First step: Don’t overreact. Don’t make accusations and don’t threaten.
Second step: If the employee’s stress is severe, get help for him or her from a professional counselor or a psychologist.
Third step: If the stress, and the resulting poor job performance, is caused by the employee’s personal (non-work) life, then back off. Don’t try to be a father, mother, brother, sister, priest, minister, or psychiatrist to your employees.