There are many ways in which employment relations end. Some of these include; (a) employer termination of contractual relations for misconduct with or without notice; (b) termination of contract due to job abandonment; (c) end of employment relationship due to completion of a fixed-term contract; and; (d) constructive dismissal[1]. Constructive dismissal is unique and involves employee termination employment relations due to contractual breaches arising from employer’s conduct[2]. In the case of Frankie’s Food, Adele Jones left her employer “collected her belongings” and informed her new manager Sharon that she would not be returning to her position. Frankie’s Food received a notice from Adele’s solicitors that she would be pursuing a claim against the company at the employment tribunal for unfair dismissal. The current paper will evaluate whether Adele has any claims against Frankie’s Food and the merits of such claims.
Rules
Generally, The Employment Rights Act 1996 provides guidance on the circumstances under which an employment relations can be terminated. Section 95 (1) (c) grants employees the power to terminate employment relations, with or withough notice, if they concluded that the behavior of their employer contravenes the employment contract. Such termination of relations is known as constructive dismissal. The section provides that the employee is entitled to dismiss the employment contract if they feel that the employer’s conduct contravenes their employment contract. In this case, the central issue is the employer’s conduct rather than the misconduct of the employee. The test in such a case is whether the employer’s conduct was so egregious as to amount to an action that repudates the contract. When evaluating the employer’s behavior, the employment tribunal will examine the facts of the case objectively, including the events that led to the constructive dismissal.
In interpreting the act, the tribunal relies on a number of cases, of which Western Excavating (ECC) Ltd v. Sharp (1978)[3] is one of the most important. The case provides guidance on constructive dismissal in employment relations. In the case, Lord Denning argued that if the conduct of an employer contravenes the terms of the contract, then such conduct indicates that the employer no longer values the employment relations, and is not willing to be bound by the terms of the employment contract[4]. In such circumstances, then the employee should consider that he or she has been constructively dismissed and can be able to terminate the contract if he or she believes so. If then the employee terminates the contract, then the reason for the termination is the conduct of the employer. Under Section 95 (1) (c), the employment tribunal will recognize that termination as an actual dismissal[5].
The terms of an employment contract comprise those stipulations that define the obligations and rights of those bound by the contract. There are two types of contractual terms, express and implied[6]. Express terms refer to those terms that an employer and an employee lay down when entering into a contract. These terms can either be oral or written statements. When examining oral statements, the court will consider a wide range of factors, including their relative importance, the timing of the statement, the strength of the statement, and the knowledge of contracting parties. On the other hand, written statements are generally put down in writing, and a signatory cannot successfully argue against written statements, as illustrated by L’Estrange v. Graucob Ltd (1934)[7]. When evaluating whether employee misconduct was responsible for the constructive dismissal, the court will rely on the contract test outlined in Wester Excavating Ltd. V Sharpe (1978)[8]. The test provides that if an employer’s conduct contravenes one or more essential terms of an employment contract, then they no longer will to be bound, and thus, the employee has a right to discharge themselves from duty.
When there are no express terms outlined in the contract, or if the facts of the case are not related to the express terms, then the employment tribunal will rely on implied terms when making its decision[9]. Implied terms arise from the relationship between the two contracting parties. These can either be implied from facts, law, or customs. In employment obligations, there are key implied terms of employees or employers. Examples of such implied terms of employers include a duty to ensure the safety of the employee, duty to pay wages, and the duty to provide reference[10]. On the other hand, employees have the duty to obey reasonable orders, duty to obey the law, duty to act in good faith, and the duty to exercise reasonable skill and care. Most of these duties are not alienable and are often thought to hold in any contract, even when the express terms of the contract do not outline these duties and obligations. A court will imply these duties hold in any employer-employee dispute.
However, in constructive dismissal, the implied term of confidence and trust remains the most important when the employment tribunal determines whether the employer contravenes their contractual obligations. The implied terms were outlined in BG v Mr. P O’Brien (2001), in which the Employment Appeal Tribunal argued that if objectively, the conduct of the employer eroded the confidence and trust of the employee then, such conduct can be considered as repudiating the contract[11]. The reason is that eroding confidence and trust between an employee and an employer goes to the root of the employment of the contract. The importance of confidence and trust as an implied term was further affirmed in MacLean v. Menzies Distribution Limited (2020), where the employment tribunal argued that the implied obligation of confidence and trust enforces the principle that the employer has a duty to promote confidence and trust, and owes that obligation to their employees[12].
