To establish constructive dismissal, claimants must show that the organisation’s actions amounted to a serious breach of contract that led to their resignation. However, this can be difficult to prove if they continue to work for the organisation after such an action, as this can suggest their affirmation to this breach. An example of conduct which can give rise to constructive dismissal is breaching the implied term of mutual trust and confidence between an employee and the organisation, which, due to case law, is also known as the Malik term.
The ‘last straw’ principle relates to a series of actions by an organisation which can, overall, lead to a breach of the Malik term. The Court of Appeal in Omilaju v Waltham Forest LB outlined that the last action which leads to a resignation does not need be the most serious but must contribute to the breach overall. An innocuous act, in other words something that is deemed not to be harmful, will not count.
In another Court of Appeal case, Kaur v Leeds Teaching Hospitals, the Court set out five principles for tribunals to consider in establishing if an employee has been constructively dismissed:
- What was the most recent act (or omission) on the part of the organisation which the employee says caused, or triggered, their resignation?
- Have they affirmed the contract since that act, such as by continuing to work for the organisation?
- If not, was that act (or omission) by itself a breach of contract?
- If not, was it nevertheless a part (applying the approach explained in Omilaju) of a course of conduct comprising several acts and omissions which, viewed cumulatively, amounted to a repudiatory breach of the Malik term?
- Did the employee resign in response (or partly in response) to that breach?
In this case, the claimant worked for a school and was considered disabled due a mental impairment. This meant that he had problems responding to stressful environments. He was suspended due to a child protection matter whilst the school implemented a disciplinary procedure and conducted their own investigations. Prior to his suspension, the claimant downloaded a number of school files and shared them with his trade union representative, in an attempt to gather evidence he was being mistreated.
As the disciplinary procedure went on, the claimant was allowed to return to the school and asked to organise a sport’s day, however this served to exacerbate his mental health condition and led to sickness absence. At this point, he was informed that the accusations against him related to his mishandling of a child. However, the school refused to disclose who had made the accusation, who the child was and what it was alleged he had actually done. In response, the claimant raised a grievance, citing the situation had been handled poorly and was having a negative impact upon him.
The disciplinary procedure was paused whilst the grievance was investigated and it was at this point the school discovered that the claimant had downloaded the files. They implemented a separate disciplinary against him and the union representative, for breaching the school’s data protection policy. Upon the rejection of his grievance, the original disciplinary procedure recommenced, with the claimant still not being told any details about the accusations. He went on to write a detailed letter expressing his concerns and, three days later, resigned. His main reason for the resignation was that the school had refused to let him contact the union representative, which he labelled the ‘last straw’.
He later brought numerous claims to the ET, including constructive dismissal.
The tribunal was very critical of the school, finding that the original disciplinary had been motivated by a desire to exercise control over the situation. Despite this, they held that the claimant had not been constructively dismissed. This was because his ‘last straw’ act, the limiting of communication between him and his union representative, was reasonable due to the data protection issues and therefore innocuous. Through the Omilaju principle, the claim had to fail, however it may have succeeded if the claimant had relied on other actions taken by the organisation.
The claimant appealed, arguing that even if the tribunal was correct to find that this final act did not contribute to a breach of the Malik term, they should not have concluded that the constructive dismissal claim as a whole had to fail. The EAT agreed, outlining that in situations where an organisation has breached the Malik term, the ‘last straw’ does not necessarily need to be the last event in a point of time.
The EAT explained that the Kaur guidance, whilst useful, did not address if the claimant’s ‘last straw’ was found to have not contributed to what was otherwise a series of actions that could amount to a breach of the Malik term. The tribunal had erred as they had failed to consider how the earlier conduct of the school had led to such a breach, and also whether the claimant had affirmed these actions. In the EAT’s view, it was clear that the employee had not affirmed them; his final resignation, despite being driven to by his ‘final straw’, had been done with all the previous actions, and concerns, in mind. This was evident due to the letter he had written three days prior.
The EAT therefore substituted a finding of constructive dismissal. As the tribunal had been critical of the school, it also remitted an unfair dismissal claim back to them to consider.
Whilst the Kaur guidance does remain useful, it does not cover all possible situations that could arise in claims for constructive dismissal. Organisations should therefore bear in mind that even if the act that leads to an employee resigning is found to be harmless, earlier acts may still result in liability. It is therefore important to remember what acts can lead to such a claim, such as significantly changing the terms and conditions of an employment contract or bullying behaviour.