Bullying, Harassment Or Reasonable Management Action? Telling Them Apart At Work

By Joanne Law and Paul Kenna Law

Published 2nd October 2026. This article states the law as at that date.

Three words get used a lot in workplace disputes, and they do not mean the same thing.

A worker says they are being bullied and the manager says it was performance management.

A colleague says it was harassment and the other says it was just a joke.

Each word points to a different legal test, a different body that hears it, a different remedy, and a different answer to the question that matters most to us as mediators.

Is mediation the right tool, or the wrong one?

Our earlier article on psychosocial safety and mediation covered the employer’s duty to prevent psychological harm and where mediation fits in a prevention system. This article is the companion to it.

It is about telling the behaviours apart, because the prevention duty cannot be met if the people running the system cannot tell a lawful direction from a pattern of bullying, or a pattern of bullying from an act of harassment.

It also deals with something the law is less tidy about. What happens when there is no manager in the picture at all, and the behaviour runs sideways between colleagues or upwards at a supervisor?

The four things at a glance

Key Distinctions	Conflict	Bullying	Harassment (including sexual harassment)	Reasonable management action
What it is	A disagreement between people who each have some capacity to advocate for themselves	Repeated, unreasonable behaviour towards a worker or group that creates a risk to health and safety	Unwelcome conduct connected to a protected attribute (sex, race, disability, age and others), or unwelcome conduct of a sexual nature	Lawful action a manager is entitled to take, carried out in a reasonable manner
Direction	Runs both ways; either person can raise the next issue	Runs one way; one person or group is consistently the target. Can be downwards, sideways or upwards	Runs one way; can come from anyone, including customers and clients	Downwards, from someone with authority over the work
Must it be repeated?	No concept of repetition; it is a state, not a count	Yes. A single incident, however unpleasant, is not bullying (though it may be repeated or escalate)	No. A single incident is enough	Not relevant
Does intent matter?	Not a legal question	No. Behaviour is bullying if a reasonable person would see it as unreasonable, whatever was intended	No. The test is whether a reasonable person would anticipate the conduct could offend, humiliate or intimidate	No. The test is objective: was the action reasonable, and was it done in a reasonable manner
Main legal source	None; it is a named psychosocial hazard under WHS law, not a wrong in itself	Fair Work Act 2009 (Cth) Part 6-4B; WHS law; state equivalents such as the NSW Industrial Relations Act 1996 from October 2025	Sex Discrimination Act 1984 (Cth); Fair Work Act Part 3-5A; federal and state anti-discrimination law	The exclusion in Fair Work Act s 789FD(2) and its equivalents in state IR and workers compensation law
Who hears it	Nobody; it is managed, mediated or left to fester	Fair Work Commission (constitutionally-covered businesses), state commissions for others, WHS regulators	Fair Work Commission, Australian Human Rights Commission, state equal opportunity bodies, courts	Nobody, unless a bullying or compensation claim puts it in issue
Typical remedy	Agreement	Stop order; in some jurisdictions compensation	Stop order, compensation, damages	None; it is the defence, not the wrong
Is mediation suitable?	Usually yes, and early	Sometimes, after screening, and usually after the employer has acted	Rarely for the harassment itself; sometimes for the working relationship afterwards	Often, where the dispute is about how a lawful decision was communicated

The rest of this article unpacks each column.

Bullying: the definition the law uses

Since 1 January 2014 the Fair Work Act 2009 (Cth) has let a worker apply to the Fair Work Commission for an order to stop bullying.

The definition in s 789FD has three elements, and all three have to be there.

One – An individual or group must behave unreasonably towards the worker.

Two – They must do so repeatedly, and

Three – the behaviour must create a risk to health and safety.

The same words are used by Safe Work Australia and by the state regulators, and from 13 October 2025 by the NSW Industrial Relations Commission for workers the federal scheme does not reach (Industrial Relations Act 1996 (NSW) s 144C), so there is now, in substance, one Australian definition.

An individual or group behaves unreasonably towards the person being targeted, they do it repeatedly and the behaviours cause a risk to health and safety.

The Fair Work Commission’s own guidance says the person behaving unreasonably can be a co-worker, a subordinate, a supervisor, or a customer, client, supplier or visitor.