In constructive dismissal cases, the tribunal will either look at a specific instance of conduct or a series of actions that contravene the obligation of confidence and trust. The last action by the employer does not matter when the tribunal is examining the facts of the case. In any dispute, the tribunal will evaluate whether proceeding actions by the employer eroded confidence and trust between parties in employment relations. Browne-Wilkinson P, in Woods v W M Car Services (Peterborough) (1982), argued that the intention of the tribunal is not to show that the employer through their conduct did not want to repudiate the contract, but rather the function of the tribunal is to evaluate the conduct as all actions that may have eroded confidence and trust, and determine whether as a whole they contributed to the constructive dismissal[13]. An employee will not have a remedy if there is no indication that cumulative conduct repudiated the contract, even if the employee was untreated unfairly by the employer. As such, the last action by the employer may not be significant in the proceedings. The employee can rely on the prior actions of the employer to justify their claims against the employer.
The ‘last straw situation’ outlined in Woods v W M Car Services (Peterborough) Ltd (1982)[14] refers to the last action that the employer took that forced the employee to leave their duties. In formulating the last straw doctrine, the tribunal argued, while it is not significant, it should be so trivial. The necessary quality of the last straw is that it should be an action by the employer, in a series of actions whose cumulative effect would repudiate the contract. The act may be less serious relative to previous actions. Essentially, it should provide some weight to the conduct of the employer and their unwillingness to be bound to the contract to have any meaningful impact on the decision of the tribunal. It has to contribute something to the whole breach, even if it has little significance on the cumulative effects of the conduct. While it may be less blameworthy, it must not always be unreasonable[15]. If it is not capable of adding any substance to earlier actions, the tribunal does not have to examine the prior actions of the employer when deciding the case.
While the straw may not always allow an employee to pursue a successful claim against an employer, it does not mean that a single event will not lead to a successful claim for unfair dismissal, as illustrated in Isle of Wight Tourist Board v Coombers (1976)[16]. In the case, a senior officer described a 58-year woman who was a member of the tourist board as an “intolerable bitch on a Monday morning.” The woman had been a member of the board for 15 years[17]. The woman was able to successfully bring a claim of unfair constructive dismissal against the board over the incident. On the other hand, an assistant in Courtaulds Northern Textiles Ltd v Anderson (1979) was able to bring successful action against the employer after a manager outrightly told the employee that they could be able to do their “blood job anyway[18].” These two cases show that an employee can rely on a single event to illustrate that the employer was unwilling to be bound to the implied terms of the duty to confidence and trust.
When examining any claims, the tribunal will also consider the time the employee considers an employer’s action as so damaging that he or she cannot continue working and the time that he or she resigns. If there is a significant delay between the last straw and the time that the employee resigns then, the employee may not be able to pursue a successful claim against the employer. In WE Cox Toner International Ltd v Cook (1981), the tribunal dealt with a case of accusation of gross dereliction of duty involving a company director[19]. However, there were no substantial grounds for the accusations. The company director consulted his lawyers over the matter in the next six months before taking his case to the tribunal. However, the case was not successful during appeal due to the delay between the allegations, and decided to pursue the claim. In making the decision, the tribunal argued such a delay may imply that the employee still wants to be bound to the employment contract, and therefore cannot successfully claim unfair constructive dismissal.
Application
In applying the rules of the case, it is essential to consider the issues in the case. Adele Jones has been working with the company for more than ten years. She has been receiving the same compensation as other employees for the same duties while engaging in similar activities as other employees. However, a new manager was appointed to manage Frankie’s Food. Adele claimed that Sharon, the new manager, was micro-managing her, often criticizing her work, conversations, and the contents of her email. Adele informed the management about Sharon’s conduct, but the management did not take any action. Adele decided to leave the job when Sharon abused her in front of other employees. Her solicitors sent a letter to Frankie’s Food one week after her resignation informing the CEO that she would be pursuing a claim against the company.
The first step in evaluating whether the claim would be successful is essential to examine whether there were implied terms about how managers should conduct themselves when performing their managerial duties. The facts of the case do not indicate any express terms in the contract between Frankie’s Food and Adele Jones. However, the tribunal could evaluate the terms of her contract and even the company’s policy to determine whether the manager’s conduct contravened the terms that the two aggreed on when Adele was joining the company. Since there are no express terms outlined in the case study, the tribunal cannot rely on the contract test outlined in Western Excavating Ltd. V Sharpe (1978)[20]. In the absence of express terms, the tribunal will rely on implied terms, of which confidence and trust between employers and employees are the most important, as illustrated in BG v Mr. P O’Brien (2001)[21].
