Employer-Employee Relationship in Australian Coach Tours and National Roadways Report

Introduction

Judiciaries across the globe have and are still experiencing changes, which place great emphasis on human factors across all aspects of life. This development made issues pertaining to Occupational Health and Safety Law, and Human Resources Law the gist of numerous discussions, with the need to improve working conditions for employees eliciting more attention over the years¹.

Traditionally, laws never covered millions of workers and as such, any work-related cases arising were ordinarily handled. Today, health and safety in the workplace are among important workers’ motivational factors that significantly influence organisational effectiveness and productivity.² This has led to the development of legislations through which governments wield regulatory authority over organisations that choose to ignore employee health and safety.

The legal concept describing “Duty of care assumes that persons and their organisations possess legal obligations to provide services to others and public considering vigilant and prudent manner to shun risks related to sensibly foreseeable harm to others”.³

This analysis commences with a summary of case under scrutiny after which, it proceeds to outline employer-employee relationship with a focus on Australian Coach Tours (ACT) and National Roadways (NR). This sets the background for the analysis. To set precedence for the analysis, closely related cases that have transpired in the recent past will be highlighted.

The analysis will then be approached by pointing out the areas where the employer and employee breached laws governing employer-employee relations. This shall give room for an outlay of claim and liability related issues on the case. The analysis will be wound up by pointing out the areas of weakness that need to be improved on by the employers, employees as well as in the legislations on occupational health and safety and human relations.

Summary of the Facts Leading to the Case

Craig Brown was an employee of a large national company offering Australia-wide bus tours known as Australian Coach Tours (ACT). Having as a tour guide for approximately 15 years, the terms of employment were contract-based renewable after every two years.

While serving at ACT, Craig finds working conditions quite favourable as he enjoys undertaking and organising all-important tour duties including overseeing itinerary schedules, facilitating and commentating the tour easily, and thus he feels that his rapport with other employees is quite impressing. Despite working for long and irregular hours, all the work arrangements in the ACT company make Craig feel happy and contented with his work.

In addition, Craig takes care of his own taxation arrangements coupled with keeping all receipts and invoices associated with travelling expenses that he incurs during the bus tour. However, sudden changes emerged in the company and his entire career underwent drastic changes following the emergence of new work arrangements.

Turnarounds in Craig’s career resulted to dramatic changes in his job after ACT sold the bus-touring department of the company to National Roadways (NR). Despite his working terms stated in the contract commencing prior to NR’s acquisition of the company and conditions of the employment remaining the same, it was evident that the organisational culture of NR seemed unattractive to Craig.

A good arrangement of tour schedules existed in ACT but lacked at NR, something that formed part of Craig’s frustration at NR. Tardiness to work and timekeeping as well as placement of belongings in right positions became constant problems to Craig in NR. Craig’s job commenced with sudden misfortunes in NR.

In one scenario, Craig got drunk and as the evening brightened, they went into a salsa dance in a local band with Moira, who was among the travellers. Unfortunately, Moira tripped and suffered serious injuries after missing the dancing steps. While preparing Moira’s belongings to send her home, he tripped over some luggage in the bus aisle and acquired an arm injury at the ankle.

While driving to the airport to bid Moira farewell, Jim was still suffering from a hung-over and Craig convinced him to be allowed to drive. When Craig took over the driving, a serious accident that made both Craig and Jim suffer severe whiplash to their necks occurred.

Employer/employee relationship depicted in ACT & NR

It is important to understand that Craig’s employment conditions typically hinge on contractual agreements that have always been unpredictable to ascertain in detail.⁴ Contracts are nonetheless legal employment provisions under the Industrial Training Act of 1975, which defines an employee as a person who works under an employment contract.⁵

Section 3 of the Craig’s contract with ACT states that, “For the purpose of services in facilitating bus tours and commentating to passengers during those bus tours; Craig Brown shall be engaged by Australian Coach Tours as an independent contractor”. This clause is conclusive of the relationship since from this contract statement, and it is evident that the relationship between Craig and ACT/NR conclusively hinges on contract agreements. Therefore, Craig’s work entailed preparing and maintaining all itineraries arrangements and the responsibilities rested upon him.

Recent cases pertinent to Craig’s case

A continuum of cases pertinent to the case of Craig and the two companies with Moira and Jim has been witnessed in the Australian judicial history. Cases involving breach of statutory Duty of Care obligations under occupational health and safety (OHS) issues are still rising in the Australian judicial system.⁶ The case of Hamilton v BHP Billiton Ltd [2012] SADC 25 is replica of Craig’s case.

