Worker awarded damages for psychiatric injury suffered following a meeting with management during which he was demoted: Gairns v Pro Music Pty Ltd [2024] QDC 118
The District Court of Queensland has recently awarded damages in the sum of $395,767 to a worker who developed a psychiatric injury as a result of a meeting with management in which he was demoted.
Background
Prior to the subject incident the Plaintiff, Robert Gairns, had been in long-term employment with the Defendant, Pro Music Pty Ltd. The Defendant carried on business as a distributor of musical products, supplying musical instrument retail stores through Australia.
The Plaintiff alleged that he had sustained a psychological injury secondary to a meeting that occurred in February 2019, during which the Plaintiff was advised that he was to relinquish the supervisory role that he held, with a corresponding reduction in his salary of around $4,000.00 to $5,000.00 (‘the meeting’). The meeting occurred in an office with an open plan layout, with two other employees overhearing the conversation.
Position of the Parties
It was not in dispute that prior to the meeting the Defendant was aware that the Plaintiff was an emotional person and that his personality was such that he could easily become stressed and anxious.
At trial, the Plaintiff submitted that a reasonable person in the position of the Defendant would have taken a number of precautions in respect of the meeting, which would have avoided the risk of injury, namely: –
a. Providing him with written notice of the specific concerns about his performance, as well as the steps that would be taken by the Defendant should these concerns not be addressed;
b. Undertaking an investigation of the concerns it had regarding the Plaintiff’s performance, and communicating the outcome of that investigation; and
c. Giving the Plaintiff the opportunity to respond to any performance concerns prior to demoting him.
The Defendant denied that it was required to take any such precautions, and submitted that the Plaintiff was aware of concerns in respect of his performance since at least 2017.
Decision
Rosengren DCJ found in favour of the Plaintiff, awarding damages in the sum of $395,767. Awards were made for past economic loss, in the amount of $190,000.00, future economic loss, in the amount of $130,000.00, amongst others.
In Her Honours view, the Defendant ought to have taken a number of steps to mitigate the risk of injury, namely: –
Providing advanced written notice of the specific performance issues that were the basis of the proposed demotion;
Providing the Plaintiff with an opportunity to respond to the above written notice prior to the meeting; and
Undertaking the meeting in a confidential and calm manner, not in an open plan office.
Her Honour distinguished Paige and Govier, on the basis that the Defendants’ conduct did not occur within the context of an investigation of complaints of unlawful conduct, nor as part of a disciplinary process. Her Honour concluded that a duty of care did exist in the circumstances, noting that the managing director’s decision to convene the meeting was not something the Plaintiff had contractually agreed to, nor was the meeting conducted as part of any formal disciplinary process or investigation.
In Rosengren DCJ’s opinion, there were clear indicators that ought to have alerted the Defendant to the Plaintiff’s vulnerability. She emphasised that it was immaterial whether previously displayed signs of distress were related or unrelated to the Plaintiff’s employment. Given the Plaintiff’s psychological vulnerability, Rosengren DCJ opined that a reasonable person in the Defendant’s position ought to have recognised that not privately addressing performance issues prior to the meeting would have lead to psychological injury.
Additionally, her Honour asserted that irrespective of the Plaintiff’s pre-existing psychological vulnerability, the circumstances of the meeting were such as to give rise to the risk of psychiatric injury.
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