Comcare: sex & “arising out of, or in the course of, employment”

I refer to my earlier posting in relation to the facts. The Full Court (Keane CJ, Buchanan & Bromberg JJ) dismissed the appeal of Comcare and concluded:


It must, in our respectful view, be steadfastly borne in mind that the objective of the High Court in Hatzimanolis was to state the circumstances in which injuries to employees, which did not occur during periods of actual work, would nevertheless be treated as arising in the course of employment. Satisfaction of that condition signifies that the injury will be compensable even if it arises from unauthorised conduct, provided it is not conduct taking it outside the course of employment. In Hatzimanolis, as we have said, the High Court emphasised that for conduct to have that consequence it must be “gross misconduct”.


It appears to us that the burden of the analysis in Hatzimanolis is that, provided one of the qualifying conditions is met, it falls to an employer to show that an employee’s conduct is such as to take it outside the course of employment for the reason that it should be regarded nevertheless as gross misconduct. In cases to which a statutory regime applies there may, of course, be different or additional tests which arise for consideration. Some of these may be less strict. It should be understood that our discussion of these issues arises in the context set by the judgment in Hatzimanolis itself. In the present case for example, entitlement is governed ultimately by s 14 of the SRC Act.


Another example of a case where a statutory provision operated to modify the application of the “gross misconduct” test was Workcover Authority of New South Wales v Walsh [2004] NSWCA 186 where s 14(2) of the Workers Compensation Act 1987 (NSW) was found to “neutralise” gross misconduct and preserve a claim for compensation for the benefit of the dependents of a deceased employee.


By contrast, an example of a case where the test of “gross misconduct” was applied as contemplated in Hatzimanolis is Dew v Maher (1996) 14 NSWCCR 56; [1996] NSWCA 154. In that case explosives were used to play a prank. Use of the explosives had been “authorised, encouraged or permitted” by the employer, but their use for an intended prank was found to be gross misconduct even though the activity itself was otherwise found to be in the course of employment. The employee was therefore disentitled to compensation.


We have given close consideration to the suggested tension between the finding in Hatzimanolis (at 484-5) that:

the whole period during which the appellant was engaged in working at Mt. Newman constituted an overall period or episode of work  and the endorsement by the High Court (at 485) of the proposition that it did not follow from the fact that the employee was (as conceded) in the course of employment while working, travelling to work, eating and sleeping, or enjoying recreation at the camp:

that the appellant was in the course of his employment “during the whole of the time” that he spent in the Mt. Newman area.


(Emphasis in original.)



The High Court said of this contention:

This contention is correct because the appellant would not necessarily be in the course of his employment while engaged in an activity during an interval or interlude in his overall period or episode of work if A.N.I. had not expressly or impliedly induced or encouraged him to engage in that activity during that interval.


We think that pronouncement does not have the effect, for which the appellant contends, of super-imposing an activity test on a place test. It merely recognises that the “place” element was not satisfied by reference to the whole Mt Newman region, or anything done within it, anymore than it was satisfied by the employee’s presence in Western Australia rather than New South Wales. Although the whole period working at Mt Newman was an overall period or episode of work, it was still necessary, in order to satisfy one of the further conditions required to make a particular injury one which occurred in the course of employment, to show that the particular interval or interlude between actual periods of work met one of the qualifying conditions. That test would have been satisfied while the employee was in camp, whatever his activities, provided they did not amount to gross misconduct. The test was actually satisfied in Hatzimanolis by participation in activities authorised or encouraged by the employer.


Far from illustrating the application of a combined test, the passage relied upon points to the contrary conclusion. In our view there is no combined or two-stage test arising from Hatzimanolis. There is a single test which may be satisfied in either one of two ways, as the primary judge correctly appreciated.


We would add the following observations about the suggestion in the present case that any sort of encouragement or endorsement of the respondent’s actions was necessary before compensation was payable.


First, Hatzimanolis is direct authority against that proposition. Just as the appellant in Hatzimanolis would have been in the course of his employment while he was at the employer’s camp, unless he committed gross misconduct, so the respondent in the present case was entitled to compensation unless she was guilty of a level of misconduct disentitling her to compensation. In the present case, the test to be ultimately applied was “serious and wilful misconduct” (s 14 of the SRC Act).


Secondly, the views of the respondent’s employer about the respondent’s (lawful) activities were irrelevant, whether or not those views (if sought) may have reflected disapproval or indifference. In a different context, involving questions of vicarious liability, but concerned with the same legal concept, Gleeson CJ said in State of New South Wales v Lepore [2003] HCA 4; (2003) 212 CLR 511 (at [40]-[41]):

40. An employer is vicariously liable for a tort committed by an employee in the course of his or her employment. The limiting or controlling concept, course of employment, is sometimes referred to as scope of employment. Its aspects are functional, as well as geographical and temporal. Not everything that an employee does at work, or during working hours, is sufficiently connected with the duties and responsibilities of the employee to be regarded as within the scope of the employment. And the fact that wrongdoing occurs away from the workplace, or outside normal working hours, is not conclusive against liability.

41. The antithesis of conduct in the course of employment is sometimes expressed by saying that the employee was “on a frolic of his own”.


It is quite clear from his Honour’s remarks (and the discussion which followed) that the concept of “a frolic of his own” is one which applies to wrongful acts. That was not the case here and the notion has no application to the present case. No approval, express or implied, of the respondent’s conduct was required in the present case. The views of the employer were irrelevant.


In all the circumstances we think the primary judge was correct to conclude that the AAT applied the wrong legal test. We see no room, on the undisputed facts of the case, for any suggestion that the result in the AAT denying compensation could be sustained once the legal error was corrected. Accordingly we think the primary judge was correct to make a declaration that the respondent was entitled to compensation.


The appeal is dismissed with costs.

NB: The High Court has since allowed the appeal by Comcare

Brisbane Barrister – David Cormack

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