If an employee has committed a fundamental breach of contract, they can still bring a constructive dismissal claim according to the Employment Appeal Tribunal (EAT) in Atkinson v Community Gateway Association. However, if their claim is successful, the tribunal will almost inevitably reduce their compensation to zero.

Basic facts

Mr Atkinson, the Director of Resources for the housing association, was being investigated for an overspend of £1.8 million when the association found a series of explicit e-mails to a woman at another housing association with whom he was having a relationship. Some of them also contained information relating to the association’s business. These were not marked “personal/private” contrary to the association’s e-mail policy which he had written and was responsible for enforcing. He had also helped his lover to apply for a job at the association and, after interview, had encouraged a colleague to give it to her. At no time did he disclose his personal relationship with her.

These issues were added to the list of disciplinary matters that the panel intended to consider. However, Mr Atkinson resigned before the association had reached a conclusion, complaining that the way it had conducted the investigation amounted to a repudiatory breach of contract. He claimed unfair constructive dismissal, among other things. The housing association argued that his claim should be struck out because it had no reasonable prospect of success.

Tribunal decision

The employer argued and the tribunal agreed to strike out Mr Atkinson’s claim on the basis that he was himself in fundamental breach of contract. Firstly, he had misused the e-mail system and secondly he had abused his position as director for personal motives which, had it been discovered at the time, would have led to his summary dismissal.
Nor could he rely on the right to respect for his private life under article 8 of the European Convention on Human Rights because by accessing his emails, the association had relied on a proportionate means of pursuing its legitimate aims and had not therefore breached article 8.

EAT decision

Relying on the decision in Aberdeen City Council v McNeill, the EAT held that Mr Atkinson was entitled to terminate his contract as a result of his employer’s conduct even though he had committed a repudiatory breach of contract. If his claim was successful, however, the tribunal could reduce his compensation by as much as 100 per cent if the employer could prove that they would have been fairly dismissed in any event. On that basis, it remitted the constructive dismissal claim (as well as a whistleblowing claim that he had brought) to another tribunal for re-hearing.

However, it agreed with the tribunal that the association had not interfered unjustly with Mr Atkinson’s right to respect for his private life when it accessed his e-mails. He had written the policy; the e-mails were not marked personal/private; and his use of the “wingdings” font in an attempt to conceal their sexual nature indicated that he knew his e-mails might one day be read.


The EAT recognised that it may be inevitable when such circumstances arise that any compensation would be reduced by 100 per cent.