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The pitfalls of workers' compensation and secondary employment

Excerpts from this article first published in ‘Human Resources’ Magazine, Issue 55, 5 May 2004

In the recent case of Lawrence v Attorney General’s Department, the New South Wales Industrial Relations Commission held that the dismissal of a Sheriff’s Officer, (Mr Lawrence) engaged in secondary employment, whilst receiving workers compensation payments, was unfair.

During his work as a Sheriff’s Officer Mr Lawrence sustained an injury. Whilst receiving workers compensation he continued to work in secondary employment on the weekends. Approximately four years after sustaining the injury, the Department alleged that Mr Lawrence was guilty of misconduct. The focus of the allegations was that Mr Lawrence:

• Did not disclose his secondary employment in writing and engaged in secondary employment without approval, in breach of the Department’s Code of Conduct.
• By engaging in secondary employment, failed to comply with his return to work plan.
  

Mr Lawrence was dismissed for misconduct. In unfair dismissal proceedings Mr Lawrence alleged that: he notified the Department of his secondary employment in his original interview; his managers were aware of his secondary employment; he had not been advised that it was inappropriate to continue in the secondary employment; and his doctors had cleared him to perform the secondary employment but not the work involved as a Sheriff’s Officer. Mr Lawrence argued that at no time had he set out to mislead or deceive the Department.

Deputy President Sams found that:

• the Department:

• was aware of Mr Lawrence’s secondary employment through various managers at different levels; and
• had condoned Mr Lawrence’s conduct and waived any right to dismiss him for serious misconduct.
  

• Mr Lawrence:

• had not wilfully breached his contract of employment; and
• was fit to perform the duties required for his secondary employment but not the duties of a Sheriff’s Officer.

DP Sams held that the dismissal for misconduct was harsh, unjust and unreasonable.

HR Tips

An employer cannot validly terminate for serious misconduct if the employer was aware of the conduct and took no action at the time that it first became aware.

An employee who is unfit for work and receiving workers compensation may still be fit to perform other work.

There is no general prohibition on secondary employment so long as such employment does not conflict with an employee’s duties to their primary employer.

Richard Taylor

Senior Associate

Australian Business Lawyers