Labour & European Law Review Weekly Issue 292 25 October 2012
To succeed in a claim of unfair constructive dismissal, employees have to show that they resigned in response to a fundamental breach of their contract (among other things). In Logan v Celyn House Ltd, the Employment Appeal Tribunal (EAT) said that as long as the breach of contract was one of the reasons for the resignation, the claim could still succeed even if it wasn’t the main reason.
As a veterinary nurse for Celyn House Ltd from September 2008, Ms Logan was entitled under her contract to four weeks’ sick pay (inclusive of SSP) at the normal basic rate.
Following a dispute over rotas, she was asked to attend a disciplinary hearing on 2 June 2010 but she wrote in to say that she was ill. She wrote in again on 7 June to say that she had been certified as being entitled to sick leave.
On 1 July she wrote to her employer asking why she had not been paid her normal salary for June, in line with her contract. Her employer wrote back saying she had been paid SSP. Ms Logan wrote again on 5 July asking for the shortfall in her salary to be paid, stating that if her employer failed to do so, she would take legal action to recover the money owed to her.
Ms Logan had already lodged a number of grievances which included being bullied by her manager, to which she now added the issue of the sick pay. These were heard on 5 July, but they were all rejected.
After an unsuccessful appeal, she resigned but did not mention the sick pay issue in her letter of resignation. Instead, she made reference to the letter rejecting her appeal which included, amongst other things. the rejection of her claim for sick pay as the reason for her resignation. She claimed constructive dismissal.
The tribunal found that the company was obliged to pay sick pay to Ms Logan and their failure to do so was a repudiatory breach of contract.
However, it then went on to say that she could not claim constructive dismissal as the principal reason for her resignation was not the failure to pay her sick pay but her belief (misplaced, according to the tribunal) that she was being bullied. In any event, she had not resigned straight away in response to the failure to pay sick pay but had waited for over two months.
Relying on the decision in the case of Meikle v Nottinghamshire County Council (LELR 93), Ms Logan appealed, saying the tribunal had approached the issue the wrong way.
Upholding the appeal, the EAT cited the following passage from Meikle: “The proper approach ... once a repudiation of the contract by the employer has been established, is to ask whether the employee has accepted that repudiation by treating the contract of employment as at an end. It must be in response to the repudiation but the fact that the employee also objected to the other actions or inactions of the employer, not amounting to a breach of contract, would not vitiate the acceptance of the repudiation.”
On that basis, the EAT said it was obvious that the tribunal had asked itself the wrong question. Instead of asking whether the principal reason for the resignation was the failure to pay sick pay, it should have asked whether the breach of contract involved in failing to pay the sick pay was one of the reasons.
As the tribunal had found that the company had breached Ms Logan’s contract by failing to pay sick pay and this was one of the reasons for the resignation (even if wasn’t the main one), her claim for constructive dismissal must succeed.
This is a good decision for employees. It follows that once a repudiatory breach is established, if the employee leaves then, even if they have done so for a host of reasons, they can claim that they have been constructively dismissed, if the repudiatory breach is one of the factors relied upon.