Executive Summary

On 11 December 2024, the High Court of Australia handed down its decision in Elisha v Vision Australia Ltd [2024] HCA 50, restoring $1,442,404.50 in damages awarded to a former employee for a psychiatric injury caused not by his dismissal alone, but by the manner in which the disciplinary process preceding it was conducted. The court overturned 115 years of established precedent to do so. Twelve days later, on 19 December 2025, the NSW Local Court convicted the Australian Department of Defence under the Work Health and Safety Act 2011 for failing to manage psychosocial risks arising from a performance management process that preceded the death of a 34-year-old RAAF technician. It was the first time a Commonwealth employer had been convicted of a WHS offence relating to psychosocial risk. The Defence Department was fined $88,000 and ordered to publish an adverse publicity notice.

These two decisions, separated by twelve months, together define the legal landscape for workplace investigations and disciplinary processes in Australia in 2026. They establish, in the clearest possible terms, two things that many employers have not yet fully absorbed: first, that the investigation process itself is a source of psychosocial harm that must be actively managed under WHS law; and second, that where it is not managed, and an employee suffers psychiatric injury as a result, the employer may be liable in ways that extend well beyond an unfair dismissal settlement.

This article examines what these decisions mean in practice, identifies the specific failures that create secondary injury, maps the multi-layered legal exposure that flows from a poorly conducted investigation, and explains what good investigation practice looks like under the current regulatory framework. It also examines a dimension that most investigation guidance does not adequately address: the role of early, confidential reporting systems in reducing the need for formal investigations altogether, and in building the documented reporting culture that protects organisations when investigations cannot be avoided.

Two Cases That Changed the Legal Landscape

Elisha v Vision Australia Ltd [2024] HCA 50

Adam Elisha had worked for Vision Australia as an adaptive technology consultant since 2006. In March 2015, during a work trip, he was accused of being aggressive and intimidating to hotel staff during a noise complaint at 12:30am. The allegation was disputed. Vision Australia stood him down and gave him a letter notifying him of the hotel incident and asking him to attend a meeting two days later. At the meeting, the company preferred the hotel owner's account.

What it did not do was put to Mr Elisha the separate allegation it had decided to act on: that he had a 'pattern of aggression' extending back through his employment. Those prior allegations were never disclosed to him and he was never given an opportunity to respond to them. Vision Australia nonetheless relied on this alleged pattern in deciding to terminate his employment for serious misconduct. The primary judge at the Supreme Court of Victoria found the process to be "unfair, unjust and wholly unreasonable" and described it as "nothing short of a sham and a disgrace."

Mr Elisha was subsequently diagnosed with a major depressive disorder and an adjustment disorder with depressed mood, and was assessed as having no future capacity for work. In 2020, more than five years after his dismissal, he commenced proceedings claiming damages for the psychiatric injury caused by Vision Australia's breach of the disciplinary procedure incorporated in his employment contract.

The primary judge awarded $1,442,404.50 in damages. The Victorian Court of Appeal overturned this, holding that damages for psychiatric injury were not recoverable for breach of contract. The High Court, in a joint judgment of the majority, reversed that decision.

The High Court held that psychiatric injury is part of the class of physical or personal injury for which damages are recoverable for breach of contract. It held that the risk of psychiatric illness from a seriously flawed disciplinary process was within the reasonable contemplation of the parties at the time of contracting as a serious possibility. And it quoted approvingly the observation that employment "is usually one of the most important things in his or her life. It gives not only a livelihood but an occupation, an identity and a sense of self-esteem" - meaning that an unfair process of termination for alleged misconduct could affect all three of those interests simultaneously.

The High Court did not resolve whether a separate duty of care in negligence exists to provide a safe system of investigation. It found it unnecessary to do so because the contract claim succeeded. But the negligence argument was not rejected - it remains available for future litigation. The full scope of employer liability for investigation-related psychiatric harm has not yet been settled by Australian courts.

Department of Defence Conviction, December 2025

On 19 December 2025, the NSW Local Court convicted the Australian Department of Defence of a Category 3 offence under section 33 of the Commonwealth Work Health and Safety Act 2011, in connection with the death of a 34-year-old RAAF technician who took his own life at RAAF Base Williamtown on 28 July 2020, while on duty.