Case Precedent

Each word carries weight. In Amie Mac v Bank of Queensland [2015] FWC 774, Vice President Hatcher explained that “repeatedly” implies persistent unreasonable behaviour but may refer to a range of behaviours over time. There is no set number of incidents and the conduct does not have to be the same each time.

“Unreasonably” is subjective test: behaviour that a reasonable person, having regard to the circumstances, may consider to be unreasonable.

The “risk to health and safety” means the possibility of danger to health and safety, the risk must be real and not simply conceptual, but it does not have to have come to pass.

The same decision gave a list, at paragraph 99, of the features one would expect to find in a course of repeated unreasonable behaviour that constitutes bullying:

intimidation,
coercion,
threats,
humiliation,
shouting,
sarcasm,
victimisation,
terrorising,
singling-out,
malicious pranks,
physical abuse,
verbal abuse,
emotional abuse,
belittling,
bad faith,
harassment,
conspiracy to harm,
ganging-up,
isolation,
freezing-out,
ostracism,
innuendo,
rumour-mongering,
disrespect,
mobbing,
mocking,
victim-blaming and
discrimination.

It is a useful list for two reasons. It shows how wide the behaviour can be; quiet exclusion is on it next to shouting. And it shows how many of the items need no rank at all. Ganging-up, freezing-out, mobbing and rumour-mongering are things colleagues do to each other.

Three things are not bullying, and the regulators say so in terms.

A single incident of unreasonable behaviour is not bullying, although it may be repeated or escalate into it.

Differences of opinion and disagreements are generally not bullying, they are conflict, and conflict is a hazard to be managed, not a wrong to be remedied.

Reasonable management action carried out in a reasonable manner is not bullying.

Nobody has to intend to bully for behaviour to be bullying.

That is the point most often missed on both sides of a complaint.

The manager who says “I never meant it that way” may be entirely sincere and still be describing a pattern the law treats as bullying.

The worker who says “I know what they’re really doing” may be entirely sincere and still be describing a pattern the law treats as reasonable management.

Reasonable management action: the exclusion, and what it is not

Section 789FD(2) says that behaviour is not bullying if it is reasonable management action carried out in a reasonable manner. The first substantive decision under the jurisdiction, Ms SB [2014] FWC 2104 (Hampton C, 12 May 2014), set out how the Commission reads that, and the principles have held since.

There are three elements:

the behaviour must be management action,
it must have been reasonable to take that action, and
the action must have been carried out in a reasonable manner (at [47]).

The Explanatory Memorandum intended “management action” to be read broadly, to cover the everyday actions a manager takes to direct and control how work is done (at [48]). Whether the action was reasonable is judged objectively, looking at the circumstances that led to it, the circumstances while it was being taken, and its consequences (at [49]).

The question is whether the action was reasonable, not whether it could have been done in a way that was more reasonable:
management actions do not need to be perfect or ideal;
a course of action may still be reasonable even if particular steps in it were not;
the action must be lawful and not irrational, absurd or ridiculous;
any unreasonableness must arise from the actual management action, not from the worker’s perception of it; and
where the action departs from established policies or procedures, the departure has to be assessed for reasonableness in context (at [51]).

The regulators give the ordinary examples:

setting realistic and achievable performance goals, standards and deadlines;
allocating work and directing how it is done;
giving honest feedback, including feedback a person does not want to hear;
managing underperformance;
disciplinary action properly taken; and
restructuring or changing a role.

None of that is bullying, however unwelcome.

There are two tests or limbs, and both matter.

The action must be reasonable, and it must be carried out in a reasonable manner.

A legitimate decision delivered by public humiliation, or a fair process run with shouting and threats, can fail the second limb while passing the first.

Equally, a direction that was delivered impeccably can fail the first limb if the direction itself had no reasonable basis. When people argue about whether something was “just performance management”, they are often arguing about different limbs without realising it.

The same phrase, or something close to it, turns up in two other places, and practitioners should know it when they see it.

Workers compensation legislation in every jurisdiction excludes psychological injury that arises from reasonable management action, under one wording or another.

