Recent damages awards for breaches of the General Protections provisions of the Fair Work Act indicate an increasing trend to award significant sums for psychological distress and conditions.
The case law indicates that many businesses and even larger employers are failing to follow basic steps in dealing with workplace complaints and disputes.
What do you do as an employer when there is a complaint of bullying and harassment in the workplace?
Some things you don’t do are:
- Ignore them
- Use the complaint as a basis for “sham” performance review
- Treat the complainant with disrespect
- Fail to initiate a fair and transparent process
- Fail to promptly and properly investigate a complaint
- Withhold monies genuinely owing pending the outcome of the complaint
The recent decision of Leggett v Hawkesbury Race Club Limited (no 3)  FCA 1658 was a case involving:
- A breach of contract claim
- A negligence claim, and
- A claim under the General Protections provisions of the Fair Work Act,
The claimant was a well- respected, senior employee of longstanding service to the employer.
She alleged that as a result of making a complaint about her new manager’s rudeness and manner:
- she was called to a performance management meeting by him, an action said to be used to injure and threaten her and
- her payments for commissions were withheld, and said to be to used as a bargaining chip for her performance discussion.
Unfortunately, the complainant was severely affected by the employer’s manager’s conduct, which “caused a very serious psychiatric illness that may never be cured, ameliorated to any significant extent.”
When she got the letter requiring her to attend a meeting concerning her performance, she became” distressed, emotionally drained and began vomiting” and took sick leave.
The manager’s response was to gloat about her condition and joke about “staff dropping like flies.”
The $2.8 million dollar figure awarded to Mrs. Leggett was made up of $1,770,510 in compensation. This was including $214,250 for pain and suffering, $1,169,048 for past economic loss, $78,980 in interest on past economic loss, $869,745 in future economic loss, plus penalties and costs.
The measure of the significant damages awarded reflected the evidence that the Complainant was indeed severely affected and suffered psychological distress as a result of the conduct towards her and that she would require ongoing treatment.
The medical evidence in the case was quite clear:
“To summarise, Mrs Leggett ’s condition was caused by the culmination of perceived bullying and intimidation at work of which the incidents of 9 and 10 October 2016 were the last straw, of her condition being worsened by the loss of her job, role, and status and by the treatment which she received as unfair after she stopped work, in relation to a lack of support and not being paid the money which she felt was owed to her”.
We recommend that every employer treat an employee’s workplace complaint seriously.
Some useful and obvious steps include the following:
- Have in place policies and procedures for dealing with complaints that in known to all employees.
- Ensure that the process for investigation of the complaints is transparent, and affords procedural fairness,
- Investigate promptly-delay may well aggravate the consequence
- Do not use the fact of the making of the complaint to cause any injury or detriment to the employee in their employment.
- Document the complaint and process followed carefully and accurately.
If your business is facing any such claims, it may be important to seek early legal advice and assistance to ensure that the risks are managed and minimise the prospect of damaging and expensive claims.
The blog published by Rostron Carlyle Rojas Lawyers is intended as general information only and is not legal advice on any subject matter. By viewing the blog posts, the reader understands there is no solicitor-client relationship between the reader and the author. The blog should not be used as a substitute for legal advice from a legal practitioner, and readers are urged to consult RCR on any legal queries concerning a specific situation.