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Landmark Cases: McGrath v Trintech – Stress Management

The case of Sutherland -v- Hatton [2002] EWCA Civ 76 involved four employees, three of whom successfully argued stress against their employers, and in the determination the Court set down 16 “Golden Rules” which employers must follow to combat stress in the workplace.

Stress Management

In the case of McGrath -v- Trintech, this is one of the first Irish cases where the courts have given strong credence to these rules from an Irish context, and as such employers should be aware of this when managing stress in their workplace.

Case Synopsis

While contracted as a project manager and employed as a senior project manager, the employee worked on projects which took him on foreign assignments. During his first two and a half years with the Company, Mr. McGrath suffered bouts of ill-health of a physical nature, in particular, in the autumn of 2000, following an assignment in Korea, in April, 2001, while on assignment in South Africa, and in October and November, 2002.

While on sick leave in October/November, 2002, he was requested by the Company to go on an assignment to Uruguay to work in a Uruguayan company, Sursoft SA, which had been acquired by Trintech in 1999. He acceded to the request and was working in Uruguay from mid-January, 2003 until the end of June, 2003, a period slightly in excess of five months. One aspect of the Employees claim is that he alleges that during this period he was subjected to grave work related stress and pressure which resulted in injury to his psychological health and well-being. Another is that the terms of his employment were varied when he took up the assignment to Uruguay.

Following his return from Uruguay in late June, 2003, he did not return to work, and was absent on certified sick leave.

On 26th August, 2003, the Employee was informed by Mr. Downes and by Mr. Gerry Cleary, the Director of Human Resources, that he was being made redundant with effect from 26th September, 2003. He was one of twelve out of one hundred and thirty employees in the Dublin office whom the defendant decided to make redundant at that time with the objective of cost-cutting against the background of a sluggish global market for the Company’s products and services.

On the same day written details of the “redundancy package” were furnished to him. The package envisaged him [Mr. McGrath] receiving a total payment of €27,536.52 to cover one month’s pay in lieu of notice, four weeks’ pay per year of service worked “including statutory redundancy” and holidays owing. The plaintiff would be required to sign a disclaimer acknowledging that the payment was in full and final settlement of all claims at common law or under statute arising from his employment and its termination.

The Employee did not accept that the Company was entitled to make him redundant, as he claimed that when he took up the assignment to Uruguay he had been guaranteed that the Company would retain him for a year in the post of Director of Professional Services following his return. He was also of the view that the method of his selection for redundancy was unfair and invalid.

The court determined that Mr McGrath was entitled to damages for the breach of his contract in failing to honour the guarantee of one year’s employment following his posting to Uruguay, and was awarded €69,026 representing his salary for one year together with a bonus of 30%.

Stress Management

The cases itself is not dramatically different from a redundancy or breach of contract point of view, however where the case holds significance is in the application of the Hatton principles in regards to dealing with stress in the workplace.

The 16 ‘golden rules’ are:

(1) There are no special control mechanisms applying to claims for psychiatric (or physical) illness or injury arising from the stress of doing the work the employee is required to do. The ordinary principles of employer’s liability apply.

(2) The threshold question is whether this kind of harm to this particular employee was reasonably foreseeable: this has two components (a) an injury to health (as distinct from occupational stress) which (b) is attributable to stress at work (as distinct from other factors) .

(3) Foreseeability depends upon what the employer knows (or ought reasonably to know) about the individual employee. Because of the nature of mental disorder, it is harder to foresee than physical injury, but may be easier to foresee in a known individual than in the population at large. An employer is usually entitled to assume that the employee can withstand the normal pressures of the job unless he knows of some particular problem or vulnerability.

(4) The test is the same whatever the employment: there are no occupations which should be regarded as intrinsically dangerous to mental health.

(5) Factors likely to be relevant in answering the threshold question include:

◦(a) The nature and extent of the work done by the employee. Is the workload much more than is normal for the particular job? Is the work particularly intellectually or emotionally demanding for this employee? Are demands being made of this employee unreasonable when compared with the demands made of others in the same or comparable jobs? Or are there signs that others doing this job are suffering harmful levels of stress? Is there an abnormal level of sickness or absenteeism in the same job or the same department?
◦(b) Signs from the employee of impending harm to health. Has he a particular problem or vulnerability? Has he already suffered from illness attributable to stress at work? Have there recently been frequent or prolonged absences which are uncharacteristic of him? Is there reason to think that these are attributable to stress at work, for example because of complaints or warnings from him or others?
◦(6) The employer is generally entitled to take what he is told by his employee at face value, unless he has good reason to think to the contrary. He does not generally have to make searching enquiries of the employee or seek permission to make further enquiries of his medical advisers.
(7) To trigger a duty to take steps, the indications of impending harm to health arising from stress at work must be plain enough for any reasonable employer to realise that he should do something about it.

(8) The employer is only in breach of duty if he has failed to take the steps which are reasonable in the circumstances, bearing in mind the magnitude of the risk of harm occurring, the gravity of the harm which may occur, the costs and practicability of preventing it, and the justifications for running the risk.

(9) The size and scope of the employer’s operation, its resources and the demands it faces are relevant in deciding what is reasonable; these include the interests of other employees and the need to treat them fairly, for example, in any redistribution of duties.

(10) An employer can only reasonably be expected to take steps which are likely to do some good: the court is likely to need expert evidence on this.

(11) An employer who offers a confidential advice service, with referral to appropriate counselling or treatment services, is unlikely to be found in breach of duty.

(12) If the only reasonable and effective step would have been to dismiss or demote the employee, the employer will not be in breach of duty in allowing a willing employee to continue in the job.

(13) In all cases, therefore, it is necessary to identify the steps which the employer both could and should have taken before finding him in breach of his duty of care.

(14) The claimant must show that breach of duty has caused or materially contributed to the harm suffered. It is not enough to show that occupational stress has caused the harm.

(15) Where the harm suffered has more than one cause, the employer should only pay for that proportion of the harm suffered which is attributable to his wrongdoing, unless the harm is truly indivisible. It is for the defendant to raise the question of apportionment.

(16) The assessment of damages will take account of any pre-existing disorder or vulnerability and of the chance that the claimant would have succumbed to a stress related disorder in any event.

Page 21 of the full publication of the Hatton case details each principle and from an employers perspective this is important. What we can take from this is that there is a liability on the employer to deal with these issues and as such if an employee presents themselves as having stress we should aim to address this issue thoroughly in order to ensure that there are no other steps or measures the employer could have taken in such cases.

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