Large payout in bullying case for employee returning from maternity leave

In the case of Keegan v Sussan Corporation (Aust.) Pty Ltd [¹] an employee was awarded just under $240,000 in damages after being bullied for 11 days.

This case demonstrates how important it is for employers to proactively respond to all workplace bullying complaints and have policies and procedures in place to manage workplace conduct.

A new manager at Sussan’s Cairns Central retail fashion store was found to have bullied an employee returning from maternity leave.

The alleged bullying conduct included:

• excluding the employee from business discussions;
• ignoring her offers of assistance;
• unwarranted criticisms of her past and present performance;
• repeatedly speaking in an ‘aggressive and nasty’ tone; and
• creating an ‘isolating atmosphere’ in which the manager was generally friendlier to other staff.

After four days, the distressed employee made a bullying complaint to her employer’s Queensland business manager who, instead of following the employer’s bullying and harassment policy, responded by calling the store manager to inform her of the complaint.

This did not resolve the complaint and the bullying continued for a further seven days. The employee made a further bullying complaint to the employer and was told to ‘work it out herself’. She was subsequently diagnosed with a psychiatric disorder and filed a claim of negligence or, alternatively, breach of contract.

Justice Henry of the Supreme Court of Queensland found that a reasonable person in the employer’s position would have realised that their failure to address the initial complaint properly ‘considerably heightened’ the prospect of the emotional distress worsening. Therefore, the psychiatric injury was a risk that the employer ought to have reasonably foreseen.

Justice Henry concluded the employer was negligent in permitting the store manager to bully the employee and that it had failed to enforce its bullying and harassment policy. The Court awarded the bullied employee $237,770 in damages.

It is vital that managers are properly trained to supervise and lead their staff, and that employers adopt and comply with adequate bullying policies and procedures, including following a fair and transparent complaint or grievance process when faced with a bullying complaint.

Importantly, a bullying complaint can run concurrently in multiple jurisdictions, such as an application to the Fair Work Commission, a complaint to the work health and safety regulator and as a civil claim.

If you would like further information, please contact a member of our employment and workplace relations team. Our team also has a range of template employment policies available, including prevention of workplace bullying, prevention of workplace discrimination and sexual harassment and complaint and grievance handling.

[¹] [2014] QSC 64