel for the CBA disclaimed any intention to argue for such an interpretation of the exclusion. They did not attempt to offer a way in which the words “as a result of” might be confined to a causal relationship of sufficient proximity to prevent the exclusion having that kind of operation, if the words “administrative action” were to be given a broad construction of the kind for which counsel for the CBA contended.
25. Just as a purposive construction offers no clear assistance in determining the breadth of the exclusion, the use of extrinsic material, as permitted by s 15AB of the Acts Interpretation Act, also provides no conclusive guide to the proper interpretation of the provision. As is pointed out in [7]-[9] above, the Explanatory Memorandum for the Bill which led to the amended exclusion includes both a Regulation Impact Statement and notes on clauses of the Bill. On the one hand, the Regulation Impact Statement refers to “the wide range of legitimate human resource management actions”, a phrase on which the Tribunal appears to have placed some reliance. On the other hand, the notes on clauses refer to “all reasonable management activities.” There is no clear statement of intention in the Explanatory Memorandum as to the limits of the breadth of the exclusion.
26. One thing is clear. The examples given in s 5A(2) of the SRC Act do not define exhaustively the scope of the exclusionary provision in s 5A(1). This is made plain by the opening words of subs (2) itself, as well as by s 15AD(a) of the Acts Interpretation Act. It is also true, as s 15AD(b) of the Acts Interpretation Act makes clear, that the examples in s 5A(2) of the SRC Act cannot be used to increase the breadth of the exclusion. To the extent to which any example in subs (2) would appear to be broader than the generality of the exclusion in subs (1), the example is confined by the exclusion.
27. With this in mind, it is necessary to return to the words of the exclusion in s 5A(1) of the SRC Act. For present purposes, it is appropriate to disregard the references to reasonableness and to focus on the other elements of the exclusion. It is also appropriate to try and avoid focussing on those other elements each in isolation from the others.
28. The central word in the exclusion is the noun “action”. That which is excluded from the definition of “injury” is a condition (“disease, injury or aggravation”) that has a causal relationship with (“suffered as a result of”) action. The action itself is qualified in two ways. It must have a relationship with (“in respect of”) employment, not just of any person but of a particular person (“the employee’s”). The other qualification of the word “action” is by means of the adjective “administrative”.
29. As is pointed out in [24] above, it is difficult to find in the words “suffered as a result of” some limitation as to the proximity of the relationship between the condition and the action. Whether the necessary causal relationship exists will be a question of fact in each case, but the words chosen by the legislature to describe the causal relationship do not lend themselves readily to confinement to a direct result, or a result with any particular degree of proximity. Similarly, the words used to describe the relationship between the action and the employment (“in respect of”) do not appear to be restrictive of the kind of connection that is envisaged.
30. The limits of the exclusion therefore appear to lie in the word “employment” and the word “administrative”. In the context of the exclusion, the word “employment” appears to be used in the sense of the “action or process of employing; the state of being employed” (Oxford English Dictionary) or “the act of employing” or “the state of being employed” (Macquarie Dictionary), rather than “that on which one is employed” (an alternative meaning given in both dictionaries). The history recounted in the Explanatory Memorandum to the amending Bill, and the identification in that Explanatory Memorandum of the mischief to which the amendment was directed, support this proposition. It is not action with respect to the duties that an employee is employed to carry out that is the subject of the exclusion, but action with respect to the employee as employee and his or her employment relationship with the employer.
31. The use of the word “administrative” in the exclusion is significant. In accordance with normal principles, it is not to be assumed that a word in a legislative provision has no function to perform. The word “administrative” must have been inserted to distinguish the kind of action to which the exclusion is directed from other kinds of action that might also be taken with respect to the employment of a particular employee. Such action that is not “administrative” could be operational, in the sense that it relates to the activities or business of the institution or enterprise in which the employee is employed. Thus, an instruction to perform work at a particular location, to drive on a particular route, or to perform particular duties would not be regarded as “administrative” action, but as operational action with respect to the employee’s employment.
32. This conclusion is similar to that reached by Doyle CJ, with whom Prior and Williams JJ agreed, in construing the words “reasonable administrative action taken in a reasonable manner by the employer in connection with the worker’s employment” in s 30(2a) of the Workers Rehabilitation and Compensation Act 1986 (SA), in Workcover Corporation of South Australia v Summers (1995) 65 SASR 243 at 247. Doyle CJ said:

The appellant argued that “administrative action” referred to “every instruction given by the employer or action taken by the employer which relates to the performance of the worker’s duties, whether directly or indirectly”. That is how it was put in the appellant’s outline. In his submissions counsel for the appellant said that administrative action embraced every instruction or action by the employer, indirectly or directly...

I am unable to accept this submission.

If it is correct, it means that it becomes necessary to identify all instructions and directions given by the employer which did contribute or might have contributed to the stress, and then to examine the reasonableness of each one of them. That would be a daunting task, and I would hesitate to conclude that Parliament intended that it be performed. The appellant’s approach would also mean that as a matter of practice subpar (iii) would defeat most stress claims, or at least very many of them, because if the stress resulted from instructions or actions of the employer (and presumably an implied instruction would be as good as an express instruction), then the claim would fail unless the instruction or action was unreasonable. Commonsense suggests that many, and probably most aspects of a worker’s work could be related back to instructions given by an employer or action taken by an employer. It is clear that Parliament intended to restrict stress claims, but it is another matter whether it intended to go as far as this in subpar (iii)...

