Is workplace stress damaging you business?

Workplace stress is a growing problem for both employers and employees. It not only affects people’s health and their firm’s productivity, it is also a growing source of costly employment claims.

A recent survey by the Health and Safety Executive revealed that more than one in five British workers is now concerned about work related stress. Employees rate it as their most feared workplace hazard, well ahead off concerns over lifting heavy loads, slips and trips or exposure to dust and fumes.

It’s estimated that around 13 million working days were lost because of it in 2005.

Clearly with figures like that it is in every employer’s interest to try to reduce stress levels among staff as much as possible. However, productivity isn’t the only reason to tackle the problem. There is also the danger that overworked, stressed out employees will eventually snap and take their case to an employment tribunal.

About 40% of those questioned by the HSE thought that the risk of stress in the workplace could be realistically reduced, and yet less than a third said that their employers had taken preventative action to do so.

There have several notable compensation cases involving stress in recent years. In 2005, a pub manager took his case all the way to the Court of Appeal claiming stress from overwork had caused him psychiatric injury.

He had worked 90 hours a week and although he complained repeatedly, nothing was done. Then he became overwhelmed by his workload and collapsed suffering from an anxiety disorder. He sued his employer for failing in its duty of care to him and was awarded £21,000 compensation.

It was a timely warning to employers to take the problem seriously. It’s vital to have a clear cut policy and a set of procedures in place to both reduce the possibility of stress developing in the first place and then deal with it as quickly and effectively as possible when incidents do arise.

A number of high profile cases in the Court of Appeal and the House of Lords have led to some significant rulings and guidance.

As soon as an employer becomes aware that one of his staff is suffering from stress then he has a duty to take reasonable steps to do something to help. The sufferer doesn’t have to make numerous complaints or describe his symptoms in great detail. All complaints should be listened to sympathetically.

Those suffering from stress will often show signs of their problems through deterioration in their work, indecisiveness, failure to delegate properly and a declining relationship with colleagues.

It will then be necessary to try to identify the cause of the stress, whether it’s workload, excessive hours or difficult relationships with other employees.

Employers may also have to face up to whether staff stress may be caused by poor management, lack of support and inadequate training. If several members of staff show signs of stress then it may be that there are problems with the way the firm operates and organises its workload. This will show itself in increasing absenteeism, a constant turnover of staff and a lower level of productivity.

Employers must also react to periods of certified sickness due to stress or depression and take them seriously, even if the employee seems to perform adequately while at work. Sufferers should not be pressurised or ignored; instead steps should be taken to rectify the problem and improve the situation.

Once it’s identified that a member of staff is suffering from stress then it is mandatory that they should be monitored.

Remedies such as reducing the sufferer’s hours and workload may have to be taken. It might be necessary to provide health checks, counseling and even psychotherapy. If it isn’t tackled then sufferers could go on to develop more serious health problems.

The employer’s attitude to staff stress problems is likely to be very important in deciding whether there has been a breach of duty. An aggressive, dismissive attitude is likely to be looked on unfavourably by the courts, whereas a more sensitive and understanding approach could have a major bearing on the outcome of a hearing.

The case for putting measures in place to deal with stress is compelling.

It not only leads to a happier, more productive workforce, it also reduces the risk of costly and time-consuming compensation claims.

Sally Laughton is an employment expert at Andersons Solicitors. She can be contacted by emailing slaughton@andersonssolicitors.co.uk or calling 0115 988 6716

Family friendly Act reflects spirit of the times

Phrases life ‘work life balance’ and ‘well-being’ have become popular both with the public and politicians over the last few years as people increasingly examine our working culture.

The children’s minister Beverley Hughes recently called for all workers to be given the right to request flexible hours, and even the Conservative leader David Cameron argues that increasing people’s happiness is a key challenge for politicians.

Whether or not one agrees with this line of thinking, it’s a trend that is likely to continue and one that finds a perfect embodiment in the Work and Families Act 2006. The Act, effective from April 6th this year, extends statutory maternity pay, statutory adoption pay and maternity allowance from six to nine months.

The government hopes to extend that to a full year by the end of the current parliament. The changes will benefit an estimated 400,000 working mothers and their families each year. In return, if the employee wants to change her date of return then she must give her employee 8 weeks notice of change. If she is still going back on the date she initially told her employer there is no need to give anymore notice of the date of return. Employers will also be allowed to make reasonable contact with women on maternity leave to help with planning and easing their return to work.

It’s hoped that employers and staff will benefit from better communication during maternity leave. There will also be up to ten “keeping in touch days” which will allow mothers to return to work occasionally without losing out on maternity pay or automatically bringing their leave to an end.

The idea of the days is to enable women to keep up to date with developments or to benefit from extra training. These days are not obligatory on either side and need only take place where both the employer and the mother think they would be useful. They’re intended to help smooth the woman’s return to work when her maternity leave ends.

The new regulations also simplify the administration of maternity payments by allowing employers to bring them into line with their normal payroll systems.

There is also help for the carers of dependent adults as they will be able to request flexible working hours. However, although the employer must give this serious consideration, it is not an automatic right.

A carer is defined as an employee looking after an adult who is married to, or the partner or civil partner of that employee. It could also include a near relative of the employee or someone who falls into neither category but lives at the same address as the employee.
The "near relative" definition includes parents, parents-in-law, adult child, adopted adult child, siblings (including those who are in-laws), uncles, aunts or grandparents and step-relatives. It’s estimated that this should include about 80% of all carers.

