Holland v Glendale Industrial Ltd [1998] ICR 493 Employment Appeal Tribunal
If an employee resigns from his job as a result of his employer's fundamental breaches of his contract, but gives a different reason for leaving, can the employee then claim constructive dismissal? No, says the Employment Appeal Tribunal.
To be able to claim constructive dismissal an employee should give a reason for leaving to his employer which is consistent with constructive dismissal. In doing so the EAT reaffirm existing case law including Norwest Holst Group Administration Ltd v Harrison [1984] ICR 668 and Walker v Josiah Wedgwood [1978] ICR 744.
Mr Holland was originally employed in a local authority parks department. He was parks foreman for a section of the Borough and was paid as a chargehand.
The parks department was contracted out and Mr Holland transferred retaining his status and extra pay. Then Glendale took over the contract and he transferred again.
Glendale were not given all the details about his employment or that he was, in practice, a chargehand. His pay was cut and a younger man given the job of chargehand.
A staff assessment gave a derogatory assessment of Mr Holland's ability and performance. Mr Holland resigned saying that he was fed up and was going to take early retirement. Mr Holland told the Employment Tribunal that his pride would not permit him to reveal the true reason for his resignation.
The tribunal found that the reason Mr Holland gave for leaving - that he intended to retire early - was a sham. They found that he left his job following repudiatory breaches of his contract and that he had not reaffirmed his contract.
The tribunal said that if the law requires the employee to show the real cause of his leaving, and that he in fact left for that reason, Mr Holland would have proved constructive dismissal.
However, they went on to say that "the law also requires that the Applicant should make clear to his employer a reason for leaving which is consistent with constructive dismissal".
On behalf of Mr Holland it was argued that there was nothing in the doctrine of constructive dismissal which required an employee to assert why he is leaving. The question to be decided is one of causation - did the employee leave as a result of the employers' conduct within the meaning of the Employment Rights Act S95(1)(c)?
The section says: "An employee is dismissed by his employer if (and...only if)...(c) the employee terminates the contract...(with or without notice) in circumstances in which he is entitled to terminate it without notice by reason of the employer's conduct".
The EAT's view was that S95(1)(c) should be considered in the light of the ordinary principles of contract law: where one party to a contract repudiates it, and the other party wants to rely on the repudiation, the latter must make clear by words and/or conduct that the repudiation is accepted.
In Mr Holland's case his employers also appealed on the grounds that no reasonable tribunal acting reasonably could have concluded that Glendale were in breach of the relationship of trust and confidence between employer and employee. The EAT did not accept that the tribunal was wrong and went on to say that it was not necessary for an employee to establish that the employer had been guilty of deliberate actions intended to destroy the employment relation. It is enough if their conduct was likely to destroy or seriously damage the relationship.
Constructive dismissal cases are notoriously difficult for employees to prove. This decision of the EAT does not change that. Those advising employees should make sure that if a worker is intent on resigning and claiming constructive dismissal they should make clear, preferably in writing, the real reason for the resignation is in response to the employer's conduct.