The NSW reforms that apply to psychological injuries notified from 1 July 2026, for example, exclude a claim where the significant cause of the injury was reasonable management action carried out in a reasonable way, or the worker’s expectation or perception of such action, and give performance appraisal, transfer, demotion, redeployment, misconduct investigations, disciplinary action and redundancy processes as examples.

Those same reforms list bullying, sexual harassment, racial harassment and excessive work demands as “relevant events” that can ground a claim, exclude interpersonal conflict and general work stress in terms, and give the NSW Industrial Relations Commission the job of deciding whether the conduct meets the definition.

The state IR schemes that have adopted a bullying jurisdiction have adopted the exclusion with it. So a dispute about whether something was reasonable management action is rarely just a bullying dispute. It may also be a live compensation question, which is one of the reasons a mediator should not be the one deciding it.

Harassment: a different test altogether

Harassment, in law, is not a more serious form of bullying. It is a different thing with a different test.

The core of it is a protected attribute.

Unwelcome conduct becomes unlawful harassment because of what it is about:

a person’s sex,
race,
disability,
age,
sexual orientation,
gender identity,
religion,
pregnancy,
family responsibilities, or
the other attributes listed in federal and state anti-discrimination law.

Sexual harassment is the most developed category. Under s 28A of the Sex Discrimination Act 1984 (Cth) it is:
an unwelcome sexual advance,
an unwelcome request for sexual favours, or
other unwelcome conduct of a sexual nature,

in circumstances where a reasonable person would have anticipated the possibility that the person harassed would be offended, humiliated or intimidated.

The Respect@Work amendments that commenced on 12 December 2022 lowered the test for harassment on the ground of sex to unwelcome conduct of a demeaning nature (s 28AA), made it unlawful to subject a person to a workplace environment that is hostile on the ground of sex (s 28M), and imposed a positive duty on employers to take reasonable and proportionate measures to eliminate sex discrimination, sexual harassment, sex-based harassment, hostile environments and victimisation (s 47C).

Since 12 December 2023 the Australian Human Rights Commission has had the power to inquire into compliance with that duty and enforce it.

Three differences from bullying matter in practice.

one incident is enough. There is no requirement of repetition. A single remark, a single touch, a single image can be unlawful harassment.
harassment has its own pathways.

Since 6 March 2023 the Fair Work Act has prohibited sexual harassment in connection with work (Part 3-5A, s 527D) and let a person apply to the Fair Work Commission for a stop order or for a dispute to be dealt with, with compensation available. That sits alongside the Australian Human Rights Commission and the state and territory equal opportunity bodies, which take complaints across all the protected attributes, and alongside the courts. The anti-bullying jurisdiction’s limit to constitutionally-covered businesses does not apply to the sexual harassment provisions in the same way.
the employer is on the hook more directly.

An employer is vicariously liable for sexual harassment by its workers unless it took all reasonable steps to prevent it, and the positive duty means the Commission can investigate an employer that has done nothing even where no individual has complained.

Queensland has gone further still: from 1 July 2025 its Anti-Discrimination Act 1991 carries a positive duty across all protected attributes, not just sex (s 131I), together with new prohibitions on harassment on the basis of sex and on hostile work environments (ss 120, 124E).

Victoria’s Equal Opportunity Act 2010 has had a positive duty to eliminate discrimination, sexual harassment and victimisation (s 15) since the Act commenced on 1 August 2011.

One trap is the ordinary meaning of the word. People say “harassment” for any persistent unwanted attention, and the law only partly follows them. Persistent unwanted conduct with no protected attribute behind it is, if repeated and unreasonable, bullying; if it is a one-off, it may be conflict, misconduct under the employer’s own policies, or in serious cases a criminal matter such as stalking or assault.

It is not unlawful harassment unless it connects to an attribute.

A mediator or HR practitioner who hears the word should ask, before doing anything else, what the conduct was about.

When there is no manager in the picture: lateral and upward bullying

Most public discussion of workplace bullying assumes a hierarchy with a manager with authority and a worker without. The law does not.

Safe Work Australia’s guidance says plainly that bullying can occur sideways between workers, downwards from supervisors or managers, and upwards from workers to supervisors or managers. The s 789FD definition refers to “an individual or group of individuals”, not to managers.

That changes the analysis in three ways.

