Employer breaches duty of care - employee suffering mental illness paid $600,000 in compensation

Employer breaches duty of care – employee suffering mental illness paid $600,000 in compensation

Managers have an obligation to ensure that the working environment and broader workplace culture is free of discrimination, harassment and bullying.

A recent case before the Fair Work Commission highlights the expectations on managers to exercise a duty of care when managing staff and to create a workplace culture that rejects inappropriate workplace behaviour such as discrimination, harassment or bullying.

A Victorian Supreme Court Judge found that a large government department had breached its duty of care and exacerbated a youth welfare case manager’s psychological injuries when it failed to exercise the standard of care “reasonably expected of an employer”.

It is alleged that the case manager suffered a breakdown in November 2008 while employed by the department.

The case manager argued that her supervisor bullied and harassed her, provided “excessive” and “unreasonable criticism”, micro-managed her performance, gave inconsistent directions, held unrealistic expectations, and offered feedback designed to embarrass and humiliate her.

She also claimed the supervisor isolated her from her colleagues socially, including an incident in which the supervisor told everyone in her team, except her, that she was a grandmother.

The case manager argued that she was exposed to bullying and harassment, which exacerbated her pre-existing condition – chronic adjustment disorder with mild anxiety and depression.

While the judge rejected the bullying claims, he acknowledged that the supervisor provided feedback in a manner that caused embarrassment and humiliation and contributed to the case manager’s anxiety and stress.

For example, the Judge cited the supervisor’s “rigid” management style, which included pulling the case manager up on her incorrect use of commas in reports and giving constant negative feedback, and the “cumulative effect of stress and anxiety” on her employment.

The Judge said the “available and appropriate” response was to move the case manager to another team and criticised the HR Department for not stepping in. This step could have been adopted six months before the case manager’s breakdown and was likely to have significantly reduced the stressors affecting the case manager’s health.

The Judge considered the severity of the case and the manager’s psychological injury and the fact that she had been incapable of working since her breakdown in 2008 and awarded $210,000 damages for pain and suffering and loss of enjoyment of life and $415,345 in pecuniary losses.

This matter shows that managers need to be proactive to ensure that the workplace culture does not encourage discrimination, harassment, bullying or inappropriate workplace behaviour.

This conflict may have been avoided had the employer been proactive in resolving the conflict between the two parties rather than letting them letting them sort it out. Specifically, the Court noted the organisations failure to formally recognise the “deteriorating relationship” between the case manager and the supervisor or to develop and implement policies to handle bullying complaints and serious interpersonal conflict.

Managers can prevent allegations of workplace bullying by being proactive. Actions include:

  • providing ongoing training to staff to ensure they understand what is inappropriate workplace behaviour and what constitutes workplace bullying, harassment and discrimination;
  • ensuring all new employees undertake a formal induction process and ensure all staff have read relevant policies and procedures;
  • ensuring that bullying policies and procedures reflect current legislation;
  • ensuring that managers have the skills to address inappropriate workplace behaviour; and
  • appointing workplace Contact Officers and providing appropriate training;
  • World Learning Hub believe prevention is the best cure. World Learning Hub’s Workplace Discrimination, Harassment and Bullying for Managers course can help managers prevent and effectively manage bullying discrimination and harassment issues in the workplace, including management techniques and styles that can reduce the risk of workplace issues and litigation.  


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