Employers not necessarily liable for psychiatric harm to employees who are stressed or overworked

In brief - Employees fail to establish that employers breached duty of care

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.

Psychiatric harm not reasonably foreseeable

In two recent cases, the employees failed to establish that their employers breached a duty of care to avoid psychiatric injury because it was found that it was not reasonably foreseeable that they would suffer psychiatric injury.

In Taylor v Haileybury [2013] VSC 58, Haileybury College was found not to be liable for the psychiatric injuries suffered by a former teacher at the school as a result of overwork and stress. Taylor claimed that the school had responded inadequately to the risks of him developing a psychiatric injury and failed to develop an adequate treatment plan in order to prevent his foreseeable injury.

In Brown v Maurice Blackburn Cashman [2013] VSCA 122, a salaried partner of Maurice Blackburn Cashman (MBC) claimed damages for psychiatric injury which she claimed to have developed as a result of being systematically harassed, undermined and bullied by a more junior salaried partner after returning from maternity leave. (For more information about this case please see Law firm successfully defends against a claim of bullying.)

Large teaching load and additional duties in Taylor v Haileybury

Taylor was employed at Haileybury between early 2005 and May 2007 as a French teacher. He ceased employment due to the "unreasonable and excessive stress and strain placed upon him by being given a weekly face-to-face teaching load which was too large as well as too many additional duties". Taylor claimed that Haileybury breached the terms of his employment contract by requiring him to work more than the maximum hours stipulated.

Although Taylor had never consulted a psychiatrist for treatment, nor taken any psychotropic medication for his condition, at trial Haileybury did not dispute that since May 2007 Taylor had been suffering a major depressive illness.

Risk of psychiatric harm and employer's duty of care

The principles governing the scope and content of the duty of care owed by employers to employees involving psychiatric harm are well settled in Australia. An employer owes a non-delegable duty of care to its employees to take reasonable care to avoid exposing them to unnecessary risks of injury.

The content of an employer's duty in psychiatric harm cases is determined by asking the question whether, in all the circumstances, the risk of an employee sustaining a recognisable psychiatric illness was reasonably foreseeable, in the sense that the risk was not far-fetched or fanciful (Koehler v Cerebos (Australia) Ltd [2005] 222 CLR 44).

The duty of care is engaged if psychiatric injury to the particular employee is reasonably foreseeable, having regard to the nature and extent of the work being done by the particular employee and signs given by the employee.

Employee did not communicate his health concerns sufficiently

In Taylor it was held that requiring Taylor to work a "full load" did not expose him to risk of injury where he had failed to indicate he was suffering any adverse heath effects. Taylor had sent Haileybury two emails regarding his workload concerns, in addition to verbal complaints made to other teachers. He argued that his communication to Haileybury of his concerns had required the school to take action to alleviate his risk of developing a psychiatric illness.

However, Justice Beach concluded that there were insufficient communications between Taylor and the school that would have placed them on notice that his workload was adversely affecting his psychiatric health. It was held that a retrospective approach to the emails (the fact Taylor now suffers from a psychiatric illness) cannot be read into the interpretation of the communications between Taylor and Haileybury.

Further, Justice Beach held that he was not satisfied that the risk of Taylor suffering psychiatric harm would have been alleviated by the creation or implementation of additional policies.

Complaints which did not mention health risk did not engage employer's duty of care

The Court of Appeal in Brown (the leading judgment being delivered by Osborne JA, with whom McCaulay AJA and Harper JA agreed) found that the trial judge did not err in concluding that it was not reasonably foreseeable that Brown would suffer psychiatric injury as a result of the performance of her duties. It was not until October 2003 that Brown gave advice to MBC that workplace stress was causing her health problems.

The complaints made previously by Brown to MBC did not make such injury foreseeable as they did not make any allegation of a health risk. The advice to MBC on 30 October 2003 that Brown had been seeing a doctor and that her health was suffering was a material sign of a more serious situation than that which Brown had previously advised her employer. It followed that a relevant duty of care was not engaged until that point in time.

Work-related stress and the risk of psychiatric ailments

Ultimately, the question the courts will always need to answer in these psychiatric harm from employment cases is whether, having due regard to the contract of employment or through notice of an employee, it was reasonably foreseeable that a particular employee would develop a psychiatric ailment as distinct from merely feeling "stress" associated with their work.

In Taylor Justice Beach was not persuaded to conclude with the benefit of "litigious hindsight" (at 139) that the defendant knew or ought to have known that Taylor was under stress and therefore at risk of psychiatric harm. Justice Beach did not doubt that Taylor's workload was heavy and he also accepted that teaching, like many professions and occupations, would have significant levels of stress associated with it, but without more, this was not sufficient basis for Haileybury to suspect that he was at risk of psychiatric injury.

No breach because psychiatric harm was not reasonably foreseeable

If psychiatric harm to a particular employee is established to have been reasonably foreseeable in the circumstances, the court will go on to consider whether there has been a breach of that duty of care and therefore negligence on the part of the employer. In so doing, the court will identify how a reasonable employer would respond to foresight of the risk of occurrence of psychiatric harm.

In Taylor, Haileybury was found not to have breached the duty of care owed because "[w]ithout the benefit of hindsight, there was no reason for [Haileybury] to suspect that the workload it required of [Taylor] placed him at any risk of psychiatric injury".

Employer responded appropriately to employee's complaint

Similarly, the Victorian Court of Appeal in Brown held that the trial judge was correct to find that Brown was not subjected to systematic harassment or bullying. The trial judge used the summary description of "trivial interoffice and interpersonal conflicts" to describe the objective seriousness of the acts of perceived harassment.

In the Court of Appeal's view, this accorded entirely with the weight of the evidence (at [191]–[192]). Further, the Court of Appeal found that MBC responded appropriately to the complaint made by Brown by facilitating an attempt at mediation upon being made aware of the risk to Brown's psychiatric health on 30 October 2003.

Outcome could be different if employers informed of risk to employee's mental health

Adopting the reasoning in Brown and Taylor, the outcomes for an employee claiming psychiatric harm in the course of employment may well be different if evidence is adduced that 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.