The Comcare investigation found that in the six months prior to his death, the worker had been placed on four separate Work Plans - the Defence Department's performance management tool. He displayed increasing signs of distress and ill-health throughout this process. Defence admitted, in pleading guilty, that it had breached its primary health and safety duty by failing to provide supervisors with the training they needed to: understand how a Work Plan could be a psychosocial hazard; identify psychosocial risks associated with workers subject to performance management; eliminate or minimise those risks; and know when to refer a worker for medical assessment or when to suspend the performance management process.

The Court fined Defence $88,000 - in the mid-range for a Category 3 offence, which carries a maximum penalty of $500,000 - and ordered an adverse publicity notice. It was the first conviction of a Commonwealth employer for failing to manage psychosocial risks under federal WHS law. Further charges remain pending against the same Department in relation to alleged psychosocial risks arising from remote work.

Norton Rose Fulbright, commenting on the decision, described it as "a defining moment for Australian workplaces," reinforcing a point that regulators had been signalling: psychosocial hazards arising from HR processes are a core part of WHS obligations, and they must be managed with the same discipline applied to physical risks.

The Investigation as a Psychosocial Hazard

The starting point that most employers miss is this: every workplace investigation is itself a psychosocial event for everyone involved. It is not a neutral administrative process that operates outside the scope of WHS obligations. Under the model WHS Regulations, and every jurisdiction's equivalent, employers must identify, assess, control, and review psychosocial hazards. A workplace investigation introduces or intensifies a range of recognised psychosocial hazards for all participants simultaneously.

For the person who has raised the complaint, the investigation process can introduce: uncertainty about whether they will be believed; fear of retaliation; loss of control over a deeply personal experience; repeated re-exposure to traumatic content through interviews and evidence gathering; and concern about confidentiality. Norton Rose Fulbright's analysis notes that even a legally fair process can be traumatising, with complainants reporting feeling interrogated rather than supported, and witnesses feeling intimidated by the process.

For the subject of the allegation, the investigation introduces: the immediate psychosocial impact of being stood down or suspended; uncertainty about outcome and timeline; potential isolation from colleagues; and the specific harm identified by the High Court in Elisha: the risk of psychiatric illness from a process that is or that feels unfair, non-transparent, or predetermined.

For the organisation's broader workforce, highly visible disciplinary processes - particularly ones that are known to be poorly handled - affect the psychological safety of bystanders. Employees who observe that complaints are not taken seriously, that processes are not fair, or that people who raise concerns are treated worse than those against whom complaints are made, adjust their own behaviour accordingly: they stop reporting.

Workplace Health and Safety Queensland explicitly identifies poor organisational justice as a psychosocial hazard under its Code of Practice. Poor organisational justice includes a lack of procedural fairness (fair processes to reach decisions), informational fairness (keeping relevant people informed), and interpersonal fairness (treating others with respect and dignity). A flawed investigation is, by this definition, a generator of psychosocial hazard for the entire organisation.

The Specific Failures That Create Legal Exposure

Drawing on the facts of Elisha, the Defence Department prosecution, and the extensive body of WHS and employment law guidance that has emerged in 2024 and 2025, the specific investigation failures that create the greatest legal exposure can be grouped into four categories.

1. Failing to Put All Allegations to the Respondent

The most fundamental procedural fairness failure in Elisha was that Vision Australia relied on allegations of prior aggressive behaviour to support dismissal, without ever putting those allegations to Mr Elisha or giving him an opportunity to respond. This failure turned a disciplinary process into a predetermined outcome. The High Court found the process was a "sham" before the meeting even began, because the employer had already accepted the complainant's account and was merely going through the motions.

The principle is not complex: every allegation that is going to be relied upon in reaching a finding or a disciplinary outcome must be put to the person who is the subject of that allegation. They must be given sufficient detail to understand what they are alleged to have done, and a genuine opportunity to respond. An employer that makes a decision based on material the employee has not seen and cannot contest has not conducted an investigation - it has conducted a performance.