Moreover, the words chosen by Parliament — “administrative action” do not seem apt to embrace every instruction of and action by an employer. The expression chosen suggests that Parliament had in mind a particular type of action by an employer, and something other than a mere instruction or requirement that the worker perform her duties. In my opinion the appellant’s submission fails to give any effect to the adjective “administrative”.

33. In the case of s 5A(1) of the SRC Act, the requisite effect is given if the provision is seen to apply to action taken in respect of the administration of the relationship of employer and employee as between the particular employee making the claim, in his or her capacity as employee, and the employer in its capacity as employer. This meaning may have been the one the Tribunal was attempting to express in its reasons for decision, when it referred to “legitimate human resource management actions”. Although inapt, the description used by the Tribunal is not far removed from the proper construction of the exclusion. As the Tribunal pointed out correctly, matters of general administration, management and the implementation of policy are excluded, even if they affect the employment of employees. It is what is done with respect to the employment relationship that the particular employee has with the employer that is excluded from the definition of “injury”, unless the action taken was not reasonable, or was not reasonably taken.

The application of the exclusion to the facts

34. When the exclusion in s 5A(1) of the SRC Act is construed in this way, it is apparent that the Tribunal made no error of law in concluding that none of the events or circumstances it identifies as having contributed to Mr Reeve’s major depressive disorder, suffered on 21 July 2008, was properly described as “administrative action...in respect of” Mr Reeve’s employment. The organisational restructure and staffing changes implemented in June 2008, affecting the CBA’s Mt Hawthorn branch were clearly operational action and not administrative action. The telephone conference on 18 July 2008, as a result of which Mr Reeve felt humiliated by having to report unsatisfactory results for his branch, also amounted to operational action by the CBA and not to administrative action in respect of Mr Reeve’s employment relationship with the CBA. Nor did it constitute an “appraisal” for the purposes of s 5A(2)(a) of the SRC Act of Mr Reeve’s performance, or something done in connection with such an “appraisal”. As is pointed out in [26] above, the examples given in s 5A(2) cannot be used to expand the meaning of the exclusion in s 5A(1). The visit of the area manager to the Mt Hawthorn branch on 18 July 2008, and his failure to engage in discussion with, or provide support to, Mr Reeve also constituted operational action by the CBA. So did the distribution of the CES scores on the afternoon of 18 July 2008 and the scheduling of the regular telephone conference on 21 July 2008, at which Mr Reeve expected to be humiliated again because of the unsatisfactory survey results. The Tribunal was also correct as a matter of law to conclude that the introduction and implementation of the CES process did not fall within the exclusion, because they were “management actions” taken by the CBA “for the purpose of measuring the quality of customer service in its various branches”.

Conclusion

35. If there were any error of law by the Tribunal in the manner in which it expressed the extent of the breadth of the exclusion found in the definition of “injury” in s 5A(1) of the SRC Act, such an error had no effect on the outcome of the proceeding in the Tribunal. The Tribunal’s decision that the CBA was liable to pay compensation to Mr Reeve in respect of a major depressive disorder sustained by him on 21 July 2008 was not the result of any error of law. Accordingly, the appeal to this Court and the application pursuant to the ADJR Act must be dismissed. In accordance with the usual principle, that costs follow the event, the CBA should be ordered to pay Mr Reeve’s costs of the appeal.

I certify that the preceding thirty-five (35) numbered paragraphs are a true copy of the reasons for judgment herein of the Honourable Justice Gray.

Associate:

Dated: 8 March 2012

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 384 of 2010

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:

COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124) Applicant

AND:	MARK REEVE First Respondent ADMINISTRATIVE APPEALS TRIBUNAL Second Respondent

JUDGES:	GRAY, RARES AND TRACEY JJ
DATE:	8 MARCH 2012
PLACE:	PERTH

REASONS FOR JUDGMENT

RARES AND TRACEY JJ

36. This appeal was brought under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) from a decision of the Administrative Appeals Tribunal that determined that the Commonwealth Bank of Australia was liable to pay compensation to its employee Mark Reeve, pursuant to s 14(1) and Pt VIII of theSafety Rehabilitation and Compensation Act 1988 (Cth) (the Act). The Bank is a licensed corporation under Pt VIII of the Act. The Bank also sought to review the decision of the Tribunal under s 8 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) but did not rely on any additional grounds or arguments. The appeal was heard by the Full Court in the original jurisdiction pursuant to a direction of the Chief Justice under s 20(1A) of the Federal Court of Australia Act 1976 (Cth).

