When worlds collide

No employment lawyer nor any personal injury (PI) lawyer can now afford to be in ignorance of details of the other. Five major developments in the law over the last decade have resulted in tort concepts being argued in employment law claims, and vice-versa.

First, there is recognition that claims for psychiatric injury caused at work can be sued for successfully, in the absence of physical injury, following the decision in Walker v Northumberland County Council (1995). Next is the authoritative recognition and development of the implied term of trust and confidence. Third, the jurisdiction of the employment tribunal has increased significantly, both in terms of total compensation (especially for unfair dismissal) and statutory torts uniquely justiciable in the employment tribunal, such as disability discrimination.

The increasing impact of European regulation in the traditional PI context is the fourth factor; for example, working time is to be regarded as a health and safety measure. And a fifth factor is the influence of the Woolf reforms upon practice in the employment sphere.

In working through the impact of these developments, the courts have had to consider how claims arising in the workplace for psychiatric injury should be dealt with. This has already produced four major House of Lords decisions: Waters v Metropolitan Police Commissioner (2000); White (or Frost) v Chief Constable of South Yorkshire (1999); Johnson v Unisys(2001); and Malik v BCCI (1998). It will produce at least two more in the next 12 months: Magnox v Eastwood and Barber v Somerset County Council. Cases at Court of Appeal level are even more common.

These developments, together with the need for the employment lawyer to be aware of civil court opportunities, and the PI lawyer to be aware of what may be obtained from a tribunal, are perhaps best illustrated by cases in which an individual alleges that they have been subject to harassment and bullying to such an extent as to cause psychiatric injury.

The employee faces a number of tough choices with significant legal implications:

• Should they remain in the employment in which they have suffered the harassment or bullying, or should they treat it as a repudiatory breach by the employer?
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• What is the best course of action? For instance, should an ethnic minority employee, where the harassment or bullying has involved racist abuse, pursue a claim under the Race Relations Act or claim for common law damages? To make the choice, they will need to know the legal implications of each route.
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• If the employee concerned has left the employment, can they claim unfair dismissal? They may have to decide what remedy they want; reinstatement may be the primary remedy before a tribunal, but it is rarely awarded and probably still less often observed by actual reinstatement or re-engagement.
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• If they choose to stay in employment, can they obtain an injunction in the civil courts to prevent the employer (if they are responsible) from continuing the harassment?

The importance of these choices cannot be underestimated, since employees cannot bring parallel claims in the employment tribunal and the civil courts. In making the choice, the rules relating to liability, to practice and to available remedies will all be relevant.

Sheriff v Klyne Tugs (Lowestoft) Ltd (1999) applies the principle of cause of action estoppel to the overlap between discrimination claims in a tribunal and civil law claims before the county or high courts. This means that if a claim under the Race Relations Act 1976 is brought before a tribunal, then a claimant has no separate claim for personal injuries arising out of the self-same racist treatment, which they are entitled to pursue before the county or High Court.

In Johnson v Unisys, almost the converse applied. A litigant could not obtain damages at common law for the fact or manner of dismissal where that caused him psychiatric injury. A major part of the reasoning was that such matters were assigned by Parliament to the employment tribunal to consider as part of its jurisdiction in unfair dismissal cases.

Anomalies and conflicts exist, and two examples demonstrate the need for further consideration and clarification in the law.

First, within the past two years, the general principle appears to have been established by the House of Lords in Johnson v Unisys that common law damages cannot be awarded for the manner or the fact of dismissal – at least, that was the interpretation made by the Employment Appeals Tribunal (EAT) in Dunnachie v Kingston upon Hull City Council (2003).

So if an employee is so badly treated as to suffer psychiatric damage because of the way they are unceremoniously kicked out of their job – in breach of contract and possibly in breach of a tortious duty to take reasonable care for their health and safety – they have no common law claim for damages for their pain, suffering and loss of amenity. Yet the EAT has just decided that they have no employment tribunal claim either.

However, they may have a claim for their difficulties, once dismissed, in obtaining fresh employment, which will compensate at least for their economic loss.

Second, the individual who is treated so badly that they would be justified in resigning and claiming constructive unlawful dismissal can claim no damages for their psychiatric illness as such if they leave employment. Although, if they choose to remain in employment, there will be no dismissal and they can make such a claim (at common law).

Is it really right that a person who is seriously injured by a lack of care on the part of their employer, in breach of contract, has no claim if the circumstances of which they complain are regarded factually as part of the manner of their dismissal? Or that the person who has sufficient fortitude to decide to soldier on in employment, when weaker souls might leave, should, although stronger, receive compensation when those who are weaker and resign do not?

Next, is it really right that if a claim in respect of racial or sexual harassment is brought in an employment tribunal, it precludes the victim bringing a claim in the common law courts based upon the same facts for injunctive relief?

With problems like this waiting for further elucidation by the higher courts, practitioners will in all likelihood need to take special care when advising clients on the factors that might affect decisions as to forum, cause of action and potential remedies.

Brian Langstaff QC is joint head of specialist PI and employment chambers Cloisters