Workers compensation for employees working from home

11 June 2020

The Court of Appeal has dismissed an appeal lodged by the Workers Compensation Nominal Insurer (Nominal Insurer) regarding death benefit monies it was liable to pay to two dependent children of a working from home employee killed by her de facto co-worker.

The background

Michel Carroll and her de facto partner Steven Leslie Hill were employed by family company, S L Hill & Associates Pty Ltd.

On 16 June 2010, Ms Carrol was killed by Mr Hill who had been experiencing paranoid delusions. Despite Mr Hill having been charged with murder, he was found not guilty on the grounds of mental illness. At the time of his death, Ms Carroll had two dependent children and they subsequently made a claim for workers compensation with the Nominal Insurer as the family company had been deregistered.

Workers compensation commission and deputy president’s decision

An arbitrator of a Worker Compensation Commission (the Commission) determined that Ms Carroll’s:

  1. death arose out of, or during the course of, her employment (s 4 of the Workers Compensation Act 1987 (WC Act)); and
  2. employment was a substantial contributing factor to the injury sustained (s 9A WC Act).

Accordingly, the Nominal Insurer was ordered to pay the sum of $450,000 in favour of the two dependent children. An appeal was lodged to the Deputy President by the Nominal Insurer however, this was dismissed.

The issues on appeal

On appeal to the Court of Appeal, the following four issues were raised:

  1. the scope of an appeal from a decision of a Deputy President (Issue 1);
  2. the scope of an appeal from an arbitrator to a Deputy President (Issue 2);
  3. whether the Deputy President erred in holding that there was evidence to support the arbitrator’s findings as to the elements of the claim (Issue 3); and
  4. whether the Deputy President failed to hold that Mr Hill’s assault, being inspired by delusions, was causally connected to Ms Carroll’s employment (Issue 4).

The decision on appeal

In relation to Issue 1, the Court of Appeal held that the right to appeal extends to any decision regarding points of law and not findings of fact. Accordingly, it held that the Deputy President did not err in points of law when satisfied of the elements of the claim.

In relation to Issue 2, the Deputy President had to be satisfied as to errors of fact, law or discretion in upholding an appeal from the arbitrator. In light of the appellate function in language taken from Whiteley Muir and Zwanenberg Ltd v Kerr, the Court of Appeal held that there was no such error.

In relation to Issue 3, the Nominal Insurer contended (among other things) that it was Mr Hill’s employment’s which may have contributed to the attack and not Ms Carroll’s employment and further, that the delusions were ‘…not real’. In dismissing this ground, Basten JA found that a person can suffer compensable harm as a result of a physical attack, verbal abuse, sexual harassment or bullying at work and the reasons pertaining to this (whether it was a mistake or without justification) is irrelevant.

In relation to Issue 4, the Court of Appeal found that the risk of a sudden and violent attack was part of a hostile working environment created by Ms Carroll’s supervisor and co-worker. Accordingly, the material presented to the arbitrator ‘demonstrated a palpable and direct connection between Mr Hill’s delusions, Ms Carroll’s employment and her death’.

Implications for you

The recent COVID-19 pandemic has given rise to some uncertainties as to the extent of the obligations owed by employer’s to their employees as they transition and settle into the new working from home norm.

This case is significant in that it is indicative that if an employee is working from home and sustains an injury, they may be entitled to compensation if a causal connection in relation to the injury and employment is established.

It is more important than ever for employers to conduct risk assessments regarding working from home arrangements for employees.

Workers Compensation Nominal Insurer v Hill [2020] NSWCA 54

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