Employment Appeals Tribunal (EAT) held that the employer had breached the implied trust and confidence when it gave a false reason for the employee’s dismissal.
In Rawlinson v Brightside Group Ltd UKEAT/0142/17, the EAT considered whether an employee who had resigned in response to a false reason for dismissal could bring a claim for breach of contract for his notice pay.
The Law – Constructive dismissal
In order to claim constructive dismissal an employee must prove that there has been a fundamental breach of contract by the employer so serious that they consider themselves dismissed by the employer. As a result the employee resigns because of the breach. A common claim in constructive dismissal by employees is that the employer breached the implied duty of mutual trust and confidence.
The Case Background
Mr Rawlinson (“the Employee”) started work on 1 December 2014 as Group Legal Counsel at Brightside Group Ltd (“the Employer”), an insurance broking business. His contract had a three month notice period. In January 2015, the Employer’s new CEO raised concerns about the Employee’s capabilities and told his line manager to dismiss him. On 14 May 2015 the Employee was told by his line manager that reporting lines would be changed and the Respondent would be using external expertise. This was to soften the blow to the Employee. The Employer gave him his three months’ notice and his dismissal was confirmed in writing.
The Claimant considered that this was a TUPE situation as they were outsourcing his work and he resigned as he considered they were acting in breach of his contract. He stated that he would not work his notice and claimed wrongful dismissal relying on the breach of contract to claim his notice pay.
The Employment Tribunal (“ET”) rejected the Claimant’s claim and he appealed to the EAT.
The EAT held that the ET had failed to look at all the circumstances when making their decision as the Claimant argued that the Respondent had a common law duty to act in good faith and not mislead him as to the reason for his dismissal. Therefore the EAT allowed the appeal overturning the ET’s decision and substituted a finding that the claim succeeded. The
Points to note for employers
It is important that if you dismiss an employee you give them the real reason for dismissal rather than attempt to soften the blow for them and are able to justify the decision to dismiss them. In any event the real reason would come out as part of the disclosure process in Tribunal action or if an employee makes a subject access request.
5 Fair Reasons For Dismissal Are:
- Breach of a statutory restriction (illegality)
- Some Other Substantial Reason (“SOSR”)
If you have similar issues with your employees and require further assistance regarding performance management or are considering dismissing an employee then please feel free to contact our Employment Solicitor, Sylvia Chan on Sylvia.firstname.lastname@example.org or call 01454 800 008 to discuss.