2. Conducting the Investigation Without a Trauma-Informed Approach

The NSW Code of Practice on Managing Psychosocial Hazards requires that employers control the risks while investigations are being conducted, so that the potential for further harm is eliminated or minimised. The Queensland Code identifies using a trauma-informed approach as a specific work design control for investigations into psychosocial hazards including bullying, harassment, and workplace violence. WorkSafe Victoria's Psychological Health Compliance Code requires that in some cases, impartial external investigators must be used - specifically those trained in trauma-informed interviewing techniques with expertise in psychosocial risk management.

Norton Rose Fulbright explains why this matters in practice. A person who has suffered trauma undergoes a heightened physiological response to perceived threats. In an investigation interview, this can manifest as an inability to answer a question (freezing), fragmented or non-chronological recall of events, or crystal-clear memory of sensory details alongside inability to recall specific words or sequences. A traditional investigation approach often misinterprets these trauma responses as signs of deception or unreliability. This misinterpretation not only leads to worse findings - it causes direct psychological harm to the person being interviewed by treating normal trauma responses as evidence of dishonesty.

3. Failing to Support All Participants During the Investigation

The Defence Department prosecution turned specifically on the failure to train supervisors to recognise psychosocial risk signals in workers subject to performance management and to know when to refer workers for medical assessment or when to suspend the process entirely. Four Work Plans in six months, in the face of escalating distress, without any intervention, was found to be a WHS breach.

The parallel obligation in investigation contexts is that employers must provide adequate support to all participants: the complainant, the respondent, and any witnesses. This means not only offering access to EAP services (which many organisations do as a box-tick), but actively monitoring whether the process is causing harm and being prepared to pause, adjust, or modify it when it is. The Commonwealth Code of Practice on Managing Psychosocial Hazards at Work (2024) articulates ten specific principles for responding to reports and complaints, including: act promptly; ensure immediate safety; use a trauma-informed approach; maintain confidentiality; support all parties; and do not victimise. These are not aspirational guidance - they are the standards against which WHS compliance will be assessed.

4. Allowing Policies to Create Contractual Obligations That Are Not Then Followed

The Elisha decision contains a lesson that many employers have not yet fully absorbed on the contract law side. Vision Australia's employment contract required compliance with company policies and procedures, and stated that breaches of those policies may result in disciplinary action. This language was sufficient for the High Court to hold that the Disciplinary Procedure was incorporated into the employment contract as a binding term. When Vision Australia failed to follow its own procedure - specifically by not putting all allegations to Mr Elisha - it breached a contractual obligation, not merely an internal process.

The practical implication is that every employer whose employment contracts reference policies and procedures in mandatory or promissory language should assume, following Elisha, that those policies may be incorporated into contracts and must be followed. Legal advisers consistently recommend, in the wake of Elisha, that employers review employment contracts to ensure they expressly state that policies are not incorporated unless that was the intention. But equally, for those policies that are incorporated - or that will be treated as incorporated in practice - they must be followed. An investigation that departs from the organisation's own procedure is not just procedurally unfair; under Elisha, it may be a contractual breach for which psychiatric injury damages are recoverable.

The Multi-Layered Legal Exposure

The two cases discussed above demonstrate that a poorly conducted workplace investigation now creates potential liability under at least four separate legal frameworks simultaneously.

Under WHS law, a flawed investigation that causes or contributes to psychiatric injury is a failure to manage a psychosocial hazard. The Defence Department prosecution shows that this exposure is real, criminal in nature, and results in fines, adverse publicity orders, and, where the circumstances are more serious, exposure to Category 2 offences (for exposure to serious harm) or industrial manslaughter provisions where applicable. The prosecution of the Defence Department involved a Category 3 offence because Defence pleaded guilty to the lesser charge; the original charge sheet included a Category 2 offence.

Under employment contract law, following Elisha, employers face potential liability for psychiatric injury damages where a disciplinary procedure incorporated into an employment contract is seriously breached and a psychiatric injury results. The $1,442,404.50 award in Elisha represents the kind of exposure that no unfair dismissal settlement was designed to cover.

