Wound up

Occupational stress is on the increase; its consequences can be devastating for the individual concerned, and more employees are looking to litigate. Solicitors have been cautious about accepting instructions because such claims can be intellectually and emotionally demanding, the investigative cost is high and the success rate is low (hence the 100 per cent fixed success fee for conditional fee agreements in stress claims under CPR 44.24). However, many claims do succeed.

Winnable claims

'Second breakdown' cases

Where the employee has already suffered a breakdown resulting from stress or bullying at work, but either the employer makes no real effort to manage the subsequent return to work at all (Walker v Northumberland [1995] 1 All ER 737) or fails to allocate sufficient resources to it (MG v North Devon NHS PCT [2006] EWHC 850 (QB)), there are likely to be good prospects of success if the employee suffers a second breakdown. The employee is likely to establish both breach and also, crucially, foreseeability: the employer must have been aware of the employee's vulnerability because of the earlier breakdown. However, it is still essential to spell out what the employer has failed to do and its effect. Often the employee will be reluctant to return to the employment where the original psychiatric injury was sustained. If the return is grudging and the employer and colleagues have made reasonable efforts to facilitate a return to work, the claim will fail as in Vahidi v Fairstead House School Trust Ltd [2005] EWCA Civ 765.

'First breakdown' cases

Where the employee has a pre-existing vulnerability to psychiatric injury which is known to the employer, but which falls short of a stress-related breakdown, it is harder for the employee to establish that any breach foreseeably caused injury (Hatton v Sutherland [2002] EWCA Civ 76). More recently, in the context of large corporations, the courts have been more prepared to find that injury was foreseeable. In Daw v Intel Corp (UK) Ltd [2007] EWCA Civ 70, the claimant had in a long series of memoranda drawn her superiors' attention to the stress that overwork and confused internal communication lines were causing her. The Court of Appeal held that 'indications of impending harm to health were plain enough for the appellants to realise that immediate action was required'.

In Dickens v O2 [2008] EWCA Civ 1144, the judge found that the employer should have been aware that the employee was 'palpably under extreme stress' and about to 'crack up'. The Court of Appeal in dismissing the employer's appeal felt that this was 'a clear indication of impending illness'.

However, establishing liability remains problematic where instead the employee relies on the employer's failure to assess risk under the Management of Health and Safety at Work Regulations 1999 (SI 1999/3242) or on a breach of the Working Time Regulations 1998 (SI 1998/1833). Sayers v Cambridgeshire County Council [2006] EWHC 2029 (QB) held that non-compliance with the Working Time Regulations does not in itself establish a cause of action for breach of statutory duty. In Paterson v Surrey Police Authority [2008] EWHC 2693 (QB) no formal risk assessments were carried out in breach of the Management Regulations. Mr Paterson argued that he suffered a nervous breakdown caused by excessive hours and irregular call outs night and day which would have been prevented if the risks had been properly assessed. The judge was not impressed, dismissing the claim and declining to adopt a purposive interpretation to the Management Regulations.

Bullying cases

The House of Lords in Majrowski v Guy's and St Thomas' NHS Trust [2006] UKHL 34 held that an employer could be vicariously liable for harassment carried out by its employee contrary to the Protection from Harassment Act 1997 (PFHA). But in Conn v Sunderland [2007] EWCA Civ 1492, the Court of Appeal held that harassment under the PFHA had to be serious enough to justify 'a criminal sanction'. The judicial mood is such that it will require at least two separate serious incidents probably either involving near-violent conduct or a well-evidenced long and deliberate campaign for the claim to succeed under the PFHA.

However, at common law, vicarious liability now encompasses almost all acts closely connected to the employment, even if expressly disapproved of by the employer (for instance, the sexual abuse committed in Lister v Hesley Hall Ltd [2001] UKHL 22). Claims against the employer on the basis of direct liability at common law '“ for example failing to operate systems to prevent or detect bullying '“ may well fail because it will be difficult to establish that psychiatric injury to the employee was foreseeable. But where there is a sustained campaign of bullying, it will be difficult for the perpetrator '“ and the employer who is vicariously liable for it '“ to argue that this was not a breach of duty and that he was not reasonably aware that the consequences may include psychiatric injury.

