In the recent case of Woolworths Limited v
Perrins  QCA 207, the Queensland Court of Appeal
examined the scope and extent of an employer's duty of care to
avoid causing psychiatric injury to employees.
Mr Perrins had a troubled life; he suffered sexual abuse,
struggled with depression and a drug addiction, had been jailed on
numerous occasions, and tragically lost a young child. Despite
these circumstances, Mr Perrins completed pre-employment forms for
Woolworths denying he had any medical condition that might
negatively affect his performance.
During his employment, Mr Perrins was offered the opportunity to
complete Woolworths' management training program after
successfully passing the rigorous selection process. However, in
accordance with Woolworths' leave policy, the opportunity to
participate in the program was withdrawn after management learned
of his unsatisfactory attendance record.
Mr Perrins was subsequently offered the position at a later
date. Once again, the discovery of his continued absences resulted
in management removing him from the course on the day it was due to
start. Mr Perrins claims to have suffered psychiatric injury as a
result of the disappointment of being withdrawn from the program a
Mr Perrins claimed that Woolworths was negligent in twice
offering him the position without first considering his suitability
and twice withdrawing the position in an insensitive manner, in
circumstances where it was aware that Mr Perrins was vulnerable to
psychological injury given his history. At first instance, the
trial judge found in Mr Perrins' favour and awarded substantial
Woolworths was successful on appeal to the Court of Appeal. The
judgment ultimately turned on the fact that Woolworths had laid
down certain entry criteria for the training program, including
that an employee could be transferred to their previous position at
any time if they failed to meet the requirements of the program.
Accordingly, Woolworths had a legitimate interest in being able to
act on a failure by an employee to meet its criteria.
This finding was supported by reasoning that both parties were
aware that the thwarting of Mr Perrins' ambition was a possible
outcome. By applying for the position, Mr Perrins implied he was
fit to cope with the disappointment of missing out.
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An employee that refused a reasonable offer of settlement was ordered by the FWC to pay his ex-employer's legal costs.
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