15 Sep 2016

Employee not entitled to compensation for injury sustained while working flexibly from home

By Jennifer Winckworth

Employees will not necessarily be entitled to compensation for injuries arising from private activities they engage in while working flexibly from home.

It is becoming increasingly more common for employers to facilitate flexible work arrangements for their employees, so that an employee’s "place of work" is not restricted to a fixed physical location where an employer carries on business in the traditional sense. The case of Demasi and Comcare (Compensation) [2016] AATA 644 highlights that this does not necessarily mean that employees are entitled to compensation for private acts engaged in while working flexibly from home.

The facts in the Demasi case

The case involved an employee of the Australian Broadcasting Corporation (ABC) who was a producer and presenter for the television program Catalyst. The employee's job required her to work not only in the ABC offices and on location, but also allowed her to work flexibly from home.

On one occasion when the employee was working from home, she took a break from work at 9.30am and went for a run. During her run, she tripped, fell awkwardly and sustained a broken hip, for which she required surgery.

She claimed that she was entitled to compensation on the basis that her injury arose "out of or in the course of her employment".

The employee's claim was denied by Comcare at first instance and again on review. The employee then made an application to the Administrative Appeals Tribunal seeking a review of that outcome.

Issue to be decided: did the injury arise out of or in the course of employment?

The Safety, Rehabilitation and Compensation Act 1988 (NSW) provides that an injury will arise out of or in the course of employment if it occurs while the employee was at the employee's place of work for the purposes of that employment, or was temporarily absent from that place during an ordinary recess in that employment.

The employee therefore argued that:

  • on the day of her injury, her place of work was her home; and
  • while she was out running, she was temporarily absent from that place of work during an ordinary recess in her employment.

On the day of the injury, was Dr Demasi's home her place of work?

The Tribunal was satisfied that, on the day in question, the employee's home was her "place of work" for the purposes of the Act (which includes "any place at which the employee is required to attend for the purposes of carrying out the duties of his or her employment").

In reaching this decision, the Tribunal accepted that:

  • ABC studios were not the employee's only "place of work";
  • the employee had an approved, albeit irregular, practice of working from home to carry out research and conduct interviews;
  • the question was not whether the employee's practice complied with the ABC's formal procedures, but rather the practical reality of the circumstances;
  • ·on the day in question, she carried out work duties at her home before leaving to go for her run;
  • her manager was aware of and approved of her working in that way.

The Tribunal:

  • did not share Comcare's concerns regarding the lack of formal written arrangements covering the employee working at home, noting that it was not satisfactory that, on one hand, the employer acknowledged the fact that she worked at home from time to time, yet on the other hand, Comcare sought to rely on the absence of documentation to nullify that reality; and 
  • ultimately held that the simple fact was that the employer and employee had an arrangement in place that was well understood by both of them, even if it was not strictly in compliance with the formal requirements.

Was the employee temporarily absent during an "ordinary recess" in her employment

Notwithstanding the Tribunal's finding that the employee's home was her "place of work", the Tribunal held that going for a run at a random time of day did not constitute being absent during an "ordinary recess" in her employment. The Tribunal suggested that a run during a regular lunch break may be different as this would be an "ordinary recess". While that outcome may seem to be drawing an overly technical distinction, the decision does appear to be correct at law.

Lessons for employers whose employees work flexibly

This is yet another example of a case where the blurry distinction between private conduct and conduct in the course of employment has caused confusion and resulted in compensation claims being made by employees. Other examples we have previously discussed include where injuries have been sustained:

The decision clarifies that, notwithstanding that an employee's home may be deemed to be their "place of work" where they are afforded flexible work arrangements, they will not necessarily be entitled to compensation for injuries arising from private activities they engage in while working flexibly from home. 

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.