In McAdie v Royal Bank of Scotland [subscription required], the Court of Appeal confirmed something that we already know: that a capability dismissal following long-term stress-related sickness absence brought on by the employer's actions can be fair. This can be the case, for example, where an employee is overworked or where a grievance has not been dealt with properly (as in this case, where there was a complaint of bullying).

An employer’s culpability in causing an employee’s illness is certainly a factor in deciding the fairness of a dismissal, but it is not the only one and the key question is whether or not the employer acted reasonably in all the circumstances. For example, an employer that causes an employee's incapability, but then goes to great lengths to accommodate him or her (for instance, by looking for alternative employment or allowing for a longer period of sickness absence) may be able to dismiss fairly.

As the EAT said in this case (a view with which the Court of Appeal wholeheartedly agreed), precluding a dismissal caused by an employer's actions from ever being fair would lead to impossible situations where employers would be obliged to retain on their books indefinitely employees who were incapable of any useful work.

The second case, Deadman v Bristol City Council [subscription required], is a personal injury and breach of contract claim. In this case, an employee (who was in good health) claimed that his employer had breached its duty of care to him when he suffered stress as a result of the way in which a disciplinary process was handled when he was accused of harassment. The Court of Appeal held that it was not reasonably foreseeable that the defects in the employer’s procedure would lead to the stress-related illness that he suffered.

According to the guidance in the leading decision of Sutherland v Hatton [subscription required], the test is whether or not this kind of harm to this particular employee was reasonably foreseeable. In cases of overwork that builds up over a period of time, it may be that the employer can foresee the injury. But in cases where the illness was caused by a single act by the employer, it is very difficult for the employee to show that this was foreseeable, especially when he or she has a record of good health.

Read the transcripts of McAdie v Royal Bank of Scotland and Deadman v Bristol City Council in full on the BAILII website.