Constructive dismissal: should I stay or should I go?


30th January 2024

Many people are familiar with the term “constructive dismissal” whereby an employee resigns in response to their employer’s breach of an express or implied term of their employment contract.

It is a complex area of law. Although the employee has resigned, for employment law purposes, they have been “dismissed”. However, the employer’s breach must be sufficiently serious and fundamental, for example, a unilateral reduction in the employee’s pay or extensive changes to their duties without consent. Another scenario is where there is a breach of the implied term of trust and confidence, for example, the employer refuses to investigate the employee’s grievance. The breach may be a single act or a series of acts over a period of time that ends with a “last straw” incident. The employee must not wait too long before resigning otherwise there is a risk that the employer will argue that the employee has affirmed the contract by continuing to work.

The Employment Appeal Tribunal (EAT) recently considered the issue of affirmation in the case of Dr Leaney v Loughborough University.

Background

Dr Leaney was a lecturer in the School of Engineering and had first joined the University as a research assistant in 1979. He was also a warden for the halls of residence.

In November 2018, student X, who lived at a hall of residence, self-harmed and raised a concern about how Dr Leaney had handled the matter. In January 2019, a disciplinary investigation concluded that there was no formal case for him to answer. However, there were some concerns about Dr Leaney’s judgment and he was asked to discuss these informally. Dr Leaney then raised a grievance which was only partially upheld and he appealed that decision in May 2019.

In June 2019, Dr Leaney resigned as warden because of the failure to set up the appeal panel. A letter from the Director of Human Resources, Ms McKinley, accepted the resignation but also referred to various concerns that the University had had for some time about Dr Leaney’s approach to the role.

In January 2020, Dr Leaney wrote to Ms McKinley. He emphasised how important it was to him to have the grievance appeal, He also asked for more details and evidence about the concerns she had mentioned. She replied indicating that they should draw a line under the matter. Dr Leaney subsequently met with the Vice-Chancellor and Ms McKinley wrote to Dr Leaney suggesting once again that they draw a line under the matter.   

On 28 June 2020, Dr Leaney contacted the Dean of the School of Engineering and said that he wanted to discuss his work and student X. They had a Teams meeting on 29 June 2020 and although the Dean said that the School of Engineering could make some arrangements about the work, the student X issue was a matter for the University.

Dr Leaney instructed solicitors on 1 July 2020 and although some negotiations followed, they were unsuccessful. Dr Leaney regarded this as the “last straw” and the date was 7 September 2020.

With the new academic year approaching, he was signed off sick from 10 September 2020 with work stress and anxiety (his first time off sick in 40 years). He did not return to work and resigned on 28 September 2020.

Employment Tribunal

Dr Leaney claimed constructive unfair dismissal on the basis of a cumulative breach of the implied duty of trust and confidence in that the University had failed to address the issues he had raised.

The Employment Tribunal concluded that as it had no evidence about what had happened during the negotiations and there was nothing to infer that the University had engaged in any misleading or underhand conduct, it could not accept the date for the “last straw”. The last act that could be relied on was the Teams meeting with the Dean on 29 June 2020.  

The Employment Tribunal dismissed the claim. It held that between 29 June 2020 and Dr Leaney’s resignation, he had affirmed the contract and had not been constructively dismissed. There was a delay of nearly three months before resigning, there was no evidence that the University misled him during the negotiations, Dr Leaney did not work “under protest” from 29 June 2020 and he was in receipt of competent legal advice. Further, there were no other particular circumstances that would justify such a delay in considering whether to resign or in tendering that resignation.

Having made that decision about affirmation, the Employment Tribunal did not determine whether the University was in fundamental breach of contract.

Dr Leaney appealed the decision relating to affirmation.

Employment Appeal Tribunal

The EAT held that the Employment Tribunal had taken the wrong approach when considering the issue of affirmation.

Its conclusion was that Dr Leaney had affirmed the contract by the time of his resignation on 28 September 2020 but it did not identify any particular conduct of his, or a date on which affirmation occurred between 29 June 2020 and the resignation.

The Employment Tribunal referred to things that did not happen, for instance, Dr Leaney had not said that he was working “under protest”. What the Employment Tribunal should have done was to focus on what conduct there had been during the relevant period that might or might not have amounted to an express or implied communication of affirmation rather than simply the delay in resigning.  

Dr Leaney had decades of service. However, the Employment Tribunal did not specifically address whether resigning might involve particular upheaval and distress for him and that he might reasonably have needed some time to come to such a significant decision as resigning. Dr Leaney’s sickness absence was also something that should have been considered in the overall context as to whether he had affirmed the contract. In addition, the Employment Tribunal failed to give sufficient attention to the potential significance of the negotiations. Dr Leaney’s position was that the negotiations might have resolved his concerns.

The matter was remitted to the same Employment Tribunal for fresh consideration of the issue of affirmation. Depending on its decision on that point, the Employment Tribunal may then have to consider whether or not there was a fundamental breach of contract.

Comment

Potential constructive unfair dismissal claims are very challenging for employees. They have to make a difficult decision about whether to resign and be without a job and then pursue proceedings, with all the risks those entail. In some cases, there may be a clear, fundamental breach by the employer but in many cases, it is not so straightforward. Each case is decided on its own facts. However, there are challenges for employers too, as this decision illustrates. If an employer wants to argue that the employee has affirmed the contract, it will need to look very carefully at the employee’s conduct during the relevant period and not simply consider the time it took the employee to resign. What is important is to ensure that where concerns are raised, these are dealt with thoroughly and promptly.

For a different perspective about resignations, see our recent article about “in the heat of the moment” resignations.

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