The management-action exclusion disappears. Reasonable management action is a defence available to someone who was taking management action. A colleague with no authority over the work cannot have been managing anyone, so the only question is the three-element one:

was the behaviour repeated,
was it unreasonable, and
did it create a risk to health and safety.

Peer bullying is in that sense simpler to identify and harder to excuse. It is also easier to miss, because it tends to be quiet. The behaviours that colleagues use on each other are the ones at the quiet end of the Amie Mac list:
exclusion from conversations and social events,
withholding of information a person needs to do their job,
rumour,
innuendo,
“jokes”,
the group that goes silent when someone walks in.

Power has to be found somewhere other than rank. Bullying relies on an imbalance of power, and between peers that imbalance comes from numbers, from length of service, from control of information or resources, from physical presence, from social standing in the team, or simply from one person’s greater willingness to use aggression.

Mobbing, where a group turns on one person, is the clearest example. The target may be formally equal to every member of the group and in practice unable to do anything about it. Where a group is involved, the individual acts can look trivial on their own; it is the cumulative pattern, and the fact that it all runs one way, that makes it bullying.

The manager’s duty does not disappear; it changes shape. Where bullying runs between peers, the manager is not the one doing it but is the one responsible for the system in which it happens.

Unresolved interpersonal conflict and workplace incivility are named psychosocial hazards under the WHS regulations in every jurisdiction, as our psychosocial safety article set out, and a manager who knows a pattern is running and does nothing is failing a prevention duty, not merely exercising poor judgment.

In practice the best moment for mediation in a peer dispute is early, before the pattern has hardened into a complaint; the worst is after a complaint has been made and before it has been looked into.

Upward bullying is real and the law has dealt with it. Ms SB itself, the first substantive decision under the jurisdiction, was brought by a team leader who alleged that two of the officers reporting to her had bullied her through unfounded complaints and rumours. The application failed on the evidence, but the Commission said in terms that making vexatious allegations against a worker, spreading rude or inaccurate rumours about them, and conducting an investigation in a grossly unfair manner are all capable of being unreasonable conduct (at [105]). Managers can be ganged up on, undermined, and worn down by a team, and the fact that they hold the formal power does not disqualify them from the protection.

What is not bullying, laterally, is the thing mediators see most:

two colleagues who have fallen out, each of whom gives as good as they get.
Differences of opinion and disagreements are not bullying.

The test we use at intake is directional.
Can either person raise the next issue?
Does the power shift with the topic, or does it sit permanently with one of them?
Is there anyone in the room who cannot say what they want?

Mutual conflict, however hostile, is mediation’s natural territory. One-directional conduct that one person cannot stop is not, or not yet, and not without the employer having done its part first.

When the complaint itself becomes the target

A pattern practitioners see constantly, and the law treats seriously, is what happens after someone complains.

A worker raises bullying or harassment, and is then left off the roster, marked down at review, moved to a worse role, excluded by the team, or quietly managed out. The person who complained is now the one who looks difficult, and the original complaint has been overtaken by the response to it.

That response can be several things at once.

If it is repeated and unreasonable, it is bullying in its own right.

If the original complaint was about discrimination or harassment, subjecting the person to a detriment because they complained is victimisation, which is unlawful under the Sex Discrimination Act (s 94) and under every state and territory anti-discrimination Act, and is itself within the employer’s positive duty.

And whoever the complaint was about, making a complaint or inquiry about your employment is a workplace right under the general protections in Part 3-1 of the Fair Work Act (ss 340 to 342), so treating a person worse because they complained is adverse action, with the burden on the employer to show the complaint was not the reason.

Whistleblower protection is a fourth layer, and the one most often claimed when it does not apply.

Part 9.4AAA of the Corporations Act 2001 (Cth), together with the public interest disclosure legislation that covers the Commonwealth and each state’s public sector, protects a person who discloses misconduct, an improper state of affairs, a breach of the law or a danger to the public, and makes it unlawful to cause or threaten detriment to them for doing so (s 1317AC), with compensation available (s 1317AD).

But the Corporations Act expressly excludes personal work-related grievances from protection (s 1317AADA): a complaint about one’s own employment, a disciplinary decision, or an interpersonal conflict with a colleague is not a protected disclosure, unless it also has significant implications for the organisation beyond the person making it, concerns other misconduct the person has observed, or concerns detriment they have suffered for having made a disclosure.

