17 May 2018

In the recent case of Kaur v Leeds Teaching Hospitals NHS Trust [2018] EWCA Civ 978, the Court of Appeal reviewed and clarified the law on constructive unfair dismissal, in particular cumulative or "last straw" type cases.

Facts

Ms Kaur, who had been a nurse for the Leeds Teaching Hospitals NHS Trust (the Trust) for six years, had previously been put though a performance and capability process, to which she had objected. She had then made bullying allegations in respect of which she had filed a grievance and, most recently, an allegation was made against her of a verbal and physical altercation with a colleague (who was one of those alleged to have been bullying her). Both Ms Kaur and her colleague were taken through a thorough disciplinary process and given final written warnings, and Ms Kaur appealed. The Trust "folded in" Ms Kaur's grievance to her disciplinary process.

Ms Kaur had been on sick leave since the altercation with the colleague, and was due to give birth after having filed her appeal against the final written warning, so the process was delayed accordingly. When a decision was finally reached, her appeal was dismissed. She resigned the next day claiming that the appeal decision was the "last straw", and that by treating her in the way she alleged that it had historically, the Trust had breached its duty not to behave in such a way as to destroy or seriously damage the trust and confidence between the parties (ie she alleged the Trust had breached the implied term of trust and confidence). Ms Kaur said that the dismissal of her appeal formed part of this cumulative treatment amounting to a fundamental breach, and that her resignation was triggered by this "last straw", namely the appeal decision.

Employment tribunal decision

Ms Kaur's claim to the employment tribunal (ET) for constructive unfair dismissal was struck out by the ET at a preliminary hearing. Having reviewed the case on paper, the employment judge decided that Ms Kaur had no reasonable prospects of showing any breach by the Trust of the implied term not to destroy trust and confidence. This was because the handling of her grievance and disciplinary by the Trust was evidently and objectively reasonable, with a fair process having been followed, and further that having affirmed this earlier treatment by not resigning in response to it at the time, Ms Kaur could not now seek to revive the previous treatment and bring it all back into the scope of what she now wished to argue was a cumulative pattern of behaviour forming a fundamental breach of contract by the Trust.

Employment Appeal Tribunal decision

Ms Kaur appealed to the Employment Appeal Tribunal and her appeal was rejected. She then appealed to the Court of Appeal.

Court of Appeal decision

The Court of Appeal issued a helpful judgment clarifying the types of constructive dismissal claim it is possible to bring, along with the proper treatment of a "last straw" case, particularly where the employee does not resign in response to earlier alleged poor treatment, but later wishes to refer to it as part of a whole when summarising the cumulative nature of their constructive unfair dismissal claim.

The Court of Appeal clarified that:

  • To claim constructive unfair dismissal, an individual has to have resigned in response to a repudiatory (fundamental) breach of contract by the employer
  • As well as "ordinary" fundamental breaches of contract (eg reducing an employee's salary by 50% unilaterally), fundamental breach can include the employer's breach of its duty not to behave in such a way as to destroy or seriously damage the trust and confidence between the parties (ie the implied term of trust and confidence)
  • Such a trust and confidence breach could be immediate, eg the employer being unexpectedly physically violent to the employee. This is not a "last straw" or cumulative type case
  • Other trust and confidence breaches could be gradual and cumulative. The resignation would be triggered by what can be referred to as the "last straw", or the final, triggering act in a series of acts that the individual argues together evidence a destruction of trust and confidence between the parties.

It is the final bullet point above with which the Court was concerned in this case, undertaking a further analysis into what can properly constitute a "last straw".

The Court of Appeal considered whether the dismissal of Ms Kaur's disciplinary appeal was sufficiently unreasonable to constitute part of the destruction of trust and confidence alleged in this case – and if it was not, was this a bar to their consideration of the rest of the alleged historic poor treatment by the Trust? This rationale for assessment followed the case of London Borough of Waltham Forest v Omilaju [2004] EWCA Civ 1493, in which the Court of Appeal confirmed that after a period of affirmation (ie the individual not resigning despite the employer's alleged unreasonable behaviour), the prior behaviour could be taken into account in a "last straw" or cumulative treatment case, provided that the last straw itself was also unreasonable enough to form part of the overall unacceptable treatment.

In Omilaju the Court decided that the final triggering act in that case (the employer withholding the employee's wages) was not sufficient to form part of the overall alleged poor treatment, and as such the employee was not permitted to rely on earlier alleged unacceptable treatment (having affirmed – not resigned - in the interim) when putting his case for constructive unfair dismissal. As such, Omilaju is authority for the "last straw" needing to be more of a "big stick" in a case where the employee has not yet resigned, ie it needs to be unreasonable in its own right if the employee is to be permitted to group together all of the historic poor treatment into one cumulative allegation of destruction of trust and confidence. The last straw does not itself have to be a fundamental breach but it must be more than just a trivial matter.

In Ms Kaur's case, the ET's position was upheld and her appeal dismissed, as the Court of Appeal found that the judge had looked at all of the matters Ms Kaur wished to accumulate for her constructive unfair dismissal claim (not finding, in this case, that her failure to resign was in fact an affirmation) and that he had found, fairly, that none of her complaints including the Trust's dismissal of her appeal had reasonable prospects of constituting part of a fundamental breach and therefore it was right for her claim to have been struck out.

Comment

This case is most useful for its summary of the specifics of constructive unfair dismissal claims, rather than the findings particular to Ms Kaur. The Court of Appeal emphasised its keenness for all parties to fully understand the difference between the types of constructive unfair dismissal that can be brought, as highlighted above. Employers facing allegations of "last straw" constructive unfair dismissal would be well advised to assess those claims at an early stage against the rationale clarified in this case, and defend them accordingly.