Australia: Psychiatric claim against an employer dismissed due to failure to establish reasonable foreseeability

HG Insurance and Risk Alert: 15 July 2015
Last Updated: 20 July 2015
Article by Aaron Clark and Hannah Staunton

In this alert, Senior Associate Aaron Clark and Solicitor Hannah Staunton discuss the recent Queensland District Court decision of Eaton v TriCare (Country) Pty Ltd [2015] QDC 173, where an administration assistant was unsuccessful in her claim for damages against her employer for a psychiatric injury because she failed to establish the requisite element of reasonable foreseeability.

Facts and relevant law

TriCare (Country) Pty Ltd (the employer) employed the plaintiff as an administration assistant in 2007 at a nursing home in Point Vernon in Queensland.

The plaintiff alleged that she sustained a psychiatric injury as a consequence of being overworked and workplace bullying and harassment on arrival of a new manager. In particular, the plaintiff alleged a number of incidents involving inappropriate communication and tone from her manager. These included:

  • threats to sack staff in response to an anonymous complaint about the manager's behaviour;
  • being told by her manager to "get over it" and "nobody likes you anyway"; and
  • disparaging comments about the Plaintiff being from New Zealand.

The plaintiff alleges that throughout the alleged period of time she suffered from considerable stress which was demonstrated through her change in character and demeanour (more negative), appearing withdrawn, worried and crying in the workplace.

Judgment

Queensland District Court Judge Devereaux SC was critical of some aspects of the defendant's corporate culture and the leadership style of the manager concerned. He found the manager had regularly conducted herself in an unreasonable manner towards the plaintiff but did not find the manager made the statement "nobody likes you anyway".

Despite this, he ultimately ruled the plaintiff's claim must fail.

His Honour was not satisfied that the plaintiff had proven, on the balance of probabilities, that the risk of the plaintiff sustaining a recognisable psychiatric illness was reasonably foreseeable. The plaintiff had not reported the manager's conduct to her superiors and they were not on notice in respect of the manager's conduct.

In his judgment His Honour referred to one of the accepted legal tests for reasonable foreseeability in Australia as established in the decision of Koehler v Cerebos (Australia) Limited (2005) 222 CLR 44:

"'The central inquiry remains whether, in all the circumstances, the risk of a plaintiff .... sustaining a recognisable psychiatric illness was reasonably foreseeable, in the sense that the risk was not far-fetched or fanciful." [paragraph 33].

His Honour noted that the plaintiff was not in a vulnerable or special position that the employer should have been aware of. Further, the plaintiff's owns representations regarding her agreement to undertake the work role of an administration assistant and her fitness for the role essentially undermined her own contention that her employer ought to have appreciated that the performance of her work duties posed a risk of injury to her psychiatric health.

Because the plaintiff failed to demonstrate the reasonable foreesability of a psychiatric illness arising from the plaintiff's workload and her supervisor's conduct, His Honour concluded that the duty of care the employer owed to the plaintiff was not engaged.

Take away points

  • This decision reaffirms the principle that workers will only be successful in a negligence claim against their employer if he/she can establish that the risk of sustaining a recognisable psychiatric illness was reasonably foreseeable by the employer;
  • Employers should ensure they have appropriate policies and procedures in place to implement if they become aware of, or are put on notice of, the risk of an employee sustaining a psychiatric injury;
  • Employers may still face significant exposure under statutory workers' compensation regimes associated with reasonable management action and psychiatric injury. Knowledge of the obligations under these regimes is vital to reduce an employer's escalating costs associated with an adverse claims experience.

© HopgoodGanim Lawyers

Award-winning law firm HopgoodGanim offers commercially-focused advice, coupled with reliable and responsive service, to clients throughout Australia and across international borders.

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Authors
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