David Marshall, Partner
Email David
Traps of the Unwary: Part 1
Increasing numbers of claims for "non-physical injury" arising out of employment have led to an overlap in the law and remedies provided by the Courts and the Employment Tribunals. Whilst there are issues of principle, there are also numerous practical implications for the personal injury lawyer and for the employment lawyer. In this article, I will set out a hypothetical case study, consider ways of using legislation to obtain more evidence, point out the practical difficulties facing the advisor and, in Part 2, will give some pointers as to how these can be resolved. The facts of the case study are fictional, but, whilst a claimant would be unlucky to have been the victim of every single incident set out, similar incidents have been the subject of decided court cases.
Hypothetical case study
The client, a black secretary with a well-known but small financial services company, has been harassed by her boss after he returns to work drunk following client lunches. The harassment started about a year ago and was serious, taking the form of verbal and some limited physical abuse. At about the same time her marriage broke down. The claimant was signed off work for a month for "work related stress", but did not suffer a breakdown. Following a grievance and disciplinary procedure, the Company issued a written warning to the manager.
The harassment ceased for a few months, but then began again. The claimant put in a further grievance. This time her complaints were belittled, it was implied that she was making things up and that she was seeking to ruin her boss’s career. She suffered a nervous breakdown and was admitted as an in-patient at a psychiatric hospital. (The claimant has evidence that a white male worker, harassed by his female line manager, had put in a second grievance and in that case the line manager had been demoted and moved).
After a month the claimant was requested to leave hospital for an afternoon and attend the office to discuss her absence. At the meeting, the Managing Director called her a "f***ing fruitcake" and summarily dismissed her. She was frog-marched from the building under guard and physically ejected from the office. She suffered a relapse and returned to hospital and stayed there for about another three months. In the interim period she put in an appeal against dismissal which had not yet been determined. She has now been discharged from hospital, but is still attending as an out-patient. The discharge letter from the hospital doubts that she will be able to return to any form of employment for at least a year and says that the long-term prognosis is unclear.
Potential causes of action
The claimant has two sets of possible claims. One set would be pursued in the Court and the other set in the Employment Tribunal.
Contract and Tort Claims in the Court
- Breach of employer’s common law duty of care, foreseeably causing loss and damage.
- Breach of statutory duty (Health & Safety at work regulations although, unfortunately few, if any will give rise to a direct civil liability in these circumstances).
- Assault (in respect of the physical abuse).
- Protection from Harassment Act 1997.
- Breach of the term of mutual trust and confidence implied into her contract of employment.
Statutory claims in the Employment Tribunal:
- Sex Discrimination Act 1975
- Race Relations Act 1976
- Unfair Dismissal (Employment Rights Act 1996)
- Disability Discrimination Act 1995
Obtaining more evidence
Before considering which of these potential causes of action should be pursued, you may want to obtain some more evidence.
Certain statutory employment rights might make evidence gathering easier so that you can carry out a risk assessment to enable you to advise the client and for the firm to decide whether to take on the case. If the dismissal letter is brief, the client is entitled to request written reasons for her dismissal under sections 92 and 93 of the Employment Rights Act 1996. If the employer fails to provide them the client can apply to the Employment Tribunal for an award. However, the mere request normally causes some thought by an employer and something seeking to justify their actions normally appears. It can be important to get a decision from the employer as to the reasons for the dismissal at an early stage so that it is more difficult for them to believably change their story later on. Often the employer will not have taken legal advice at this point, particularly if the request comes from the client rather than from you.
A request under the Data Protection Act 1998 for a copy of all data records relating to the client is a very useful weapon. It is cheap (£10) and the employer must comply within 40 days. If they fail to do so, an application may be made to the Court for an Order. From 24 October 2001, the employer will be required to disclose copies of all data records (written records as well as computer records). Stress cases usually relate to incidents over a long period of time. If there are records disclosed, you can get full early disclosure and assess the damage to the case. If there aren’t any, what are the chances of the employer having fulfilled their duties under the Health & Safety Regulations (e.g. risk assessments)?