The first question is whether micromanaging an employee would amount to an erosion of trust and confidence in employment relations. Micromanagement is a subjective term, and its meaning varies from one person to another. One may consider micromanagement as interaction, attention, and support, while another one may consider it as interference, excessive control, manipulation, and meddling[22]. Since there is a large gap between the perceptions of a manager about micromanaging and those who are subject to it, a manager may not be able to identify it as a potentially negative behavior. However, the facts of the case study show that Adele had been working in the company for some ten years, and there have not been prior issues about her conduct. Such a long duration of employment, without any indication that the performance or conduct of the employee had deteriorated, it could mean that the change in management may have been a critical factor in the events leading to the constructive dismissal.
Micromanagement for an employee who has been in the workplace for such a long duration of time may be indicative of loss of trust and confidence in the employee. Empirical evidence shows that employers who do not trust their employees or those who do not have confidence in the skills or competencies of their employees are more likely to micromanage their employees[23]. Such employers have lost cognitive-based trust and affective-based trust towards their employees. However, for the employee to successfully bring a claim against the employer, they must be able to show that the employer had lost trust in the employee, not due to deteriorating competence, skills, or conduct, but rather due to unsubstantiated lack of trust in the employee. In this case, Adele claims that Sharon often criticizes her conversations, the contents of her email and even constantly monitors her work. The events began six months ago. If there is no indication of previous misconduct or complaints about her work during the period or prevailing period, then Adele’s may be able to bring a successful claim against the employer.
The other issue is whether the failure of the management to intervene after Adele reported incidents indicates a breach of implied terms. The tribunal would likely find it to be the case. Failure to resolve the issue shows that the management was unwilling to provide a safe working environment for Adele. Lord Denning in Woods v WM Car Services (Peterborough) Ltd (1981) provides some insight into the issue[24]. Each employer should be considerate of the affairs of their subordinates. The scope of the implied duty of confidence and trust is so broad and covers a wide range of issues, including criticizing employees, unreasonable accusations, and even verbal abuse[25]. The failure of the company to investigate the matter even after Adele reported the matter to the management implies a loss of confidence and trust in the employee, which means the possibility of a successful claim is high. The management did not consider the affairs of Adele, nor did it investigate any claims that were brought forward. Unfortunately, even if Adele did not report the claims, the management would not mount a sufficient defense on the basis of ignorance.
The last issue is the last straw, where Sharon abused Adele in front of other employees, which forced Adele to leave her place of employment. Three cases are of particular interest here in determining whether the last straw has meaningful implications on the prior conduct of Sharon. First, one has to consider whether it has a substantial effect. As Isle of Wight Tourist Board v Coombes (1976) illustrates, a single abusive event can result in successful claims against an employer[26]. In the case, the employee was able to pursue a successful claim on the basis that a senior had abused a woman in a single event, meaning that abusing an employee can lead to a successful claim against an employer. Since the last straw is so egregious, it can stand alone and allow Adele to proceed with a successful claim or encourage the tribunal to look for proceeding conduct as demonstrated in London Borough of Waltham Forrest v Omilaju (2005)[27].
When evaluating the last straw, it is critical to examine the time between the last straw, actual resignation, and the time of letter informing the management about the claim of unfair constructive dismissal. After Sharon abused Adele, the latter left immediately and informed her manager that she would not be returning. There is no significant delay between the last straw and the resignation. Frankie’s Food cannot amount defense on the basis of the decision in WE Cox Toner International Ltd v Cook (1981)[28], as Adele’s decision was immediate. As such, she did not affirm her contractual obligations by continuing to work. Furthermore, while Adele did seek managerial input on the issue prior to the resignation, the management did not take any action. Lastly, Adele pursued the matter with her solicitors, with the latter sending a letter informing the management about the claims about one week after the incident.
Conclusion
Adele can successfully bring a claim against Frankie Food for unfair constructive dismissal. When evaluating the case, one has to consider the cumulative actions of the employer, the final straw, and the time of resignation. In any employment relationship, employers have a duty of confidence and trust to their employees. Any conduct so egregious that it erodes the duty of confidence and trust erodes the duty and repudiates the contract. Under such circumstances, the employer may decide that they do not have to put up with the conduct of the employer and leave their position. The last straw alone has sufficient credence to allow for a successful claim against Frankie’s Food and encourage the employment tribunal to examine prior conduct of the management.
