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Sussan's Failures to Act on Bullying Reports Leads to Liability

Bullying by an inexperienced supervisor of an assistant manager over just 11 days at “Sussan” in Cairns resulted in a psychiatric injury that could have been avoided.

Returning from maternity leave to a new manager

Gabrielle Keegan returned from maternity leave in September 2010 after the birth of her first child to find that a new store manager had been appointed in her absence. Ms Keegan, who had been with women’s fashion retailer Sussan for six years, was subjected to unwarranted criticism – often aggressively – about “the previous state of the store”; “not signing up customers to the store’s VIP discount programme”; “poor handwriting”; “failing to remove security tags from clothing”; and “not mopping the floor properly”.

The new store manager’s conduct also involved excluding Ms Keegan from knowledge of and participation in matters of business management, ignoring her offers of assistance and warning her of the consequences of a drop in standards. On the third day back, Ms Keegan responded to the Queensland Business Manager, Jayne Makarein, that she was enjoying being back at work and the new manager Diana Clarke was “good”.

Bullying and harassment policy

But at the end of day 4, she contacted Makarein to reveal the bullying, which regrettably for Sussan, did not prompt a proper application of its bullying and harassment policy. The situation deteriorated daily until day 11 when Ms Keegan left.

Ms Keegan sued Sussan on the basis the employer had caused or permitted the supervisor’s conduct “by failing to provide and maintain a safe workplace”. The claim was defended by WorkCover. The Supreme Court had to determine when and whether the employer should have intervened in the incident and how such intervention may have resulted.

Under new management

“The point on the fourth day when Keegan telephoned Makarein in tears complaining Clarke was bullying her was a pivot point in this case,” ruled His Honour Justice Henry. The employer might not necessarily “have predicted the return of a longstanding assistant manager to work under a new manager might test that manager’s ability”.

“But the telephone call on day 4 from a crying Ms Keegan complaining of bullying conduct by Ms Clarke changed the equation”. At that point, the risk of psychiatric injury had escalated beyond a mere “far fetched or fanciful possibility”.

Not being treated seriously, or confidentiality ignored

Contrary to its documented procedures, the complaint was not treated seriously or impartially, confidentiality was not observed and no investigation occurred. On that analysis, the court readily accepted that there had been breach of duty and that Sussan was liable for the resulting injury.

Forensic Psychiatrist Dr Antoce reported a PIRS of 26%, whilst Dr Chung for WorkCover assessed a PIRS rating of 28%, but 10% was due to pre-existing personality traits. Although the Court considered the pre-existing personality trait did not take away from the negligence of Sussan, it did reduce the Plaintiff's damages on the basis that the Plaintiff may have sustained loss of income in the future due to such vulnerability. Her future economic loss was significantly reduced to $55,000.

The Court awarded general damages at $71,610 (ISV of 37) and past lost wages at $120,000, included in a total award of damages in the sum of $304,000.

To read the case in its entirety, go to the following link: Keegan v Sussan Corporation (Aust.) Pty Ltd [2014] QSC 064 Henry J 07/04/2014.

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