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You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Mostyn v S and P Casuals Ltd [2018] UKEAT 0158_17_2202 (22 February 2018) URL: https://www.bailii.org/uk/cases/UKEAT/2018/0158_17_2202.html Cite as: [2018] UKEAT 0158_17_2202, [2018] UKEAT 158_17_2202 |
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At the Tribunal | |
Before
THE HONOURABLE MRS JUSTICE ELISABETH LAING DBE
(SITTING ALONE)
![]() | APPELLANT |
![]() ![]() ![]() ![]() ![]() ![]() |
RESPONDENT |
Transcript of Proceedings
JUDGMENT
For the Appellant | MR IAN ![]() (Solicitor) Law ![]() 331c Harrogate Road Leeds LS17 6QD |
For the Respondent | MR ![]() ![]() ![]() (of ![]() Instructed by: ![]() ![]() ![]() 1 ![]() ![]() ![]() ![]() Doncaster South ![]() DN1 2DJ |
SUMMARY
CONTRACT OF EMPLOYMENT - Wrongful dismissal
UNFAIR DISMISSAL - Constructive dismissal
UNFAIR DISMISSAL - Reasonableness of dismissal
The EAT allowed the appeal of the Claimant against a Judgment of the ET dismissing, among other claims, his claim for constructive unfair dismissal. The Claimant had relied on a threat unilaterally to impose a substantial
cut in his basic
pay
(before commission) as a breach of the implied term of trust and confidence. The ET held that the Claimant resigned because of the breach and that the breach was a breach of the implied term, but that the Respondent had reasonable and
probable
cause for imposing the
pay
cut. The EAT held that, given that the breach relied on was a
significant
breach of an important express term (as well as a
pleaded
breach of the implied term) the ET had erred in law in asking itself whether the employer had reasonable and
probable
cause for repudiating the contract of employment. It also held that the ET'
s
conditional decision that any dismissal was unfair could not
stand.
The case was remitted to a different ET for it to consider whether or not the Claimant was unfairly dismissed.
THE HONOURABLE MRS JUSTICE ELISABETH LAING DBE
Introduction
"13. In dismissing the [Claimant's]
claim [for] unfair dismissal the Tribunal held that the employer had reasonable or
proper
cause to unilaterally change the [employee'
s]
terms and as
such
had a defence to the [employee'
s]
claim. With respect to the Tribunal it is contended on behalf of the employee that the Tribunal erred in law when it applied the test as to what amounted [to] conduct likely to destroy or
seriously
damage the relationship of trust and confidence. Further and with respect to the Tribunal, it is also
submitted
that the Employment Tribunal erred in that on the facts as
set
out herein, a justification for the decision to unilaterally and
so
![]()
significantly
change the employee'
s
terms and conditions could not reasonably be
supported/justified."
The Background
"38. There was no doubt in the [Claimant's]
mind that the Respondents were
seeking
to terminate him from his employment by implementing an unfair deduction of wages to a
salary
that the claimant had made clear to the Respondents he was unable to live off or
support
his family."
"73. As indicated earlier, the issues to be determined were clarified by Employment Judge Camp at thePreliminary
Hearing in July of this year."
And at paragraph
75 in which the ET
said:
"75. The Tribunal then moved on to consider whether that action of the Respondent amounted to a breach of the implied term of trust and confidence that is implied into every contract of employment. We have to consider that question because that is the term of the contract which the Claimant alleges to have been breached."
"74. … As we have alreadyset
out in this judgment, we find that the reason the Claimant resigned was that he had been informed by e-mail that his remuneration
package
was going to be changed and that that change was going to effectively be imposed upon him. For reasons already given above, the Tribunal rejects the Respondent'
s
![]()
suggestion
that the Claimant resigned
simply
because he was
planning
to leave the Respondent'
s
employment and move to live in London in any event."
"76. … theparties
to the contract will not, without reasonable and
proper
cause, conduct themselves in a manner calculated or likely to destroy or
seriously
damage the relationship of confidence and trust which
should
exist between employer and employee …"
"77. … Firstly, the Respondent's
action must be
such
that, objectively
viewed,
it is calculated or likely to destroy or
seriously
damage the trust and confidence that
should
exist between employer and employee.
