When Workers Just Can't Cope

New rulings clarify what employers should and shouldn't do

In 1997, Dorene Sherman was suffering from manic depression, making it difficult to carry out her duties as director of before- and after-school programs at the Calvary Christian School in Toledo. Sherman's illness often made her suicidal, impaired her speech, and forced her into the hospital for up to two weeks at a time. Her employer, a private religious school, gave her a flexible schedule, allowed her to take breaks during the day, and, when she felt stressed out, let her hole up in her office away from the children and other staff members. When things became unbearable, Sherman, then 34, would take a day off. "It was difficult at times, and I could tell it was stressful on them when I was in the hospital, but they always did their best to make it work," says Sherman, who left the job last year when she moved away from Toledo.

Dealing with mental illness is never easy for anyone, employers included. Until Congress passed the Americans with Disabilities Act (ADA) in 1990, most companies decided how to handle such problems on a case-by-case basis, often depending on such factors as just how ill the employee was and how sympathetically the supervisor responded. And even the ADA didn't help employers much with deciding how far to go to accommodate people like Sherman. The law requires employers to make all "reasonable" accommodations for people with disabilities, including mental ones. But given how subjective and personal psychiatric issues can be, employers have struggled to develop clear policies about what to do in such cases.

In the past few years, the Clinton Administration and the courts have begun to delineate how companies must act. The good news for employers is that the guidelines are surprisingly sympathetic to the dilemmas they face when someone shows signs of mental illness. If a worker becomes depressed or suicidal, the employer must try to find a way to help, by, for example, granting a short leave of absence or changing his or her work schedule (table). But companies don't have to lower work standards, tolerate misconduct, or give someone a make-work job--steps some employers have taken out of fear of a lawsuit, experts say. A key U.S. Supreme Court case last year further clarified the law by specifying that an employee suffering from mental illness isn't disabled if medication allows the person to function like anyone else. "Most courts are taking a narrow view of who is covered under the ADA," says Peggy Mastroianni, an associate legal counsel for the Equal Employment Opportunity Commission (EEOC).

LOST WEEKS. Any signposts are welcome, since mental illness has posed one of the most difficult challenges to employers--and the courts--since the ADA took effect in mid-1992. Each year, clinical depression alone causes a loss of some 200 million working days in the U.S., according to a report released on Oct. 10 by the International Labor Organization. Psychiatric claims filed with the EEOC doubled from 1993 to 1998, to 2,917 a year. This made them the single largest type of ADA claim, constituting 16.4% of all ADA discrimination cases, according to the commission.

But a series of recent rulings has slowed such claims, which dipped to 2,682 last year. The first came in 1997, when the EEOC issued enforcement guidelines for psychiatric disabilities. The agency gave specific examples of who is covered by the ADA, as well as examples of what reasonable accommodations might be.

Since then, the courts have applied strict definitions to the often vague wording of the ADA--making it more difficult for mental illness claims to make it to a jury. For example, courts have held that employees must prove that their illness substantially limits their life abilities. And employers must prove that an accommodation requested by an employee would be an undue hardship. They also have ruled that employers can't be accused of misconduct unless they knew the employee was disabled. Since most workers with mental illness don't disclose their problem until the illness shows up in bad behavior, this makes it more difficult for employees to sue.

Last year's Supreme Court decision went even further. The case involved two sisters who didn't qualify to be pilots at United Airlines Inc. because of poor vision. The court ruled that the sisters couldn't sue for discrimination under the ADA because their disability was correctable (with glasses or contacts). Since then, lower courts have applied the ruling to say that employers can consider the mitigating effects of interventions such as medication. In other words, if an antidepressant drug enables a depressed person to function normally, he or she isn't considered disabled and can't claim discrimination.

This puts tighter limits on who can sue under the act. One of the first post-United cases involved Sam Spades, a Walnut Ridge, Ark., police officer with depression who shot himself in the head. He was treated for his injuries and underwent counseling and medication for his depression. But the police department refused to reinstate Spades. In 1999, the Eighth Circuit Court of Appeals said that his depression did not meet the definition of a disability because the medication corrected it.

The new guidelines should help employers avoid being pushed into unreasonable actions. It's now clear that companies don't need to lower their standards to help a troubled employee, says K. Tia Burke, a Philadelphia management attorney who had one client company that did just that. Nor do employers have to invent light-duty jobs, as other clients have done, says Burke. "Many employers are so loath to get involved in these cases that they bend over backwards and provide more than what is reasonable," she says.

Some critics say the ADA has been limited too much. In fact, on Sept. 30, California's governor signed a law that reaffirms the state's broader definition of disability under a California statute after advocates for the mentally ill argued that the courts had eviscerated the federal act. Lawmakers were particularly concerned that the United Airlines case might end up depriving some mentally ill employees of protection because they're taking medication.

Of course, employers can still go further than the law requires. Dorene's boss, for example, didn't even consider the ADA; he simply looked at her potential and made the situation work. Still, it helps that there's now something of a bottom line in this most delicate workplace arena.

To join a discussion on mental disabilities go to forums.businessweek.com/bw-magazine/start/

Before it's here, it's on the Bloomberg Terminal.