Under the Fair Work Act 2009, a procedurally unfair investigation that leads to dismissal creates exposure to unfair dismissal claims. Norton Rose Fulbright notes that a procedurally unfair process is highly vulnerable to successful challenge in the Fair Work Commission. The unfair dismissal settlement in Elisha was approximately $7,000 - but the psychiatric injury claim it did not resolve was worth more than $1.4 million.

Under anti-discrimination legislation and adverse action provisions, an employee who is treated worse for raising a complaint, who is victimised during the investigation process, or whose protected attribute is a factor in how the investigation is conducted, has separate causes of action that run parallel to any WHS or contract claim. WorkSafe Victoria's Compliance Code explicitly identifies that psychosocial harm during investigations can intersect with discrimination and adverse action liability.

Court Services Victoria's prosecution in October 2023, where the organisation pleaded guilty and was fined $379,157 for failing to properly assess and manage psychosocial risks in the Coroners Court due to a toxic culture, illustrates that the prosecution of investigation-related and management-related psychosocial failures has been building since before either Elisha or the Defence Department case. The direction of travel is clear.

Why Prevention Matters More Than Procedural Compliance

The most important thing the Defence Department prosecution teaches is that by the time an employer is conducting a formal investigation or performance management process, the psychosocial risk has already materialised. The RAAF technician had been displaying signs of escalating distress for months before his death. The question for the court was not whether Defence had a performance management policy - it did. The question was whether supervisors had been trained to see the psychosocial risk that the policy was creating, and to act on it. They had not been.

Every formal investigation is a downstream event. It responds to something that has already gone wrong. The complainant has already been harmed, or the alleged misconduct has already occurred, by the time the investigation begins. The question of whether the investigation causes further harm - to the complainant through re-traumatisation, to the respondent through procedural unfairness, or to the broader workplace through damaged trust in the organisation's fairness - is determined by how well the investigation is designed and conducted. But the question of whether a formal investigation was necessary at all is a different question, and it is answered further upstream.

Organisations with trusted, confidential, accessible reporting infrastructure surface psychosocial risk signals early - before they escalate to the point where a formal investigation becomes unavoidable. A worker who can report a concern about a manager's conduct anonymously, at any time, through a channel they trust to handle it appropriately, is not the worker who eventually files a formal complaint after months of escalating harm. The informal, early signal creates the opportunity to intervene before the situation becomes a matter that requires investigation, legal advice, and a formal process that puts everyone at risk.

Salus is designed for exactly this upstream function. As a confidential, 24/7 reporting platform accessible to all workers, it captures the psychosocial risk signals - the workload complaint, the concern about a manager's behaviour, the early-stage interpersonal conflict - before they escalate to formal allegations. It provides the organisation with the lead indicator data that enables targeted, early intervention. And it provides the documented evidence of a proactive, trusted reporting culture that, in the event of a WHS investigation or litigation, demonstrates that the organisation was not waiting for a formal complaint before acting. That documentation matters: it is the difference between an organisation that can show it managed psychosocial risk, and one that cannot.

What Good Investigation Practice Looks Like in 2026

For investigations that cannot be avoided, the minimum standard in 2026 is considerably higher than it was three years ago. Drawing on the Elisha decision, the Defence Department prosecution, the WHS Codes of Practice, and the guidance of Norton Rose Fulbright, Clyde & Co, and Q Workplace Solutions, the practical requirements include:

• All allegations that will be relied upon in reaching a finding or disciplinary outcome must be put to the respondent in writing, with sufficient detail to understand what they are alleged to have done, before the investigation concludes.

• The investigation must be conducted by a person who is skilled, independent, impartial, and, where the subject matter involves traumatic content, trained in trauma-informed interviewing techniques. The 10 principles in the Commonwealth Code of Practice must be applied: act promptly, ensure immediate safety, treat all matters seriously, use a trauma-informed approach, maintain confidentiality, be neutral, support all parties, do not victimise, communicate process and outcomes, and keep records.

