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Bullying at work is a serious problem whatever the rights and wrongs of the allegations against Gordon Brown, a leading lawyer has warned.

Nick Jew, head of employment at the Birmingham office of DLA Piper, said it resulted in millions of working days lost and cost up to £2 billion in revenue every year.

Some research put the figure as high as £18 billion.

Mr Brown has fiercely denied the bullying claims despite revelations from the National Bullying Helpline charity that it had received calls from stressed out Downing Street staff.

Lord Mandelson, the Business Secretary, said that while the Prime Minister is "emotional" and "demanding", he does not abuse staff.

Mr Jew said the affair nevertheless served to highlight how one in four people claimed to have experienced bullying in the workplace.

It could damage employees' confidence and motivation and lead to a decline in productivity and an increase in absenteeism.

He cautioned: “Workplace bullying can cause serious legal headaches for employers.

“Employers have a duty under the Health and Safety at Work Act 1974 to ensure the health, safety and welfare of their employees.
There is no specific legislation in the UK dealing with workplace bullying, but employers can be held liable for the actions of their staff under a range of discrimination laws, in addition to claims for personal injury and under the Protection from Harassment Act.

“Employers are also under an obligation to maintain the trust and confidence of their employees and if they fail to do so, the employee may resign and claim constructive dismissal.”

In a case against Deutsche Bank in 2006, an employee was awarded over £800,000 compensation for personal injury after bullying by colleagues resulted in her suffering a psychiatric breakdown.

Mr Jew went on: “In order to avoid the risks associated with workplace bullying, employers need to take positive steps to protect workers. It is not sufficient merely to have in place a bullying and harassment policy. Employers need to be able to show that the policy has been implemented and consistently applied and enforced and that managers have been trained in how to operate it.

“Employers need to make it clear that bullying and harassment will not be tolerated, set out the steps to be taken to prevent it happening and clarify the responsibilities of supervisors and managers. A domineering or arrogant style of management can often create a culture where bullying and harassment thrive.

“Complaints should be dealt with promptly with employees made aware of the damaging affects of bullying and harassment and what behaviour is acceptable. Managers should be supportive; employees need to be sure that they will get a sympathetic response if they make a complaint.

“Do not brush it under the carpet or even perpetuate the situation. Organisations need to build an open culture in which the potential for bullying is minimised and if it occurs, employees have the confidence to report it. Failure to deal with bullying can lead to significant legal liability as well as reducing the effectiveness of the business."

A survey by Unison last November indicated that over a third of workers had experienced bullying in the previous six months – double the number recorded in 1997.

Eighty per cent of victims said it had affected their physical and mental health and a third took time off work, or left their jobs as a result. Nine out of 10 said bullies were able to get away with it and the same proportion said they were too scared to report the problem.