THE CRITICAL ISSUE

37. Mr Reeve was a manager at a Perth branch of the Bank in July 2008. He suffered an injury within the meaning of s 5A(1) of the Act, being a disease constituted by a mental ailment or disorder, namely, major depressive disorder when he attempted suicide three times in the early morning of 21 July 2008. The Tribunal found that this disease had resulted from a number of work related factors.
38. The central question on this appeal is whether, in arriving at its decision, the Tribunal correctly construed and applied an exclusion in the definition of injury in s 5A of the Act. It was common ground that the mental ailment that Mr Reeve suffered was “contributed to, to a significant degree”, by his employment and that he suffered a “disease” within the meaning of injury on 21 July 2008. However, the definition of “injury” in s 5A(1) excluded a disease “suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee’s employment”.
39. The Bank contended that the Tribunal erred in construing “reasonable administrative action” in s 5A(1), as being limited to reasonable and legitimate human resource management actions, that did not include matters of general administration, management and implementation of policy even if that action indirectly or incidentally affected the employment of employees. The Bank also argued that the Tribunal erred by failing to consider at all one instance of reasonable administrative action, provided in s 5A(2)(e), being anything done in connection with an action, such as a reasonable appraisal of the employee’s performance in s 5A(2)(a). Because of the potential significance of the decision in this appeal to the operation of the Act, the Bank informed the Full Court that it did not seek costs in the event it succeeded.

THE LEGISLATIVE SCHEME

40. “Injury” and “Disease” were defined in ss 5A and 5B as follows:

“5A Definition of injury

(1) In this Act:

injury means:

(a) a disease suffered by an employee; or

(b) an injury (other than a disease) suffered by an employee, that is a physical or mental injury arising out of, or in the course of, the employee’s employment; or

(c) an aggravation of a physical or mental injury (other than a disease) suffered by an employee (whether or not that injury arose out of, or in the course of, the employee’s employment), that is an aggravation that arose out of, or in the course of, that employment;

but does not include a disease, injury or aggravation suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee’s employment.

(2) For the purposes of subsection (1) and without limiting that subsection, reasonable administrative action is taken to include the following:

(a) a reasonable appraisal of the employee’s performance;

(b) a reasonable counselling action (whether formal or informal) taken in respect of the employee’s employment;

(c) a reasonable suspension action in respect of the employee’s employment;

(d) a reasonable disciplinary action (whether formal or informal) taken in respect of the employee’s employment;

(e) anything reasonable done in connection with an action mentioned in paragraph (a), (b), (c) or (d);

(f) anything reasonable done in connection with the employee’s failure to obtain a promotion, reclassification, transfer or benefit, or to retain a benefit, in connection with his or her employment.

5B Definition of disease

(1) In this Act:

disease means:

(a) an ailment suffered by an employee; or

(b) an aggravation of such an ailment;

that was contributed to, to a significant degree, by the employee’s employment by the Commonwealth or a licensee.

(2) In determining whether an ailment or aggravation was contributed to, to a significant degree, by an employee’s employment by the Commonwealth or a licensee, the following matters may be taken into account:

(a) the duration of the employment;

(b) the nature of, and particular tasks involved in, the employment;

(c) any predisposition of the employee to the ailment or aggravation;

(d) any activities of the employee not related to the employment;

(e) any other matters affecting the employee’s health.

This subsection does not limit the matters that may be taken into account.

(3) In this Act:

significant degree means a degree that is substantially more than material.” (emphasis added)

41. Without being exhaustive, s 6 provided for a number of deemed instances in which an injury to an employee would be taken as having arisen out of, or in the course of, his or her employment. These included, as provided in s 6(1)(a) and (b), an injury sustained:

“(a) as a result of an act of violence that would not have occurred but for the employee’s employment or the performance by the employee of the duties or functions of his or her employment; or

(b) while the employee was at the employee’s place of work, including during an ordinary recess, for the purposes of that employment;” (emphasis added)

42. Relevantly s 14(1) provided:

“14 Compensation for injuries

(1) Subject to this Part, Comcare is liable to pay compensation in accordance with this Act in respect of an injury suffered by an employee if the injury results in death, incapacity for work, or impairment.”

THE FACTUAL BACKGROUND

43. The Tribunal heard a considerable body of evidence, but the relevant matters relating to this appeal can be shortly stated. Mr Reeve had commenced employment with the Bank in January 2007. In August 2007 he was appointed manager of a branch in a suburb of Perth. The Bank undertook a restructure so that on 1 July 2008 a new area manager, Glenn Hurst, assumed responsibility for Mr Reeve’s branch. Shortly before then, two staff members, a lender and an assistant manager, in whose competence and performance Mr Reeve had confidence, were transferred out of his branch. The lender was replaced by a person who was unhappy about his transfer. Mr Reeve was upset when he learnt of these changes. As part of his duties, Mr Reeve had to participate in teleconferences three times a week with Mr Hurst and about 15 to 17 other branch managers. At these teleconferences, Mr Reeve and the other branch managers had to report on and explain the results for, or outcomes of, their branch’s lending activity and customer experience surveys (customer surveys) for the previous week. The customer surveys were conducted for the Bank by a market research company which contacted customers who had attended at a branch. The researcher would ask questions of the customer about the service he or she received and ask the customer to rate the level on a scale of 1 to 10. Unbeknowst to the customer, the Bank would award 100% for scores of 9 or 10 but zero for any other score. Branch managers were advised of their branch’s customer survey results each Friday. Their bonus payments were linked to the customer survey results.
44. Mr Reeve said that he had felt upset and humiliated by what he understood as Mr Hurst’s criticism of him in front of his fellow managers in a teleconference on Friday, 18 July 2008. Later that day he received a zero result in his branch’s customer survey for that week. He said that he could not face the thought of going through the same scenario at the teleconference on Monday, 21 July 2008 and this led to his suffering a major depressive disorder on that day. The Tribunal accepted the following evidence of Jill Russell, a clinical psychologist as stating the collective causes of his attempted suicide:

