When Does Disciplinary Action Go Too Far?

02 MAY 2023


Employers are legally entitled to conduct reasonable disciplinary actions against their employees. In the Workers Compensation Scheme, employers are in fact protected from certain psychological claims from workers, if it can be shown that their injury was caused by reasonable disciplinary action.

However, in order for employers to receive this protection, they must prove that the disciplinary action was reasonable and that it was carried out in a reasonable way. A recent case from the Personal Injury Commission considered this issue.


McNamara v State of NSW (Illawarra Shoalhaven Local Health District) [2022] NSWPIC 600


The worker was employed by NSW Health as an administration officer at a hospital.

One day, she realised that she and a psychiatric patient both had the same surname, which was uncommon, particularly in that area. As such, she invited her to an upcoming family reunion and provided her with her contact details. Following this occasion, the worker and patient kept in touch.

Unfortunately, as time went on, the patient began to inappropriately contact the worker. The worker would be contacted at inappropriate times, and with inappropriate messages. The worker asked the patient to stop, but they refused to do so.

In light of the above, the worker informed her coordinator. An investigation was then conducted, which found that the worker providing her phone number was a breach of NSW Health’s policies, as they stated that patient information could not be used for any non-medical reasons, without the proper authority.

The worker was then subjected to disciplinary action, including being barred from using various IT systems, including the patient information systems. She was also not allowed to tell any of her colleagues why her access had been revoked. Due to this, it became impossible for the worker the complete her job, as she could not access any information. She was also not able to tell her colleagues why she could not access any information.

The above led to a psychological injury and the worker lodged a Workers Compensation Claim.



The insurer denied the claim, on the basis that the worker’s injury was caused by reasonable disciplinary action. As such, the parties went to the Personal Injury Commission.

The worker obtained evidence from some of her colleagues, including doctors, who testified that she was unable to do her job, as a result of the disciplinary action. For example, a doctor recounted when they would ask the worker to call patients and remind them of upcoming appointments, but the worker would be unable to do so, as she could not access patients’ contact information. Further, she was unable to tell his doctor why she could not access the information.

The Personal Injury Commission found that whilst the worker did breach her employer’s policies, and disciplinary action was warranted, the extent of the action was excessive and unreasonable, particularly because it resulted in the worker being unable to do her job. As such, the worker was successful.


Key Takeaways

This decision highlights the importance of employers ensuring that even when disciplinary action is reasonable, it is conducted in a reasonable fashion.


The contents of this publication are for reference purposes only. This publication does not constitute legal advice and should not be relied upon as legal advice. Specific legal advice should always be sought separately before taking any action based on this publication.


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