It entails a story of a man employed by a defendant from May 1964 to April 1965 to work as an electrician in a wharf at Whyalla installing cables within the engine rooms.⁷ In the course of practising his duty, he inhaled asbestos dust and suffered cancer-related mesothelioma.⁸ The risk was thus reasonably foreseeable and early interventions could avert the risk.

Carelessly placing belongings and driving with Class B license had foreseeable risk in Craig’s case. Another case that is commensurate with Craig’s case is the case of Geoffrey Hewitt v Chubb Security Personnel Pty Ltd [2007] AIRC 282. From the end story where Craig and Jim incurred injuries following wilful misconduct of both contrary to the employment requirements, it was clear that Craig’s contract could be terminated and Jim would be laid off.⁹

The case of Geoffrey Hewitt v Chubb Security Personnel Pty Ltd [2007] AIRC 282 is similar to Craig’s case in this sense; Mr. Geoffrey Hewitt claimed and alleged unfair termination of his employment from Chubb Security Personnel Pty. Hewitt breached the statutory duty obligations after doing activities in contradiction to the contractual agreements with the company.

He failed to comply with responsibilities stated in the contract and the act was of wilful misconduct. The company terminated his contract based on breaching contractual agreements, especially through wilful misconduct.

Company’s Breach of Statutory duty of care in Craig’s case

Craig’s case seems intertwined in a continuum of events that occur in unclear, although explainable situation, based on the contractual agreements. Statutory Duty of care is Australia’s legal obligation as stated in the common law, “requires individuals and their organisations to perform duties that possess risks of foreseeable harm while cautiously observing principles of reasonable care”.¹⁰

Both Craig and the NR Company in certain ways participated in breaching parts of statutory Duty of Care. The statutory Duty of Care obligations remains articulated in the Occupational Safety and Health Act of 1984 (OSHA). According to Claus, “employers must furnish their employees with a place of employment that is free from recognised hazards that cause, or are likely to cause, death or serious physical harm to their employees.”¹¹

As defined in Australian common law, a company is a person who employs workforce under a contract of apprenticeship, employment, or even a traineeship scheme.¹² In Australian laws and regulations, a company possesses a corporate identity and in most cases acts as the employer of the entire staff in Western Australian.¹³

Therefore, any company operating in Australia possesses an obligation to act in accordance with all the employer’s duties as articulated in Western Australian Occupational Safety and Health Act of 1984.¹⁴ NR did not consider anything in the new arrangements, and it allowed Craig to commence with his previous contract agreements and still had a culture of carelessly handling passengers’ bags and personal belongings.

Therefore, in Craig’s ankle injury, NR Company was responsible for this problem. The case of Palfrey-v-Ark Offshore Limited [2001] WL 134034706 is replica of Craig’s situation where Court awarded damages for the employer’s breach of Duty of Care despite the employee’s knowledge of the associated risk.¹⁵

Despite the Australian law of Occupational Safety and Health Act 1984 articulating the responsibility of employers, RN failed to comply with the law requirements. In section 19 of this Act, the law states that employers have the responsibility or duty of providing and maintaining as much as possible, a working environment that makes employees less exposed to risks.

Craig in the case was not actually amused by the practice of handling passenger’s belongings in a careless manner in NR, but as the tour manager had an obligation to advise the company. However, connecting this issue to the case of Palfrey v-Ark Offshore limited [2001] WL134034706, the “court stated that the employer has a minimum responsibility to ascertain and make available to the employee publicly available information on health hazards”.¹⁶

Craig’s breach of statutory duty of care in the case

Craig’s case might not be easy if understood in the layperson’s perspective considering the contractual agreements that bounded him with the Act that automatically could apply on his commencement with his career at NR. Under section 3 of his contract agreement with ACT, where similar provisions applied in NR, Craig worked with Australian Coach Tours as an independent contractor, who was responsible for entire practices of facilitating bus tours and commentating to passengers during those bus tours.

This assertion means that Craig also possessed the responsibility of ensuring that passengers’ bags and personal belongings inside the bus were positioned well. Contrarily, Craig noticed the mess in the practice of handling passengers’ bags and personal belongings earlier enough to make considerable advisory to the management, but he ignored the mess. The risk was foreseeable and thus, Craig failed to comply with occupational safety and health standards.

