For my first post on Mental Health Awareness Week I thought it best to take a look at the legal risks to businesses of not protecting their employees from mental illnesses such as stress and anxiety disorders.

Each year in the UK around 40% of sick days are attributed to stress, anxiety or depression. Between 2011 and 2012 this would equate to approximately 428,000 days of absence. According to research conducted by the Health Service Executive (HSE) this is at a cost of over £26 billion to UK economy. The research also suggested that one in five employees consider themselves to be suffering from stress as a result of occupational factors.

The UK’s largest trade union, UNISON, also conducted a study into work-related stress among council workers. Its research found that 87% of workers struggle to cope with increasing stress and pressure at work. Work-related stress puts pressure on all aspects of a person’s life, with 70% of those questioned stating that the pressure at work affects their personal lives.

The law regarding compensation for mental illness in relation to stress, depression and anxiety caused by the workplace environment has developed slowly over the last two decades. It has now been refined to the point where it is necessary to prove that the employer was aware, or should with reasonable diligence have been aware, of a claimants’ susceptibility to mental illness resulting from the pressure of work. The employer must also have failed to adequately protect that employee from danger by ensuring that they remained in the same situation without taking steps to reduce the risk to health. The failure by an employer to take care of the health and safety of their employee can result in a successful mental illness compensation claim.

There are several cases of interest that show the development of the law across the UK. In Alcock v Chief Constable of South Yorkshire (1991), the House of Lords emphasised the general requirement that psychiatric illness should come about by shock. In Sion v Hampstead Health Authority [1994] 5 Med LR 170, the Court of Appeal entertained an allegation of stress-related illness suffered by a father who had mounted a two-week-long vigil at the hospital bed of his dying son. In that case the court declined to hold the defendant health authority under a duty of care to the father as on the facts pleaded his illness had not been caused by a single shocking event.

The first case in which an employer was found liable for its employee’s work-related stress was Walker v Northumberland County Council [1995] 1 All ER 737. After the High Court’s ruling in his case, the claimant accepted £175,000 from the defendant council in an out-of-court settlement.

Hatton v Sutherland [2002] EWCA Civ 76, [2002] A All ER1, was effectively a test case to determine the nature of the legal duty imposed on employers in respect of psychiatric illness through stress at work, and the circumstances in which a court may find that it was reasonably foreseeable to an employer that his employee might suffer such illness and that the employer was in breach of his duty.

In the Scottish case Rorrison vWest Lothian College and Lothian Regional Council, allegations that the claimant suffered psychological damage in the form of severe anxiety and depression, resulting in them feeling dizzy and unwell, were held to be irrelevant. Lord Reed – now a Justice of the Supreme Court of the United Kingdom – said:

“The action being based on negligence, the pursuer can only recover if she has sustained psychiatric illness in the form of a recognised psychiatric illness … there must be a recognised psychiatric illness, not mere depression or anxiety … the pursuer’s pleadings must give fair notice that it is her intention to lead evidence that she has suffered a recognised psychiatric disorder, and they should specify what disorder that is … There is no suggestion [in the present case] that she has ever been diagnosed by a psychiatrist as suffering from a recognised psychiatric disorder, and there is no suggestion that her condition is recognised by any psychiatrist or body of psychiatric opinion as constituting a psychiatric disorder. It follows that an action based on negligence cannot succeed.”

In Cross v Highlands and Islands Development Board, the late Lord MacFadyen, emphasised that stress is not itself an illness, even though it may be the cause of illness. The fact that the claimant felt themselves to be under stress, and that the stress made them feel unwell, is not enough for a claim of psychiatric harm to be successful.

Compensation payable by negligent employers can be substantial. In an unreported case dealt with by Brachers Law, the chronic anxiety and depression suffered by a surveyor, with a previous history of psychiatric injury lead to the end of her career and she obtained compensation of £300,000. With that in mind, and as with most employment issues, prevention is key. Successful stress management training within organisations is important so that the signs of stress and anxiety related conditions can be noticed before they become a bigger problem. It is also important the members of staff are informed that they should contact their managers if and when they begin to feel the affects of mental illness and thus give their employer the opportunity to implement necessary changes.

As can be seen the cost of mental illness can be huge on businesses. Not only must they contend with staff absences brought on by crippling symptoms – which can lead to a loss of productivity – they may also end up paying large sums in compensation when they fail to implement reasonable changes to working conditions. The Mental Health Foundation provides training that they say can help to effectively manage situations involving individuals who are experiencing mental distress. To find out more you can visit their website here.

The main takeaway from this post that I would give is that both employees and employers should not be afraid to talk about mental illness openly and honestly. In the long run it may well save them both a lot of time, money and pain.

Disclaimer: The views expressed are those of the writer and this article does not constitute legal advice.