Dealing with Stress

Stress-related absence is on the rise and it’s giving employers grief. Yet recent court rulings seem to have given employers more leeway and employees less scope for compensation when it comes stress. So is it easier for staff to bring stress claims against their employers nowadays? Here, the facts, figures and background of the stress situation are laid out, alongside recent coverage in Personnel Today and Employers’ Law, to give an indication of whether or not it is a chronic case.

“Stress can have a serious detrimental effect on the individual, but the employer is also at legal risk if it fails to take action immediately” Judith Harris, Professional support lawyer, Addleshaw Goddard

Stress facts

  • Only 3% of directors believe that their company has a policy robust enough to deal with stress and mental illness. Source: The Shaw Trust
  • 3/4 of executives say that stress adversely affects their health, happiness and home life as well as their performance at work. Source: CIPD
  • The 21st century is likely to see stress become the most dangerous risk to business.

Source: Health and Safety Executive

Case law

A duty to soothe

In Sutherland v Hatton, the Court of Appeal made an important ruling – setting out guidelines for employers about their obligation to reduce stress in the workplace. An employer is entitled to assume that an employee is able to cope with the normal pressures of the role unless it is aware of something special about either the job or the individual concerned, which would lead it to consider there was a risk to that person’s psychiatric health.

At what cost?

Although teacher Alan Barber was successful in receiving a £72,547 payout (Barber v Somerset County Council) after ill-treatment upon his return to work, and although it was ruled that employers should take the initiative to tackle stress, the court ruled that the guidelines in the Sutherland case could not be given any statutory force.

Watching workload

In Intel Corporation (UK) Limited v Daw, it was ruled that, although that it would have been impossible for the company to foresee the claimant’s illness, this was irrelevant, given that her workload had been increased despite her protests. This was found to be the main cause of Mrs Daw’s stress, and is a good indicator of how important prioritisation of workloads can be for employers.

Going the extra mile

The recent court ruling McAdie v Royal Bank of Scotland (see page 7) suggests that, even if an employer directly causes a stress-related incapacity, it cannot be culpable if acting ‘reasonably’ within the given circumstances. In McAdie, the tribunal held that, if an employer is directly responsible for stress leading to dismissal or resignation, it should ‘go the extra mile in finding alternative employment for such an employee’.

No breach of duty of care

The High Court ruled in favour of employers recently in Deadman v Bristol City Council. When a company’s disciplinary action instigated stress for an employee, the court ruled that the employer had not breached its duty of care. There was no foreseeable risk of ill-health resulting from the proceedings.

On the up

  • 40% of organisations report an increase in stress-related absence in the past 12 months. Source: CIPD
  • £659 the average cost of absence per annum, as opposed to £598 last year. Source: CIPD
  • 1/5 of UK workers claim to find their job either ‘stressful’ or ‘extremely stressful’. Source: Norton Rose

Stress is defined by the HSE as ‘the adverse reaction people have to excessive pressures or other types of demand placed on them’


Q What are employers legally expected to do to reduce stress in the workplace?

Q If stress is not managed properly, what type of claims may be brought?

  • Constructive dismissal – an employer has an implied duty to provide an employee with a safe environment in which to work. If an employer fails to do so, they could be in breach of their implied duty.
  • Disability discrimination – an employer has an obligation to make reasonable adjustments to an employee’s role if they are deemed to be ‘disabled’. Failure to do so will be in contravention of the provision of the Disability Discrimination Act and would result in the employer being liable for damages.

Q Are employers doing enough to tackle stress?

Employers are getting better at dealing with stress caused by work. Well-publicised legal claims have helped to raise awareness further and many employers have begun to put steps in place that, even if they don’t actually deal with the problem, go some way to protect them from claims. But some workplaces are always going to be more stressful than others and certain employers are prepared to live with the legal risks that this brings. Many employers do not carry out risk assessments often enough. When tackling stress, this should be an analysis of the risk to an employee’s psychiatric health caused by stress. This would help them identify and target the probability and the origins of stress.

Q Where are employers going wrong?

Not identifying a problem at all – this is becoming less common but it still happens. If there is a general culture of ignorance towards stress, or that people who report being stressed are seen as weak or simply ‘trying it on’, then there is certainly a higher likelihood of stress within that organisation. This is often compounded by employers who have no open forms of communication for staff to raise issues around stress-related matters or employers who fail to spot the signs of stress. Ignoring the problem simply isn’t an option.