The case of Craig and Moira seems somewhat straightforward, given the circumstances that marked the occurrence of injuries to Moira. According to the Government of Western Australia, “inadvertent acts by employees could result in injury to themselves and others and, in situations where an employer can foresee that misjudgement or inattention is likely, the system of work should minimise these risks”.¹⁷

Craig was responsible for breaching statutory Duty of Care when he decided to get over drunk (‘couple of beers’ as stated) in the course of his duty. The drinking behaviour consequently affected his behaviour while dancing with Moira after having a different perception of the band’s beat, thus leaving Moira to trip down and hence sustaining injuries. Considering he was still working on an independent contractor basis at NR, he was to blame for Duty of care.

Claus notes, “Employees also have Duty of Care responsibilities to comply with occupational safety and health standards and all rules, regulations, and orders issued by the Australian law”.¹⁸ The second case involves Craig and Jim acquiring severe whiplash to their necks from the accident that occurred outside the course of employment that brings us to examining Craig’s responsibility in breaching statutory Duty of Care.

Craig was quite aware that his driving license depicted little experience in driving and made a personal and voluntary decision to take over the driving that led to the accident. This aspect makes Craig responsible for breaching the duty of care.

Claims of compensation to Craig and Jim

The incident where Craig and Jim sustained severe whiplash to their necks from the accident on the way to the airport may not qualify for compensation based on a number of entangled issues and stipulations of the law. However, much attention in compensation is on Jim, who is a worker at NR. Workers Compensation and Injury Management Act 1981 (WA) is integral here.

According to Workers’ Compensation and Injury Management Act 1981 section 21, part III, if “injury of a worker is attributable to his voluntary consumption of alcoholic liquor or of a drug of addiction, or both, which impairs the proper functioning of his faculties; or other serious and wilful misconduct,”¹⁹ the compensation is invalid.

Capacity of Moira and Craig to claim compensation

From the contractual agreements to occurrence of certain activities, the two owe NR no compensation. According to stipulations of Workers Compensation and Injury Management Act 1981 (WA), section 5, part I, that follows circumstance of section 4, a compensation is acceptable, when the employee of the company acquires a stress disorder that has resulted from an accident acquired in the course of duty.

Similar issues prevail in Accident Compensation Act 1985.²⁰ Unfortunately, from the stipulations of the Craig’s contract with the Act that also apply in his commencement with RN, the relationship between Craig and the two companies is typically contractual and Craig performs his duties independently.

Therefore, Craig in any circumstance, does not qualify for any compensation. Following the circumstance that marked the events of Moira’s accident, Craig works as an independent contractor in the job and the aspects of how foreseeable the risk of Moira’s injury matters only to Craig.

Liabilities to injuries incurred

The liabilities to injuries incurred by the victims in the case are twofold. The first case of Craig sustaining injuries while ensuring clearance of Moira’s belongings involves both the company and Craig responsible for the liabilities. Placement of belongings on bus aisles and stairwells was NR’s tradition of practice.

Just as judged in the case of Harris v Digital Pulse Pty Ltd [2003] NSWCA 10, it makes the NR Company liable for the injuries incurred by Craig on his ankle. Craig himself was responsible for his own injuries.²¹ From ACT’s handover to NR, Craig’s contractual agreements involve him as an independent contractor when it comes to issues pertaining to facilitating bus tours and commentating to passengers during those bus tours.

It was in the course of his contractual duties that involve personal responsibility when he sustained the ankle injuries. Acting as an independent contractor to NR, Craig is also liable for Moira’s injuries.

Conclusion

The case of Craig and the two companies with Moira and Jim typically involves important factors that include breaching of Occupational Health and Safety Act and common law. The assertion holds because statutory duties of care articulated in Occupational Health and Safety Act normally hinge upon principles established under common law.

Craig’s contractual agreements are the basis of his liability in the case as he operates with both companies as an independent contractor. However, NR Company beached the statutory Duty of Care by failing to provide basic information on health hazards related to practices of work coupled with failure to provide support and proper induction to Craig on issues of a particular work environment.

However, Craig works as an independent contractor in NR and thus both are responsible for liabilities to injuries incurred at his ankle. Being an independent contractor as stated in the contract, Craig breached statutory Duty of Care obligations in the case where Moira incurred injuries while dancing salsa, though the risk associated with Moira’s injuries seem unforeseeable.

Recommendations

Governments and organisations, under the influence of prevailing trends, strive to devise statutory measures to ensure that the increasingly important nature of employee safety is catered for by formulating befitting legislations. Such was the case with the Australian government and the companies Craig worked with.

