A federal law that takes effect in July will provide far-reaching employment rights to the mentally ill, requiring most businesses to alter hiring practices and workplace conditions.
Psychologists and government officials say they expect the law and the recently issued regulations explaining it to diminish the stigma of mental illness and reduce discrimination involving millions of Americans.
At least 60 million Americans between the ages of 18 and 64 will experience a mental disorder during their lifetimes, government economists say.
The Americans With Disabilities Act of 1990, which applies to all businesses with 25 or more employees, forbids employers from asking job applicants questions such as whether they have a history of mental illness.
Once hired, employees with these problems will be entitled to extra support and accommodation from their employers so long as they can perform essential job requirements. The rules will be extended in 1994 to cover companies with 15 or more employees.
Many large corporations are only beginning to recognize the law's implications. Lawyers involved in mental health issues say companies are unlikely to try to get rid of mentally ill workers before the law takes effect, in part because many of these employees have not come forward and are hard to identify.
"As this law starts to be taken seriously, it will be a tool that protects people from the widespread and deep-seated fear and hostility toward any kind of mental illness," said Leonard S. Rubinstein, a lawyer who is executive director of the Mental Health Law Project, a public-interest law firm in Washington.
The new federal law does not protect workers who cannot perform the fundamental duties of their jobs, but it is expected to have sweeping repercussions. Most states have laws protecting the handicapped, but disability-rights lawyers say many of those laws, exclude people with mental disabilities.
In those states, mentally ill employees have brought relatively few complaints under existing laws.
"Cases often aren't brought; people with mental illnesses don't assert their rights because of the stigma," said Ellen M. Saideman, director of disability law with the New York Lawyers for the Public Interest. "And a lot of employers have had no idea what their obligations are."
Under the new federal law, Ms. Saideman said, "we expect more people will be aware and filing complaints."
The law covers a broad range of mental problems, including retardation and learning disabilities. It also protects workers who have overcome alcohol or drug addiction. Employees may still be dismissed for intoxication or for using illegal drugs at work.
Employers usually deal with mental illnesses and substance abuse as related problems, treated by the same counselors and institutions and provided for in the same budget. Drug and alcohol problems affect about 27 million people of working age, the government estimates.
The cost of mental-health care is growing rapidly while companies struggle to control health-care costs in general, and many businesses have recently limited payments for treating mental illnesses.
Richard J. Sinni, a health-management specialist with Buck Consultants in New York, says many employers already spend 10 to 20 percent of their medical-benefits budgets on treatments for mental illness.
Under the new federal law, businesses cannot reject job applicants because they might add to a company's medical costs. But legal experts say the law does not prevent employers from limiting benefits for the treatment of mental illness, as many companies are now doing.
Federal officials estimate that at least 15 million adults will experience one or more of three types of severe mental illness -- schizophrenia, manic-depressive disorders or major depression -- in their lifetimes.
And an estimated one of four Americans will have one of a wider range of mental problems, including anxiety disorders like claustrophobia, personality problems and mental retardation.
These would all be covered by the law. Conditions not covered include kleptomania, pyromania, compulsive gambling and certain types of sexual behavior, like transvestism.