• Psychosocial risk must be actively managed throughout the investigation. This means monitoring the wellbeing of all participants, not just offering EAP access at the outset. Where signs of escalating distress are present in any participant, the organisation must be prepared to pause or modify the process. The Defence Department prosecution confirms that the obligation to manage psychosocial risk does not pause while an HR process is underway.

• Where an investigation may be a WHS matter, the organisation's HR function and WHS function must work together. In safety-critical sectors or where the alleged conduct involves WHS risks, the investigation should be coordinated to meet both employment law and WHS obligations without compromising evidence or breaching confidentiality.

• Employment contracts and the policies they reference must be reviewed. Where policies are incorporated into contracts in mandatory or promissory language, they are binding and must be followed. Where they are not intended to be binding, the contract language should expressly say so. Following Elisha, the gap between an organisation's investigation policy and its investigation practice is a financial risk, not just a process failure.

• Investigation timelines must be defined and met. The Fair Work Commission expects investigations to be conducted within a reasonable time. Delays cause harm to all participants and are a source of the ongoing uncertainty that the Codes of Practice identify as a psychosocial hazard. A timeline agreed at the outset and communicated to participants is both good practice and risk mitigation.

Key Takeaways

• The High Court decision in Elisha v Vision Australia [2024] HCA 50, handed down 11 December 2024, overturned 115 years of precedent and held that employees can recover damages for psychiatric injury caused by a seriously flawed disciplinary process where the disciplinary procedure is incorporated into the employment contract. The award was $1,442,404.50. The decision means that an employer whose investigation policy is incorporated into employment contracts and who fails to follow that policy faces potential liability for psychiatric injury damages, not merely unfair dismissal exposure.

• The Department of Defence was convicted on 19 December 2025 of a WHS offence relating to failure to manage psychosocial risks arising from a performance management process that preceded a worker's death. It was the first conviction of a Commonwealth employer under federal WHS law for psychosocial risk. The fine was $88,000, and an adverse publicity order was issued. Further charges against the same department relating to remote work psychosocial risks remain pending.

• A workplace investigation is itself a psychosocial hazard under WHS law. It introduces or intensifies recognised psychosocial hazards for all participants: uncertainty, low control, lack of support, poor organisational justice, and, in traumatic subject matter cases, re-traumatisation. The NSW, Queensland, and Victorian Codes of Practice all specifically address the obligation to manage psychosocial risk during investigation and disciplinary processes.

• The specific failures that create the greatest legal exposure are: failing to put all relied-upon allegations to the respondent; conducting the investigation without a trauma-informed approach; failing to monitor and respond to escalating distress in participants; and allowing investigation policies to be incorporated into employment contracts and then not following them.

• Poorly conducted investigations create potential liability under at least four legal frameworks simultaneously: WHS law (criminal prosecution and fines); employment contract law (psychiatric injury damages under Elisha); the Fair Work Act (unfair dismissal); and anti-discrimination and adverse action provisions.

• Prevention is more important than procedural compliance. By the time a formal investigation is required, psychosocial risk has already materialised. Organisations with trusted, confidential, accessible reporting infrastructure surface risk signals earlier, enabling early intervention before formal investigation becomes necessary. This upstream capacity is both better WHS practice and better legal risk management.

• Salus provides the confidential, real-time reporting infrastructure that enables early detection of psychosocial risk before it escalates to formal complaint, generates the lead indicator data that drives early intervention, and builds the documented reporting culture that demonstrates proactive psychosocial risk management to both WHS regulators and, if necessary, courts.

The Elisha decision and the Defence Department prosecution together send a message that Australian employers can no longer afford to treat workplace investigations as purely administrative HR exercises. They are psychosocial events, WHS obligations, and - where procedures are contractually incorporated - sources of contractual liability. The investigation that is conducted badly can now cause more legal damage than the misconduct it was designed to address. Safe Work Tech's Salus platform is designed to reduce the frequency with which organisations reach that point: by building the confidential, trusted reporting culture that surfaces concerns early, enables intervention before formal complaint, and creates the documented evidence that a genuinely proactive psychosocial safety system was in place. Contact Safe Work Tech to understand how Salus can reduce your investigation exposure at its source.