“Critical Events and Other Contributing Factors

On Friday, July 18, 2008, Mark, as Branch Manager, attended a teleconference meeting including 15-17 managers to evaluate the performance of each branch in Area Perth. He described several precursors to that meeting that influenced his response to that meeting, viz:

• An organisational restructure resulted in Mark’s branch being relocated to another area. There was increased work pressure and stress as a result of this process.
• The moving out of two high performing staff members from under his management to other branches in the restructure was destabilising to his branch.
• He was then under a different area manager, Mr Glenn Hurst. 
• A one-on-one meeting with Glenn had not been arranged before the restructure. Mark did not know him personally nor was he presented with an opportunity to speak with him personally. 
• The results of the customer experience survey and lending achievements were poor in the first two weeks of operation in the new location due to unavoidable circumstances.
• The process of evaluation of his branch’s results was not adequate in Mark’s view. 
• Mark had to report the less than satisfactory results to the meeting participants.

In the immediate time after the evaluation teleconference the following circumstances occurred:

• Later on the day of the meeting, the current week’s results arrived and indicated that week’s required targets were not met.
• Glenn Hurst made an unexpected visit to the branch but ‘did not engage in any personal discussion’ with Mark that would have been a supportive gesture. 
• Mark could not bear the thought of facing the same circumstances again in the following week’s meeting.

Mark’s experience was one of intense humiliation and shaming in the meeting procedure. Consequently, he could not face the idea that he was expected to repeat a similar scenario the following week. After making order of his work tasks and desk early on the Monday morning that followed the Friday meeting, he made 3 unsuccessful attempts to suffocate himself in his car. ...”

45. The Tribunal then evaluated each of the events and circumstances identified by Ms Russell to ascertain whether any of them constituted reasonable administrative action that fell within the exception to the definition of injury in s 5A(1) of the Act. It said that the instances listed in s 5A(2) were indicative of the kinds of action that the Parliament intended should constitute “reasonable administrative action”. In light of this and one passage from the Explanatory Memorandum for the Safety Rehabilitation and Compensation and Other Legislative Amendment Bill 2006, the Tribunal said that the exception meant:

“... in accordance with its ordinary meaning, limited to reasonable and “legitimate human resource management actions” (as described in the Explanatory Memorandum) taken in a reasonable manner in respect of an employee’s employment, and does not include “reasonable administrative action taken in a reasonable manner in respect of” any matter other than (and not including) an employee’s employment, including matters of general administration, management and the implementation of policy, even if such action indirectly or incidentally affects the employment of employees.”

46. Next, the Tribunal dealt with the Bank’s submissions that its use of the customer surveys fell within the meaning of an appraisal, in s 5A(2)(a) or something reasonably done in connection with Mr Reeve’s failure to obtain a benefit, namely a salary bonus, in s 5A(2)(f). It rejected each of those submissions. The Tribunal found that none of the results or outcomes of the customer surveys or the teleconferences at which they were discussed constituted a reasonable appraisal of Mr Reeve’s performance within the meaning of s 5A(2)(a). It made that finding because it accepted evidence that such an appraisal did not occur in the weekly teleconferences with the area manager and branch managers. Rather, it found that such a appraisal for the purposes of s 5A(2)(a) would typically involve a one-to-one meeting and discussion between the person whose performance was being appraised and his or her superior. The Tribunal also found that the customer surveys were appraisals by the customers of aspects of a branch’s service performance, as opposed to that of the branch manager.
47. The Tribunal found that the customer survey results were one of the Bank’s seven key performance indicators relevant to appraisal of a bank manager’s performance. It found that 40% of Mr Reeve’s annual salary bonus was dependent on his branch achieving satisfactory customer survey results. However, the Tribunal found that s 5A(2)(f) did not apply to the customer survey results. This was because it found that there was no evidence that Mr Reeve had failed to obtain or retain any part of his bonus by reason of unsatisfactory customer survey outcomes at any time prior to 21 July 2008. And, it found that in the financial year ended 30 June 2008, Mr Reeve had achieved his full salary bonus. The Tribunal rejected the Bank’s argument that s 5A(2)(f) should be read as including an employee’s fear of failing to obtain a benefit because of the poor scores in the customer surveys that were provided to him on 18 July 2008. It held that the statutory language dealt with the fact of, and not an anticipatory state of mind concerning, a failure to obtain a benefit.
48. The Tribunal then considered whether the exception in s 5A(1) otherwise applied to Mr Reeve’s having suffered his disease on 21 July 2008. First, it found that the implementation in June 2008 of the bank’s organisational restructure and staffing changes at Mr Reeve’s branch affected him in his capacity of manager of the branch but was not action “taken ... in respect of [his] employment” as manager. Secondly, it found that the teleconference on 18 July 2008 constituted administrative action taken by the Bank through Mr Hurst that affected Mr Reeve and each of the other participants by reason of each person’s participation, but that this was not action taken by Mr Hurst in respect of Mr Reeve’s (or the others’) employment. Thirdly, the Tribunal found that the purpose of Mr Hurst’s visit to Mr Reeve’s branch on 18 July 2008 had been to meet the branch’s lender and to discuss with that person his own key performance indicators and measurement grids, and so was not action taken in respect of Mr Reeve’s employment. Fourthly, it found that Mr Reeve’s receipt of the customer survey scores later that day and his feeling that he could not face the prospect of participating in the next teleconference on the following Monday, 21 July, likewise did not constitute action taken in respect of his employment. Last, the Tribunal found that the Bank’s introduction and implementation of the customer survey process itself amounted to action taken by the Bank for the purpose of measuring the quality of customer service in its various branches, and so was not action taken in respect of Mr Reeve’s employment.

