Andrew Douglas: Why don’t we go on to the major topic? This major topic, can I say, looks as boring as batshit, that is because…

Nina Hoang: What?

Andrew Douglas: Oh, sorry. It’s second week. But it’s really interesting ’cause it’s talking about reasonable management action and, probably-

Nina Hoang: I think it’s very relevant. Yeah.

Andrew Douglas: Yeah, the most notorious difficulty of reasonable management action, and that is dealing with a person who is highly sensitised and doesn’t respond well-

Nina Hoang: To feedback.

Andrew Douglas: To feedback. So talk us through the facts, and then let’s break it out, okay?

Nina Hoang: Yeah, I think the facts are very convoluted. I think there’s quite a long case, but I’ll just condense it down to the main key bits. Essentially, this employee worked for the NDIA, had recently come back from a period of workers’ compensation where he’d been diagnosed with adjustment disorder, anxiety, stress-related things. His role involved dealing with customers, and, basically, while he was working, the department received like several ministerial complaints.

Andrew Douglas: Ministerial complaints. Yeah.

Nina Hoang: About how he dealt with customers. It was pretty bad. So, they were trying to performance manage him, and they had regular, essentially reviews where you had to rate the performance. And he wasn’t very happy with how they rated him ’cause they told him he needed to improve. So he continually reviewed, sought internal reviews, and each time it was, they said, “No, that’s what it stands for.” Similarly, his manager was managing his performance, and, as a result of that, he filed a workers’ compensation claim based on two incidents.

One where she allegedly went off at him because he’d sent a blank template instead of the one that he was supposed to send. And also he said that her behaviour suddenly changed when she’d been telling him he’d been doing really well, and she started being very aggressive and mean to him when she was speaking to him about the complaints. Medical evidence found he definitely did have adjustment disorder, stress and anxiety, but it originated from the performance management action. So, Comcare denied the claim at first instance, because it was reasonable management action.

And so it went to the tribunal who found, “Yes, we agree with the medical advice. He definitely has a condition, but it originated from the reasonable management action so it’s not compensable.” And also the medical evidence found that he had like personality condition, I think they said it was, where he was quite sensitive to feedback and, based on that condition, would reframe it in his mind as bullying and being targeted and stuff, whereas it was completely warranted and reasonable.

Andrew Douglas: Okay, and can I say, the interesting part of this case is this is right on the borderline of high level risk in new law, okay?

Nina Hoang: New law

Andrew Douglas: Yeah, and we’ll talk about the new law, which is industrial and safety law. But, what this shows you, is if you follow a process, it’s a good process. You can be robust. At times, you can fail a little bit, but if what you’re doing is doing what is… You know, reasonable management action is two fairness. Are you dealing with a problem that is a problem? So is it fair, your assessment of what the problem is? And is the method by which you’re dealing with it fair? Then it’s reasonable management action.

It doesn’t have to be perfect. Different regulators around Australia in workers’ compensation, it’s not as easy as that because the Victorian regulator will immediately find and say “Not reasonable management action” if you sniff during a thing, whereas New South Wales and Queensland are much more robust. So, each jurisdiction is a bit different. And in the bullying jurisdiction, where reasonable management action is a complete defence, the Fair Work Commission will allow quite robust behaviour still being. In other words, if someone’s aggressive to you, just say “You need to stop it, don’t speak to me.” Like that would be taken as reasonable management action because you’re responding to wrong behaviour.

So, there is a problem that sits jurisdictionally between workers’ comp insurers and there is a significant difference between the bullying jurisdiction where it’s a complete defence and workers’ compensation. But I guess the reason I’ve got it here is slightly different. And that is we’ve just had a malicious case on psychiatric damages. We’ve just had the beginning of a prosecution, the Victorian Building Authority, and this is where they meet, where you’re aware of a person’s psychological profile and risk and you continue to run the same process and you run the process. And this is not what happened in this case, but you run the process where there is a knowledge of harm.

You are right in the Victorian Building Authority, safety reckless endangerment area. And you’re right in a Alicia’s case, new psychiatric damages. If I knew during the process of disciplining that I did something that could cause harm to a person, that is a psychiatric nature. There is no reasonable management action test in it. Okay? There is reasonableness in the sense that it’s a breach of contract, and therefore, if your behaviour is reasonable, it will be a defence to it. But once you have a knowledge of harm, to continue to do it in the same way, would give rise to a Alicia case. Psychiatric damages, they’re massive. Now, if this person doesn’t come back to work, they’re a hundred thousand dollar employee.

You’ve got general damages and loss over a million dollars. Admittedly, workers’ compensation insured, but people are bringing these claims quickly, as Tom and I talked about with Alicia’s case in the workplace watch. We are now having a lot of people starting to bring these claims because of what they are. And we’re now having people going to the regulator saying they knew that I had a psychiatric problem, they knew related to my performance management. And they continue to do the same thing in the knowledge that had harmed him. That’s reckless endangerment. That’s why we’re agitating this case. ’cause the reasonable management actions are fascinating and it’s a really good thing to know. But what I want you to know is what seems like a simple case is suddenly after Alicia’s case in the VBU become a much more complex case, when you become aware that the nature of management of a person could cause them harm, step back, reanalyze, regroup, and do it in a way that is safe and documented. That’s my comment about the case. Why don’t we go on to the case study?

