Thursday, July 11, 2013


It’s all in your head


Or is it?


According to, Australia’s courts seem to be spending a lot of time considering “psychiatric harm” in the workplace.

While these concerns seem primarily based on conditions “Down Under,” risk management practitioners should be aware that the issue can become global and effect their clients. Similar cases may be coming to a courtroom near you.

In one case, the court ruled that “Employers not necessarily liable for psychiatric harm to employees who are stressed or overworked” ( In separate decisions, two employees who sustained psychiatric injuries in the course of their employment in Victoria were denied damages in recent decisions of the Supreme Court of Victoria and the Victorian Court of Appeal.

In another case, “Law firm successfully defends against claim of bullying” (, the court decided that an employee who experienced an overwhelming workload, professional and personal pressure, conflict and a strained relationship with a colleague was found not to have been bullied.

Interestingly, all cases were heard in the same Australian state, Victoria.

In the liability for psychiatric harm case, the court determined that an employee claiming psychiatric harm in the course of employment needs to prove the employer was provided with a medical certificate or told that a doctor had been consulted because the employment was adversely affecting the employee's mental health.

In the bullying case, the court admonished employers to carefully manage workload shifts associated with maternity leave. This decision highlights the need for employers to ensure that policies and procedures are implemented to manage workflow and to ensure that appropriate resources are allocated to assist a returning staff member to transition back into the workplace after an absence.

While the Australian courts’ decisions impact only operations in Australia, the issues raised in these cases should give practitioners pause and have them consider working closely with in-house and retained legal advisers to develop policies and procedures to at least mitigate the potential for similar legal action against the organizations that engage us.

The bottom line is simple: It is expensive to do battle in the courts. Even if the organization prevails, it still loses. Besides financial loss, there can be production loss, customer good will loss, and personnel misgivings regarding how the organization treats its staff.

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