Not dealing with it effectively – when a problem is recognised, there is a short-term response where HR, solicitors or managers spring into action, plans are created and promises are made. However, these are often not properly followed through so the problem can turn into a claim or a serious employee relations issue. Even where an employer realises that it needs to monitor an employee who is suffering from or complaining about stress, the monitoring often falls by the wayside, is superficial, or doesn’t happen at all because staff change, people are too busy or get distracted. Employers all too often wrongly perceive someone’s failure in a task as being down to a lack of knowledge or experience, or poor time management, rather than them genuinely having too much on their plate.

Q Is it easier now for staff to bring stress claims?

Yes and no. Changes to the Disability Discrimination Act 1995 that were made a couple years ago have meant that something as medically imprecise as stress can amount to a disability, so it is much easier to bring a disability discrimination claim based on stress. However, one area where it has become more difficult to bring a claim is in personal injury cases, where the courts have taken a fairly robust line and set a high threshold for staff to get over to succeed.

Top tips

Employers should:

  • Be trained to spot the signs of stress, including behavioural changes, performance levels and continual absence
  • Initiate prompt discussion when a stress-related problem is discovered
  • Give employees a chance to improve in their role before dismissal, and time for an explanation of any drop in terms of productivity
  • Consult with employees on how you can assist with stress-related illness
  • Prioritise workloads and monitor working hours
  • Set up helplines to allow staff to talk about their occupational worries (although Intel v Daw demonstrates that a helpline alone is not enough)

    Create a stress policy, so staff know what they can do if they feel stressed (see Policy clinic page 24)
  • Conduct return-to-work interviews to assess an employee’s mental health after a period of stress-related sick leave
  • Conduct stress audits or surveys, recording how stressed each employee is feeling.

Employers all too often wrongly perceive someone’s failure in a task as being down to a lack of knowledge or experience


Stress takes a multitude of forms and affects different people in different ways. What might be sufficient to push one employee over the edge might not concern another, and conversely the precautions that an employer takes to safeguard the mental health of its staff may be sufficient for the great majority but not for a few.

There are undoubtedly some frightful abuses by employers, but equally undeniably many stress grievances are brought by people who are just in the wrong job and either do not recognise it or have realised it but still expect their employer to pay them to go.

Unless they cater for the very lowest denominator in staff terms (a suicidally expensive process), therefore, employers are always going to face stress allegations from those unable or unwilling to differentiate between harassment and performance management or between bullying and ordinary pressure to perform. Increased access to legal representation through contingency fee arrangements makes it ever easier for these claims to be threatened and brought.

Stemming the tide of such complaints is not easy for employers. Most decided cases go against the employee, but the number of such grievances that continue to be made indicates that employees feel it worth doing nonetheless.

That, in turn, suggests that a sufficient number of such cases are settled (regardless of the statistically probable outcome at trial) that they still think it worth making a complaint.

Perhaps if employers took a more resilient line in the handling of stress grievances and did not resort so quickly to the severance offer, fewer such grievances would ultimately be made.

The same might be true if sick pay rules provided that payment would not be made for stress and similar absences arising immediately following a summons to a disciplinary or other performance or conduct-related meeting.

This all sounds most uncharitable, but to be blunt our experience shows that – albeit at some small risk in a minority of cases – the curative/restorative properties of not being paid are significant.

At the very least, this tactic may force the employee into a dialogue about their position, avoid the frustrating radio silence of the “I am too stressed to deal with my stress” variety, and give the employer a proper chance to address the problem before it becomes irretrievable.

David Whincup
Partner and head of human capital,

On the up

  • 44% of workers claim to be under excessive pressure at work twice a week or more. Source: CIPD
  • £9bn could be the cost to UK businesses per annum of stress-related illnesses. Source: The Shaw Trust
  • 30.9 working days lost per case of stress-related illness. Source: Health and Safety Executive

Top causes of stress-related illness

  • Workload – by a large margin, this was identified in the Chartered Institute of Personnel and Development’s (CIPD) Annual Survey Report 2007 as the main cause of stress in the workplace.
  • Management style – instances of bullying, intimidation and a failure to spot the tell-tale signs of a chronic breakdown have lead to businesses’ recognition of a need for greater training in this area.
  • Organisational change – fear of an impending call for a business to restructure is most likely to trouble employees of non-profit and public service organisations.
  • Working hours – although this goes hand-in-hand with an increased workload.

Compiled by Daniel Howell and Dawn Spalding


Norton Rose
Addleshaw Goddard
Irwin Mitchell
Davies Blank Furniss
Shepherd and Wedderburn

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