The most controversial part of the Act concerning paternity leave is yet to come into force. Fathers are currently entitled to two weeks paternity leave but the Act could soon extend that. It will enable them to benefit from leave and statutory pay if the mother returns to work after six months but before the end of her maternity leave period. She will effectively be able to transfer some of her leave to her partner. It is estimated that between 240,000 and 280,000 fathers will benefit from this.

The additional period of paternity leave for fathers will be introduced at the same time as the extension of Statutory Maternity Pay, Adoption Pay and Maternity Allowance to 12 months. This is unlikely to be before 2008. It is this extension to paternity leave that has most concerned many employers. A survey by the Chartered Institute of Personnel and Development revealed that nearly two thirds of firms thought that the provisions would cause them difficulties while the Federation of Small Businesses described them as a nightmare.

There’s little doubt that the new measures will place extra responsibilities on businesses but if employers put the right procedures in place as soon as possible then that would greatly reduce the chances of any serious problems developing. The Equal Opportunities Commission has monitored the treatment of women in the workplace and concluded that, as is so often the case in employment law issues, ignorance rather than any real prejudice is at the heart of most misunderstandings and difficulties.

Jenny Watson, Chair of the Equal Opportunities Commission said: "The EOC's investigation into pregnancy discrimination in the workplace found that a lack of awareness of the law, and of good practice, is often at the root of the problem.”

Sally Laughton is an Employment expert at Andersons Solicitors. She can be contacted by emailing slaughton@andersonssolicitors.co.uk or calling 0115 988 6736.

Employers can influence law on workplace disputes

Many employers have been saying it for years and now they’ve got official backing: the current procedures for dealing with workplace disputes are flawed and need to be overhauled.

That’s the conclusion of a review commissioned by the Department of Trade and Industry.

Now employers, employees and other interested parties can say how they think the system should be improved as the government embarks on a public consultation on the issue. The review of the 2004 Dispute Resolution Regulations was carried out by Michael Gibbons, a member of the DTI’s Ministerial Challenge Panel and of the Better Regulation Commission.

Mr Gibbons said the average cost to businesses of defending an employment tribunal claim has recently been estimated to be around £9,000. “The financial cost to employees is lower but there are also very significant non-financial costs, including stress and damaged employment prospects. The dispute resolution system costs the Government around £120 million per year.”

He recommends that the government should repeal the current regulations and review the whole system. Mr Gibbons said: “In conducting this Review I was struck by the overwhelming consensus that the intentions of the 2004 Dispute Resolution Regulations were sound and there was a genuine attempt to keep them simple. However, they have had unintended consequences which have outweighed their benefits. I have therefore made recommendations to bring about effective resolution of disputes as early as possible.”

The recommendations include producing clear, simple, non-prescriptive guidelines on grievances, discipline and dismissal in the workplace, for employers and employees. He also wants to ensure there are incentives to comply with the new guidelines, by maintaining and expanding employment tribunals’ discretion to take into account reasonableness of behaviour and procedure when making awards and cost orders.

The government consultation will focus on a wide range of issues such as whether there should be a new way of dealing with straightforward claims without the need for employment tribunal hearings, and whether there should be a reformed tribunal system with simplified processes and timings.

Views are sought from businesses, individuals, trade unions, representative bodies, and other interested parties. The consultation will close on 20 June 2007.

The need to look again at the Dispute Resolution Regulations is borne out by the figures.

The changes introduced in 2004 did lead to a significant drop in the number of claims brought before the Employment Tribunal Service, but the success was short lived. After a temporary respite, the number during 2005 rose by a third to 115,000, marking a quick return to the levels seen before the changes were introduced.

Faced with such a deluge of rising figures it’s not surprising that so many employers have been losing faith in the tribunal system. According to a recent survey by the CBI, many firms settle cases they have a strong chance of winning because they fear the cost of going to tribunals.

Nevertheless, employers should not give in too easily when faced by unreasonable claims. It’s easy to see a firm’s dilemma if they feel the tribunal system is more trouble than it’s worth, but if everyone simply gives in then it encourages more people to proceed with weak cases and the problem snowballs.

Sometimes it’s cheaper to stand your ground and fight. A good example of this is the case of the deputy head teacher who recently sought £1m compensation for bullying and intimidation after claiming she’d been forced to use a chair that made embarrassing noises every time she sat down.
The tribunal ruled that she was neither unfairly dismissed nor discriminated against. Ironically, it may be the fact that she was claiming so much that led to her defeat. Had her demands been more modest her employers might have decided that it was cheaper to settle out of court.
If they had taken that decision then clearly an injustice would have been done and taxpayers’ money would have been wasted on undeserved compensation.

As in so many things, prevention is better than cure. Putting the correct employment policies in place helps to ensure that problems to do with pay, staff relations, discrimination and so on don’t occur in the first place. When cases do slip through the net, the employer is more likely to succeed at a tribunal if he can show that he followed the company’s own published and properly drawn up dispute procedures.

A little foresight and planning combined with properly drawn up policies can save thousands of pounds in the long run.

For more informartion contact Sally Laughton by emailing slaughton@andersonssolicitors.co.uk