This decision of the New South Wales District Court provides useful guidance on the scope of an employer’s duty to protect employees from foreseeable risks posed by aggressive customers. The Court considered whether an employer could be liable for injuries arising from the criminal conduct of a customer and, if so, the extent to which preventative measures such as security guards may be required.
Overview
The plaintiff was working in the defendant’s Macarthur Vodafone store on 22 November 2019 when he was subjected to verbal abuse by a customer. The customer returned several hours later to continue the confrontation before using a deodorant can and a lighter to create a makeshift blowtorch and direct flames at the plaintiff’s face. The plaintiff suffered superficial injuries to his arm and head, in addition to a psychiatric injury.
The plaintiff claimed that the defendant negligently breached its duty of care as an employer to prevent injury and harm, and that this breach gave rise to the injuries suffered. On this basis, the plaintiff sought compensation for past and future economic loss.
The defendant denied liability in negligence. While it admitted owing the plaintiff a duty of care, it denied breaching that duty. Further, the defendant argued that, even if a breach were established, the breach did not cause the loss suffered by the plaintiff.
The key issues for resolution were:
- Whether the plaintiff’s injury resulted from the negligence of the defendant.
- The extent of the plaintiff’s entitlement to future economic loss arising from the injury.
In relation to damages, the principal point of contention was whether the plaintiff retained any earning capacity and, if so, the extent of that capacity.
The plaintiff relied on evidence of previous incidents involving aggressive customers and reports expressing concern for staff safety. The defendant relied upon evidence from its Head of Security regarding existing safeguards, including duress alarms, incident reporting systems and the occasional deployment of security personnel. Expert security evidence was also led by both parties regarding whether the presence of a security guard would have materially reduced the risk of injury.
Court’s Reasoning
Breach
The Court was required to determine breach and causation at common law because work injury damages are excluded from the operation of the Civil Liability Act 2002 (NSW) by s 3B(1)(f).
The plaintiff submitted that the defendant’s failure to assign a security guard to the Macarthur store constituted a breach of duty. The plaintiff argued that the risk was foreseeable, relying on evidence of previous threats of violence and the report stating that he no longer felt safe at work.
The defendant contended that its response to the risk was reasonable and that the assignment of a security guard was unnecessary. It argued that an employer’s duty of care is directed towards controlling the employee and the system of work and does not ordinarily extend to controlling the conduct of third parties. The defendant submitted that the case was distinguishable from previous authorities in which employers were held liable for criminal acts of third parties because, in those cases, the employer had “created or maintained a specific, identifiable exposure which it had the power to alter.”
The Court defined the relevant risk of harm as the risk of physical and/or psychological injury resulting from the actions of aggressive customers attending and interacting with staff at the Macarthur store.
The Court found that there was an elevated risk of aggressive customer behaviour at the Macarthur store. It held that a reasonable employer in the defendant’s position would have foreseen the risk of physical or psychological injury arising from interactions with aggressive customers and that the risk was neither far-fetched nor fanciful.
In determining whether the defendant’s response was reasonable, the Court considered the magnitude and probability of the risk, together with the expense, difficulty and inconvenience of any mitigating measures, viewed in light of the defendant’s competing responsibilities.
The Court found that:
- the magnitude of the risk was significant;
- the probability that the risk would result in harm was high; and
- the cost of the appropriate preventative measure, namely the deployment of a security guard, was relatively insignificant.
Accordingly, the Court rejected the defendant’s submission that the existing measures constituted a reasonable response to the risk. It held that the defendant had failed to take reasonable steps to avoid a foreseeable risk of injury by providing adequate safeguards. In reaching this conclusion, the Court relied upon the plaintiff’s evidence concerning the discouragement of incident reporting by management and the defendant’s own incident-reporting data demonstrating a higher incidence of customer aggression at the Macarthur store.
Causation
In considering causation, the Court applied the “but for” test established in March v Stramare (E & MH) Pty Ltd (1991).
The Court reiterated that causation is ultimately a matter of common sense and may be inferred where an injury might reasonably have resulted from the breach, absent any sufficient alternative explanation (Betts v Whittingslowe (1945)).
The plaintiff argued that the failure to provide a security guard was causative of his injuries.
The defendant submitted that any preventative effect of a security guard was merely speculative. Alternatively, it argued that even if there had been a breach through inadequate training, that breach was not causative of the plaintiff’s losses.
The Court found that there was sufficient time for a security guard to intervene and prevent the injury. It therefore concluded that the defendant’s failure to provide a security guard either caused or materially contributed to the plaintiff’s injuries.
In reaching this conclusion, the Court accepted the evidence of the plaintiff’s expert and aspects of Mr Jackson’s evidence while rejecting the evidence of the defendant’s expert.
Damages
The central issue in relation to damages was whether the plaintiff retained any residual earning capacity and, consequently, whether he was entitled to compensation for his full economic loss.
Where a defendant contends that a plaintiff has residual earning capacity, the defendant bears the onus of identifying both:
- the type of work the plaintiff is capable of performing; and
- the availability of such work
(Kallouf v Middis [2008]; Nominal Defendant v Livaja [2011]; South Western Sydney Local Health District v Sorbello [2017]; Mead v Kearney [2012]).
The Court found, on balance, that the plaintiff retained some capacity for employment, including work as a shelf-filler. The Court also relied upon evidence that the plaintiff was exercising responsibility as his mother’s attorney under a power of attorney arrangement.
The decision also provides guidance regarding the evidentiary burden borne by defendants seeking to establish residual earning capacity. Consistent with established authority, the Court reiterated that identifying theoretical work capacity is insufficient. The defendant must identify both suitable employment and its availability in the labour market.
After accounting for expected periods during which the plaintiff would not be working, the Court assessed his residual earning capacity as being $133 per week below his potential weekly earnings.
Decision
The Court found in favour of the plaintiff on liability and awarded damages totalling $1,006,996.29, comprising:
- past economic loss;
- past loss of superannuation;
- Fox v Wood damages;
- future economic loss; and
- future loss of superannuation.
The award for future economic loss was reduced to reflect the Court’s finding that the plaintiff retained some residual earning capacity.
Key Takeaways
- Employers in the retail sector may be held liable for injuries suffered by employees because of criminal conduct by customers where there is an established risk of such conduct and the employer’s response to that risk is inadequate.
- In circumstances where an employer is aware of a heightened risk of customer aggression, the failure to implement practical risk-control measures, including the possible use of security personnel, may constitute a breach of the employer’s duty of care.
- Evidence that a plaintiff is capable of undertaking activities involving responsibility and decision-making, such as acting under a power of attorney, may support a finding of residual earning capacity and reduce an award for future economic loss.
The case can be read in full here: https://www.caselaw.nsw.gov.au/decision/1a089fa42649fb79932907a0
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