THE PARTIES’ SUBMISSIONS

49. The Bank’s amended notice of appeal raised 22 grounds. In essence, however, its argument was that the Tribunal misconstrued and misapplied s 5A in arriving at its decision. The Bank contended that the meaning of “reasonable administrative action” in s 5A(1) was not limited simply to reasonable and legitimate human resource management actions. The Bank argued that this narrowed and glossed the statutory language. It also submitted that the Tribunal erred in using s 5A(2) to limit the scope of the exception in s 5A(1). It contended that each of the 18 July 2008 teleconference, the customer survey results or outcomes and the Bank’s use of them in the weekly teleconferences were “reasonable administrative action” within the meaning of s 5A(1) and also one or more of ss 5A(2)(a), (e) or (f). The Bank accepted in argument that it had not put a case to the Tribunal that relied on the branch’s lending results or their use or consideration at the teleconferences as a basis that enlivened the exception in s 5A(1).
50. Mr Reeve contended that the Tribunal had not made any of the errors asserted by the Bank. He argued that the Tribunal had correctly applied the law and arrived at a result that was open to it.

CONSIDERATION

51. For the purposes of the Act the concept of an “injury” had, at least, three important features identified by Gummow ACJ, Kirby, Callinan, Heydon and Crennan JJ in Canute v Comcare (2006) 234 CLR 535 at 540 [10] and by Hayne, Heydon, Crennan and Bell JJ in Fellowes v Military Rehabilitation and Compensation Commission [2009] HCA 38; (2009) 240 CLR 28 at 34-35 [14]. First, s 14(1) obliged Comcare (or a licensee) to pay compensation “in respect of an injury”. Secondly, the word “injury” was not used in the Act in the sense of “workplace accident”. Rather, as their Honours said the definition of “injury” “... is expressed in terms of the resultant effect of an incident or ailment upon the employee’s body”, or mind. Thirdly, “injury” was not used in the Act in a global sense to describe the general condition of an employee following an incident. Instead, as their Honours pointed out, the definition of “injury” was disjunctive and so envisaged that an employee might sustain more than one injury. The Act hinges about the concept of “injury”: Fellowes 240 CLR at 37 [21].
52. The ordinary and natural meaning of “administrative” concerns the management of a body or enterprise as opposed to the task or job entrusted to a person who is subject to that management. “Administrative” has the following relevant dictionary meanings:
    • relating to administration (“administration” being defined as “the management or direction of any office or employment”) (The Macquarie Dictionaryonline);
    • pertaining to , or dealing with, the conduct or management of affairs (The Oxford English Dictionary online);

In addition, The Oxford English Dictionary, online, defines “administrative leave” as “a leave of absence imposed or granted in extraordinary circumstances;spec[ifically] “enforced leave (paid or unpaid) taken by an employee pending the resolution of a disciplinary investigation”.

53. In the first portion of the definition of “injury” in s 5A(1) two of the three conditions, namely an injury and an aggravation of a physical or mental injury, were qualified. The qualification was that the injury or aggravation must arise “... out of, or in the course of, the employee’s employment”. A similar qualification for the third condition, a disease, was contained in its separate definition in s 5B(1). This provided that a disease meant an ailment suffered by an employee or an aggravation of such an ailment that was “contributed to, to a significant degree, by the employee’s employment”. All of the three conditions were further qualified by the concluding portion of the definition of “injury” in s 5A(1). That excluded a disease, injury or aggravation that had the following characteristics:
    • it was suffered as a result of reasonable administrative action;
    • that action was taken, first, in a reasonable manner, and, secondly, in respect of the employee’s employment.
54. The use in the exclusion in s 5A(1) of the connecting factor “as a result of” replicates an earlier, and since repealed, version of a different exclusion in the previous definition of “injury” in s 4(1) of the Act considered in Hart v Comcare [2005] FCAFC 16; (2005) 145 FCR 29. The exclusion in s 4(1) of previous definition of injury provided that “injury”:

