Tribunal Tales – Sorry Seems to be the Hardest Word

A recent case from the Employment Appeal Tribunal (EAT) has clarified that an employer can rescue the situation even where a manager has reacted over-zealously and inappropriately to an employee’s conduct.

The employee was sent a letter suspending him pending an investigation into his alleged non-attendance at work on one day and subsequent failure to attend a team meeting two days later. During the investigation meeting, it became clear that his non-attendance at work was by prior arrangement with his manager, and that he was on holiday the day of the team meeting. No action was therefore taken against the employee, but he raised a grievance against his manager accusing him of undertaking malicious and spurious disciplinary actions against him and complaining about the short notice given of his investigatory meeting.

The employee was then given a new contract which, while changing his job title, did not otherwise alter his terms and conditions. The employee refused to sign it, as he considered his hours were being reduced (although the tribunal found this not to be the case). The employee also sought an apology from his manager, which the manager refused to give. The employer said that he had three options – sign the terms and conditions and return to work with no further action, sign the terms and conditions and return to work at another location, or resign. The employee resigned, complaining about the treatment at the hands of his manager, and that he was being forced to sign a new contract which involved a demotion and reduced hours. He went on to claim constructive dismissal before the employment tribunal.

The tribunal found that the actions of the manager, in calling the employee to a team meeting during his holiday, asserting he was absent without permission on one day, (whereas, in fact, the manager had himself formally sanctioned that absence), and thereafter refusing to apologise, were acts likely to damage the relationship of trust and confidence between himself as manager and the employee. However, the tribunal went on to find that the actions of the employer’s more senior managers, in believing and accepting the employee’s account of events about his holiday during the investigatory meeting, stating that no further action would be taken and three days later offering the employee the option of a transfer to another nearby location under a different manager, prevented the manager’s conduct from constituting a breach of the implied term of trust and confidence entitling the employee to resign and regard himself as constructively dismissed. His claim therefore failed.

On appeal to the EAT, the employee argued that the tribunal had misdirected itself in law. There was existing authority which said that once an employer had committed a fundamental breach of contract, it could not repair that breach. He therefore argued that since the tribunal had found that the manager’s actions were acts likely to damage a relationship of trust and confidence between employer and employee, the tribunal ought to have found that he had been constructively dismissed.

The EAT disagreed with this argument, and dismissed the appeal. It held that the tribunal’s decision was such that it found the manager’s actions to be unreasonable, but not so bad as to amount to a fundamental breach of contract. In effect, the senior managers’ actions rescued the manager’s unreasonable conduct. However, if an employer does fundamentally breach the employee’s contract, then the situation cannot be remedied.

The decision will come as some relief to employers. As the EAT pointed out, the whole purpose of a grievance procedure is that an employee has the opportunity to put forward concerns about employer behaviour. If every grievance which was upheld resulted in a possible constructive dismissal claim, that would defeat the purpose of the grievance procedure. In this case, the manager concerned had acted unreasonably, but the employer as a whole had not gone so far as to fundamentally breach the contract of employment. However, employers should not assume that unreasonable behaviour on their part will always be capable of being remedied – this will always be a matter of fact and degree.

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