Companies may be prosecuted and fined for not dealing with stress in the workplace, law firm Eversheds has warned.

As the Health and Safety Executive (HSE) estimates that employers lose £3.7bn per year due to stress-induced absence, companies need to act quickly or face possible prosecution.

Employment lawyer Ed Farrelly of Eversheds law firm said: "The decision by the HSE to serve an Improvement Notice on an NHS trust is a stark warning to all businesses.

"It comes on the back of guidelines announced by the HSE earlier this year stating businesses have to prove that 85% of employees can cope with their jobs and 85% feel they have the back up they need."

Mr Farrelly also advised that employers have a stress policy and carry our regular 'stress audits' on their staff.