Employer’s poor treatment needs to be ‘really serious’ for a successful claim
Employees considering claiming constructive dismissal need to do much more than just show their treatment is something they disagree with or don’t like. Potential claimants should make an assessment the risks involved before deciding how to respond to such a situation at work, and employers should be reassured that an employee faces a significant burden in proving his or her case.
Tribunal and EAT
A recent Employment Appeal Tribunal (EAT) decision in the case Frenkel Topping v King
is a good reminder of these points. In the case, the employee succeeded in her claim of constructive dismissal (and, therefore, unfair dismissal) on the basis of her numerous allegations of poor treatment. These included unfair and inappropriate criticism of her performance, which on one occasion involved her being humiliated in front of colleagues, and threats to increase her working hours. However, she failed to prove that the reason for her treatment – and, therefore, for her constructive dismissal – was a number of protected disclosures she had made about charging arrangements to clients (in other words, whistleblowing).
Her resignation (necessary for a constructive dismissal claim) was found to have been principally because of the breakdown of trust and confidence between her and her employer caused by her various complaints rather than the two whistleblowing disclosures she had made. So she succeeded in claiming ‘normal’ unfair dismissal but not in her claim of automatically unfair dismissal for whistleblowing, to which the cap on compensation does not apply.
The tribunal was held to have been entitled to reach the conclusions which it did but the EAT, as its summary of the case put it, reminded tribunals that the conduct an employee is complaining of must be "really serious". In its decision, the EAT emphasised the "stringency" of the constructive dismissal test which requires an employee to show what has been described as "conduct with which an employee could not be expected to put up".
The EAT also reiterated the point that the legal test for whether or not a constructive dismissal claim can succeed is not whether the breach complained of is the principal reason for the employee's resignation but whether the employee resigned because some or all of the employer’s conduct amounted to a repudiatory breach of contract (in other words, sufficiently serious that it brings the employment contract to an end).
The employer’s poor treatment of the employee need not be the only reason for the employee deciding to leave. Employees considering whether to claim constructive dismissal would need to look at a variety of interlocking issues, including the costs and uncertainties of subsequent legal proceedings, the risk of damaging their own reputation as a result of bringing such a claim, and the likely level of compensation they can expect given they have a duty to take reasonable action to minimise the amount of loss they have suffered.
Employees need to consider the prospects of success given that they have to establish a breach of the implied duty to maintain mutual trust and confidence in employment contracts in circumstances where they cannot establish that there has been a breach of an express contractual term. This requires the employer behaving “in a manner calculated or likely to destroy or seriously damage the relationship of confidence and trust between employer and employee".
Some employer treatment will obviously constitute constructive dismissal - such as failing to pay agreed remuneration or reducing an employee’s status without reasonable or proper cause. But in other cases, such as generalised poor treatment, a change of reporting lines and so on, the situation may be far from clear cut.
Charles Wynn-Evans is a partner at Dechert LLP