Cumulatively, the actions of the new manager, Sharon, show that the management did not have confidence and trust in Adele, and therefore were not willing to be bound in the employment relations. Micromanagement indicates a loss of trust in an employee in their ability to execute their responsibilities, and it could be understood as manipulation, excessive control, and meddling. Lastly, the timing of resignation does not affirm that Adele wants to be bound by the employment contract. She leaves immediately after the verbal abuse and informs the management about her willingness to pursue the claim one week later. Thus, the probability that the claim is viable is high.
Bibliography
Case Law
Bg Plc v O’Brien [2001] UKEAT 1063_99_1405
Courtaulds Northern Textiles Ltd v Andrew (1979) IRLR 84
Isle of Wight Tourist Board v JJ Coombers [1976] IRLR 413)
L’Estrange v F Graucob Ltd [1934] 2 KB 394
MacLean v Menzies Distribution Ltd [2020] 4107699/2019.
Omilaju v Waltham Forest London Borough Council [2004] EWCA Civ 1493
The Employment Rights Act 1996
W.E. Cox Toner (International) Ltd. v Crook [1981] ICR 823
Waltham Forest v Omilaju | [2005] ICR 481
Western Excavating (ECC) Ltd v Sharp [1978] ICR 221
Woods v WM Car Services (Peterborough) Ltd [1982] ICR 69
Books and Journal Articles
Schirru E, and Brown J, ‘Constructive Dismissal: A Primer’ (Koskie Minsky LLP, 2015) <https://www.hrreporter.com/employment-law/news/constructive-dismissal-a-primer/317827> accessed 19 December 2021
Oloko L, ‘Workplace Trust and Micromanaging Behavior in Rivers State Restaurant Industry’ (2019) 8 Scholarly Journal of Business Administration
Lewis D, and Sargeant M, Essentials of Employment Law (Chartered Institute of Personnel and Development 2009)
[1] Ernest Schirru and Jody Brown, ‘Constructive Dismissal: A Primer’ (Koskie Minsky LLP, 2015) <https://www.hrreporter.com/employment-law/news/constructive-dismissal-a-primer/317827> accessed 19 December 2021.
[2] ibid
[3]Western Excavating (ECC) Ltd v Sharp [1978] ICR 221
[4] Ibid page 29 para 15
[5]The Employment Rights Act 1996
[6] David Lewis and Malcolm Sargeant, Essentials of Employment Law (Chartered Institute of Personnel and Development 2009). P. 18
[7]L’Estrange v F Graucob Ltd [1934] 2 KB 394
[8]Western Excavating (ECC) Ltd v Sharp [1978] ICR 221
[9] ibid
[10] David Lewis and Malcolm Sargeant, Essentials of Employment Law (Chartered Institute of Personnel and Development 2009). P. 18-20
[11]Bg Plc v. O’Brien | [2001] UKEAT 1063_99_140
[12]MacLean v Menzies Distribution Ltd [2020] 4107699/2019.
[13]Woods v WM Car Services (Peterborough) Ltd [1982] ICR 693
[14] ibid
[15]Waltham Forest v Omilaju | [2005] ICR 481
[16]Isle of Wight Tourist Board v Coombers [1976] IRLR 413, EAT
[17] ibid
[18]Courtaulds Northern Textiles Ltd v Andrew (1979) IRLR 84
[19]W.E. Cox Toner (International) Ltd. v Crook [1981] ICR 823
[20]Western Excavating (ECC) Ltd v Sharp [1978] ICR 221
[21] Bg Plc v O’Brien [2001] UKEAT 1063_99_1405
[22] Lawrence Oloko, ‘Workplace Trust and Micromanaging Behavior in Rivers State Restaurant Industry’ (2019) 8 Scholarly Journal of Business Administration. P. 35
[23] ibid
[24]Woods v WM Car Services (Peterborough) Ltd [1982] ICR 69
[25] ibid
[26]Isle of Wight Tourist Board v JJ Coombers [1976] IRLR 413)
[27]Omilaju v Waltham Forest London Borough Council [2004] EWCA Civ 1493
[28]W.E. Cox Toner (International) Ltd. v Crook [1981] ICR 823
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