Employer required to pay over $1.4M damages to employee for psychiatric injury resulting from managerial mistreatment5 September 2017 | Employer's Liability
The defendant was found liable for the plaintiff's psychiatric injury for failing to take timely and determinative action in response to complaints made against the plaintiff by another staff member.
- Failure to take determinative action in response to allegations of workplace bullying
Mrs Robinson (the plaintiff) was employed by the Cape York Health Service (the defendant) as its District Director of Nursing. The plaintiff alleged she developed a psychiatric injury over a period of time from March 2010 to January 2011 as a result of repeated managerial mistreatment by the District Chief Executive Officer (the CEO).
The plaintiff was the target of a series of bullying and harassment allegations made by her sub-ordinate, a Nurse Unit Manager (“NUM”). After the plaintiff informed the CEO of her concerns the NUM may potentially unfairly target her, the NUM submitted a number of written complaints. The plaintiff was not made aware of the complaints until two months later, and was not given copies of them until four months later. The complaints, along with the plaintiff’s response to them, were not actioned by the CEO, despite the plaintiff’s repeated requests they be dealt with in order that her professional reputation be restored in a timely manner.
During this time, the plaintiff became increasingly worried about her job security in circumstances where the original complaints made against her were left un-actioned, and a further complaint against her was lodged by the NUM. The plaintiff showed a high and increasing degree of emotional concern and distress about the complaints against her, including crying and teariness. Despite this, no determinative action was taken by the CEO in response to the complaints. The situation was compounded by the fact the plaintiff’s work arrangements became such that she came into contact with the complainant NUM on a regular basis. The plaintiff’s psychological state decompensated as a result, and she sustained a significant psychiatric injury rendering her permanently unable to return to her substantive career.
The trial judge found the plaintiff’s risk of psychiatric injury ought to have been foreseeable, given she had initially informed the CEO of her concerns about the NUM, and then made it clear to the CEO she was suffering from a high degree of emotional distress due to the CEO’s inaction of the complaints against her.
In turn, the court found that, vicariously through the CEO, the defendant breached its duty of care to avoid psychiatric injury by failing to take timely and determinative action on the NUM’s complaints. The court found the defendant had failed to actually deal with the complaints submitted to it, rather had left them drift on unresolved, which caused the plaintiff increasing distress, ending in injury. Accordingly, the court found the plaintiff’s psychiatric injury was caused by the defendant’s negligence and awarded her $1.703M in damages, of which approximately $670,000 was in respect of past economic and just over $660,000 in respect of future economic loss. After repayment of the WorkCover refund, the plaintiff received a net amount of $1.468M. Economic loss damages were substantial because it was accepted the plaintiff had not been able to work since her decompensation (at which time she was 52 years of age), and that she would not be able to return to paid work in the future.
Implications for you
The judge paid particular attention to the fact the defendant failed to comply with its own departmental policies and procedures dealing with grievances. All workplaces should have in place a set of policies outlining a clear process as to how complaints against staff should be dealt with, including a clear timeline in which to do it. This case shows that an employer is at risk of liability exposure if it does not ensure its grievance policies are strictly followed and if it does not ensure complaints are resolved in a timely manner.