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Rethinking Damages in Cases of Botched Dismissal: A Worker Challenges Legal Constraints

In a recent development before the High Court, a worker has challenged the prevailing limitations on seeking damages for psychiatric injuries arising from disciplinary and dismissal procedures, arguing that they are illogical and unjust. This case has the potential to redefine the duty of care owed by employers to their employees.

Rethinking Damages in Cases of Botched Dismissal: A Worker Challenges Legal Constraints
Rethinking Damages in Cases of Botched Dismissal: A Worker Challenges Legal Constraints

The former adaptive technology consultant at Vision Australia, who obtained leave to contest a judgment from the Victorian Supreme Court of Appeal, emphasized in his initial submission the fundamental principle that employers are obligated to provide a safe working environment. Citing the precedent set in McLean v Tedman (1976) 137 CLR 11, the worker asserted that this duty extends beyond the workplace and encompasses all situations where the employer maintains authority over the employee, including work-related travel.


The worker highlighted the inconsistency in the current legal framework, which excludes damages for breaches of disciplinary and termination procedures, despite the employer's unilateral control over such processes. He argued that these limitations are arbitrary and fail to align with the overarching duty of care owed by employers.


The consultant, who developed major depressive disorder following his dismissal in 2015, emphasized the adverse impact of the incident on his mental health. While the appeal court affirmed the rejection of the worker's negligence claim, it identified an error in the awarding of damages for lost earnings and suffering due to Vision's failure to adhere to disciplinary protocols outlined in the employment contract.


Citing precedents such as Addis v Gramophone Co Ltd [1909] AC 488, Baltic Shipping Co v Dillon (1993) 176 CLR 344, Paige v The Queen (2002) 211 CLR 30, and Nikolich v Goldman Sachs JBWere Services Pty Ltd (2007) 163 FCR 516, the court justified its decision by referring to established legal principles. However, the worker contested the misinterpretation of Addis, arguing that it does not preclude recovery in cases of contractual breach. He urged the High Court to reconsider this precedent and apply ordinary principles of compensation.


Furthermore, the consultant challenged the notion that the Fair Work Act's unfair dismissal regime should serve as the sole basis for determining compensation in cases of wrongful dismissal. He argued that the exclusion of damages for emotional distress under this regime does not justify a blanket denial of compensation for breaches of the duty of care.


In conclusion, the worker called for a reassessment of the existing legal framework to ensure that individuals are not deprived of compensation for psychiatric injuries resulting from breaches of employment contracts. Vision Australia's response to these arguments is expected by May 22, marking a significant milestone in this ongoing legal battle.

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