When your own expectation of management action excludes your claim
The exclusion has three limbs, not one. The second, a worker's own expectation or perception of reasonable management action, surprises most readers.
s 32(5) has three limbs. The first, covered in the previous guide, is reasonable management action actually taken. The second is different, and less obvious: paragraph (b) excludes a psychiatric or psychological disorder arising out of "the worker's expectation or perception of reasonable management action being taken against the worker." This limb can exclude a claim even where nothing has actually happened yet, if the disorder arose from the worker's own belief or anticipation that reasonable management action was coming.
The third limb: distress from the claims process itself
Paragraph (c) excludes a psychiatric or psychological disorder arising from "action by the Regulator or an insurer in connection with the worker's application for compensation." This means distress caused specifically by how the Regulator or the insurer handled the compensation claim itself, as distinct from the original workplace injury, sits outside what the Act compensates.
What this means in practice
Together, the three limbs mean a psychological injury claim can be excluded because of something an employer actually did, because of a worker's own anticipation of it, or because of how the claim itself was handled afterward. None of this changes whether the underlying distress is real. It changes whether the Act treats it as a compensable injury. If your situation involves any of these three limbs, it is worth reading the reasonable management action guide alongside this one before assuming either that a claim is hopeless or that it is straightforward.