Failure to prevent workplace bullying costs employer $1.5 million

Apr 20, 2018

A case involving ongoing managerial mistreatment of a director of nursing (DON) by an area health service manager resulted in damages of nearly $1.5 million awarded against the employer.

As his Honour Justice Henry noted in the 2017 state Supreme Court decision “In an era when the potentially grave psychological harm done by workplace harassment and bullying is well known, unjustified blaming, humiliation, belittling, isolation, undermining and contemptuous disregard of an employee… was conduct collectively raising a foreseeable and not insignificant risk of psychiatric injury.”

This decision makes it clear that a reasonable employer would be expected to take precautions to protect employees from such behaviour, particularly by senior managers. As well as a stark illustration of the human cost of managerial mistreatment, the case serves as a reminder to employers that failing to prevent such behaviours can have significant financial implications.

Failure to resolve complaints

The court placed particular emphasis on the ongoing failure by the DON’s manager (the CEO) to act to resolve a series of complaints of bullying and harassment made against the DON by one of her team members. It was accepted that the complaints were vexatious and without substance. Despite knowing that the DON was distressed by the issue and concerned about the impact of the complaints on her authority within the team, the CEO failed to take steps either to investigate or dismiss the complaints.

This issue was one of a series of instances of ‘managerial mistreatment’, and needs to be seen in that context. Nevertheless, it is important recognition by the courts of the significant impact that poor complaints handling can have on all those involved.

Abuses of authority

In considering the impact of the manager’s behaviour, the judge noted that, while a single incident might not give rise to probable risk of injury, the impact of accumulating and repeated episodes might well do so, particularly when perpetrated by the same person. Further, the risk of injury would be increased relative to the perpetrator’s position of authority over the employee. In this instance “the fact that someone with a powerful influence over the employee’s fate in the workplace is so targeting the employee will obviously tend to have such a crushing impact upon the employee as to heighten the risk of psychiatric injury”.

The importance of the “intrinsic power differential” is significant given the entrenched hierarchical nature of many workplaces in the health sector.

The importance of raising concerns

This case highlights the importance of finding ways of speaking out about concerns. Legally, the question of liability turns on whether the injury was “reasonably foreseeable”. This case emphasises that the test is not whether it was foreseeable that a person of reasonable fortitude would have sustained such an injury, rather it was necessary to consider the particular employee in question, and the signs given by them.

In this case, it was important that the CEO was aware that the DON was concerned about the complaint against her. She had specifically advised the CEO of ongoing performance management issues with this NUM. She had explained that she believed the NUM was targeting her in response to a performance report, and that she was feeling vulnerable about the situation and concerned about her authority within the team.

Reasonable management behaviour

The decision provides some reflections on what might be reasonable in terms of providing feedback. The court highlighted that an employer’s duty to provide a safe system of work required that any correction of staff must be justified and carried out in a way that it is not objectively humiliating. The judge recognised that being corrected is a necessary element of employment but “unjustified correction involving an intemperate tone or language and carried out in front of others involves qualities which employees of ordinary sensitivity will find humiliating.” Repeated and significant humiliation, and unjustified blaming of the DON by the CEO, was a strong feature in the facts of this case.


This decision also provides an illustration of the harm that can be caused by ongoing exposure to managerial mistreatment. Once a highly regarded, competent senior nurse and manager, the DON became unable to take on any role involving people, conflict or decision-making. In discussions of whether other roles might be suitable for the DON after her injury, the DON’s own evidence is particularly poignant: “That position still has HR aspects and management and is decision-making, and I’m flat out making a decision what to wear.”

The employer’s failure to address the harmful workplace situation, even after the DON went on sick leave is also significant. The expert evidence indicated that, had a suitable alternative work option been available, the DON was expected to recover from her injury. The fact that the only option offered to her was to return to her previous role, under the same manager, seems to have contributed further to the harm that she suffered.

The decision in this case, and the significant damages awarded, highlights how important it is that employers not only have policies in place regarding appropriate workplace behaviours, but that they ensure those policies are followed by all employees, including managers. Failure to do so may well result in the organisation being held responsible.

More information

Download our factsheet on workplace bullying.  

If you are being subjected to bullying or harassment at work, you may be able to make a complaint to the Fair Work Commission if you work for particular organisations (for example, companies). Further information about your rights can be found at

You can also contact our Medico-legal Advisory Service (MLAS) on 1800 128 268 for expert advice, 24/7 in emergencies.

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