A person who says “I’m a whistleblower” because they complained about how they were treated usually is not one in law, and telling them so, gently and early, is a kindness. Whistleblowing is a regime of its own, with its own rules about who can disclose, to whom, and about what, and we deal with it in a separate article.

For mediators, the practical point is that a participant who has complained is in a protected position in more than one way, and a mediation that is used, or looks as if it is being used, to pressure them to withdraw or to accept a worse arrangement can itself be the detriment. Where retaliation is alleged, screen for it as you would screen for one-way conduct, and do not let the mediation become the place where the complaint gets settled quietly.

Who hears what

The body that hears a complaint depends on who the employer is and what the conduct was, and this is where cross-border and public sector practitioners get caught.

The Fair Work Commission’s anti-bullying jurisdiction applies only to workers in a constitutionally-covered business:

constitutional corporations,
the Commonwealth and its authorities, and
businesses in the territories.

State government employers such as a public school or hospital are outside it, and so are wholly volunteer associations with no employees, which for many years left state public servants and local government workers in several states with no stop-bullying jurisdiction at all.

New South Wales closed that gap on 13 October 2025, when the Industrial Relations and Other Legislation Amendment (Workplace Protections) Act 2025 (NSW) gave the NSW Industrial Relations Commission power to conciliate and arbitrate stop bullying and sexual harassment disputes for more than 400,000 public sector and local government workers the federal scheme does not cover, using the same definition and the same exclusion, and, for the first time in Australia, with damages of up to $100,000 available (Industrial Relations Act 1996 (NSW) ss 144C, 144G).

Other states handle their public sectors through their own industrial commissions, public sector standards and WHS regulators, and the coverage differs.

Work health and safety regulators in every jurisdiction can act on bullying as a psychosocial hazard regardless of who the employer is, but their focus is the employer’s system, not a remedy for the individual.

Harassment on a protected attribute goes to the Australian Human Rights Commission or the state and territory bodies, and sexual harassment in connection with work can also go to the Fair Work Commission. Serious conduct of any kind may be a crime, and goes to the police.

Workers compensation sits separately again, and after the NSW reforms of July 2026 the eligibility rules for psychological injury differ sharply between jurisdictions. A participant in a workplace mediation may have a compensation claim running at the same time, and what is said about management action in one forum can matter in the other.

None of this is detail a mediator needs to hold in their head. What a mediator needs to hold is that it exists, that it differs by state and by employer, and that the answer to “where does this go?” is a question for the employer and its advisers, not for the mediation.

What this means for mediators

Screen on the behaviour, not the label. Both participants will arrive with a word. The word tells you what each of them believes; it does not tell you what happened.

At intake, get the conduct described concretely:

what was done,
how often,
by whom,
to whom, and
whether it ran one way or both.

Then ask yourself which column it belongs in. If you cannot tell, that is information too.

Feeling bullied by a direction does not make the direction bullying. A participant who describes a performance process as bullying may be describing lawful management action that was handled badly.

That is a real grievance, and mediation about how a decision was communicated and how the relationship goes from here can help a great deal. But do not let the process become a review of whether the decision was right.

Equally, a manager who describes a pattern of monitoring, exclusion and public criticism as performance management may be describing bullying with a label on it.

The distinction is in what a reasonable person would make of the conduct and the manner, not in which party is using which word.

Peer disputes need a different first question. When neither participant has authority over the other, the management-action question is off the table, and the first question is whether this is two-way conflict or one-way conduct. If it is two-way, you are in the right process.

If it is one-way, ask what the employer has done, and whether this mediation is being used instead of the employer doing its part.

Harassment, sexual harassment and anything criminal are not yours to mediate. Where the conduct described connects to a protected attribute or is sexual, assaultive or otherwise potentially criminal, the matter belongs with an investigation, the regulator or the police, and our guidance to workplace mediators is to screen for exactly these factors and refer rather than mediate.

Mediation may have a role later, for the working relationship after the conduct has been dealt with, and only where the person affected chooses it freely.

You are not the investigator. A mediator’s role is to help participants communicate and, where appropriate, reach their own agreement.

