Stress caused by disciplinary investigation

In the past, stress claims have commonly arisen in the context of excessive workloads, long working hours and allegations of bullying and harassment. In the Deadman case, the Court of Appeal considered liability for the less usual situation in which a stress-related illness was allegedly caused by the manner in which an employer had conducted a disciplinary investigation.

Mr Deadman had worked for the Council for over 30 years when a colleague made an allegation of sexual harassment against him. The Council appointed an investigatory panel under its formal procedures, which required harassment complaints to be dealt with “sensitively”.

Mr Deadman complained about the panel and whilst its findings were set aside because it consisted of two rather than three members, it was determined that the matter should be reinvestigated. A letter informing Mr Deadman about this was left on his desk. Mr Deadman was subsequently signed off work with depression and did not return. He brought a personal injury claim against the Council for breaches of its duty of care and of the terms of his employment contract.

The issue in Mr Deadman’s case was the extent to which the Council was responsible for his illness, given the manner of the investigation.

The Court of Appeal held that:

		the general statement in the harassment policy to the effect that the Council would deal with complaints of harassment sensitively was not suitable for incorporation into Mr Deadman’s employment contract;
		although it was a breach of contract for the investigatory panel to be convened with two, not three, members, it was not reasonably foreseeable that, as a result, Mr Deadman would suffer psychiatric harm, and any damage flowing from this breach was therefore too remote to be recoverable; and
		to all appearances, Mr Deadman was in robust good health and there was nothing to alert the Council that he was liable to be seriously adversely affected by the ordinary operation of its procedure for investigating harassment complaints.

Dismissing for stress-related illness

In the McAdie case, the claimant raised a grievance concerning her transfer from one branch of the Royal Bank of Scotland to another. She alleged that her manager dealt with her concerns in an authoritarian and unsympathetic way. She went off sick with stress and raised a further grievance regarding her manager’s conduct.

The grievance was not upheld and Mrs McAdie invoked the next stage of the grievance procedure. Her complaints were rejected and she was offered a return to work in a different role and at her choice of location.

Mrs McAdie did not return and the bank applied its long-term sickness procedure. Medical evidence established that she was unfit for work. Mrs McAdie pursued her grievance and asked to leave the bank with compensation. She said she would have returned to work had she received an apology at the outset. Her employment was then terminated on 12 weeks’ notice.

Lack of capability on the grounds of long-term ill health is a potentially fair reason for dismissal. The issue in Mrs McAdie’s case was whether it was reasonable for the bank to dismiss her on capability grounds when the bank itself seemed to be responsible for her ill health because of the way in which it had dealt with her grievance.

The Court of Appeal rejected Mrs McAdie’s argument that the bank was precluded from dismissing her fairly because it was responsible for her illness. It endorsed the earlier decision of the Employment Appeal Tribunal (EAT) to the effect that:

		where an employer is responsible for an employee’s incapacity, it may be necessary to “go the extra mile” in allowing a longer period of absence or finding a new role;
		the tribunal’s focus should not be on what gave rise to the employee’s situation but on what it was reasonable for the employer to do in response; and
		in this case, there was no prospect of a return to work and no real alternative to dismissal.

What does it mean for me?

		Although disciplinary investigations are inherently stressful for employees, where an employer is investigating alleged misconduct it should not be at risk of a stress claim provided it follows a fair procedure. This means investigating the complaint thoroughly and adhering to the contractual and statutory disciplinary procedures.
		The fact that an employer is responsible for the stressful environment that caused an employee’s ill health does not necessarily mean that a dismissal for long-term sickness absence will be unfair. Where the employee is unlikely to return to work, and provided the employer follows the appropriate procedure, dismissal is likely to be reasonable.
		In sickness absence cases, up-to-date medical evidence and consultation with the employee regarding returning to work is critical. In dismissal situations, the statutory dismissal procedure must be followed.

Back to top