Nina Hoang: Yep. All right.

Andrew Douglas: Over to you, Nina.

Nina Hoang: All right. So, Gus was tired. He had worked several long shifts as a contract manager, supervisor for Clever Kids Builders, CKB, as subcontractors sought acceleration variations to complete two childcare centres before January 1 opening with pre-booked children. His hours grew longer and more demanding. There were many demands upon him. Not only was he employed by the principal contractor to manage the builds, but he also had to deal with complex site meetings with the owners and subcontractors.

Everyone wanted the work done, but everyone also wanted to be paid more. His job was to stop the budget blowout caused by the demands of others, and somehow find a remedy. It seemed insolvable to him. He became increasingly irritable with his family and colleagues and struggled to sleep. He told his boss, Neil, that he felt on the edge. Neil told him to wind it back. There were only a few more weeks to go. Neil confided in HR that they needed to watch Gus as he might blow a valve.

Gus, the site supervisor under the building contract, approved two acceleration variations involving significant overtime for two subcontractors. Neil was furious. Yes, it was within Gus’s delegation, but Christmas was a tough time for cashflow. Neil confronted Gus and told him how inappropriate it was. Gus snapped, calling Neil an ungrateful a-hole and telling him to get effed before storming off home.

When he returned to work the next day, Gus seemed drugged, subdued, and almost vague. Neil asked him if he was okay. Gus just grunted, “You did this, mate. Now I’m on Valium and goodness knows what else. You’re killing me.” Neil proceeded to hold a disciplinary meeting with him, but just before you could say “You’re terminated,” Gus exploded and walked out.

Andrew Douglas: Alright, interesting set of case. By the way, coming from my old building construction lawyer base, a lot of this is real. So, that’s not a bad start.

Nina Hoang: Yeah.

Andrew Douglas: What’s our first question?

Nina Hoang: Were there any workers’ compensation risks and what were they? Oh yeah. I think that’s obvious.

Andrew Douglas: Well, I think he did say that Gus is a winner there, isn’t he? He’s got workers’ comp and there’s-

Nina Hoang: So many psychological hazards.

Andrew Douglas: Yeah, so many hazards in there. And no reasonable management action as well.

Nina Hoang: Yeah, and he has also raised it as well. And he’s displaying clear signs. Yeah. Nothing.

Andrew Douglas: And can I say, that takes us, the second question is, is there a chance of psychiatric damages?

Nina Hoang: Psychiatric damages?

Andrew Douglas: This is a Alicia case, so this is… You knew what you’re doing. You know the harm that’s being done, you can see the harm occurring. It did happen. I’m afraid that’s an own goal. Very, very easy to get psychiatric damages out of that. So, that’s a common law claim, which should be brought on behalf of your workers’ compensation legislation. No trouble in getting up and running. What about discrimination and general protections?

Nina Hoang: Yeah, I believe so. He’s raised concerns, and the, Neil’s acted against it.

Andrew Douglas: Yeah. Not as he raised the concerns, but he’s told you it’s impacting his mental health.

Nina Hoang: Yeah.

Andrew Douglas: Moreover, he said it’s unsafe.

Nina Hoang: Yeah, they haven’t provided a safe workplace.

Andrew Douglas: So, the general protections, he’s home and not safe. He’s home on raising an issue, which from Suncorp, where our Suncorp case, there is no doubt that Neil knew or ought to have known that this was impacting his mental health.

Nina Hoang: Yeah.

Andrew Douglas: And he has then directed him in spite of that, to do something.

Nina Hoang: Yeah, but the final incident is when he takes action against him because he is come to work drugged, subdued, and stuff as a result of the stresses at work. So he’s being directly punished.

Andrew Douglas: But he is totally, yeah. So, that takes me to your area of specialty. Safety role.

Nina Hoang: Safety risk. Yeah. No. I think if anything happened to him, so say if he walked out and, you know, got hit by a car or something.

Andrew Douglas: This is reckless endangerment

Nina Hoang: Yeah, reckless… But also I think industrial manslaughter. It’s pretty bad.

Andrew Douglas: It’s not, I don’t look, I don’t think it’s, but it’s close. But it’s definitely reckless.

Nina Hoang: He’s been doing it for a long time. He’s showing signs. He’s come to work in that state with me and then deliberately,

Andrew Douglas: Then drive away. Don’t you work for the regulator that’s over the top. Okay. And just for fun.

Nina Hoang: If he was dismissed. Yes. Unfair dismissal.

Andrew Douglas: Unfair dismissal.

Nina Hoang: There’s no reasonable procedure. There’s no valid reason.

Andrew Douglas: No. There you go. We’ve done it. Can I say that’s it for this week?

Nina Hoang: Cool.

Andrew Douglas: Okay. We’ll look… Can I? I think we should just say I’m nearly dying this process. I’ve got three cameras looking at me. I’m not used to three cameras.

Nina Hoang: We’re getting used to it, but give us the thumbs up to keep us going.

Andrew Douglas: Yeah, that is because it’s getting better every time and we’re doing it for you. Here’s cheers.

Nina Hoang: See ya.