It is not to find whether bullying occurred, whether management action was reasonable, or whether harassment happened. Those are findings, they have consequences in other forums, and a mediator who makes them has stepped out of role and into exposure. If the parties need a finding, they need an investigation first.

Keep the record factual. Your intake notes should record what each participant said, in their words, the safeguards you put in place and why, and any referral made. They should not record a conclusion about who was the bully. That protects the participants, protects you if a complaint follows, and stays inside the role you actually hold.

What this means for HR and managers

The prevention duty means the labels are now your problem before they are anyone else’s. A manager who cannot tell a lawful direction from bullying will either over-manage out of fear or under-manage out of avoidance, and both are psychosocial hazards.

Give directions you can defend on both limbs: a reasonable basis, delivered in a reasonable manner, consistent with your own policies. When you depart from a policy, know why and write it down. When a complaint names a colleague rather than a manager, do not treat it as a personality clash to be sent to mediation; look at whether it is one-way, and if it is, act first. Use mediation early for conflict, and for relationships after investigation, and not as a substitute for either an investigation or a decision that is yours to make. And verify that anyone you engage as a mediator is accredited under the Australian Mediator and Dispute Resolution Accreditation Standards and listed on the national register.

Where to go from here

Mediation Institute members provide workplace mediation across Australia and screen every matter for the factors described in this article before agreeing to proceed. We train HR practitioners, managers and internal mediators in conflict resolution and in the distinctions this article draws, and our Certificate of Training and Certificate of Assessment lead to AMDRAS accreditation. For practitioners who want to go deeper, the psychosocial safety article is the companion piece on the employer’s prevention duty, and our Mediation and Communication Skills Manual deals with the practice of workplace mediation in detail.

Frequently asked questions

Is a one-off angry outburst by my manager bullying?

Not on its own. Bullying requires repeated behaviour. A single incident may still breach the employer’s own conduct policies, and if it is repeated it can become bullying. If the outburst connected to a protected attribute, or was sexual, it is a harassment question and one incident is enough.

My manager put me on a performance plan I think is unfair. Is that bullying?

Usually not, if the plan has a reasonable basis and was put in place in a reasonable manner, even if it is not perfect and even if you disagree with it. It can be bullying if there was no reasonable basis for it, if it was used as a pretext, or if the way it was done was humiliating or intimidating. The way it was communicated is a legitimate subject for mediation; whether the plan was right is not.

Can colleagues bully me if none of them is my boss?

Yes. Bullying can run sideways between workers and upwards from workers to a manager. There is no management-action defence between peers, so the only question is whether the behaviour was repeated, unreasonable, and created a risk to your health and safety. Group exclusion, rumour and “freezing out” are recognised forms.

What is the difference between harassment and bullying?

Harassment is unwelcome conduct connected to a protected attribute such as sex, race, disability or age, or unwelcome conduct of a sexual nature. A single incident is enough, and it goes to the human rights and equal opportunity bodies or the Fair Work Commission’s sexual harassment jurisdiction. Bullying is repeated unreasonable behaviour creating a risk to health and safety, with no attribute required, and it goes to the anti-bullying jurisdictions and the WHS regulators.

Does it matter whether the person meant to bully or harass me?

No. Both tests are objective. Behaviour is unreasonable if a reasonable person would see it that way, and conduct is harassment if a reasonable person would anticipate it could offend, humiliate or intimidate.

I complained about my manager and now I’m being frozen out. Is that bullying?

It may be, if it is repeated and unreasonable. It may also be victimisation under discrimination law if your complaint was about harassment or discrimination, and adverse action under the Fair Work Act’s general protections, because making a complaint about your employment is a workplace right. It is usually not a whistleblower matter unless your complaint exposed misconduct beyond your own treatment. Get advice early; these protections have time limits.

Should bullying go to mediation?

Sometimes, and not first. Two-way conflict between colleagues is mediation’s natural territory and the earlier the better. One-way conduct that one person cannot stop needs the employer to act first, and mediation may then help repair the working relationship. Harassment, sexual harassment and anything potentially criminal should be investigated or reported, not mediated.

Bullying, Harassment or Reasonable Management Action? Telling Them Apart at Work