Winning the winnable claims

Credibility

The employee must be a credible witness. In Ellis v Eagle Place Services Ltd (unreported, QBD Henriques J LTL 7/10/2002) a solicitor alleged that she had suffered a psychiatric injury as the result of bullying by a partner. The judge in dismissing her claim formed an adverse view of her credibility after he accepted evidence about her 'concocting self-certificates' and mis-using firm notepaper. He did not conclude that she must have been deliberately lying. She genuinely believed that she was ill as a result of bullying, but this may have been a result of her psychiatric condition.

Focus

While the letter of claim must be sufficiently detailed so as to enable the employer to understand the case, there is a danger of including an un-evidenced allegation which the employer can subsequently demonstrate to be untrue or inaccurate. Conversely, it is also essential to ensure that all of the important causes of action are set out in the letter of claim. The employee is not restricted to pleading the matters set out in the letter of claim. However, causation is such a significant issue in most stress and bullying cases that a judge might look askance at a subsequent allegation that a particular breach caused serious psychiatric injury when it was not even mentioned in the letter of claim.

GP records

The underlying reasons given for the stress-related illness in the GP records and any other contributory factors, such as marital breakdown or bereavement, must be carefully examined by the lawyer. The GP records must be reviewed in their entirety, not just in relation to the employee's present condition. Information provided by the GP to occupational health doctors, health insurers and the Benefits Agency enquiries is informative as it shows the GP's assessment of the employee when presenting a view to a third party that the GP may have to justify.

Employment documents

The employee will usually have some, but not all, of the documents from his employment. These documents may produce a partial view of the situation. The employee, or a lawyer on his behalf, can make a 'subject access request' under the Data Protection Act 1998 for a complete copy of 'personal data' (documents held by the employer relating to him). In any event, the employer should be requested to confirm that all documents will be preserved. In Green v DB Group Services (UK) Ltd [2006] EWHC 1898 (QB) the employee's solicitors made such a request, but some documents were still destroyed. The judge was distinctly unimpressed with the employer.

Independent witnesses

Independent witness evidence is usually crucial as it is a more objective view of how the workplace affected the employee. Without it there is a great danger that a judge might conclude that the reality was much less serious than the employee alleged. In many cases the employer will call evidence from numerous members of the management team. There is a danger of the employee appearing to be outnumbered. Even if the direct knowledge of some of the employer's witnesses is rather limited, or the witnesses are suspected of sticking together for business reasons, the judge will be reluctant to find that they are lying or are mistaken in the absence of corroborative evidence from the employee's work colleagues.

Experts

It will be essential to adduce evidence from a consultant psychiatrist to establish the employee's present condition and prognosis. The psychiatrist must include a diagnosis of a recognised psychiatric condition in accordance with the recognised international diagnostic criteria. The expert should be asked to report separately on the employee's condition and prognosis and on causation. As well as reporting on how the psychiatric injury can be linked to the pleaded breaches of duty, the expert must deal with issues of acceleration or apportionment of damage. An expert who has practical experience of treating illness caused by stress at work but who also understands these issues for the medico-legal report is invaluable.

Increasing numbers

Stress is now the second biggest cause of workplace absence. The annual research by the Work Life Balance Centre and Coventry University has revealed a rise in the number of people reporting chronic fatigue, sleeplessness, irritability and headaches as a result of work-related stress. Although just over a third of respondents reported having received effective support from their employers, a quarter found that support was ineffective and 7.9 per cent found their employer's measures actually to be counter-productive.

Work-related stress levels are of course increasing rapidly as a direct result of the current crisis in the financial markets '“ we are already seeing the emergence of substantial compensation claims from City workers. Employers should be concerned that the recession is likely to see a rise in stress-related claims in the workplace. There is a legal duty to assess and to take steps to minimise risk; and the best solution for both the individual and the business is for employers to take appropriate steps to reduce work-related stress. In February 2009 the Health & Safety Executive launched a new website to assist (www.hse.gov.uk/stress).

The courts are growing increasingly impatient at the failure, particularly of large employers, to take appropriate steps to deal with occupational stress. There are winnable claims where significant compensation can be recovered for seriously injured employees.