Disciplinary policy in contract bound employer to follow it: High Court

Until recently, it has long been the case in Australian law that courts would not award damages for breach of contract because of the way in which the worker was dismissed.

In Elisha v. Vision Australia Limited [2024] HCA 50, the High Court decision resulted in an employer being liable for almost $1.5 million to an employee for breaching his contract by failing to follow its disciplinary policy when terminating that employee’s employment.

In 2006, Adam Elisha commenced employment with Vision Australia in a role that required him to travel for work. His contract had not been comprehensively updated since he started.

On one work trip in 2015, he allegedly was rude and aggressive towards the acting hotel manager. The allegations came to light sometime later when other Vision Australia employees stayed at the same hotel. After completing an investigation, Vision Australia dismissed Elisha for serious misconduct. The Supreme Court found that the investigation that led to the dismissal was flawed.

Unfair dismissal

Soon after his dismissal, Elisha lodged an unfair dismissal claim. Vision Australia paid him $27,248.68, equal to 26 weeks’ pay, to settle his claim. Elisha signed a deed of settlement.

Elisha also made a WorkCover claim for psychological injury. He claimed that his injury was caused by Vision Australia not following its disciplinary procedure and enterprise agreement terms when dismissing him,...

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