“ ... does not include any such disease, injury or aggravation suffered by an employee as a result of reasonable disciplinary action taken against the employee or failure by the employee to obtain a promotion, transfer or benefit in connection with his or her employment.” (emphasis added)

55. Branson, Conti and Allsop JJ concluded that in the previous definition of “injury” in s 4(1), the expression “as a result of” applied to any operative cause, whether or not there were other operative causes that had nothing to do with the disciplinary action. Accordingly, they held that the exclusion applied so long as the injury was suffered “as a result of” disciplinary action, even if there were other causes also operating: Hart 145 FCR at 32-34 [18]-[26].
56. Importantly, in the first portion of the new definition of “injury” in s 5A(1) the particular employee’s employment had a critical role to play in ascertaining whether the disease, injury or aggravation was sufficient to connect it to a compensable injury. In addition, the other connecting factors were that that the disease was contributed to by the employee’s employment, or the injury or aggravation arose out of, or in the course of, the employee’s employment. Once a disease, injury or aggravation satisfied those connecting factors, then the effect of the exclusion had to be considered. Notably, the exclusion employed a key qualification that the reasonable administrative action had to be taken in respect of the employee’s employment. The first portion of the definition in s 5A(1) applied to circumstances of the aetiology of the disease, injury or aggravation that are ordinary incidents of the employment: i.e. of the employee performing his or her work or as a part of his or her duties or activities as an employee. Thus, s 5B(2)(b) referred to “the nature of, and particular tasks involved in, the employment” as relevant to the question whether the disease was contributed to, to a significant degree, by the employment.
57. However, in contrast to a disease that was contributed to by, or an injury or aggravation that arose out of, or in the course of, the employee’s employment, the exclusion in s 5A(1) applied to action taken in respect of that person’s employment. This suggests that the action referred to in the exclusion was intended to refer to action directed specifically to the employee as opposed to it affecting him or her because it was an ordinary feature of his or her work, workplace or environment or otherwise connected to his or her employment.
58. The Bank argued that the requirement for managers, such as Mr Reeve to attend at and report to the meetings that dealt with, among other topics, the customer satisfaction surveys fell within the meaning of “reasonable administrative action taken in a reasonable manner in respect of [Mr Reeve’s] employment”. It pointed to the fact that Mr Reeve’s bonus entitlement at the end of a financial period would be assessed in part based on his branches’ results in customer satisfaction surveys.
59. We are of opinion that this argument should be rejected. The Act gave non-exhaustive examples of an injury. These included those in s 6(1)(a) and (b) that were injuries taken to arise out of, or in the course of, an employee’s employment. Thus, a bank teller whose duties required him or her to work at a particular time and branch would be taken to sustain an injury if he or she were subjected to violence in an armed robbery at the branch. The concept of “reasonable administrative action taken in a reasonable manner in respect of” the teller’s employment in the exclusion of s 5A(1) could not have been intended to comprehend an employer’s direction or requirement to a teller to work in his or her job at the time of the robbery so as to exclude the teller’s right to compensation under the Act for an injury sustained in the robbery. The reason that the teller would have been in the position of being a victim of the robbery was because that was his employment; it was not because of administrative action taken in respect of the teller’s employment. The teller’s job would involve him or her being in the bank ready to serve customers. The mere fact that he or she was reasonably told or required to be there so as to do his or her job when, fortuitously, a robbery occurred cannot have been what the Parliament intended to fall within the exclusion in the definition of “injury” in s 5A(1). So much is made clear by the very words of s 6(1)(a) and (b) as they applied to the circumstances in which an “injury” would be sustained as arising out of, or in the course of, the employee’s employment.
60. The qualification in the final phase of the exclusion in s 5A(1) is important. It requires that the action be taken “in respect of the employee’s employment”. That qualification distinguishes the criterion of the exclusion in s 5A(1) from an action or circumstance that the Act uses to impose liability, namely an action or circumstance that arises out of, or in the course of, the employee’s employment. This suggests that the Parliament intended that the exclusory action be specific administrative action directed to the person’s employment itself, as opposed to action forming part of the everyday duties or tasks that the employee performed in his or her employment or job. The action must be “in respect of” something that exists – the person’s employment. That is, the action must be something different to the duties and incidents of that employment or, as s 5B(2)(b), provided “the nature of, and particular tasks involved in, the employment”. Rather, the administrative action in the exclusion must take the employment as a factum and operate in respect of whatever its duties, incidents, nature and tasks may be. Thus, “employment”, as used in s 5A, is concerned with the conditions in which the employee works, the terms of his or her engagement and his or her duties: cf John Holland Group Pty Ltd v Robertson [2010] FCAFC 88; (2010) 185 FCR 566 at 586 [72]- [73] per Dowsett J, with whom Spender J agreed. An analogy, although taken from a different statutory context, can be seen from the facts in The Commonwealth v Rutledge [1964] HCA 63; (1964) 111 CLR 1. Thereafter working in her job for over four years, an employee, who was latently susceptible to developing paranoia, was required to perform new duties that involved her spying on fellow employees. Within two weeks the employee developed into an active psychotic. As Menzies J put it (111 CLR at 11):

