Workplace stress is something many employees experience at some point in their careers. But when that stress leads to a serious psychological injury, can an employer be held legally responsible?
The High Court of Australia’s decision in Koehler v Cerebos (Australia) Ltd [2005] HCA 15 remains one of the most paramount cases in defining when an employer may or may not be held liable for psychiatric injury caused by solely by work-related stress. Understanding this case helps workers know what must be proven before a claim for psychological injury can succeed.
The Background
The plaintiff in this matter, Ms Koehler, worked for Cerebos (Australia) Ltd as a part-time sales representative in Western Australia. Her duties included having to Visit supermarkets and setting up promotional displays for her employer’s products.
After the company had undergone some restructuring, Ms Koehler agreed to take on additional hours and responsibilities. Shortly after accepting these additional hours and responsibilities, she began to feel overwhelmed. Ms Koehler repeatedly informed her employer that the current expectations exceed her abilities and that she felt as though she was struggling to complete her tasks within her agreed hours. In response to these concerns the employer failed to make any changes or alterations to her duties or responsibilities.
Ultimately, Ms Koehler suffered a psychiatric injury, developing depression and anxiety due to newfound stress relating to her work. Ms Koehler then decided to bring a legal claim against her employer, arguing that they had failed to take reasonable care for her mental health.
The Legal Question
The case asked a key question:
When does an employer have a legal duty to prevent an employee from suffering psychiatric harm due to stress at work?
Ms Koehler argued that her employer should have reduced her workload after she raised her concerns, and by failing to make any alterations to her duties they, they breached their duty of care to her.
Her employer, disagreed with this conclusion arguing that the duties and responsibilities she was expected to complete where not dangerous or inherently risky, that she had agreed to the terms of her employment, and that there was clear risk that having her continue with work would result in psychiatric harm or injury.
The High Court’s Decision
The High Court ultimately dismissed Ms Koehler’s claim, on the basis that the employer had not breached its duty of care. Though this decision did not extinguish the potential for claims for psychiatric injury entirely.
The judges ruled that while employers must take reasonable steps to protect their employees from harm, this duty is only applicable when the subject psychiatric injury is reasonably foreseeable. This term simply means that the employer knew, or ought to have known, that there was a real risk of mental harm.
In Ms Koehler’s case, there were no clear warning signs that she was at risk of psychiatric injury. Although she had complained about her workload, the Court said such complaints are common in workplaces and do not necessarily mean that psychiatric harm is likely.
The Court also noted that Ms Koehler had agreed to the role and its duties, which made it difficult to later argue that the agreed workload was unreasonable or unsafe.
What This Means for Workers
This case makes it clear that for an employer to be found negligent for causing psychological injury, the following must usually be shown:
- The injury was caused by work or work conditions.
- The risk of psychiatric injury was reasonably foreseeable to the employer.
- The employer failed to take reasonable steps to prevent the injury once the risk was known.
Complaints about being “busy” or “stressed” are not, on their own, enough to make psychiatric injury foreseeable. However, if there are clear warning signs, such as ongoing medical certificates, visible distress, or explicit reports of mental health strain, the employer may then have a duty to act.
Why It’s Important
Koehler v Cerebos highlights the scope of employer liability for psychological injuries. It doesn’t mean that workers can never claim compensation for work-related mental health issues, there has been many successful claims have been made since this case, but it sets the threshold for foreseeability and requirement for prior notice.
The success of these claims is typically dependent on evidence: employees must be able to show that their employer either knew, or should have known, that their mental health was at risk and failed to take reasonable action.
Final Thoughts
If you are suffering from work-related stress, anxiety, or depression, there are steps that can be taken to ensure that the issues of Koehler v Cerebos are adequately satisfied these steps may include raising your concerns with your employer early and document them in writing, seek medical advice and keep records of all workplace discussions.
While the decision in Koehler v Cerebos shows that not every case of workplace stress will result in a successful compensation claim, legitimate psychological injuries that arise from unreasonable work practices or ignored complaints can still give rise to a valid claim.
If you believe your employer has failed to protect your mental health, contact our experienced personal injury lawyers today. We can advise you on whether you may be entitled to compensation under Queensland law and help you take the next steps toward recovery and resolution.
