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Stress at work … again!
In 2003, New Zealand's health and safety legislation was amended to confirm workplace stress as a recognised hazard.
This step was not, in itself, controversial; it simply confirmed what doctors have been telling us for a very long time - namely that certain people, when subjected to particular circumstances, may be likely to suffer conditions such as depression and anxiety.
At the time, it was feared that stress claims would become something of a trend in employment law.
To a certain extent, that fear was borne out by a trilogy of successful employment law claims, all of which involved employees who successfully claimed compensation for stress-related harm.
But, with the exception of one or two successful cases since, the flood gates have never really opened. That is not to say, however, that the law has closed the door to meritorious claims in this area.
A recent case, Davis v Portage Licensing Trust (Unreported, Employment Court, Auckland, 4 May 2006) provides a dramatic illustration of the consequences that may follow for an employer that finds itself responsible for causing stress-related harm.
For most of his life, Mr Davis had worked in the shipping industry. In 1997, however, he took up a position as a barman at Richardson's Tavern in Owairaka. In March 1999, Davis was at work when an armed robbery occurred. It was a terrifying experience which, amongst other things, involved Davis having his arm pinned to the ground by an armed man.
Unbelievably, just three weeks after this robbery, the bar was robbed again - and again while Davis was at work. This time he was confronted at gun point and told that if he moved he would get "blasted".
Remarkably, lightning struck for a third time about a month later. This time, Davis had a gun pointed at his face, and was told to fill a bag with money.
In a horrible twist of fate, on the day after the third robbery, as he was waiting to get into the tavern to see if the other staff were alright, a man approached Davis, and then collapsed in front of him. The man later died in hospital. Davis was understandably traumatised by his unwitting involvement in this tragedy - which was completely unrelated to the other incidents.
Regrettably, at about the same time as these incidents were occurring, Davis was also coming to terms with the fact that his brother was dying of cancer.
Following the three armed robberies, Davis took some time off on medical advice. After he had been away for a month, his employer ceased paying his salary.
Davis was diagnosed as suffering from Post Traumatic Stress Disorder, and received counselling (which was initially paid for by his employer). Following the third robbery, however, Davis never returned to work and went through a 10 month period without any employment.
The issue in the case concerned the employer's liability for Davis' condition. To address this issue, the Employment Court was required to consider whether robberies were a foreseeable occurrence at this particular tavern. It held that they were and that - despite the fact that several steps had been taken to prepare staff for armed robberies - the employer failed to provide a number of reasonable security and safety measures prior to the first robbery.
Further, the court found that the employer had failed to address some of its failings prior to the second and third robberies - meaning that it was in breach of the obligations owed to Davis throughout the unfortunate series of events.
The court ordered the employer to compensate Davis by paying him lost remuneration for a six year period, and for 18 months into the future. It also ordered the employer to pay medical and counselling costs, and to meet the future costs of such treatment. In addition, the employer was ordered to pay $45,000 in compensation for non-economic losses suffered by Davis.
So what can we take out of this decision?
First, Davis' case provides a dramatic illustration of how harm can be suffered as a consequence of exposure to traumatic events. This is a case which involves something far greater than an employee who simply says that he is "stressed" in his day-to-day work: it is, on any view, an extraordinary case, involving an employee who was exposed to unfortunate, and undeniably traumatic incidents - and which led to him suffering a stress-related condition.
Put another way, this case involves someone who had suffered harm from stress – in contrast to someone who felt "stressed" about work conditions (which would not have given rise to a claim).
Secondly, the case illustrates the fact that, despite unusual circumstances (a string of armed robberies), an employer can still be liable if it fails to take reasonable precautions to avoid harm occurring. In this case, the employer's downfall was a failure to recognise the probability of an armed robbery occurring - and to take pre-emptive steps accordingly.
Finally, the case illustrates the consequences which may follow for an employer where, as a result of harm, an employee may be rendered unfit for work. Such lengthy absence from the workforce will not, of course, always be the case; many people who suffer from stress-related conditions (including depression) are able to pursue alternative careers, and to mitigate any financial loss. Mr Davis was not - and was therefore entitled to payment of a significant sum by way of compensation.
While this case is no indication of the opening of flood gates in the area, it is an illustration of the consequences that may follow for an employer where a legitimate claim of stress-related harm is made.
