The final appeal – was it reasonable management action?

26 June 2023

A worker appeals WorkCover Queensland’s original decision to reject their statutory claim for psychological injury arising out of a performance management plan that was put in place by her employer.

In issue

  • On appeal, the Industrial Court of Queensland (ICQ) was required to find on a very specific issue, that of itself gave rise to a separate issue relating to the jurisdiction of the Court to hear appeals from the Queensland Industrial Relations Commission (QIRC). The Court was asked to determine whether the QIRC erred in finding that an employer had acted reasonably when deciding to implement a performance management plan (PMP). Entangled in this decision, the Court was also required to address whether this would be an error of law or an error of fact, giving rise to a jurisdictional issue, given that appeals from the QIRC can only be made to the ICQ on an error of law, or with leave of the ICQ.

The background

The Appellant was employed as a dental assistant. By 2010, the Appellant had achieved the role of Administration Team Leader of a department. Unfortunately, the Appellant sustained a broken ankle whilst working in 2015 (unrelated to the current matter), before making a gradual return to work in 2016.

Due to staffing shortages, the Appellant was put under significant stress upon her return. On 23 February 2016, at the direction of a supervisor, a PMP was introduced in order to assist the Appellant, which was then extended beyond its original finish date. The Appellant was performance managed until she left in June 2016.

On 8 August 2016, the Appellant lodged an application for worker’s compensation claiming a psychological injury arising out of the initiation, extension and implementation of the PMP. WorkCover Queensland (WorkCover) rejected the Appellant’s application. WorkCover was of the view that the initiation, extension and implementation of the PMP was reasonable management action that had been taken in a reasonable way by the employer. The Appellant requested a review of this decision, which was upheld by the Regulator.

The decision at first instance

The QIRC agreed with WorkCover and the Regulator, and found that both the initiation and implementation of the PMP was reasonable management action taken in a reasonable way by her employer.

The issues on appeal

The Appellant then sought to appeal the decision of the QIRC to the ICQ. In making submissions, the Appellant contended that there were two policies put in place by her employer, namely the Performance Improvement Policy and the Performance and Development Policy (collectively the relevant policies), that should have been, and were not, considered by the employer when deciding to initiate and implement the PMP.

However, a further issue arose as to the jurisdiction of the ICQ to hear the appeal. Section 557 of the Industrial Relations Act 2016 provides that appeals from the QIRC to the ICQ may only be made on the grounds of error of law or jurisdiction, or on any other ground with the leave of the ICQ.

Therefore, the ICQ concluded that the two issues to be determined were:

  1. Whether the QIRC took into account the relevant policies in determining whether the initiation of the PMP was reasonable; and
  2. If not, whether that was an error of law on the behalf of the QIRC.

The decision on appeal

The ICQ dismissed the Appellant’s appeal, finding that the QIRC had considered the relevant policies in determining whether the initiation of the PMP was reasonable, and in turn that no error of law could be found to allow the appeal.

The ICQ referred to the extensive review of evidence undertaken by the QIRC, particularly the review of the Appellant’s evidence as to the reasons she was not performing satisfactorily, which was immediately followed by a review of the relevant policies and their applicability to the Appellant’s situation at work. The ICQ therefore concluded that the QIRC had considered the relevant policies in determining whether the initiation of the PMP was reasonable.

Given no error of law of the QIRC had been identified, the ICQ was required to determine whether leave should be granted for the Appellant’s appeal to nevertheless be accepted. In concluding on this issue, the ICQ noted that leave should only be granted for an appeal on grounds of an error of fact in circumstances where there is a public interest. In submission as to why leave should be granted, the Appellant neglected to raise any issue of public interest and, on its own review, the ICQ concluded that no public interest existed to satisfy leave to appeal on broader grounds.

Implications for you

This case provides a helpful discussion on the tricky topic of psychiatric injuries sustained as a result of management action, and whether that management action was reasonable management action taken in a reasonable way.

Further, and more particularly, it discussed the appeal process to contest an insurer’s original decision to reject an application (or any other decision that can be reviewed under section 540 of the Act) and provides workers and insurers alike with clarification on the limited scope of appeal to the ICQ.

Khan v Workers’ Compensation Regulator [2023] ICQ 002

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