UK: Court of Appeal Stress Ruling

Last Updated: 13 February 2002

Last week, in the case of Hatton v Sutherland, the Court of Appeal laid down guidelines for personal injury claims arising from stress at work. The case is of interest to all employers, not least because the number of union-backed work-related stress claims has increased from 516 in 1999 to 6,428 in 2000 (according to the TUC).

The decision does not change the law in this area, but it does provide some useful clarification of what the employer's duty to take reasonable care in relation to mental health actually means in practice. Note, however, that leave is being sought to appeal the case to the House of Lords.

It has always been the case that employees bringing such claims have to show that (i) psychiatric injury to that individual was reasonably foreseeable, (ii) the employer breached its duty to take reasonable care, and (iii) the breach caused (or played a material part in causing) the employee to develop a medically recognised psychiatric illness (rather than just distress).

(i) Foreseeability

The Court of Appeal set out the following guidance on when an employer can reasonably be expected to foresee the risk to an individual's health:

  • Unless an employer knows of a particular problem or vulnerability, it will usually be entitled to assume the employee is up to the normal pressures of the job. There are no jobs which should be regarded as so intrinsically stressful that harm to mental health is always foreseeable – not least because some individuals thrive on the most stressful of jobs.
  • Whether harm is foreseeable will depend on the individual and job concerned. The indications of harm "must be plain enough for any reasonable employer to realise that he should do something about it".
  • Employers will need to be more alert to picking up signs of impending harm where there is clear evidence of unreasonable pressure or bullying, or of an employee in an intellectual or emotionally demanding job being overworked (such evidence could be in the form of harm to, or abnormally high absence levels in, other staff carrying out the same work).
  • Central to the issue will be whether there were warning signs of impending harm to health from the employee. These could take the form of complaints from the employee or abnormally high levels of absence (in terms of frequency or duration).
  • If an employee conceals his condition, an employer should be entitled to take his employee's statements at face value and is not required to make "searching or intrusive enquiries". Where an employee has been off sick, the fact that a GP's certificate has expired should not be taken as conclusive that the employee is fit to return to the same workload but, if the employee returns and resumes his workload without complaint, that will usually amount to an implied statement that he believes himself fit to do so (in the absence of evidence to the contrary).

(ii) Breach of duty

Once harm is foreseeable, what steps must an employer take? The Court confirmed that employers need only to take such steps as are reasonable and are likely to do some good.

Prior case law has established that what is reasonable depends on the magnitude of the risk of harm, the gravity of the harm that may occur, the costs and practicability of preventing it, and the justifications for running the risk. Employers are entitled to take into account the interests of other employees and the need to treat them fairly, for example, in reallocating duties.

In view of the interests that need to be balanced, the Court of Appeal here considered that employers who provide confidential counselling services are unlikely to be found in breach of the duty, except where totally unreasonable demands are being placed on the employee in circumstances where the risk of harm is clear.

If the only reasonable and effective step would be to remove the employee from his duties altogether by dismissal or demotion, but the employee wishes to continue in the job, the employer will not be liable for allowing him to continue in the job.

(iii) Causation

The employee must show that the employer's breach of duty made a material contribution to the harm suffered.

If the employer can show that the personal injury is caused partly by stress in other areas of the employee's life, the employer should only be required to pay for that proportion of the injury attributable to his breaches of duty.

Conclusions – practical steps

The main message for employees "suffering from stress" is that they must not suffer in silence and then expect to win their claim – they must get their complaints on record and make it clear to the employer that there is a risk of damage to their health unless something is done.

Employers must take such warnings seriously and carefully consider what reasonable and effective steps could be taken. Employers may wish to consider providing confidential counselling services available to all employees, given the Court's comments that in most cases this will satisfy the employer's obligation. However, even those employers who do provide such services should still monitor the level of demands being placed on employees and, if excessive, consider whether other steps should be taken to reduce those demands. Employers who do not normally provide confidential counselling services must consider whether a one-off arrangement should be made or whether there are other steps that could be taken (examples could include reallocation of work, mentoring schemes, additional training or supervision etc).

Employers must also look out for signs of impending mental harm even where they have not received any formal complaints from employees. Employers have a duty under health and safety regulations to carry out risk assessments, including the risk of mental injury. Such assessments should therefore be carried out, combined with monitoring of sickness absence levels (with a view to establishing whether any particular types of jobs, or particular individuals, have higher levels of absence). Training for staff as to the causes and signs of stress-related harm would also be prudent. Managers should be aware that stress claims commonly involve employees who have had additional or different duties given to them due to a reorganisation, staff shortage, or promotion, without sufficient training or support being provided. These measures should enable managers to pick up on any signs early enough to satisfy the "reasonable employer" test.

Employers may also want to consider using self-certification sickness absence forms to obtain an employee's written confirmation on their return to work that they consider themselves fit to resume their previous workload.

Other stress claims

Of course, even if an employee's personal injury claim fails, in some circumstances he may still be able to claim constructive unfair dismissal or disability discrimination. The former would not require the employee to have developed a psychiatric injury, simply to show that the employer's conduct was such as to breach the implied duty of trust and confidence. However, the compensatory award is capped at Ł52,600 and there is some debate as to whether it could include damages for injury to feelings/mental harm. Another possibility is a claim under the Disability Discrimination Act, provided the employee can satisfy the definition of "disabled" (which requires a medical recognised psychiatric illness likely to last for 12 months). In such a case, the employer has a duty not to treat the employee less favourably and to make reasonable adjustments. Compensation for discrimination is not capped and can include damages for personal injury. The measures set out above should also assist in defending such claims, but clearly great care needs to be taken in dealing with the stressed employee!

General information on work-related stress is available on the Health and Safety Executive website (www.hse.gov.uk/pubns/stresspk.htm).

"© Herbert Smith 2002

The content of this article does not constitute legal advice and should not be relied on as such. Specific advice should be sought about your specific circumstances.

For more information on this or other Herbert Smith publications, please email us."

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