Picture this: Steve is 49 and is production manager for a manufacturing company. It's late Friday afternoon and the week has been a nightmare. His assistant manager has been off ill for the second successive week and his own boss is on holiday.

On Thursday a computer failure caused the loss of half a day's production. Earlier today, he was been warned by the managing director that unless production improves next week, there will be trouble. The day ends and he is relieved to be on the way home. Traffic is a nightmare and he arrives home late. He argues with his wife and shouts at the children. Enough is enough: he decides he needs a drink and goes to the pub.

By Sunday afternoon, he is feeling a bit better but then he begins to think about the week ahead. What if it's as bad as the last week? He begins to feel in a panic and feels himself sweating. He feels sick and can feel palpitations coming on. Steve hopes this is not a repeat of six months ago when he had a month off after a nervous breakdown.

Q: Is he stressed?
A: You bet!

Q: Will he perform well in his job next week?
A: Probably not, given his present state of mind.

Q: If he has another breakdown, will he have a claim against his employers? What could be done to help Steve and avoid a claim being made?
We all suffer from stress. We know some stress is good to create adrenaline and make us work well. The problem is that we are all different and individuals react differently to outside pressures. Stress is more to do with an individual's reaction to outside pressure than the actual pressures themselves. But stress is one of the main reasons for employee absence from work. The department of health estimates that stress related illness costs industry over £5m a year. An unhappy employee is unlikely to work to his or her full potential. Not least of all, the law recognises an employer's liability to compensate an employee where a stress related injury is the employer's fault.

Consider the following examples:
The landmark decision of Walker v Northumberland county council (November 1994): a 54-year-old senior social worker suffered two nervous breakdowns as a result of stress at work, largely in connection with spiralling child abuse cases. The local authority were held liable for the second breakdown. Compensation was £175,000. With legal costs, the total cost to the council and its insurers was over £300,000.

Lancaster v Birmingham city council (July 1999): the Council admitted liability for a claim by a 46-year-old draughtsperson who was transferred from the drawing department to the housing department. It was claimed that she was not trained and her complaints were not heeded. The Court had awarded her £67,000.

In January of this year, a 42-year-old man was awarded £200,000 when he suffered a breakdown caused by bullying, verbal abuse and harassment by his line manager.

What should an employer do?
First recognise that work-related stress is a real issue and then analyse the risk to employees through a risk assessment. Listen to complaints and don't brush issues under the carpet. If necessary, have an occupational health expert consider whether an employee is fit for work where, for example, a member of staff has been absent through stress and returns to work. Is help needed? What does the employee say about his or her ability to do the job on return? Is a phased return to work needed?

In Steve's case, the following might help the employer avoid causing him a stress related injury, and save hundreds of thousands of pounds by preventing a claim:

  • When he returned to work after his earlier breakdown:

    An occupational health expert should have considered Steve's fitness for his work and whether he needs assistance. Talk to Steve about these issues. Make a record of the discussion in case a claim is ever made. Monitor Steve's progress to ensure he is managing.

  • When the assistant manager went off ill, consider and discuss with Steve whether he needed any help. Provide assistance.
  • Avoid telling Steve there will be trouble if production does not improve. To some, this could be a helpful incentive but in light of Steve's previous nervous problems, it will it be the proverbial straw that breaks the camel's back? Instead, think about talking to Steve about how things can be improved and whether he needs help.

    Awareness of rights
    After the Walker case, many predicted a flood of stress claims. In reality, it was more of a trickle. In the past year or so, however, there has been a noticeable increase in stress claims. People are more aware of their rights. Recent figures show that trade unions brought 783 claims against employers for stress related illness last year, an increase of 70% on the past 12 months.

  • Paul Hughes is a partner with Crutes Solicitors specialising in civil litigation, with a special interest in stress claims.