Supreme Court clarifies emotional distress claims: What it means for employers

At a glance

• The Irish Supreme Court has clarified that claims for emotional harm such as distress, anxiety, or inconvenience do not require prior authorisation from the Personal Injuries Assessment Board (PIAB) before legal proceedings can be initiated.
• Therefore, unless they involve a medically recognised psychiatric disorder, these claims do not require PIAB authorisation.

Dillon v Irish Life Assurance PLC

The Supreme Court’s decision in Dillon v Irish Life Assurance PLC  has reshaped the legal landscape for data breach and emotional distress claims in Ireland. From the perspective of employers, the ruling brings clarity to this area of the law. 

The plaintiff in this case claimed damages for 'distress, upset, anxiety, inconvenience, loss and damage' caused by a data breach, submitting that this constituted negligence and breach of statutory duty. On the question of whether PIAB authorisation was required for this claim, the Court held that claims for emotional distress, such as anxiety, upset, or inconvenience, do not constitute 'personal injuries' under the Personal Injuries Assessment Board Acts. Therefore, unless they amount to a recognised psychiatric disorder, PIAB authorisation would not be required for such claims.

Implications 

The Supreme Court has drawn a clear boundary between minor emotional distress and psychiatric injury, confirming that only the latter qualifies as a personal injury requiring PIAB authorisation.  

Removal of the procedural filter of PIAB will amount to more small claims

This opens the door to a rise in low-value claims made directly in the Circuit Court, which may often be merely speculative or tactical in nature. While these claims may not survive scrutiny, they will still require a legal response. These claims for minor emotional harm could arise following data breaches, workplace incidents, or disciplinary procedures.

However, in delivering his judgment, Mr Justice Murray also confirmed that where these claims for mental distress, upset and anxiety are made, claimants should 'not expect anything other than very, very modest awards.' He also emphasised that clarity will be essential, as it remain the responsibility of claimants to specify the type of loss they are claiming and the legal basis for that claim.   

Psychiatric injury: A separate legal consideration

Where a claim involves a diagnosed psychiatric condition, it does qualify as a personal injury and would trigger PIAB requirements and potentially lead to significantly higher awards. Employers must treat such claims with heightened caution and ensure early legal and psychiatric injury claims at the outset.