How to discipline an employee with mental health concerns

Employers are responsible for minimising risks to their employees’ mental health dependent on how foreseeable the risks are. Where a job is more intrinsically a stressful one, it’s more foreseeable that the employee would suffer mental harm if the employer did not take proactive steps to ensure the employee could work in a safe way.

“In these kinds of circumstances more is expected of the employer to prevent employees from suffering mental harm,” added Bell. “If an employer knows that an employee has been diagnosed with a mental health condition, has raised with the employer that they are feeling stressed or overwhelmed at work, or has shown signs of distress, this will make harm to an employee more foreseeable.” 

Performance management and mental health

There is no check list or prescriptive guidance in order to manage an employee's mental health when they are undergoing a performance management process, according to Bell. There are guides issued by WorkSafe but they are more in the nature of general advice and tips to employers as opposed to protocols. The case of FGH v RST [2018] NZEmpC 60 is a good example of the court’s approach to the issue of the employer’s responsibility concerning mental health effects in performance and disciplinary processes.

“The crux of the court’s finding was that the employer had failed to seek proper medical advice when this was necessary,” added Bell.

This case discerns the following;

1. When an employee is undergoing a performance improvement process, employers should observe the employee to see if they are showing any obvious signs of heightened stress or anxiety, or are simply not coping.
2. If the employee is showing signs that a routine performance management process is affecting their mental health, or if the employer becomes aware that an employee has a mental health condition, the employer should request appropriate medical advice regarding the impact a performance management process could have on the employee’s mental health.
3. Employers should consider ways the performance management process could be modified in order to cater for the employee’s needs, or consider whether it would be better to address the issues in another manner.

Supporting mental health vs maintaining performance standards

Employers have an obligation to maintain a healthy and safe workplace and to minimise risks to their employee’s mental health as far as is practicable, as well as an obligation to do everything that a fair and reasonable employer could do in the circumstances.

“This becomes more onerous when the employee is known to have a mental health condition that could be exacerbated by a performance management process,” Bell told HRD. “When considering whether to run a performance management process, it must be held in mind that the purpose of a performance management process is to enable the employee to improve their work performance. If there are medical issues that are impacting an employee’s performance (which could be exacerbated by a standard performance management process), consider ways to amend the process, delaying the process or alternatives to the process.”

Preventing psychological harm in performance pressure

“In light of these obligations, we consider the principles below to be good ones to adopt,” Bell added. 

• Be observant - notice what is going on for the employee. Are they showing any signs of excessive stress or anxiety?
• Be approachable and ensure support is available - ensure there is an avenue for the employee to raise issues. Check in with them concerning issues of stress and mental health. If that is difficult because of conflict, make sure there is a line of communication to someone else.  
• Be adaptable - be prepared to change tack if the employee is struggling.
• Use good medical advice and options - if an employer is responsibly using professional advice, then they will meet the standards required. Make sure the brief to professionals asks for avenues to proceed with performance management safely and pursue those options. 

When is an employer at fault for causing employee stress

An employer will be liable for the stress related harm caused to their employee where three factors are established.

1. Causation: the work was a material cause of the stress-related harm suffered;
2. Foreseeability: the risk of harm was reasonably foreseeable to the employer; and
3. Failure to make steps: the employer failed to take all reasonably practicable steps to remedy the situation.

‘’For example, in Rosenberg v Air New Zealand Ltd (1/9/09 ERA Auckland), Rosenberg worked in a role that involved supervising, coaching and mentoring a team of 18 staff, alongside various administrative tasks,” Bell told HRD. “Due to interruptions during the day, Rosenberg was not able to complete her work and worked extra hours to complete her work. Rosenberg sought support a number of times. Although she did receive support and her workload was reduced, in September 2001 she collapsed from exhaustion.

“A series of health issues followed, which medical professionals determined were caused by stress. She took periods of leave and was placed on a part-time temporary training role while she recovered. Following a company restructure, Rosenberg was offered the permanent training role. She resigned and claimed constructive dismissal and that her employer had breached the contract by failing to provide her with a safe workplace. The Authority agreed.”

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