However, anything devised by a human always has room for improvement and as such, the statutes governing the contract under which Craig was engaged by ACT and NR, Occupational Health and Safety Law and Human Resources Law may need to be restructured to incorporate the following recommendations in order to function seamlessly.

• National Roadways as a company needs to develop a framework that will henceforth guide the company’s expansion efforts. In this case, an acquisition was made and the employees who had been working at ACT taken on board. NR was supposed to consider them new and introduced them to the organisation’s culture via say, an induction program. This would have helped with the attitude of the employees towards their new work environment if new contract agreements were not necessary.
• The government of Australia needs to ensure that the authorities charged with the responsibility of approving and monitoring activities such as acquisitions carry out their duties effectively. A close consideration of NR’s acquisition of ACT’s bus touring department reveals a breach of relevant laws.

The former ACT employees on transition to NR were now employees of NR and new agreements needed to be signed. The arm of government that handles employee welfare issues needed to do a follow up as well. The simple acts of omission and negligence culminated into unforeseeable complications later on.

Therefore, the Australian government needs to ensure that all its agencies are apt in the discharge of their duties by intensifying the overall monitoring of their service delivery to avoid any cases of negligence or omission in future.

References

Accident Compensation Act 1985 (AA Act) Arnold, Jennifer, ‘Tracking business travellers’ (2008) 53(11), HR Magazine, 6, 15.

Cameron, David, ‘Managing travel risk: A duty of care toolkit’ (2007) 1(2) Journal of Business Continuity & Emergency Planning, 158, 166.

Claus, Lisbeth, Duty of Care of Employers for Protecting International Assignees, their Dependents, and International Business Travelers (2009) International SOS. Web.

Cohen, Amon, ‘Duty of care raises U.K. car risks’ (2006) 23(9) Business Travel News, 4, 4.

Comcare, Preventing and managing bullying at work: A guide for employers (2010) Commonwealth of Australia. Web.

Geoffrey Hewitt v Chubb Security Personnel Pty Ltd [2007] AIRC 282

Government of Western Australia, Guidance Note: General Duty of Care in Western Australian Workplaces (2005) Commission for Occupational Safety and Health. Web.

Hamilton V BHP Billiton Ltd [2012] SADC 25.

Harris v Digital Pulse Pty Ltd [2003] NSWCA 10.

Kim, Jeong-ah, The role of legislation in driving good occupational health and safety management systems (2004) Queensland University of Technology. Web.

Occupational Health and Safety Act 1991 (OHS Act)

Palfrey V Ark Offshore limited [2001] WL 134034706.

Workers’ Compensation and Injury Management Act 1981 (WA Act).

Footnotes

¹ Kim, Jeong-ah, The role of legislation in driving good occupational health and safety management systems (2004) Queensland University of Technology.

² Comcare, Preventing and managing bullying at work: A guide for employers (2010) Commonwealth of Australia.

³ Cameron, David, ‘Managing travel risk: A duty of care toolkit’ (2007) 1(2) Journal of Business Continuity & Emergency Planning, 158, 166.

⁴ Cohen, Amon, ‘Duty of care raises U.K. car risks’ (2006) 23(9) Business Travel News, 4, 4.

⁵ Government of Western Australia, Guidance Note: General Duty of Care in Western Australian Workplaces (2005) Commission for Occupational Safety and Health.

⁶ Arnold, Jennifer Taylor, ‘Tracking business travelers’ (2008) 53(11), HR Magazine, 6, 15

⁷Hamilton V BHP Billiton Ltd [2012] SADC 25

⁸Hamilton V BHP Billiton Ltd [2012] SADC 25

9 Geoffrey Hewitt v Chubb Security Personnel Pty Ltd [2007] AIRC 282

¹⁰ Claus, Lisbeth, Duty of Care of Employers for Protecting International Assignees, their Dependents, and International Business Travelers (2009) International SOS.

¹¹ Ibid

¹² Government of Western Australia

¹³ Ibid

¹⁴ Ibid

¹⁵ Palfrey-v-Ark Offshore Limited [2001] WL 134034706

¹⁶ Claus, 2009

¹⁷ Government of Western Australia

¹⁸ Claus, 2009

¹⁹Workers’ Compensation and Injury Management Act 1981 (WA Act)

²⁰Accident Compensation Act 1985 (AA Act)

21 Harris v Digital Pulse Pty Ltd [2003] NSWCA 10