“... it is sufficient, however, if the spying which was her employment for the time being, had in its nature something to aggravate a pre-existing condition of latent paranoia or to accelerate a change from that condition into that of active psychosis. Here I think the evidence did have the requisite generality.” (emphasis added)

61. Here, Mr Reeve’s employment included the tasks of attending the teleconferences and dealing with the consequences, results and outcomes of the customer surveys. Thus, the teleconferences, customer surveys and their uses were not administrative action taken in respect of his employment – they were part and parcel of his employment.
62. The non-exhaustive list of examples of “reasonable administrative action” in s 5A(2) could not confine the meaning of that expression as used in s 5A(1). So much follows from the chapeau to s 5A(2) that contained the words “without limiting” in referring to the expression “reasonable administrative action”: Leon Fink Holdings Pty Ltd v Australian Film Commission (1979) 141 CLR 672 at 679 per Mason J with whom Barwick CJ at 674 and Aickin J at 680 agreed. Thus, the specific references in s 5A(2) to a reasonable appraisal of the employee’s performance as well as reasonable counselling or disciplinary action taken, and reasonable suspension action in respect of the employee’s employment dispel any doubt about the width of, but do not constrain, the ordinary and natural meaning of “reasonable administrative action” in s 5A(1). Likewise, s 5A(2)(e) and (f) provided that this expression included anything reasonably done in connection with either any of the actions in paragraphs 5A(2)(a)-(d) or the employee’s failure to obtain a different position or to obtain or retain a benefit in connection with his or her employment.
63. Each instance referred to in s 5A(2), however, concerned something outside the actual employment, or job, that the employee was required to perform. An appraisal involved reviewing how the employee performed his or her employment and so can be seen readily to fit into action taken “in respect of the employee’s employment”. Each of the instances in s 5A(2) was of a matter that was in respect of, but apart from, ordinary duties or tasks of the employee’s employment or job itself.
64. The Bank’s argument that the wording of s 5A(2)(e) was broad enough to comprehend the teleconferences and uses of customer surveys in them as being done in connection with the appraisal of managers such as Mr Reeve also fail. The customer surveys may have been obtained and provided to Mr Reeve in connection with a future appraisal of his performance. The issue that now arises is whether what was done was done in connection with (s 5A(2)(e)) reasonable administrative action that consisted of a reasonable appraisal (s 5A(2)(a)). The teleconferences and use in them of the customer surveys were actions not done in connection with any appraisal of the employee’s performance; they were done as part of the ordinary course of Mr Reeve’s employment and in appraising the performance of his branch.
65. The assessment of whether a disease, injury or aggravation has been suffered as a result of reasonable administrative action within the meaning of s 5A(1), involves the formation of a judgment as to causation. This requires a tribunal of fact to ascertain whether the disease, injury or aggravation is the, or a, common sense, consequence of what is identified as reasonable administrative action by the employer in respect of the employee’s employment.
66. In Workcover Corporation of South Australia v Summers (1995) 65 SASR 243 at 247, Doyle CJ with whom Prior and Williams JJ agreed, held that the ordinary meaning of the expression “administrative action” in an inexact analogue of s 5A(1), included a course of conduct or a general instruction by the employer or a general approach by the employer to a particular job or a particular situation. That analogue was in s 30(2a) of the Workers Rehabilitation and Compensation Act 1986 (SA) which provided:

“A disability that consists of an illness or disorder of the mind caused by stress is compensable if and only if —

(a) stress arising out of employment was a substantial cause of the disability; and

(b) the stress did not arise wholly or predominantly from —

(i) reasonable action taken in a reasonable manner by the employer to transfer, demote, discipline, counsel, retrench or dismiss the worker;

(ii) a decision of the employer, based on reasonable grounds, not to award or provide a promotion, transfer or benefit in connection with the worker's employment; or

(iii) reasonable administrative action taken in a reasonable manner by the employer in connection with the worker's employment.” (emphasis added)

67. The Chief Justice observed that the expression in s 30(2a)(b)(iii) was not apt to embrace every instruction of, and action by, an employer. Rather, he said that the expression referred to:

“... a particular type of action by an employer, and something other than a mere instruction or requirement that the worker perform her duties.”

