In Potter v Gympie Regional Council, the Queensland Court of Appeal was asked to consider whether an injury arising from psychiatric conditions caused by a workplace investigation accounted for negligence on behalf of the employer. 

The case involved Ron Potter, a manager employed at the Gympie Regional Council at its Local Laws Branch. Potter, who had been employed since 2008 and was a manager from 2014, made a claim for damages for psychiatric injury following his suspension due to allegations of misconduct raised by other employees. 

Background and Timeline of Potter v Gympie Regional Council

In late 2013, a staff survey revealed issues regarding Potter’s work performance. Subsequently, on 21 July 2014, Potter was suspended with full pay while the Council conducted a formal investigation into the allegations. The investigation, completed in August 2014, cleared Potter of serious misconduct but highlighted lesser misconduct and concerns about his management style.  

However, Potter was not informed of the investigation’s findings until January 2015. Shortly after his suspension, on 9 August 2014, Potter provided a medical certificate to the Council, indicating that he was unfit for duty due to workplace stress. Further medical documents confirmed that he was suffering from stress related to his work environment. Despite being cleared of serious misconduct, Potter never returned to work, and his employment was eventually terminated. Potter subsequently filed a claim against the Council, arguing that his suspension was unjustified and that the Council’s actions caused him psychiatric harm.  

Court Findings

 Ultimately, the Supreme Court of Queensland dismissed Potter’s claim, and the Court of Appeal upheld the original decision. Justice Brown’s key findings included:  

Duty of care not established 

The Court found that the respondent did not owe a duty of care to Potter to prevent psychiatric injury resulting from his suspension. The suspension was a lawful action by the Council in response to the allegations made against Potter.  

No Foreseeability of Psychiatric Injury 

Based on the evidence, the Court determined that it was not foreseeable that Potter would suffer psychiatric injury as a result of his suspension. At the time of the suspension, there was no indication that Potter had a history of psychiatric vulnerability, and therefore, the Council could not have reasonably foreseen that its actions would cause him such harm. This ruling was based on the precedent set in Koehler v Cerebos (Australia) Ltd.  

Reasonable management action 

Even if a duty of care had existed, the Court concluded that suspending Potter was a reasonable and bona fide action by the Council. The decision to suspend was based on legitimate concerns regarding his performance and was carried out in accordance with the Council’s employment contract and policies.  

Causation 

The Court found that even if there had been a breach of duty in suspending Potter, the suspension was not the direct cause of his psychiatric injury. The issues raised in the complaints and the investigation would have resulted in the same outcome for Potter regardless of the suspension. 

Implications for future claims

The Potter case reinforces the principle that employers are not liable for psychiatric injuries suffered by employees if the employer makes a reasonable management action, such as suspending an employee pending an investigation.  

If you have suffered a psychiatric injury as a result of your employment it is important to seek legal advice to determine your potential rights to a claim. 

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