Source: Warhammer Fantasy: 4th Edition

Character and Unit Psychology
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A unit accompanied by a character may use the character's leadership value for any leadership tests. This is a very important rule, as it provides units of poor troops with the leadership they need. This is especially true of Goblins which are all but useless without a proper character to lead them. Leadership is used for psychology tests, rally tests, and break tests in combat.

If a unit is joined by several characters use the highest leadership amongst them. While the character is with the unit he is considered to be part of the unit in all respects. If the unit is broken in combat and flees then he is broken and must flee with them at the same speed.

If the unit panics, or is forced to flee because of a fear or terror test, then the character is also forced to flee even if he is immune to fear or terror himself. If the unit is affected by frenzy or forced to pursue because of hatred, the character must move with the unit, but he does not benefit from the bonuses for frenzy unless he is affected by frenzy himself. This means a character does not go into a frenzy just because he is with a unit that can do so, although he can accompany them as they charge. If a unit is affected by stupidity the character must move as the unit moves, although he can always fight normally. Remember, a character cannot leave a unit when it turns stupid and stands still or moves stupidly; such a unit is bound by a compulsory movement rule and the character must therefore stay put. In reality he is trying to goad the stupid creatures into activity, or perhaps he is pinned down or hemmed in by the unthinking brutes and unable to move of his own volition.

If a character is liable to a psychological rule which doesn't apply to the unit he is with, he must make any appropriate tests on his own and will react on his own. This may cause the character to separate from the unit. For example if he is obliged to charge because of frenzy, compelled to pursue because of hatred, or forced to move or stand immobile due to stupidity.