Australian workers unfairly fired from their jobs can now seek compensation for mental ill-health associated with their dismissal.
This week, the High Court of Australia ruled in favour of a man who sued his employer for damages, after he developed depression following a “seriously unfair” firing.
The Court found that workers can sue their ex-employer if they incur “psychiatric injury” when the conditions of their employment contracts are breached — including terms around firing. The decision can’t be appealed.
Unfair dismissal
The High Court ruling centres around the unfair dismissal of Adam Elisha, who worked for Vision Australia as an adaptive technology consultant for nearly ten years.
Elisha’s role required him to travel across Australia to set up technology for vision-impaired people in homes and offices.
Towards the end of his time at Vision Australia, Elisha was treated for anxiety and depression related to sound sensitivity issues, workplace stress and challenges with colleagues.
In March 2015, while on a work trip in rural Victoria, Elisha made a noise complaint at the hotel where he was staying.
A hotel staff member then made a complaint to Vision Australia, alleging Elisha had been “aggressive and intimidating” during his stay.
After returning from the trip, Elisha went on annual leave. When Elisha’s manager was informed about the alleged incident, she passed the complaint to the company’s HR department and to its General Manager. Elisha’s manager said she was not surprised and “that [his] behaviour has deteriorated.”
On Elisha’s first day back from annual leave, he was given a letter explaining that he was being stood down because of the alleged incident at the hotel.
He was told to come back to the office in two days to give his side of the story. Elisha was informed that he couldn’t speak to any other staff members unless they were going to be his support person at the upcoming meeting, or he would be immediately fired.
At the meeting, Elisha denied the allegation. He was subsequently fired via letter. Elisha was then diagnosed with clinical depression.
Lawsuit
Elisha filed an unfair dismissal case to the Fair Work Commission in 2015. Vision Australia agreed to pay him more than $27,000.
In 2020, he launched a new case in the Victorian Supreme Court, alleging his termination breached his employment contract. He alleged this had caused his depression, which had left him with “no capacity for work in the foreseeable future.”
The court ruled his dismissal was “unfair, unjust, and wholly unreasonable,” ordering Vision Australia to pay him over $1 million.
Appeal
Vision Australia appealed this decision, arguing that damages should not have been awarded to Elisha for two key reasons.
- Under Australian law, Elisha wasn’t entitled to damages for mental ill-health resulting from a breached contract.
- His mental ill-health was not directly related to the firing.
Overturned
This week, Australia’s High Court overturned the Vision Australia appeal to reinstate the Victorian Supreme Court’s initial ruling, which described the firing process as “a sham and a disgrace.”
The High Court found that Australian workers can sue for damages relating to “psychiatric injury” that follows breaches of their employment contracts.
This decision overturns a legal precedent established in 1909.
High Court decisions can’t be appealed.
