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May 2019

Employer hit with damages for defaming employee

Employer hit with damages for defaming employee

Bowden v KSMC Holdings Pty Ltd t/as Hubba Bubba Childcare on Haig & Chapman (2019)

The Case

Mr Matthew Bowden was an employee of KSMC Holdings Pty Ltd t/a Hubba Bubba Childcare on Haig & Chapman (HB Childcare). Mr Bowden was also studying a Diploma of Early Childhood Education. He resigned his employment because his TAFE timetable clashed with his employment shifts.

Thereafter, HB Childcare sent an email to its customers, as follows:

“Matt is unfortunately no longer with us due to disciplinary reasons. Whilst being good with the children in general, Matt was not truthful with us regarding his studies and some other issues, and I felt it was better for him to move on and possibly gain a bit more life experience. We wish him well with his future.”

Mr Bowden was provided with a copy of the email by a customer. He thereafter suffered a psychological injury, withdrew from TAFE and commenced defamation proceedings.

Verdict

In the District Court, HB Childcare argued there was some truth to the accusations in the email. However, the Court rejected this, finding that:

  • HB Childcare became dissatisfied when Mr Bowden could not work on Wednesdays because of his TAFE course;
  • there was no clear prohibition on Mr Bowden babysitting outside its hours of operation; and
  • the email sent to its customers went beyond what they needed to know and “impugned [Mr Bowden]’s character and reputation in an injurious way”. In awarding Mr Bowden $237,970.22 in compensatory, aggravated, special damages and interest, the Court considered:
  • Mr Bowden required medical and psychological treatment;
  • he was a vulnerable 18-year-old man;
  • his reputation had been severely damaged both directly to customers who had received the email and through gossip;
  • the TAFE Mr Bowden attended had become involved in the case as a result of HB Childcare’s actions in defending the claim, hence further injuring Mr Bowden’s reputation;
  • Mr Bowden had ceased his studies and postponed his course;
  • it took Mr Bowden a considerable period of time to find another childcare position; and
  • the email had a detrimental effect on Mr Bowden’s career options given it had occurred in the area where he lived.

Lessons

This case demonstrates that employers should be careful what they say about departing employees. If the termination of an employee is acrimonious, it is best just to inform clients of the employee’s departure, as and when required, without engaging in discussion as to the reasons. Any disparaging remarks could result in expensive litigation, reputational harm and costly damages.

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