He concluded (65 SASR at 248), in respect of a mental injury of stress, that if the stress suffered by the employee:

“... is caused simply by an inability to cope with the requirements of her work, by an inability to cope with the job itself, then the worker has shown that her stress does not arise from administrative action, whatever that expression might mean. I do not think it matters whether or not the worker was given a series of express instructions to perform her work.” (emphasis added)

68. Doyle CJ observed (65 SASR at 248) that the expression “administrative action” in the South Australian legislation was probably intended to apply to decisions or actions taken by the employer that in some way related to the workings or functionings of the workplace, rather than the actual task performed by the worker. This decision is distinguishable because s 30(2a)(b) operated in three scenarios, including that of reasonable administrative action taken in a reasonable manner by the employer “in connection with the employee’s employment. First, the expression “in connection with” was wider than “in respect of” as used in s 5A(1) of the Act. Secondly, the other two scenarios in s 30(2a)(b) had to be given distinct meanings from that in s 30(2a)(b)(iii).
69. The intention that we have discerned from the Parliament’s use in s 5A(1) of “in respect of” is to provide a relational context for the administrative action taken and the employee’s employment. It is to require that the action be specific to the employee’s work or job so that the exclusion can operate harmoniously with the preceding portion of s 5A(1) rather than as eviscerative of it: see too Parker v President of the Industrial Court of Queensland [2009] QCA 120;[2010] 1 Qd R 255 at 273 [41], and see too [42], [44] per Keane JA with whom Fraser JA and White J agreed.

THE SECONDARY MATERIAL

70. The Explanatory Memorandum gave a number of reasons for the amendment that replaced the definition of “injury” in s 4(1) with what became s 5A. One of these reasons were used by the Tribunal as an integral part of its construction of “reasonable administrative action”. This was the following explanation of the objectives of the amendment:

“It was the original intention of the legislation to ensure that there is a close connection to employment as the cause, aggravator or contributor of a worker’s disease or injury, before eligibility for workers’ compensation can be established.

A further objective, through the exclusionary provisions, was to ensure that the wide range of legitimate human resource management actions, when undertaken in a reasonable manner, do not give rise to eligibility for workers’ compensation.”
(emphasis added)

71. The words we have emphasised above were the source of the Tribunal’s construction of “administrative action” (see [45] above). The Explanatory Memorandum discussed three possible options that the Government considered in selecting the new definition of injury. The Explanatory Memorandum stated that it was desirable that the Act “... should prevent workers’ compensation claims being used to obstruct legitimate administrative action undertaken in a reasonable manner” and that the wording of what became s 5A was broader, more comprehensively elaborated and covered a wider range of legitimate administrative actions than the existing definition. It went on to say that the exclusions in the new s 5A “will extend to all reasonable management activities” in lieu of the existing limitation of the exclusion in the old s 4(1) definition to reasonable disciplinary action taken against the employee or his or her failure to obtain a promotion, transfer or benefit in connection with his or her employment.
72. The task of statutory construction must begin with a consideration of the text of the provision or provisions being construed. If the meaning of the text is clear, then considerations of history and extrinsic materials cannot displace that meaning. This is because the intention of the legislature is most surely to be found in the words that it chose to use. Nonetheless, the meaning of the text, may require consideration of the context, including the general purpose and policy of the provision, and, in particular, any mischief that it seeks to remedy: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 at [47] per Hayne, Heydon, Crennan and Kiefel JJ; PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission (2011) 192 FCR 393 at 413 [96] per Rares J, Lander and Greenwood JJ agreeing.
73. Here, the purpose of s 5A was to broaden the exclusion of matters from the previous definition of “injury” so that an employer would not be unduly inhibited in taking reasonable administrative action in respect of an employee’s employment. The Parliament sought to ensure that an employer would be freer to deal with an employee, by taking disciplinary action or deciding to deal with that employee as an individual in respect of his or her employment, than had been the case under what it considered were narrow judicial interpretations of the old exclusion in s 4(1).
74. However, the Explanatory Memorandum did not suggest that “administrative action” was intended to cover the way in which the employee was to perform the employment itself or what were his or her duties or tasks in doing so. It is one thing to contemplate disciplining an employee or taking steps under his or her contract of employment, and quite another to define or delimit or supervise the employment, job or task entrusted to the employee for him or her to perform or to give directions to him or her as to how and when he or she is to perform it. The former is comprehended by the expression “administrative action in s 5A(1); the latter deals with the way in which the employee carries out the employment for which he or she was engaged. The latter is not “administrative action”.

CONCLUSION

75. The Tribunal erred in its construction of s 5A by limiting its scope to legitimate human resource management actions. It also failed to consider the possible application of s 5A(2)(e). However, the entitlement to relief is discretionary. Here, the question is whether any useful result could ensue from a grant of relief if the appeal were allowed and the matter remitted to the Tribunal for it to apply the correct construction of s 5A to the facts: SZBYR v Minister for Immigration and Citizenship [2007] HCA 26; (2007) 235 ALR 609 at 618-619 [29] per Gleeson CJ, Gummow, Callinan, Heydon and Crennan JJ.
76. We are of opinion that despite the Tribunal’s errors in construing s 5A, no useful result could ensue from a remittal. The Tribunal’s findings on the teleconferences, customer survey results and their uses would have been the same had it applied the exclusion as explained in these reasons. And, for the reasons we have given, the Tribunal’s error in failing to consider s 5A(2)(e) made no difference because, had it correctly construed the Act, that provision did not have the consequence that the actions relied on by the Bank were taken “in respect of [Mr Reeve’s] employment”. The actions were or occurred as part of his employment: i.e. they were not actions taken in respect of it. We would dismiss the appeal and application. The Bank should pay Mr Reeve’s costs.

I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Rares and Tracey.

Associate:

Dated: 8 March 2012