Secondly,
the action must be carried out without reasonable or
proper
cause. Both limbs of the term need to be considered before determining that there has been a breach of it."
"78. The Tribunal considered firstly whether the action of the Respondent was calculated or likely to destroy orseriously
damage trust and confidence. In our
view,
the actions of the Respondent were likely to the damage the trust and confidence between employer and employee. In coming to that decision, we have taken into account the following matters:
78.1. Following the meeting on 26 February, no further written communication was made with the Claimant about the terms of the meeting that had takenplace;
78.2. In his letter of 9 March, the Claimant asked for certain assurances to be given by the Respondent about hisposition
and
particularly
as to his remuneration
package;
78.3. The Claimant thensent
a further e-mail chasing the outcome of a grievance meeting that had occurred on 18 March 2016 following which he received a
very
![]()
short,
and in our judgment, a
very
curt e-mail informing him that
pay
changes were to be imposed upon him;
78.4. In our judgment, that amounted to asignificant
alteration to his remuneration
package
which was a
package
he had enjoyed for a
period
of
some
6 years by that
stage
and represented a change which was to be imposed on him with
very
little by way of consultation."
"80. The context was this: there had been dwindlingsales
figures for the
sales
![]()
staff
but especially for the Claimant by that
stage
over a
protracted
![]()
period
of time. The Respondent believed the Claimant was not taking any
steps
to improve his
sales
![]()
performance.
The offer of an altered remuneration
package
had been made to him on 26 February. Following that date, no alternative
proposals
were forthcoming from the Claimant for a
period
of 10 days, despite the Claimant accepting in evidence that the Respondent was expecting him to go back to the Directors with any alternative
suggestions
of his own. In our judgment, his failure to revert to them was effectively
stifling
any consultation
process
that may have taken
place.
Finally, the Respondent believed that the Claimant was, therefore,
playing
no active
part
in the
process,
nor in the grievance
process
which had been initiated by the Claimant'
s
letter of 9 March."
"85. The Tribunal also finds that, even if we had found that there had been a dismissal in the circumstancesset
out above, we would have gone on to find that it was a fair dismissal on the basis that the reason for the action of the employer was related to the Claimant'
s
![]()
performance,
that it was therefore related to his capability, and that the actions taken for the reasons we have already outlined would have been within a range of reasonable actions open to a reasonable employer in the circumstances."
Discussion
"(1) In determining whether or not the employer is in fundamental breach of the implied term of trust and confidence the unvarnished Mahmud testshould
be applied [Mahmud is another name for Malik].
(2) If applying theSharp
![]()
principles,
acceptance of that breach entitled the employee to leave, he has been constructively dismissed.
(3) It is open to the employer toshow
that
such
dismissal was for a
potentially
fair reason.
(4) If he doesso,
it will then be for the Employment Tribunal to decide whether dismissal for that reason, both
substantively
and
procedurally
… fell within the range of reasonable responses and was fair."
"23. To the EAT's
reasons one can now add the remark of Underhill
P
in Amnesty International
v
Ahmed [2009] ICR 1450,
paragraph
70, in relation to the EAT'
s
decision in this case, that he was "
sympathetic
to the contention that it is unhelpful to introduce into the concept of constructive dismissal a conceptual tool devised for an entirely different
purpose"."
"28. It is nevertheless arguable, I would accept, that reasonableness is one of the tools in the employment tribunal's
factual analysis kit for deciding whether there has been a fundamental breach. There are likely to be cases in which it is useful. But it cannot be a legal requirement. Take the
simplest
and commonest of fundamental breaches on an employer'
s
![]()
part,
a failure to
pay
wages. If the failure is due, as it not infrequently is, to a major customer defaulting on
payment,
not
paying
the
staff's
wages is arguably the most, if indeed the only, reasonable response to the
situation.
But to hold that it is not a fundamental breach would drive a coach and four through the law of contract, of which this aspect of employment law is an integral
part."
"85. … and that the actions taken for the reasons we have already outlined would have been within a range of reasonable actions open to a reasonable employer in the circumstances."