If there are potential witnesses who are still employed and afraid to come forward, there are protections available through findings of automatically unfair dismissal (s100 Employment Rights Act 1996 for dismissals connected with health and safety issues and the Public Interest Disclosure Act 1998 for ‘whistleblowers’.
Sheriff v Klyne Tugs
At first sight, having so many potential causes of action might appear to be good news for the claimant. However, because of the decision of the Court of Appeal in Sheriff v Klyne Tugs [(1999) IRLR 481], you have to make a quick decision as to whether you are going to advise the client to pursue a claim for her psychiatric injuries through the Court or in the Employment Tribunal. In the Sheriff case, the claimant suffered race discrimination. He was a Muslim who suffered from extreme racial abuse form his work colleagues, including being forced to eat pork. He suffered a nervous breakdown. He was dismissed. He brought a claim for unfair dismissal and race discrimination (including a claim for compensation for "injuries to feelings") in the Employment Tribunal and settled "all claims which he has or may have against the Respondent arising out of his employment or the termination thereof being claims in respect of which an Industrial tribunal has jurisdiction" using the standard COT3 procedure. He then sought to bring a personal injury claim in the County Court for psychiatric injury caused by his employment. The Court of Appeal struck out the claim. They ruled that the compensation for injuries to feelings in a discrimination claim in the Employment Tribunal included within it the claim for psychiatric injury. Having decided to commence Employment Tribunal proceedings, he had to bring all his claims before the Employment Tribunal and, having settled them, he was precluded from pursuing his psychiatric injury claim in the County Court.
This is settled law for sex and race discrimination cases (subject to any possible future review by the House of Lords – but, notwithstanding the Lawtel note on the case, it is not believed that the Sheriff case itself is going to appeal). Presumably, the same ratio would apply to a Disability Discrimination Act claim where compensation for injuries to feelings can also be awarded. Some obiter comments made by Lord Hoffman in the case of Johnson v Unisys Limited (2001 IRLR 279) suggest that it might be possible for tribunals to award for injuries to feelings in unfair dismissal cases. I believe that some awards have been made, but none have yet been affirmed by a higher court. If it is now possible to be awarded compensation for injury to feelings for unfair dismissal, arguably the Sheriff case might apply in unfair dismissal cases too!
There are potential negligence claims here waiting to entrap the employment lawyer (who may be unaware of how to run a personal injury claim) and the personal injury lawyer (who may be unaware of the possible benefits of the employment claim). There will rarely be a right or wrong answer as to which route to take. However, the danger is in taking one route which, without realising it and with hindsight, turns our to be the wrong one, without having fully discussed this in advance with the client.
If employment remedies are to be pursued, a compromise agreement settling them before issue of Tribunal proceedings should expressly exclude all personal injury clams from the settlement. Such an agreement is not binding without the advice of an independent lawyer. Many clients in these circumstances first turn up at a solicitor’s offices having been dismissed and clutching a compromise agreement. It is interesting how may draft compromise agreements prepared by employers or their lawyers ask the claimant to giving up personal injury claims within an often paltry settlement offer.
If Employment Tribunal proceedings have actually been commenced (perhaps by the client or an advice centre) and it is clear that the claim would be better put for psychiatric injury in the Court, even more care needs to be taken. It is possible to "withdraw" Employment Tribunal proceedings. However, such a request will probably bring the standard Employment Tribunal order "claim dismissed upon the application of the Applicant". This is potentially a disaster, because the claims for compensation for psychiatric injury will have been technically "decided" by the Employment Tribunal and dismissed for no compensation, preventing the claims from being litigated in the County Court. To avoid this, you need to make it clear this is a withdrawal, not a request for a decision. If an order to dismiss is made, apply to the Employment Tribunal Chairman for a review. (My thanks to Yvette Genn of Cloisters for pointing out this particularly nasty twist!).
So which way do you go? All of these routes would appear to give a potential remedy to the client. As a personal injury practitioner you may feel more at home with a claim for common law negligence and breach of statutory duty. However, that this route would not, to say the least, be risk free. In Part 2 of this Article, I will consider some of the pros and cons of the Court and the Employment Tribunal remedies.
For further information email David Marshall or call 020 7940 4000.
